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SBJ/August 13-19, 2012/In DepthPrint All
As he tracks back through a decade as head of the Warsaw Sports Marketing Center at the University of Oregon, which annually produces about 20 MBA graduates who specialize in sports, Paul Swangard has little trouble identifying the alumni who went to work for pro franchises.
“I can literally count them on my fingers,” Swangard said, “and it wouldn’t take both hands.
“It’s partly and directly attributable to salary expectations. … If we’re teaching you what a business school can teach you, an entrepreneurial piece of your brain kicks in and says, ‘Where can I get my biggest ROI?’ For someone with an MBA, that’s probably not going to be with a team.”
The path to the front office in sports isn’t for the faint hearted. Lower starting pay and longer working hours can make some grads think twice.
Getty images / Ohio University / Photo Illustration
Relatively low pay, particularly when compared with the starting salaries of most MBAs. Long hours. Lots of nights and weekends. Heavy on sales, especially at the start. Welcome to the lower rungs of a career ladder at a pro team.
Sound like a dream job?
For many, it is, despite the rigors and the rarity of financial reward. But buyer beware.
When he was associate department head at the University of Central Florida’s sports business management program, Bill Sutton asked all the applicants he interviewed why they wanted to go to grad school.
“If it’s just that you want to break into sports, that’s fine, so long as you know what you’re buying,” said Sutton, who this year left UCF to start a sports business program at the University of South Florida in Tampa. “What you’re buying is the network. And some experience that’s going to get you in the door. What you’re not buying is a better salary.
“If the job pays 36, you get 36.”
Those who run the better-connected sports management programs know what sort of offers their students field each year as graduation approaches, and what sort of workstyle those jobs entail. Recruiters know salary ranges based on the positions they have filled.
But most impressions formed about executive compensation at major pro franchises have been anecdotal, or abridged.
Earlier this year Turnkey Search, in conjunction with SportsBusiness Journal/Daily, fielded a survey that collected compensation data and other employment-related information from business-side personnel at franchises in Major League Baseball, Major League Soccer, the NFL, NBA and NHL.
Industry Salary Survey: Total compensation highlights
Department Median Mean Finance/Administration/HR $125,000 $167,286 Marketing/Broadcast/Communications $65,000 $79,510 Sponsorship sales/Service $125,000 $148,130 Technology $125,000 $116,000 Ticket/Suite/Club sales $95,000 $110,524 Venue operations $100,000 $122,000 Manage several departments $350,000 $309,318 Other $65,000 $119,621 Title Median Mean President/CEO/COO level $425,000 $409,000 Other C-Level (CFO, CMO, etc.) $355,000 $335,526 Executive or senior VP level $340,000 $325,000 VP level $165,000 $194,697 Director level (senior director, associate director, etc.) $105,000 $115,125 Manager level (senior manager, associate manager, etc.) $65,000 $69,821 Organizational level Median Mean Top person in the overall organization $425,000 $346,579 Report to top person $175,000 $209,917 Two levels below $105,000 $124,497 Three levels below $65,000 $73,241 Four or more levels below $65,000 $68,556 Departmental level Median Mean Run department $185,000 $220,732 Report to person who runs department $85,000 $96,378 Two levels below $55,000 $60,238 Three levels below $55,000 $63,182 Direct reports Median Mean None $65,000 $81,130 1-2 $75,000 $89,677 3-4 $105,000 $133,353 5-6 $155,000 $212,500 7-8 $195,000 $223,511 9 or more $145,000 $177,188 Tenure Median Mean 0-2 $95,000 $149,459 3-5 $85,000 $120,613 6-8 $85,000 $103,211 9-11 $115,000 $159,516 12-14 $125,000 $147,000 15 or more $135,000 $174,153 Years in current role Median Mean 0-2 $85,000 $126,093 3-5 $95,000 $139,852 6-8 $105,000 $127,394 9 or more $150,000 $175,769 Gender Median Mean Male $105,000 $150,231 Female $75,000 $87,264 Age Median Mean 18-29 $55,000 $58,476 30-39 $85,000 $111,959 40-49 $135,000 $184,407 50 or older $190,000 $230,800
Responses came from more than 500 employees at 126 teams, ranging from manager to C-level executive (CFO, CMO, etc.). Participation was spread across the leagues, with 137 coming from NFL teams, 128 from MLB, 123 from the NHL, 97 from the NBA and 55 from MLS. Sixty-five percent came from managers and directors. Thirty-five percent were vice president level and higher.
