09-20-2024, 01:59 PM
(09-20-2024, 01:10 PM)SleepingHero Wrote: Without access to Philly's records, it's hard to accurately gauge the true ROI a star player has on a team. But we can get close.
NBA teams income comes from merchandise, concessions, ticket sales, but most importantly advertising and broadcast rights.
The current deal this past year brought in an estimated 2.6 billion dollars. That alone split amongst the 30 teams is about 87 million per team.
On top of that, there are licensing rights with Nike that brings in an additional 1 billion per year. (https://www.espn.com/nba/story/_/id/1305...-deal-nike). That's another 34 million per team. So just from broadcast rights and licensing, each NBA team is making about 125 mil rounded.
These deals are only valuable because of star players that people want to watch. Philly has 21 nationally televised games which is 7th in the league for next year. Meaning they are a marquee draw for the league.
Now we add in tickets+concessions. Philly was number 3 in the NBA in terms of attendance with an average of 19,218 seats filled, basically 95% filled every night according to ESPN.
A Sports Media company called OhBets ran a study on the average ticket cost, concessions, and parking for each team so we'll use that as reference. The average ticket according to them (I couldn't find a median price) was $264. For concessions lets tack on another $15.28 per person (price of 1 beer and hot dog) and we'll add in parking for $30. That brings our total cost for an average ticket for 1 person at $310. At that price this means each game brings in about ~6 mil for the 76ers. A total season of 41 games would be $244 mil. A website called statista has PHI 2022-23 season revenue listed at a total $376mil. If we add in our broadcast rights+ticket sales we're pretty close to that. Then we factor in merchandise and jersey sponsorships and we're pretty close to that ~$380 mil estimate.
Now lets compare this to a bottom dweller team with no marketable stars. Charlotte! They ranked 29th in total attendance by number at 17,358 according to ESPN, but their stadium only fills 17,500. According to the Charlotte Observer quoting that same OhBets study, the average ticket cost was $169. The price of a beer and hotdog was $14.08. And parking was $15. That brings the total for 1 person at $198.37. At that price each game would bring in ~3.5 mil, and an entire season they'd make $141 mil.
That is nearly a 100 mil difference. The total difference in ticket sales per game is about 1860 (with only 142 being unsold seats). Let's just say CHA builds an extra 1860 seats, even then they'd only make an additional 15mil. Add in merchandise (Lamelo Ball was their best selling jersey which was 13th), I'll venture to say the difference having a star player is about $100mil a year.
So Joel Embiid is worth easily his contract and PHI gets a positive return just by having him on the team.
Great summation!
I also propose that PHI has the arena size (and extra revenue) because of the market size, as compared to Charlotte. Per the US Census site Philadelphia-Camden-Wilmington MSA is 6,241,00 compared to Charlotte-Concord-Gastonia MSA of 2,756,000. Household income is about 9% higher in PHL vs CHA although cost of living is only about 5% higher.
Apart from that, PHL has a history of fielding a competitive team. When was the last time PHL was dismissed before the season even started? You would have to go back to the "process" days under Hinkle, but even then they ended up with future stars like Embiid and Saric, the teams just didn't play well (possibly on purpose). Before and after, PHL was usually a team worthy of at least a mention for Eastern conference contention. This allowed them to price admission, merch, concessions, etc., as premium prices.
Contrast to CHA whose history is basically that of two expansion franchises. The original one moving to NO and becoming the Pelicans and the second starting as the CHA Bobcats before renaming back to the Hornets. Their biggest splash was getting Jordan as an investor/owner. With neither history nor accomplishments, CHA doesn't have much leverage when pricing their product. I suspect that the quality of the opponent does more to sell tickets than most of the home team roster. Kind of like the pre-Dirk Mavs.
I wonder if DAL could make a case for a cut of their gate because Luka, Kyrie and the boys put more butts in seats? I mean, the players have to pay income taxes on games played in other states, why not get incremental income as well? Wouldn't that be a mess to administer?