This paper aims to recommend opportunities for professional sport leagues in the USA and Canada to apply the art and science of revenue management in order to minimize potential losses and maximize profits.
The evolution of current key revenue management concepts is presented from their initial stages to their current level of implementation. In addition, the literature regarding the strongest business models is reviewed and examined in the context of current successes and challenges across the major sport leagues in North America.
Five revenue streams in sports organizations are identified and analysed. Five key elements for revenues are highlighted as strategic tools used to maximize effectiveness in achieving revenue management goals. A series of recommendations is made to best use revenue management including careful negotiation of television contracts, the use of dynamic pricing models, maximization of partnerships and sponsorships, acceptance of new approaches to food and beverage and accessibility of sport merchandise to customers.
At the regional, national and international levels, sports organizations should review their current business practices to identify areas to improve their revenue management in light of the recommendations in this paper.
Although the use of the concept of revenue management in sectors of tourism has evolved since early 1970s, its application in professional sports is relatively new. Therefore, this paper provides value to professional sports organizations to optimize their profitability.
