Currently in the NBA discourse, there has been some significant talk about Anthony Davis and what exactly to do about the remaining games until the New Orleans Pelicans are able to trade, or run out, his contract. Scott Kushner of the The New Orleans Advocate published a charged column today suggesting that the Pelicans need to sit Anthony Davis and take a stand in favor of the Pelicans’ fans, who would otherwise spend their money elsewhere if the New Orleans Pelicans continued to play Anthony Davis.
In 2017 the Bureau of Labor Statistics published that the average American household made about 5.3% of their total expenditures in the category of Entertainment, for a total sum of about $3,000 per year. This reflected a 10% increase vs. 2016. In a 2013 BLS survey, tickets (fees and admissions) contributed to about 22% of all entertainment spending. The average American household, then, spends 1% of all their expenditures on ticketed events, such as concerts, sporting events, museum tours, and of course, basketball games. For comparison, this aligns closely with the total household spend on Personal Care products and services, so this is safely a massive market.
Event tickets are consistently a large portion of families’ entertainment spend.
The NBA as a ticketed product has a great opportunity available in the coming years as entertainment spend, and ticket spend, continue to rise, and as concert tickets continue to rise out of families’ price ranges. In 2018, the average concert ticket was $96, according to concert tracking firm Pollstar, and the concert ticket has experienced a massive increase in price over just the last year, as the 2017 average concert cost was $84. With NBA prices getting as low as $10 in some markets, such as for my hometown Washington Wizards (who have twelve of their remaining thirteen home games being sold for $10 or less on StubHub), it is an attractive alternative to other events that have much larger costs for a family of four, or even a single person.
Concert tickets continue to get more expensive.
In the NBA the fans are largely attracted to individual players, and specifically, the top ten or so players in the league. These players are able to drive attendance and ticket revenue for teams that are hosting these superstar players, e.g., for those same Wizards that have twelve games remaining where the cheapest ticket is under $10, the cheapest ticket available for the Los Angeles Lakers game (the LeBron game) was $85, over 10 times as much as the March Denver Nuggets game, for a Denver team that is 10.5 games up on LA in the standings. The stars are what drive the league interest – and the revenue. This is why, while Kushner is completely correct about the value of tickets as a revenue pathway for the NBA, he is completely wrong about forcing Anthony Davis to play.
Above is a list of the cheapest ticket prices on StubHub for each of the remaining Atlanta Hawks games this season. It is well known in the ticketed entertainment world that events on Fridays and Saturdays reign supreme in terms of driving higher prices. However, the Pelicans’ matchup with Anthony Davis against the Hawks currently is a more valuable ticket than Friday and Saturday matchups against three different playoff teams. In fact, the top five most expensive tickets are all teams that have a top ten player on the roster.
If the NBA wants to be able to continue to compete against concerts, other sporting events, and other different ticketed entertainment products, they simply cannot allow the Pelicans to tank by sitting Anthony Davis for the rest of the season, especially if he wants to play. The average family makes event plans far out in advance, and a large percentage of the tickets for any given game are bought when the schedule is released and the tickets go on sale at the beginning of the season. Sports fans understand the unfortunate nature of injuries, but this is different. This isn’t a player being hurt; this is a team deciding to plummet the value of competitor’s assets (their tickets) by sitting their player in order to lose games on purpose. This is something that simply cant be allowed if the NBA wants to compete as an entertainment product. When a concert goes on sale, and you buy a ticket for the Rolling Stones, you know you are getting Mick Jagger. When an NBA game goes on sale, you should know that you are getting Anthony Davis.
by RJ Garcia, Northwestern University