Stadium Management: Transitioning from Cost to Profit Centers

by Iñaki Alvarez

February 6, 2017

For most of my professional life, I have been helping organizations and facilities prepare to host major events. Most of them were FIFA World Cups, but the underlying principles are always very much the same. In almost all occasions I start off the conversations with the “Why” question: Why are you hosting this event? It is amazingly insightful how people answer this question.

Camp Nou Barcelona I have been in some of the best and most sophisticated stadiums in the world, as well as some of the least. The reality is that once upon a time, it was simply enough to open the gates and start the match. Today however, with the proliferation of so many more forms of entertainment, including all kinds of handheld devices and streaming services, as well as all the new security conditions, the status quo is no longer enough. Excellence is the new requirement.

Today, we will discuss stadium facilities as profit centers. It is amazing how many stadiums continue to exist as “expenses,” always living in the red or how many facilities are built with profit as an afterthought.

Simply stated, every stadium must see itself primarily as a profit center. In this respect, it must also envision itself as a multi-use facility. Every space within it (not just the field or pitch area, but every parking lot, every large seating area, every meeting room, etc.) must be working towards those goals. Yes, the days of the dreaded white elephants are gone. If you are thinking of building a new facility, or are involved with such a project for whatever special event or reason, and you have not planned for profit either in the short or long-term, then you’re headed for mismanagement from the very beginning.

Football Stadium Similarly, if you have a white elephant in-hand, but have not had the chance to rebrand and/or remarket, then now is the time. Every day of delay means profit lost. No matter what the situation, managers have stakeholders, and those stakeholders deserve value. If they are not asking for it today, they will soon enough. The potential for additional revenues (thousands if not millions) in whatever currency you are dealing with, is enormous.

Maximizing the opportunities for profit is the right thing to do. Plus, it makes things more interesting and definitely more exciting. Do it for yourself – your own professional growth.

How many times, all around the world, do we see stadiums that are used perhaps once every two weeks for the home matches (and only during the season)? If your organization or club earns enough from season ticket holders, rights holders, merchandising and the like to turn a profit, then good for you. But as we all know, such stadiums are rare and not the norm. Most stadiums are in constant struggle to keep the gates open. To be fair, many clubs do not own the stadiums they call home – they are often just tenants.

GS-7 Command Center When we speak of stadiums and facilities as multi-use, we are speaking of a whole list of possibilities. They range from the familiar concerts to meetings and conventions of all sizes, and any and all kinds of related or non-related sporting events (weddings are a new popular option). For instance, if you have an Olympic track around a football pitch, then you already have multiple options. Parking lots are not just for parking. Media tribunes are not just for the media. Giant screens are not just for replays. In theory, your stadium can be running/hosting at least two or three additional events per week. Do the math.

What are we speaking about here? Answer honestly: what does the stadium look like from across the street? Not to mention the website? What does the parking lot look like? Would you let your family park and make the walk to the front gates? What do the north and south tribunes look like? What about bathrooms, seats, concessions, elevators/escalators, camera platforms, etc.? How about ingress and egress? How about wireless internet?

Sorry, we did not mean to overwhelm you – actually we did – because these are just the basics. We haven’t even touched upon safety and security. Can you answer this simple question: can you definitively say who is in your stadium at any point in time? We know about the spectators who hopefully all came in with tickets, but how about all the rest? Stay tuned for the next post on those two questions…

In his most recent role, Iñaki served as Director of Operations for CONCACAF (Confederation of North, Central American, and Caribbean Football Federations), one of the six confederations under FIFA. In this role, Iñaki was responsible for the delivery of all the confederation events including the annual Congress, the bi-annual Gold Cup, as well as most recently the Copa America Centenario. Before joining CONCACAF, Iñaki was with FIFA for 10 years where he held the dual roles of Deputy Director for the Competitions Division and Head of Event Management. The one consistent theme going across most if not all of Iñaki’s experiences is that he has become not just a stadium expert, but also an expert in helping organizations prepare to host major events.