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Columbia Business Monthly

Which team is worth more, the Carolina Gamecocks or the Clemson Tigers?

Dec 07, 2018 10:41AM ● By Kathleen Maris
By Richard Breen

Although the University of South Carolina football team has had some success over the past several years, fans of Clemson University would tell you that, bottom line, they’re better.

They would be wrong.

When it comes to the actual bottom line—the one on the financial statement, not the scoreboard or the Top 25 rankings—the Gamecocks own a decisive advantage over Clemson, at least in the eyes of some business experts.

Forbes ranks USC No. 15 on its 2018 list of the most valuable college football teams, which focuses on annual revenue. The Gamecocks generate an estimated $90 million. The Tigers don’t make the top 25. Meanwhile, a USA Today report covering the 2016-17 academic year ranked the University of Texas No. 1 with $214.8 million in revenue. USC was 16th ($136.0 million) and Clemson came in at No. 26 ($112.6 million).

Dr. Ryan Brewer, a finance professor at Indiana University-Purdue University Columbus and not the former Gamecocks running back, produces an annual ranking that explores the market value of each football program as if it were to be sold on the open market, like a pro sports franchise.

In 2017, he had Ohio State University at No. 1 (worth $1.5 billion), with USC at No. 15 ($484.8 million) and Clemson at No. 24 ($328.4 million).

TV truths
Where is the money coming from and why are the Gamecocks getting more than the Tigers?

“First, it’s those long-term TV deals that are done with all those super five conferences other than Notre Dame,” says Dr. Tom Regan with the USC College of Hospitality, Retail, and Sport Management. “Then you start to take a look at anything they can generate in-stadium. Everything gets driven in those major markets by that TV deal.”

The Atlantic Coast Conference, Big Ten, Big 12, Pac-12, and Southeastern Conference are the five major college football conferences. The SEC is a leader in signing big media deals. Its latest is a 15-year contract with ESPN worth a reported $2.25 billion. As a result, 10 Southeastern Conference schools are in the Forbes top 25.

“There is a significant difference from conference to conference,” Brewer says.

The University of Notre Dame is loosely affiliated with the ACC but has its own TV deal with NBC. The Tigers are in the ACC. The Gamecocks are in the SEC.

Raymond Sauer, a Clemson professor and chairman of the school’s economics department, says most rankings are too dependent on revenue. “It’s not a measure of the value of the program to the university,” Sauer says. “You have to think about why schools have a football team in the first place.”

Brewer says his value ranking sheds light on the “bifurcated mission statement” of universities with lofty academic goals and business-minded athletic departments.

“They show universities how expensive it is—and how lucrative it can be,” he says. “It also shows the marketing power of what athletics do for a university as far as driving admissions.”

Power of pride
Allen University revived its football program this season.

“One reason was to boost enrollment,” says Chad Washington, athletic director at the historically black school in Columbia. “It’s also giving the alumni something they really wanted back.”

Allen’s $500,000 football budget comes entirely from alumni and other supporters. Thanks to the influx of football players and marching band and dance team members, enrollment has jumped from 600 last fall to 720 this fall. Washington says adding football to Allen’s campus life will also begin attracting students who don’t dance, tackle, or play an instrument.

Sauer says students and alumni simply want a program they can be proud of. “You have to look at the output measures that really matter,” he says.

For that, the ranking Sauer prefers is the “Grid of Shame,” published by The Wall Street Journal. It’s a spray chart that concentrates on won-loss records and the amount of trouble a team and its players get into.
For 2017, Clemson and USC both did well in terms of off-the-field admirability versus embarrassment. On the field, the Tigers were on the “powerhouse” end of the axis while the Gamecocks were halfway between “powerhouse” and “weakling.”

“Athletics is a window into the university,” Sauer says. “Winning, doing it with integrity, providing opportunities for students and alumni to celebrate what’s great about a university. That’s what really matters.”
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