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Economy

Aztec Basketball Runs Up Economic Score For Business

The success of the SDSU Aztecs men's basketball team appears to be having a significant impact on San Diego's economy

Courtesy of Derrick Tuskan/SDSU Athletics

Early last week, the Associated Press released its latest men’s college basketball poll and San Diego State University climbed three spots to No. 4, tying for the best ranking in the school’s history. The only other time SDSU reached No. 4 was during the 2010-2011 season, with star player Kawhi Leonard at the helm, before it lost at Utah’s Brigham Young University.

On Jan. 21, the San Diego State University Aztecs men’s basketball team continued its undefeated run after beating the University of Wyoming Cowboys 72-55 before a sold-out Viejas Arena crowd.

That wasn’t the only sell-out event the team has had in town this season.

Steve Schnall, executive athletic director for external at San Diego State University, said the last three straight games have sold out — a total of 12,414 tickets per game of which roughly 98% are purchased by Aztec fans, he said — and the balance of the year is sold out as well.

As such, it appears the reigning status is not just giving the SDSU men’s basketball team some well-deserved clout, it is also having a significant economic impact on the city of San Diego.

Schnall explained that for conference games, which is the part of the season San Diego State University basketball is in now, bench tickets, which make up the last five rows of Viejas Arena, are $20 each. Chair back tickets, making up the rest of the arena, cost $40 a piece.

In total, the per game revenue for 17 games is $165,000, according to Chuck Lang, senior associate athletic director and business administrator at SDSU. That’s almost $3 million in revenue just from ticket sales.

There are other things to consider when it comes to the economic impact of the team, said Schnall.

“To me, I think it’s a combination of obviously ticket sales revenue but also parking revenue would increase, with more people going to the games,” he said. “I think there is also the general excitement in the community from this, which would affect some online merchandise sales and things along those lines. This can be from others, not just people attending the games, which is peripheral impact.”

Schnall said not only businesses on and around campus can be impacted by the basketball team’s current popularity, like D.Z. Akin’s deli and restaurants like El Pollo Loco on Mission Gorge, to name a few, but obviously the concessions and student union offerings on campus, which get more crowded on game days, he said.

Brian Wynne, general manager of concessions at San Diego State University, confirms the assessment, stating that concessions revenue is up 47.1% from last year. As well, Elan Akin, owner of D.Z. Akin’s, founded in 1980 and with over 100 employees, said the eatery tends to get busier when the Aztecs are having a winning season.

“Fortunately, we are always impacted by the Aztecs basketball teams, both men’s and women’s, even when they aren’t as successful as they are this season,” he said. “But, definitely, when there is a winning season, we tend to notice we get busier. (Fans) come to have a meal here before the game and often times after the game. We definitely notice an uptick in business, (and, as a result), we staff heavier when we know there is a basketball game because we know (fans) will come in (to D.Z.’s).”

Akin said, while the store doesn’t keep track of how many more customers it gets during busy Aztecs seasons like the current one, he does increase his staff by 10% to 20% for Aztecs’ hometown sporting events.

Merchandise Sales Up 240%

Another location that is impacted, according to Kathy Brown, director of campus stores division and licensing at San Diego State University, is the university-located Aztec Shops, with merchandise sales up 240% this year compared to last year.

“Last year, there was one less game to date, but our large percentage increase (this year) is due to the basketball team’s success and the sold out arena,” she said.

On the sponsorship end, Duke Little, general manager at FOX Sports College Properties, which oversees all sponsorship efforts for the university, said inquiries have picked up and will positively impact the 2020-2021 sales cycle.

Sponsorship Brings Name Recognition, Customers

Chelsea Collins, sales manager from Collins Family Jewelers in Mira Mesa, a sponsor of the San Diego State University basketball and football teams, said the company has seen a growth in business as a result of the basketball team’s winning stretch.

“We’ve seen this back when we were (San Diego) Padres sponsors, too,” she said. “When the team is doing well, people want to buy team merch.” This can mean an SDSU Aztec related piece as well as jewelry in general, simply because Collins Family Jewelers is an SDSU sponsor, said Collins.

Collins said the family-owned and run jewelry store has sold approximately five Aztecs themed pieces so far this season and about 20-25 nonspecific items to people coming into Collins Family Jewelers that recognized the company as an Aztecs sponsor.

“It seems like anything people can do to support the team, they are putting more thought and effort into that — choosing to support the people that support their favorite team,” she said.

While there are no actual reports available that show the exact economic impact of the San Diego State University men’s basketball team (the closest data available is a 2017 article on the SDSU website that states the entire university generates $5.67 billion in economic activity for the San Diego region), there are others available that can help paint a picture.

Economic Impact

In June 2019, West Virginia University commissioned a research company to do a comprehensive study of Mountaineer athletics during the course of the 2017-2018 academic year.

What it found was that a football or basketball game played in Morgantown, West Virginia, has an economic impact of $78.8 million on Monongalia County and $302.7 million on the state of West Virginia per year. The overall tax impact to the state of West Virginia is roughly $18.6 million, the report states. One must keep in mind that Morgantown is a much smaller city than San Diego.

David Ely, associate dean at Fowler College of Business and professor of finance at SDSU, said there are a lot of secondary factors to consider when measuring the economic impact of a collegiate team on any city.

“It’s a tough question,” he said. “When you do the economic impact of college sports, there is a lot that goes into it…ticket sales represent one major economic activity. But, when we think about the economic impact to the region, the sort of question we begin to ask is, who is buying the tickets?”

Cheering for Visitors

For example, Ely said, if visiting teams and fans of visiting teams, even out-of-towner fans of the Aztecs, are coming to San Diego that would otherwise not visit the city, that’s a significant economic impact.

The reason for this is that it is revenue that is being generated in the city that would not be generated otherwise, especially if the visitors are not just spending money on tickets, but also staying overnight at hotels, eating at restaurants and renting cars, he said.

That represents spending that would not have taken place if those fans would not have come here, Ely said.

But the other side to consider — which economists must look at when gauging economic impact from any event on any given city, Ely said — is whether or not that spending is just replacing another expenditure.

“If you have a lot of local fans showing up at games, buying tickets and spending money related to the game, you have to ask, are those expenditures just replacing something else?” he said. “Like, instead of the games, would those same people go to a concert or a movie or something like that? If some of the people showing up to the game would be spending money somewhere else in the city rather than the game, we just have a substitution in the game. And, we don’t want to count all the revenue of ticket sales as an additional benefit to the city if that is the case.”

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