Using data from the 2008-09 season obtained by CBSSports.com, Jim Grinstead of Nashville-based Revenues from Sports Venues created a series of indices illustrating the disparity among high- and low-revenue teams in the NBA. This Class Warfare Index explains why changing the league's revenue-sharing model could become a significant factor in collective bargaining for the first time in NBA history.
Focusing on four key categories that contribute heavily to the health of a sports franchise -- ticket revenue, total ticket sales, pricing power and actual attendance -- Grinstead ranked the teams based on their relation to the league average. The average in each category is assigned a value of 100, so a team with an index of 200 is performing twice as well as the league average and one with a 50 is performing half as well. (Oh, and it gets worse, but you get the idea.)
Category 1: Ticket revenue
This is simply the average net gate receipts, or the five best and five worst teams at selling the most tickets for the most money:
|Haves||Index||Net ticket revenue/game|
Category 2: Pricing power
This is the average revenue that each team brings in from season tickets. It includes full-season and partial plans, which are combined by the league and called "full-season equivalents."
Grinstead determines a team's pricing power based on season tickets because those sales tend to fluctuate less and provide a more reliable source of revenue for teams. Also, unlike individual tickets, season-ticket prices don't fluctuate based on factors beyond a team's control -- such as the attractiveness of the opponent or the team's competitiveness at the time.
Not surprisingly, the Knicks and Lakers have the most pricing power based on season-ticket prices. They also bring in the most revenue based on all tickets sold, though the yields are lower -- $121.07 for the Lakers and $96.31 for the Knicks -- and their positions are swapped. Individual game tickets are cheaper on average than season tickets for both teams, but the Lakers' sell for more than the Knicks'.
Category 3: Total tickets sold
These teams do the best and worst jobs selling tickets. But as the Trail Blazers can attest, selling tickets is only half the battle. Portland is second in the league with a 128 index for tickets sold, but with a 64 index for pricing power, the Blazers wind up below the league average for revenue.
New Orleans is the only other team above the league average in tickets sold but below average in revenue. The Pistons, who had the highest average ticket sales, also are below average in pricing power (87), and thus slightly above average for revenue (101).
|Haves||Index||Avg. tickets sold|
Category 4: Actual attendance
Paid tickets are nice, but teams prefer when fans actually come to the arena and pay for parking, concessions and souvenirs.
The percentage of tickets used is called the "drop count," derived from the old method of counting tickets that were dropped in the turnstiles. These teams have the highest and lowest percentage of all tickets -- including comps -- used by people who actually show up:
|Haves||Index||Drop count pct.|