The Great Rebate Debate

By Joe Bush, August 29, 2015

 

While parents will argue that limiting housing options leads to greater individual costs, event owners like Lauri Dagostino, founder of Asics Big South National Qualifier volleyball tournament, say rebates result in better group prices.

“Our job isn’t to look out for one family, it’s to look out for all of them.” — Lauri Dagostino, founder of Asics Big South National Qualifier

That’s because rebates lead to stay to play, which leads to higher room pickup and trackable business, which leads to more solid economic reports—which lead to an event having a better chance of getting the space it wants for a price it can afford. That data gives a rights holder or tournament front-runner a better negotiating tool for scoring the lowest rate for their teams and accompanying family and friends.

“Our job isn’t to look out for one family, it’s to look out for all of them,” says Dagostino.

Don Schumacher, executive director of the National Association of Sports Commissions, says there is a big downside to the trend. He is among those who think the ripple effects of high rebates may upset the upward trajectory the sports tourism industry is experiencing. He argues better planning and budgeting should take the place of rebates.

“There’s nothing inherently wrong with rebates or stay to play or commissions,” he says. “What’s wrong is when they get out of hand. I’m not saying we should stop rebates or stop commissions. What I’m saying is that reasonable people have to be reasonable.”

Somogyi says one of his clients admits that registration fees, sponsorships and apparel generate the bulk of tournament revenue. Rebates are “purely icing on the cake,” he says.

Will sports planners be able to give up that icing? They may have to cut back at the very least as rebates receive higher scrutiny. “More questions are being asked regarding what is fair, ethical, legal and, above all, where they wish to place themselves moving forward,” says Chris Butlin, CEO and president of West Coast operations at CSTT Sports Management. “The sports market certainly needs guidance, boundaries and a certain amount of standard practice implemented before economic pressure dictates a radical change in what the market will bear.”

Related: The Pros and Cons of Hotel Rebates

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