Financial incentive to win a title

[AlaskanAssassin]

The biggest benefit has to be the increased TV revenue dollars. Right?

 

[LogGrad98]

Here is the answer. This is the NBA Playoff Pool, published in the Knicks team PDF.

2011 NBA Playoff Pool
The 2011 NBA Playoff pool is $12 million and will be distributed to teams in the following manner:
Best Record in NBA ......................................................... $346,105 Teams Participating in First Round, $179,092 each .................... $2,865,472
Best Record in Conference, $302,841 each..................... $605,682 Teams Participating in Conference Semifinals, $213,095 each ... $1,704,760
Second Best Record in Conference, $243,411 each ........ $486,822 Teams Participating in Conference Finals, $352,137 each .......... $1,408,548
Third Best Record in Conference, $181,706 each............ $363,412
Fourth Best Record in Conference, $142,800 each ......... $285,600 Losing Team, NBA Finals ........................................................... $1,408,168
Fifth Best record in Conference, $118,990 each .............. $237,980 Winning Team, NBA Finals ......................................................... $2,125,137
Sixth Best Record in Conference, $81,157 each .............. $162,314 Total Playoff Pool ...................................................................... $12,000,000
Recent NBA Playoff Pools
1982 ............................ $1,500,000 1990 ............................ $2,400,000 1998 ............................ $7,000,000 2005 ............................ $9,500,000
1983 ............................ $1,500,000 1991 ............................ $3,200,000 1999 ............................ $7,500,000 2006 .......................... $10,000,000
1984 ............................ $1,750,000 1992 ............................ $4,000,000 2000 ............................ $7,500,000 2007 .......................... $10,000,000
1985 ............................ $1,750,000 1993 ............................ $5,000,000 2001 ............................ $7,500,000 2008 .......................... $11,000,000
1986 ............................ $1,750,000 1994 ............................ $6,000,000 2002 ............................ $8,000,000 2009 .......................... $11,000,000
1987 ............................ $1,750,000 1995 ............................ $7,000,000 2003 ............................ $8,750,000 2010 .......................... $12,000,000
1988 ............................ $1,750,000 1996 ............................ $7,000,000 2004 ............................ $8,750,000 2011 .......................... $12,000,000
1989 ............................ $2,400,000 1997 ............................ $7,000,000
Note: Players and coaches shared a pool of $50,000 during the 1951 Playoffs.

https://origin.nba.com/knicks/media/2010-11_NY_Knicks_Regular_Season.pdf

Obviously this is not all, but it is the portion paid out by the league. I am sure extra revenue was generated from the extra games, media coverage, merchandising, etc.

 

[Stifle Tower]

This is just wrong. Why would the league be pressing so hard for smaller salaries and a hard cap?

The league lost 300 million last year.

https://thestockmarketwatch.com/stock-market-news/recent-events/nba-loses-300-million-usd/7728

According to the Deputy Commissioner of National Basketball Association Mr. Adam Silver, out of the 30 league franchises 22 of them are expected to lose money this season.

Hmmm...do you think he is impartial? I'm a Finance guy. I understand there are a lot of ways to position a company and define profit and loss. I seriously doubt losses were that high. I'd like to see what a team of independent auditors would find. But the league and owners will NEVER allow that to happen. The NBA Is making money...tons of it. What IS a problem is that a group of small market teams are having difficulty. That's a revenue-sharing problem.

I hate a lot of the players; I hate most of the owners. But I love the game. I really don't care if the billionaires or millionaires win the fight. In the end, ticket, concession and League Pass fees will increase. The fans always get it in the end, so to speak.

 

[vj_74]

Thanks for all the inputs. "Emotional" reward as someone mentioned here is a different thing altogether. There is the issue of prestige here. My question was purely in terms of $$$ incentives.


Loggrad, I have seen that data before, but I couldnt quite get a handle on the difference in $$, that a team makes by being a perennial playoff contender vs a team that breaks through one year to win it all. Thats the reason I started this thread.

