Impact of on-field football success on the off-field financial performance of AFL football clubs

Abstract

In this study, we examine the factors that contribute to the financial performance of clubs in the Australian Football League over the period from 1993 to 2002. Primarily, we examine the association between the on-field football success of clubs and their level of off-field financial performance. We find that match attendance is positively related to both short-term and long-term success of football clubs and also to the uncertainty as to the match outcome (i.e. the expected closeness of the match). We also find that club membership is highly persistent and is positively related to both the past football success of the club and the marketing expense incurred. Finally, we find that there is a significant association between the level of marketing revenue and the level of on-field success in the prior 2 years. Copyright (c) The Authors Journal compilation (c) 2006 AFAANZ.

The first 25 years of the Queensland Rugby Football League: Claims to legitimacy in annual reports

“…Given the finding by Pinnuck and Potter (2006) that on-field football success is positively associated with off-field financial performance, the establishment of QRFL's image as a financially viable organization presented a powerful legitimizing message. On occasions, setbacks and difficulties were identified and addressed, with positive outcomes always identified.…”

“…Historical empirical research examining disclosures in NFP annual reports has been limited (Christensen and Mohr, 2003), the dearth particularly evident in relation to sporting organizations, despite their cultural and economic significance (Pinnuck and Potter, 2006). This historical study of the early years of QRFL addresses that gap, providing insights into the claims to legitimacy evident in its annual reports.…”

Human Resources Turnover as an Asset Acquisition, Accumulation and Divesture Process

“…A number of previous studies have examined empirically the links between coach turnover and sports performance with mixed results (e.g., see Audas et al, 2002;Bruinshoofd and ter Weel, 2003;Tena and Forest, 2007). Although some causality can be expected to run between performance on the field and shareholder wealth (see Pinnuck and Potter, 2006), the specific effect that turnover in coaches may have on club stock prices has not yet been studied. Secondly, since the performance on the field has also been found to affect shareholder wealth (rational explanations of this link are discussed by, for example, Dobson and Goddard, 2001;Palomino, Renneboog & Zhang, 2009;Stadtmann, 2006; for a behavioral explanation see Edmans, Garcia & Norli, 2007), we control for match outcome in our analysis.…”

Financial Versus Sports Performance: The Missing Link

“…Thus, a club has high sports performance when it achieves high scores in these competitions. Indeed, the results are influenced by a huge number of variables (endogenous and exogenous), such as the players' personal and cultural values (Denzin, 2003;Ono, Kennedy, Reeves, & Cronin, 2012), the club management's ability to define and reach sports goals through appropriate decisions (Heiji et al, 2006;Ozawa, Cross, & Henderson, 2004), individual player attributes (Gerrard, 2005), the coach's skills (Dawsona & Dobson, 2002;Koning, 2003), the club's market size, the number of supporters (Pinnuck & Potter, 2006), and the casualty of the game (Boscà et al, 2008;Carmichael, Thomas, & Ward, 2000). Clearly, the sports results are related to the existence of an appropriate corporate structure that is able to regulate all of these variables.…”