US dues revenue doubles Canada

The United States took in more than twice as much dues revenue as Canada in 2010, even as the North American rivals posted nearly identical revenue figures.

The implication is the Canadian Rugby Union, which has a much smaller playing population, relies less on participants and earns more via sponsorship and commerce.

USARFU also spent 18 percent more on staff salaries, according to the audited financial statements of each union *and people familiar with the figures*. The finding comes as Boulder prepares to hire a senior men's national team coach, which has been its second highest-paid position.

As America counted greater than 250 percent more registrants than Canada -- 88,151 to 23,853, using International Rugby Board figures -- it is sensible, to a degree, that Boulder requires additional personnel to service its membership. A larger audience is typically more attractive to sponsors, however. Thus Canada's commercial and fundraising totals are the more impressive.

In 2010, the CRU amassed a total of C$6.62 million while USARFU took in $6.38 million. As a rough measure of equivalence, 2010's average exchange rate was C$1.029 : $1, according to the Internal Revenue Service, meaning USARFU's revenue would have been worth $6.57 million north of the border.

The CRU receives direct government funding, to the tune of C$800,000 in 2010. Added to its dues intake of C$1.43 million, the total remains almost than C$700,000, or 24 percent, short of America's adjusted Club and Individual Participation Program (CIPP) intake of C$2.92 million ($2.84 million).

Canada's statement breaks out IRB grants (C$1.74 million), while the US version does not. In as much as both countries are considered 'tier 2' nations by the IRB, it is likely these are comparable.

Dues as a percentage of USARFU's revenue have soared over the past 5 years, accounting for nearly all of the union's growth. In 2005, USARFU collected $1.11 million of its $4.63 million gross revenue, or 24 percent, from players, coaches, and administrators. By 2010, Boulder booked $2.84 million of $6.38 million, or 45 percent, from members. Of the $1.75 million revenue gain, $1.73 million -- 99 percent -- came from participants.

Comments

[Sack Melville]

Pathetic.

[Anon]

Considering nearly everyone in Canada plays in either BC or Ontario, I imagine that attracting sponsors is easier. That, and 23,853 in a nation of 34 million is a much higher percentage than 88,151 in a nation of 312 million. In other words, to sponsors, rugby in Canada is about 3x more attractive.

[keeping it real]

Two things which shouldn't be heard in the same sentences...USAR and corporate sponsorship.

[Working Class Rugger]

Quick question, how do most of you believe the vast majority of Union's derived their revenue? Yes, sponsorship is a considerable source but dues as you would call them make up a significant portion of every major Union's balance sheet let alone Tier 2 and 3.

Maybe if you paid the same as I do for the privilege to play the sport, $250 Aus. dollars per annum, then the USAR would have significantly more funding to do what you all want to see happen.

[White Collar Rugby]

@Working Class Rugger

Your lack of knowledge about the business of world rugby is astonishing. The "haves" in world rugby make their money from a combination of broadcast revenue of their test matches, sponsorship revenue of their national teams, merch sales and licenses of their national team brand and player images, IRB grants and the revenue from the gate, parking & concessions from their home and away tests (some countries like England and I believe the Welsh the union owns the stadium and generate revenue from concerts, sporting events, conventions, tours and other events).

They use the money to FUND community rugby in the form of grants and low interest loans for clubs to improve facilities, coaching clinics, club administration training & counselling, referee training and recruitment, and basically any and all aspects that the union believes will help develop rugby in that nation.

[Working Class Rugger]

White Collar Rugby

I think you greatly overestimate exactly how much money many of these Unions draw from commercial transactions. Whether you like to acknowledge it or not, today even in Tier 1 nations playing fee's do make up a significant portion of Union revenue.

The USAR is the governing body of a developing sport with limited commercial appeal at present. It's market albeit growing is still small and dubious in the commercial sense. It will take more time before companies view Rugby as a viable commercial opportunity. What more can you expect? Especially considering it's limited funding capabilities. Perhaps if it decided to double its current CIPP levels, would you like to see that, then maybe they may be able to deliver some of your demands.

[White Collar Rugby]

No demands made by me. Is English your first language?

[Look Around]

I've got to agree with anon up top. Working in a business that looks at sporting sponsorships regularly I can tell you that it is hard to overestimate the value of a highly concentrated market with people willing to pay and come out to events. Canada fits this bill nicely (not sure about their spending habits).

US rugby is spread thin across one of the largest countries on the face of the planet- no critical mass for local sponsors. Certainly no critical mass for even large national sponsors looking for a regional edge.

Couple this with the frustrating fact that rugby players do not support rugby events and companies very well and it becomes clear very quickly why we just do not have a strong product to put in front of advertisers.

It will get there but we should not be shocked by these our lack of meaningful and long term sponsorships.

[WTF?]

@Look

I see the USA is too populated, too wealthy and too large for rugby sponsorships to work.

[NG nothing]

USAR should be maximizing their opportunities and providing benefit back to the clubs and players. Charging dues with no services is underachieving.