If you go, say, 5-10 mil over the LT, to get that impact player who helps you win a championship. You end up actually spending 10-15 mil on him including the LT. Now for someone like Cuban it might be peanuts. But for a small market franchise is there enough of an incentive to go that far, was my thought. Is the ROI good enough? Maybe it is just difficult to speculate, unless there is some article somewhere where someone who is privy to such info has taken actual data from a team's balance sheet and done some math. For a small franchise team like the Jazz with a loyal fanbase I would think the merchandise sale would already be high enough if they were just making the playoffs every year and creating some noise.

 

[vj_74]

I would think there are financial benefits. Off the top of my head:
-Increased revenue from ticket sales. Both during the playoff run (more games for that year) and the next season(s) ticket sales..

Like I said you can be a perennial playoff contender and keep losing in the second round or say the WCF. You just get revenue from 2 more rounds if you win the title , that's all
-

Going along with the previous one is increased concessions sales (beer, pizza, hot dogs, soda, etc.) during all these games.
-Increased merchandise sales. How many championship T-shirts, hats, banners, get sold in the immediate aftermath of the championship? I would also assume jersey sales would go up.
There's probably more that I haven't thought of

Those are definitely there, but enough to justify say, a 10 mil luxury tax? Will be interesting to find out. I am sure quite a few people would have looked into this and done some math.I dont recall any articles on this specifically in recent times but with lockout looming there is a chance something on this gets out in some magazine or some sports site or the other.

 

[vj_74]

What makes Greg Miller a cold businessman?

I dont want to digress in this thread, but Greg IS a businessman and you know that. The "cold" comes from the fact that he is not the type of guy who would sit down and sob if AK leaves, like his dad would. His dad would have soaked several hankies when Sloan quit. This guy is just detached and bottomline-driven(not that his father was'nt but he was a different personality altogether). That and the fact what happened last year and the year before when we just like that dumped players for $$$, let go of several free agents. The payroll might have been still high,but that was mostly because of the AK contract which happened much before Greg Miller's time.

 

[Gameface]

I dont want to digress in this thread, but Greg IS a businessman and you know that. The "cold" comes from the fact that he is not the type of guy who would sit down and sob if AK leaves, like his dad would. His dad would have soaked several hankies when Sloan quit. This guy is just detached and bottomline-driven(not that his father was'nt but he was a different personality altogether). That and the fact what happened last year and the year before when we just like that dumped players for $$$, let go of several free agents. The payroll might have been still high,but that was mostly because of the AK contract which happened much before Greg Miller's time.

I think you're confusing cold with stoned.

So anyone have an idea what the average fan spends in beer, hotdogs, popcorn, etc. while at the game? With 20,000 fans I imagine a few extra rounds in the playoffs would amount to a good amount of money, not to mention playoff games are pretty sure to be sellouts and they charge more and more for tickets every round.

 

[Chad Feldheimer]

I dont want to digress in this thread, but Greg IS a businessman and you know that. The "cold" comes from the fact that he is not the type of guy who would sit down and sob if AK leaves, like his dad would. His dad would have soaked several hankies when Sloan quit. This guy is just detached and bottomline-driven(not that his father was'nt but he was a different personality altogether). That and the fact what happened last year and the year before when we just like that dumped players for $$$, let go of several free agents. The payroll might have been still high,but that was mostly because of the AK contract which happened much before Greg Miller's time.

I don't see the problem. Larry was the strange one out of the two. How many owners do you see that cry like Larry did? Just because he doesn't sob doesn't mean he doesn't care. I haven't heard any complaints from players or frankly anyone (outside of a delusional fan here and there. Not accusing you) who think Miller is uncommitted to helping the Jazz as much as possible. Jazz made the mistake on Wes Matthews leaving. Blame KOC & Miller on that one. But even at the time I remember many Jazz fans saying they thought that was too much money for him. Boozer was a smart decision. The Bulls already regret that move. The payroll was high and then the Jazz went and acquired a trade exception(giving up a 2nd rounder) that they didn't have to use, but did to acquire Al Jefferson making 13 million. Putting them far into the luxury tax. That should prove that he isn't just about the bottom line. Of course he wants to make money. Everyone does. He wants to win too. Greg Miller has been less conservative than his father already. Letting Boozer walk, trading for Al Jefferson, trading DWill. If that ends up being a good or bad thing remains to be seen.

