Tennessee Football Economics: It Pays to Win Games
Analyzing the impacts of the University of Tennessee’s rise from a mediocre football program to one that is nationally relevant once again.
Butch Jones was named Tennessee’s head football coach in 2012.
He inherited a failing sleeping giant of average talent and sky-high expectations.
That’s a dangerous combination for a first-year coach.
The Vols had not reached a bowl game since 2008. Athletic director Dave Hart went to Jones to resurrect the program, who had a mountain to climb in his first season. Since the program was struggling on the field, the athletic department felt the impact in its pocketbook.
Tennessee’s economic impact report in 2012 highlighted the athletic department’s impact on the surrounding community. Like the 5–7 seasons under head coach Derek Dooley, the report was underwhelming.
Attendance was down to an all-time low during Dooley’s tenure. Tennessee football was an asset to the local economy, but it wasn’t showing any kind of crazy growth.
Fast forward to 2016. Tennessee has won two straight bowl games, and finished off the 2015–16 season with eight wins.
The on-field results have taken steps forward, but the economic impact has reached unprecedented levels.
According to a report published by UT in June of 2016, the athletic department’s “economic impact” on the City of Knoxville has almost quadrupled since Butch Jones took the reins. While UT athletics contributed $151 million in 2012, Tennessee contributes $464 million this year.
What makes the difference between those two numbers? Tennessee finance professor Dr. Ramon DeGennaro says it starts with winning games.
“We don’t fathom how much influence good sports teams have on the world,” DeGennaro said. “Years ago, at another institution, I had a grad student from Korea. I asked him, ‘What brings you to Michigan State?’ He said, ‘Magic Johnson, of course!’ It’s not just within Tennessee, it’s worldwide.”
The Vols did plenty of winning in 2015–2016, taking the national spotlight in college football the past two seasons.
Tennessee set a record for playing the most “SEC on CBS” games (5), which highlights the game of the week each Saturday in the Southeastern Conference. Tennessee also was a featured team for ESPN’s College Gameday three times in the first six weeks of the season.
Pregame shows like College Gameday and SEC Nation on SEC Network bring in more fans who don’t even go to the game. The restaurant and hotel industry in Knox County reaped the benefits. Every home-game weekend, Knox County’s out of county visitors rose by 70 percent. The economic impact of one football game was estimated to be around $40 million.
The athletic department created 2,929 jobs in 2012. In 2016, that number rose to 4,456 jobs.
What makes the difference in those two numbers? According to Dr. DeGennaro, growth like that doesn’t just happen overnight.
“I can’t imagine its normal growth. It doesn’t grow that fast,” DeGennaro said. “Pro football is declining viewership, but in the face of that UT’s growth has taken off. It can’t be organic growth, it’s just too big for that.”
At the end of the day, DeGennaro says that the value of being a Vol can’t be quantified by numbers.
“Being a Vol is worth something. It might not be economic benefit, but you can’t tell me it isn’t nice to be a Vol. You meet a guy in Hawaii and you’re looking for a place to go, and he’s got an Auburn hat on and you’re best buds from the get go.”
But it doesn’t just pay to be a Vol outside of campus. The University has also seen growth in admissions numbers that directly correlate to success on the football field.
Following Tennessee’s dramatic last-second win over Georgia this season, it was estimated that UT’s admissions website saw a 70 percent increase in web traffic directly following the game. Capture Higher Ed Research calls it the “Dobbs Effect,” in honor of quarterback Joshua Dobbs.
“As the morning progresses, people start getting excited about the game and browse admissions-related pages on Tennessee’s website,” the Capture report stated. “When the game starts, traffic initially increases then drops off as the game gets more exciting. Finally, after the dramatic win, visitors start flooding in.”
Tennessee football beat writer Daniel Lewis of rockytopinsider.com says that good results on the field help local businesses like his website.
“We’ve certainly seen a strong link between the performance of the team we cover and web traffic at RockyTopInsider.com,” Lewis said. “Some of our highest-hitting days and months have followed recent momentous occasions for Tennessee football — bowl wins, rivalry victories and top-10 signing classes for example. We’ve found that fans are not only more eager to read positive news, they are also more willing to share links to it on various social media platforms, increasing our total reach.”
Conversely, losses have the opposite impact.
“Stretches of failure or mediocre on-field performance have generally led to decreased traffic.”
When Tennessee football is winning games, whether it is on campus, around Knox County or online as a media member, it pays to be a Vol.