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Yesterday marked the running of the Preakness Stakes, the second leg of the Triple Crown. While all eyes in the horse racing world will now shift to the Belmont Stakes and undoubtedly focus on American Pharoah as the horse attempts to win the final leg of horse racing's biggest prize, a less heralded series of horse-related events recently wrapped up its early 2015 schedule. The sport is polo, and it is commonly referred to as the "Sport of Kings." While not readily recognized as a major sport, the economics surrounding polo are quite fascinating.
According to the International Polo Club (IPC), a premier polo club in Palm Beach, Florida, box office revenue for polo events has increased by 185% in the past three Winter seasons to the amount of $245,420. In 2013, Sunday box office revenue increased 13.5% over 2012 and the IPC says it earned more than $3.5 million worth of editorial coverage. In 2014, the box office had a 133% year-over-year increase in revenue for the 16-week polo. It estimated earned editorial coverage worth over $6.5 in that year. General admission for polo at the IPC runs $10 per ticket.
The overall Sunday revenue at IPC, which includes box office revenue, food and beverage, and retail sales has realized an increase of 106.9% since 2012. In 2012, total revenue came in at $1.037 million. At the close of 2015, IPC reported a total season revenue of $2.147 million.
Additionally, IPC has attracted 106 new members within the last 36 months.
"At the end of the 2012 polo season, we took a hard look at our role and the inherent responsibility of the club to not only grow the sport, but to ignite fresh, new enthusiasm for our Sunday tournament matches," said John Wash, president of club operations at IPC. "We strategically set about developing a shift in our marketing that included reaching out to the entire community of South Florida, and engaging them in the excitement of the sport."
The key for Wash was to make Sunday polo the "place to be" in South Florida. In 2014, Sunday's brunch and polo experience started to sell out every weekend and general admission law seats as well as grandstand seating were tougher to purchase.
I recently spent Easter Sunday at the 200+ acres of IPC's grounds in Palm Beach and was overwhelmed by the sheer number of individuals in attendance as well as the atmosphere that it provided for people to network for social and business purposes. While more traditional professional sports struggle with the technological enhancements of entertainment offerings, leading many people to stay home as opposed to attending events in person, polo does not have the same problem. A dearth of media coverage certainly adds to the attractiveness of attending polo matches.
In only 12 years of existence, the IPC has grown into a world-leading polo facility. That is quite impressive considering that various reports indicate that the sport is currently played in over 77 countries. The numbers reported by IPC also provide promise for the sport's longevity and leads to the possibility for growth of the sport despite it being rather stagnant over the recent past.
"Five years from now, IPC will be the epicenter of polo in the world, eclipsing many of the historical clubs in Europe and South America," added Wash. "Our goal is to grow the popularity of the sport along with our club. We will continue to attract the world’s best polo players and teams, while providing the highest standard of spectator experience offered anywhere."
In order for Wash and his competitors in charge of other polo facilities to keep growing, those responsible for riding and managing the horses must be able to afford being members of the profession. The suggested cost of putting together a high-goal team to compete during the 16-week Winter polo season is rumored to cost a patron between $1-3 million. Patrons are typically amateur polo players who spend the requisite amount of money to field a team and participate in a season of play. They negotiate each player's salary, living expenses, equipment costs and polo ponies, which includes transportation, grooms, vets, trainers and barn fees. Each match requires roughly 8-10 ponies at an average cost of $45,000 per horse. Furthermore, each tournament has an entry fee attached thereto. The price to perform in a polo match is quite steep.
While the IPC and other polo facilities may appear to do quite well based on a review of the crowd and the sponsor names surrounding the field, the sport is actually played more for the fun than as a return on any investment. Sponsorship is rather rare and those companies that are attached to the sport typically pay little for the right to have their names displayed at the matches. The fact that there is little in the realm of media rights contributes to a lack of leverage for those negotiating the sponsorship deals on behalf of the IPC and other facilities.
Polo remains a sport that is largely played for the love of the game. The costs are high, the players' payment is low, but the champagne is flowing during Sunday brunch and everyone in attendance seems to be having a great time. However, budgets remain thin.
When asked about the costs associated with running the IPC, Wash responded, "All clubs have a budget, and certainly ours can be challenging at times, but we prefer to keep the club’s expenses private."
Darren Heitner is a lawyer and the Founder of South Florida-based HEITNER LEGAL, P.L.L.C., which has a focus on Sports Law and Entertainment Law.