 

[vj_74]

I don't see the problem. Larry was the strange one out of the two. How many owners do you see that cry like Larry did? Just because he doesn't sob doesn't mean he doesn't care. I haven't heard any complaints from players or frankly anyone (outside of a delusional fan here and there. Not accusing you) who think Miller is uncommitted to helping the Jazz as much as possible. .

I never said it is a major problem. Just an observation.
Greg has been here for just a short while and the players are mostly new faces. And those players arent going to come out in the open anyways and criticize their owner even if they have a problem with him. No Malones around anymore. And I never implied that Greg has to cry in order to show that he cares. I just said his father was more emotionally inolved in it and it is a fact. Right from getting involved in games, to locker room visits and getting in it wih the refs and so on. It is not just about the press conference crying when a player leaves. LHM's emotional investment with certain players could have even prevented the Jazz from trading them-like say, AK. Also, this is not about who is the better owner overall, LHM or Greg, so you dont have to get too defensive with it.

Jazz made the mistake on Wes Matthews leaving. Blame KOC & Miller on that one. But even at the time I remember many Jazz fans saying they thought that was too much money for him. Boozer was a smart decision. The Bulls already regret that move. The payroll was high and then the Jazz went and acquired a trade exception(giving up a 2nd rounder) that they didn't have to use, but did to acquire Al Jefferson making 13 million. Putting them far into the luxury tax. That should prove that he isn't just about the bottom line.

That actually proves that he is concerned about the bottomine-making the playoffs. He has to make money by making the playoffs, especially when Deron was still there on the team.He would have always found another way to cut his losses(by making a cash saving trade like the Brewer and Maynor ones)

Of course he wants to make money. Everyone does. He wants to win too. Greg Miller has been less conservative than his father alreadyLetting Boozer walk, trading for Al Jefferson, trading DWill. If that ends up being a good or bad thing remains to be seen

Thats precisely my point. He can easily trade his best player, let go of his best coach who is a local legend, dump picks and do whatever he wants all in the span of a year. Think of how the Jazz turned upside down within a span of a few months last year.Couldnt see that happening if his dad was still around.
Again, this is not about who is the better owner overall.So you dont need to get all defensive about Greg Miller. What I have mentioned is something which a lot of other posters have echoed in the past. He doesnt get too attached to anything out there on the floor-the players, the game or the coaches. But he does care about the $$$. That easily makes him a colder businessman than his dad. Whether that is a problem or not-that is a debate for another day in the distant future.

 

[zman1527]

Hmmm...do you think he is impartial? I'm a Finance guy. I understand there are a lot of ways to position a company and define profit and loss. I seriously doubt losses were that high. I'd like to see what a team of independent auditors would find. But the league and owners will NEVER allow that to happen. The NBA Is making money...tons of it. What IS a problem is that a group of small market teams are having difficulty. That's a revenue-sharing problem.

I hate a lot of the players; I hate most of the owners. But I love the game. I really don't care if the billionaires or millionaires win the fight. In the end, ticket, concession and League Pass fees will increase. The fans always get it in the end, so to speak.

Well said. It amazes me that with the financial shenanigans we have all witnessed lately that there are still so many Pollyanna's buying into the owners sob stories. If these guys were losing money they would sell. They are downplaying their financial picture everyway they can to hide things from the players, the fans, and the IRS.

 

[TheItinerantSon]

This is just wrong. Why would the league be pressing so hard for smaller salaries and a hard cap?

The league lost 300 million last year.

This is not true - this is because of accounting gimmicks. Even New Orleans brought more money in than it spent last year.