The data tells a story that resonated with the heads of the more prominent sports management programs, as well as some of their students and recent graduates.
While educators and senior team executives said starting salaries typically are $20,000 to $35,000 a year, the survey showed those who crack manager level earn a median of $65,000 in total compensation, including commissions and bonuses. Median compensation increases to $105,000 at director level and $165,000 for vice presidents, and then soars to $340,000 for senior vice president and executive vice presidents.
The maximum choice of “$400,000 or more” was reported by 14 of 29 C-level executives, including nine of 10 presidents and CEOs.
The survey also examined factors such as organizational level, department, tenure and education, and asked about job satisfaction and perceptions of which teams offered the most rewarding careers and paid best.
“One of the benefits of going through a program like ours is that we have so much contact with the industry, we’re making educated decisions about our careers,” said John Bollinger, a second-year MBA student at Ohio University. “Ohio has trained me to not care about working hard for that low wage now. I’ve done it for a couple of years and I can do it for couple more if I know the end goal is a good one.
“The key is, I know what I’m getting into.”
So did Wade Martin, who graduated from Ohio University with an M.S. and MBA in 2007. Martin initially had aspirations of becoming a college athletic director. While in school, he found he had a knack for sponsorship sales and shifted gears. After working as an account executive on Marshall University for ISP Sports for a year, he landed a job in corporate sales for the Cincinnati Bengals. Four years in, he has risen to assistant director of corporate sales, marketing and broadcasting, which at that franchise is the No. 2 slot in sales and marketing.
“Everyone who works in sports kind of starts in the same spot, managing expectations and communicating that to family,” Martin said. “My wife knew going in that the paycheck dropping into the account each week was not going to knock our socks off initially. But if I did well, it would grow.”
Martin said that, like most who chase a career in sports, he arrived on campus with a head filled with career questions. A survey can’t answer them all definitively. But it can help address some of the common ones.
Q: How tough will it be, and how long will it take?
For those in sales, not so bad, so long as you don’t mind grinding it out on a tight household budget while you build a book of business, which might take a couple of years. Those who don’t ring the bell on commissions rarely stay longer than that.
For those who pursue the management track, financial reward comes with advancement more than tenure. The survey figures laid out earlier in the story show a total compensation jump of 62 percent from manager to director and again from director to vice president. Those at senior vice president and executive vice president make slightly more than double the compensation of other vice presidents.
Not surprisingly, the curve is considerably flatter when charted strictly by tenure. Those with three to five and six to eight years each had median salaries of $65,000 and total compensation of $85,000. After that, total compensation went from $115,000 (nine-11 years) to $125,000 (12-14 years) and then $135,000 (15 or more years).
Glass ceiling? Gender and compensation
Male Female NFL $125,000 $75,000 NBA $125,000 $85,000 MLB $85,000 $65,000 MLS $105,000 $55,000 NHL $125,000 $85,000
Male Female Finance/Administration/HR $165,000 $85,000 Marketing/Broadcast/Communications $65,000 $65,000 Sponsorship sales/Service $145,000 $85,000 Ticket/Suite/Club sales $95,000 $80,000 Venue operations $95,000 N/A Manage several departments $355,000 N/A Other $75,000 $65,000
Male Female Other C-Level (CFO, CMO, etc.) $350,000 N/A Executive or senior VP level $355,000 N/A VP level $185,000 N/A Director level (senior director, associate director, etc.) $105,000 $85,000 Manager level (senior manager, associate manager, etc.) $65,000 $55,000
By organizational level
Male Female Top person in the overall organization $425,000 N/A Report to top person $205,000 $95,000 Two levels below $115,000 $85,000 Three levels below $65,000 $65,000 Four or more levels below $65,000 $60,000
By years in current role
Male Female 0-2 $95,000 $75,000 3-5 $115,000 $85,000 6-8 $125,000 $85,000 9 or more $155,000 N/A
Male Female 18-29 $55,000 $45,000 30-39 $95,000 $85,000 40-49 $145,000 $105,000 50 or older $205,000 NA
Male Female Bachelor’s $105,000 $75,000 Post-grad — all $115,000 $85,000 Post-grad — business $100,000 $85,000 Post-grad — sports management $85,000 $55,000
So while the potential is there to knock down upward of $150,000, it typically doesn’t happen until you either make vice president, run a department, or report to the top person on the business side of the organization. And that’s the case no matter how long you hang around.