[Sergeant Hulka]

Question: How many USAR members used the Sports Authority coupons sent to them? This is one instance where it's totally trackable to see what an investor's return on sponsorship is. If you didn't use it, then you can consider yourself part of the problem of why sponsorship for USA Rugby is so difficult to get. We should all have the USA Rugby Mastercard.

[Look Around]

@WTF?

You are missing the point entirely. Obviously the US is the largest economy and sports market in the country, but investors do not pay serious money not to be noticed big market or not.

I'll give you an example. I have had clubs contact me about sponsorship with some variation on the following "Hey for the small fee of {several thousand dollars} we will hang your banner on our field, put you on our jerseys, and give a full page ad in our program!"

Considering even the very best teams MIGHT draw 2,000 people to the biggest game they will hold all year long this would be one of the dumbest investments I could possibly make. You generally look to make at least 2-3 times in sales what you spend on the advertising side.

So if I am a big sponsor, do you honestly think I could get millions of dollars back from sponsoring the Eagles? What channels do they have to promote my brand, how much exposure, how many events, etc. The math just doesn't add up RIGHT NOW. One day it will, but that day is not today nor will it be for some time.

Europe and Canada get away with this because of highly concentrated populations in relatively small geographic areas. Don't forget that England could fit inside the state of Texas several times over. They struggle to pay players professionally (outside of a couple of clubs) and they have 2 million registered players. You could drive from one end of England to the other in less than a day.

As a group rugby players have to be more realistic of our value to sponsors or we will get none. Not supporting USAR test matches, conferences, etc. does not help this cause. Hell we can hardly get a full stadium for the Vegas 7's. Luckily those guys have been willing to lose their ass for years to try and see that event to some meager profitability last year. Support USAR sponsors and other rugby events better and this might change sooner rather than later.

[Brain Freeze]

Look Around just hit the nail right on the head. It is the harsh truth, but it is still the truth.

We have a registered player base of less than 100K yet there are still plenty that wonder why Nike or Under Armor aren't fighting over the rights to get involved with us. For all of our progress (which has been great), we are still just a small blip on the American sports landscape.

[sevens]

National sponsorship is difficult and USAR is certainly not qualifed to attract any sponsors. Did Regional sponsorship looks more likely. Not easy, but certainly easier than anything on a nationnal level. The new college conferences and GU's should be working on regional sponsorships and TV coverage (online streaming, cable). Some already are and have had some success Regional development and spending is the way forward. Or they could wait for USAR to come up with something.

[One step at a time]

The figure for sponsorships for the Canadian Rugby Union in 2010 was $417,520.

I'd be interested to see how that compares with U.S. figures. Probably the largest sponsor is Macquarie which is an Australian company offering mortgages in Canada. Also Trafigura which is a multinational natural resources company operating in Canada.

So the key seems to be to find large multinationals with roots in rugby mad countries and sell them on partnering their business expansion in North America with rugby sponsorship.

[Bruce Carter]

England is smaller than Louisiana. All Great Britain would fit several times in Texas.

I know this when I hear RFU refs complain about long drives of twenty miles to a game!

[Look Around]

@Bruce

Amen brother. I remember listening to the travel manager for the Boston Red Sox complaining of traveling costs and actually having to take the train and the like because they simply could not afford all of the travel if they didn't go coach and train regularly.

It made me realize that geography plays a far bigger role for our development as a sport, professional or otherwise, than many people give it credence. If one of the most well capitalized sporting organizations in the world has to penny pinch to travel and play it shows what a barrier it really is. Admittedly baseball plays an un-Godly amount of games but the point still stands.

[Jeff Arker]

I haven't been on Gainline for many months but am glad to see some good debate emerging rather than just mudslinging. Might improve more if more people used their real names.

Travel costs are a huge issue on the national level and really limit assembly time for rep teams. I remember discussing this issue with the Junior Eagles manager in 2003 after a 3-16 loss to Belgium at the World Champs. Belgium, being 1/8th the size of Oregon, had been able to play together often and assembled frequently for camps. Belgium made less mistakes. US teams need to make full use of every single minute they have together.

We find the same issue here in Oregon when we assemble our Red Hawks All Star teams at the end of each high school season. Oregon, New Zealand and Great Britain are all about 100,000 sq miles in size. Getting players from the south and east of the state in to Portland for practice really takes planning and sacrifice. Then taking the teams to Washington, California, Idaho and Montana for games is really expensive.

[Anon]

@Look Around:

For what it's worth, though baseball players play an admittedly ungodly amount of games, the typical MLB team only travels about 27 times (since they play so many games per series). Hotel costs have to be a good raping, however. Basketball and hockey are the sports most brutalized by travel (41 times save for the teams in towns with multiple teams).

The larger point about geography is spot-on though. That's one of the biggest reasons regional development of our game is far more important than national development, which is why expectations of what USAR can accomplish on a development front should always be tempered.