The Economic Impact of March Madness
Every March it seems as though all productivity is halted, and the nation watches the greatest annual sports tournament unfold, the NCAA Men’s Basketball Tournament. Everyone is scrambling to fill out the perfect bracket (the odds are 1 in 9.2 quintillion), predicting upsets, finding an excuse to miss school or work, and antagonizing about their team’s tough matchup. Even those who aren’t college basketball fans from November - February can still find it in their heart to love college basketball in March. It is simply the greatest time of the year.
Business is boomin’ in March and much of that can be attributed to March Madness. There is $9B bet on March Madness every year with $7B of that being done so illegally. The pizza and beer industry both see an increase in demand as pizza sales raise 17% and the normal 14 million barrels of American beer is increased to 17.5 million in March. CBS paid $10.8B to have TV rights to broadcast the tournament over a 13 year span, that may sound like a lot, but when 30 second commercials during the final four cost $1.5 million, they can make plenty of revenue.
Although Villanova edged North Carolina in a game for the ages in last years championship game, the real winner was the city of Houston, because they hosted the final four. Taxpayers were on edge as Texas paid a $8 million subsidy to host the event, but their minds were eased as the local economy saw $300 million in revenue during the final four. The average visitor ended up spending over $2,000 on hotels, food and public transportation and that figure doesn’t even include the ticket price ㅡ which go for anywhere between $437 and $5,700.
Las Vegas wins every year when it comes March Madness with Casinos raking in an estimated $100 million in profit every year, purely off of bets. That doesn’t even include the increased prices for rooms, food and beverages, due to the increased demand of spending a weekend in Las Vegas during the tournament. One of the most unpredictable and nail biting tournaments is bound to draw a lot of interest in the gambling capital of the world.
Of course schools will be rooting for their teams because of school pride, and also because Villanova raked in $2.1 million in profits as a result of their National Championship. Other teams this year that have no chance of winning it all such as Texas Southern, Jacksonville State, Wisconsin and East Tennessee State will just be hoping to make some noise in the early rounds and enjoy the madness.
"Economic and Social Impact of March Madness (Infographic)." AthlonSports.com. Athlon Sports, 10 Apr. 2016. Web. 13 Mar. 2017.
Ogus, Simon. "The Economic Impact Of March Madness From First Four To Final Four." Forbes. Forbes Magazine, 24 Mar. 2016. Web. 13 Mar. 2017.