From the time he started as undergraduate at the University of British Columbia, Marcus Cheng knew he’d follow up his management information sciences degree with grad school. So when he heard about the MBA program at Oregon, bells went off. “It had a sports marketing program that I didn’t tell my parents about when I applied,” Cheng said. “They kind of found out after all the checks were signed.”
Entering the job market with an MBA in 2001, Cheng found a tepid response, even when he applied for lower-level staff positions. He returned to Canada when his student visa ran out, resigned to the idea that his sports dream was dead.
But soon after he moved, a friend from the Warsaw program called with an offer from a market research firm in Portland that was doing sports work. He was there for a year when a Warsaw friend with the New Orleans Hornets emailed with news that the Miami Heat was looking for a market research coordinator.
It meant a pay cut.
“Whatever they were paying me to get a shot at my dream job, I was OK with it,” said Cheng, who since then has been promoted twice and now is manager of research and database marketing. “But I think the notion that it’s not for everybody is probably accurate.”
Cheng said it’s less a matter of starting salary than the fact that opportunities for advancement up through management are far fewer than they would be at a large corporation.
“I think people see our brand and the other teams’ brands out there so often that they think it’s a big business,” Cheng said. “Really, we kind of are a small business. It’s not a lot of people. So, when you’re talking about advancing, how are you going to advance in a relatively flat organization? You see good people start to drop out because they can’t wait forever.”
That same dynamic drives some who feel stalled early in their career to pursue an MBA, or at least a sports business-oriented master’s degree. Built primarily around night classes and located in Manhattan, Columbia’s sports management program gets mostly students who already are in the field and hope to accelerate their advancement.
“The trick is that it’s such a pyramid,” said Lucas Rubin, director of the sport management program at Columbia. “As you move up in rank it gets smaller and smaller. That happens everywhere, but at a team, it happens right away. Many of our students look at the degree specifically to help them get a leg up on the competition.”
When current Oregon MBA candidate Bill Zachry opted to pursue grad school after five years in the Teach for America program, he did it because he found his passion for his work had waned, and he was looking for a career that would rekindle it.
“I didn’t go back to school with the idea that I would get in [sports] and be making six figures in a couple of years,” Zachry said. “And that was reinforced in my two years. People would say, ‘You get in, you make nothing, and you work a million times harder than what you make.’
“It can get discouraging to hear that over and over. But if you’re doing something you love, you feel like it’s worth it.” The survey showed an intriguing jump in compensation of late, with those hired in the last two years making a median of $85,000, compared with $65,000 for those with three to eight years’ tenure. But that appears to have more to do with the positions teams have filled than a general loosening of the purse strings. Almost all the shift has occurred among those who report directly to the top executive. At that level, those with six to 14 years with a team earned a median of $150,000. Those with three to five years made $175,000. Those hired in the last two years were at $205,000.
“People are creating positions and they’ll spend a little more money to get a higher caliber person instead of opening the file cabinet and saying, ‘We’ve got a 1,000 résumés,’” said Len Perna, president of Turnkey Sports & Entertainment, a market research firm that includes the Turnkey Search executive search division. We’ve been asked to go outside the industry and bring in people more times in the last two years than in any time in the prior 15. You’re not going to get those people from other industries by throwing money at them. But they’re not going to take a huge cut, either.”
Q: What do I want to be when I grow up?
Financial prospects, alone, should not dictate that. But there’s little question that, in sports, those who make and monitor the money make more of it than those in other roles.
Again, you have to get beyond the baseline numbers to get an accurate picture, comparing those at similar levels.
Those who report to the ranking executive made $205,000 if they worked in sponsorship sales or finance/administration. Those at that level in ticket sales made $165,000. Those in marketing, broadcasting and communications made $110,000. One level beneath that, sponsorship paid $135,000, finance and administration paid $125,000, ticket sales paid $105,000 and marketing and communications paid $85,000.
Looking at title, managers made $75,000 in sponsorship, $65,000 in ticketing and $55,000 in marketing and communications. At director level, those departments paid $135,000, $105,000 and $85,000, respectively.
“I like to recruit rainmakers,” said Jim Kahler, executive director of the sports administration center at Ohio University and a former Cleveland Cavaliers CMO. “If you can make it rain, you’re going to be competitive with some of your fellow MBA students.
“If you’ve got what it takes to sell sponsorships, how long will it take to climb the ladder? You’re going to be making six figures before too long.”
Q: Red Sox, Redskins, Red Wings, Red Bulls or Red Auerbach?
Comparisons between teams in one league and another are complicated by a wide range of front office sizes and organizational structures. Still, by focusing on level, regardless of title, you can make some comparisons.
Based on the survey, NBA team executives are paid better than their counterparts, with the 19 who said they report to the top person at the franchise receiving median compensation of $245,000. The 25 MLB executives at that level reported median compensation of $205,000. The 28 at that level in the NHL made a median of $175,000. The 36 NFL executives at that level were at $160,000. The 14 in MLS were at $120,000.
NBA franchise employees also were paid better than those in other leagues when compared at two and three levels down from the top.
“Most people will tell you that the NBA invests more money in its people than any other league,” Perna said. “You have to give credit to TMBO [the NBA’s team marketing unit]. They’ve persuaded owners across the NBA that it’s worth it to get the best people and pay a little more to get performance.”
Interestingly, not many who answered the survey were particularly clued in to where they were likely to make the most money.
Three out of four people said they thought the NFL paid the best. Only 13 percent said the NBA did. Sixty percent said they thought the NFL was the “most rewarding” league to work in.
Asked to identify which teams were the best to work for, those who responded — all of them already working for a team at manager level and above — generally named iconic franchises and those who have been successful of late.
The Green Bay Packers, New England Patriots, Dallas Mavericks, Los Angeles Lakers, Boston Red Sox, New York Yankees, Los Angeles Galaxy and Seattle Sounders all were named on at least one-third of the surveys.
Perception vs. reality?
Perceptions of working for teams in each league
Most rewarding Highest salaries NFL 60% 73% NBA 7% 13% MLB 17% 12% MLS 5% 1% NHL 11% 1%
Total compensation at teams, by league
NFL teams NBA teams MLB teams MLS teams NHL teams Report to top person $160,000 $245,000 $205,000 $120,000 $175,000 Two levels below $105,000 $135,000 $115,000 $85,000 $125,000 Three levels below $55,000 $80,000 $55,000 N/A $75,000 Four or more levels below N/A $85,000 $55,000 N/A $80,000
Total compensation, for teams in the top leagues
NFL NBA MLB MLS NHL VP level $230,000 $155,000 $165,000 N/A $160,000 Director level (senior director, associate director, etc.) $105,000 $105,000 $110,000 $95,000 $95,000 Manager level (senior manager, associate manager, etc.) $65,000 $75,000 $55,000 $55,000 $75,000
By organizational level
NFL NBA MLB MLS NHL Report to top person $160,000 $245,000 $205,000 $120,000 $175,000 Two levels below $105,000 $135,000 $115,000 $85,000 $125,000 Three levels below $55,000 $80,000 $55,000 N/A $75,000 Four or more levels below N/A $85,000 $55,000 N/A $80,000
Department by organizational level
Sponsorship Sales/Service Ticket/Suite
Manage several departments Report to top person $205,000 $110,000 $205,000 $165,000 $355,000 Two levels below $125,000 $85,000 $135,000 $105,000 N/A Three levels below N/A $55,000 $75,000 $70,000 N/A Four or more levels below N/A $55,000 $85,000 $75,000 N/A
Some of the teams that ranked high surprised the program heads and recruiters who hear a lot about which are the better places to work, though none wanted to identify the shockers publicly.
“I think that’s the response I’d get if I asked the sports management kids, not people who already are in the industry,” Sutton said after hearing the top five finishers in each league. “Those [answers] are based on your results in the standings. That’s fine if your prerequisite is that you get a ring. But that’s not necessarily what makes a team a great place to work.”
Q: What one thing has the greatest, broadest impact on pay?
You can’t buy it, earn it or learn it.
Among those who responded to the survey, men made about 30 percent more than women in base salary and 40 percent more in total compensation. Men also earned markedly more than women when you compare people with similar titles and at similar levels. And they made more regardless of tenure or education, across all five sports.
At the director and manager levels, where the sample sizes are largest (149 and 162) and roles are most similar, men out-earn women on median total compensation $105,000 to $85,000 and $65,000 to $55,000, respectively. That’s about the same rate at which men out-earn women in the broader workplace. The difference is, the general workplace includes people who work in varied fields.
When equalized to take career choice and other factors out of the equation, the pay gap in the general workforce is about 5 percent one year after college graduation and 12 percent 10 years after graduation, according to the American Association of University Women.
“It could be that women are not negotiating as much for salaries as men are,” said Lisa Masteralexis, department head in sport management at the University of Massachusetts at Amherst. “And there’s probably not the mentoring and networking, although I think that’s improving. It’s a very complex issue, and not only in sports.”
Kahler suggested that one factor driving the gap could be the fact that women typically are less willing to relocate in order to advance, particularly once they’re five to 10 years in their career.
“My experience is that women are more likely to be promoted internally as opposed to being recruited from a different organization,” Kahler said. “If I’m going to promote you, I don’t have to pay as much as if I’m recruiting you from another organization.”
Q: What’s this nice piece of parchment worth?
If you come away with an advanced degree in sport management, be it an M.S. or sports-accented MBA, think of it as a key. But to a door. Not a treasure chest.
Considered broadly, it actually looks like those with sports management degrees not only earn less than those with other graduate degrees, but less than those with bachelor’s degrees.
A closer look that compares those working at similar levels debunks that. But there’s still less value placed on sports management than on other grad degrees, at least among those who answered the survey.
For those at the top end, reporting directly to the ranking executive, an MBA delivers a slight edge over other post-grad degrees — $205,000 to $200,000. Those with sports management degrees made $175,000. Those with a bachelor’s made $165,000. At the next level down, those with a master’s in sports management lagged behind the others, coming in at $85,000 versus $100,000 for those with MBAs and $105,000 for those with a bachelor’s.
That odd dynamic — bachelor’s degree holders earning more than MBAs — leads you to wonder whether there’s any connection between education and earning power at all in sports.
The program heads suggested the figures might reflect the fact that, at the manager and director level, those with bachelor’s degrees are the ones who survived the sales gauntlet and now are making larger commissions and bonuses.
While few Oregon MBAs have gone to work for teams, Swangard can run down “about 50” alums from Oregon’s undergraduate sports business concentration who are building careers at teams, including vice presidents of ticket sales at three MLB franchises.
Masteralexis said: “I tell our [master’s] students to stick it out. If this is your passion, stick it out. When we look at our alumni and where they are over a longitudinal level of 10 years, the master’s-level students are still in the industry, whereas more of the students from the bachelor’s program may melt off into general business. The sports thing is fun, but the hours get crazy once you have a family.
“This industry really requires a commitment. And it’s not an easy road.”
Martin remembers watching the graduating class ahead of him at Ohio University head off to their first jobs, and hearing stories of the salaries that the other business school grads had landed.
“The MBAs were going to make 75 grand and the sports kids were making 25 grand, and you thought for a minute — maybe I can jump ship,” Martin said. “Then you realize, yeah, they’re going to make money, but they’re going to work at an accounting firm.
“I work for an NFL team.”
Education by organizational level
Bachelor’s Post-grad — all Business Sports management Report to top person $165,000 $200,000 $205,000 $175,000 Two levels below $105,000 $105,000 $100,000 $85,000 Three levels below $65,000 $65,000 $75,000 $60,000 Four or more levels below $65,000 N/A N/A N/A
Education by department level
Bachelor’s Post-grad — all Business Sports management Top person in department $180,000 $185,000 $205,000 $155,000 Report to top person $85,000 $85,000 $85,000 $75,000 Two or more levels below $55,000 $55,000 N/A N/A
Age by department
18-29 30-39 40-49 50 or older Finance/Administration/HR N/A $125,000 $135,000 N/A Marketing/Broadcast/Communications $45,000 $65,000 $105,000 N/A Sponsorship sales/Service $55,000 $120,000 $165,000 $145,000 Ticket/Suite/Club sales $70,000 $95,000 $135,000 N/A Manage several departments N/A $260,000 $425,000 $385,000 Other $45,000 $65,000 $85,000 N/A
Age by departmental level
18-29 30-39 40-49 50 or older Top person in department N/A $155,000 $205,000 $285,000 Report to top person $55,000 $85,000 $100,000 $145,000 Two or more levels below $45,000 $55,000 N/A N/A
Hours each week
by department (during season)
Median Mean Finance/Administration/HR 52.5 52.4 Marketing/Broadcast/Communications 62.5 61.6 Sponsorship sales/Service 57.5 59.8 Technology 52.5 55.7 Ticket/Suite/Club sales 62.5 60.1 Venue operations 62.5 63.6 Manage several departments 62.5 62.2 Other 57.5 59.5
Hours each week
by department (offseason)
Median Mean Finance/Administration/HR 47.5 49.3 Marketing/Broadcast/Communications 47.5 49.1 Sponsorship sales/Service 52.5 50.8 Technology 47.5 48.6 Ticket/Suite/Club sales 47.5 49.3 Venue operations 47.5 46.7 Manage several departments 52.5 53.7 Other 47.5 49.2