Comments on: We will not do a Cleveland-style rebuilding

By: Gomez

Gomez — Wed, 10 Oct 2007 20:30:04 +0000

Isn’t Cleveland as a city also struggling economically? IIRC part of the problem with the Indians’ low attendances was that wages were relatively low and stagnant and the populace didn’t have a lot of disposable income, thus they didn’t go out of their way to attend games (and you’ll notice that, even as their attendance has risen, it hasn’t quite returned to previous levels)… whereas Seattle is a more prosperous town (even factoring in the dot com crash) where a lot of people have a lot of disposable income.

By: joser

joser — Wed, 10 Oct 2007 08:28:27 +0000

BTW, my attendance numbers (which match DMZ's) and rankings are from here. Interesting facts buried in there. Sure you might guess that the Yankees, Red Sox, and Cubs (in that order) draw the closest to 100% attendance on the road, but who's number 4? Would you believe the Mets? And obviously with rabid fans and the smallest stadiums, the Red Sox (over 100%, Fenway is groaning) and Cubs get the most sellouts, but who's number 3? Not either New York team, but SF. Thank you, Barry. (Interestingly the Angels, who've been #3 or #4 in percentage the last couple of years, dropped down to #6 this year.)

By: msb

msb — Wed, 10 Oct 2007 08:10:35 +0000

FWIW, the 'fan cost index' for 2006 (the last data they list); my question-- does the 'average' family of four really buy all the crap they factor into a ballpark visit? and a column on some raised prices opening day around baseball this season

By: Alaskan

Alaskan — Wed, 10 Oct 2007 04:20:53 +0000

Interesting. In the Forbes article (http://members.forbes.com/global/2005/0425/036.html) they pointed out that, at the time (2005), the Mariners were actually paying a lower percentage of their revenue out in payroll (50%) than the league average. I excluded that point, because obviously it’s no longer true since the payroll jump when they signed Sexson and Beltre. So, after dropping from 2nd to 10th in 2004, they bumped up their payroll significantly in 2005, perhaps in recognition that a certain level of success IS necessary to keep up interest. I think the Forbes article shows that, at least for the Mariners, butts in seats is not the only way to pay the bills. But it is probably the biggest chunk, and the most variable.

So you’ve convinced me – they really ARE trying to win, they’re just not very good at it. Well played.

By: joser

joser — Wed, 10 Oct 2007 03:54:10 +0000

Actually, I’m not suggesting anything of the sort. I didn’t mention wins anywhere in my post, and nothing in my analysis is contingent on winning a single game. I was talking strictly about how much they paid in payroll vs how many people attended the games. Now, I don’t know what their intent was in jacking up their payroll as much as they did; presumably it was either to win games or to persuade their customers that they were trying to win games — which suggests the Mariners think that winning games (or at least giving the appearance of trying to do so) correlates to attendance. Whatever the case, it hasn’t paid off. They would have been better off, from a profitability standpoint, to have not signed Sexson and Beltre et al and just relied on a bunch of scrubs and their family-friendly marketing to pull in the sheep, er, fans.

But of course there actually is a trailing correlation between wins and attendance:
Year…Wins…Rank
2001….116……1
2002…..93……1
2003…..93……2
2004…..63…..10
2005…..69…..12
2006…..78…..15
2007…..88…..16

The M’s, at the top of the heap just five years ago, are now right at the middle of the 30 teams in attendance. Clearly, they’ve outperformed the Indians (who bottomed out at 25th and even now are only 21st) and, as you said, thanks to all their sweetheart deals on the stadium they don’t have to draw as well to make more money. But the Indians are paying a lot less to be where they’re at. So if butts in seats pay the bills, then the Mariners are not getting as many of them as they used to, and — the point of my original post — they’re paying a lot more than they need to to get the ones they have.

By: Alaskan

Alaskan — Wed, 10 Oct 2007 03:20:49 +0000

joser (31),
it seems like you’re suggesting a direct correlation between the two (wins and attendance). I think the Mariners managment operates on the belief that wins alone DO NOT put people in the seats / pay the bills. I think if you look at the Mariners last few years of attendance, you find that, while taking a hit, attendance has never been that bad, comparative to other teams.

In reading quotes from Lincoln and Armstrong, I get the strong impression that winning is secondary. That’s not how they draw people. Here’s a good quote from Armstrong:

I just can’t say enough about our great fans. We’ve marketed hard to the women and families demographic.

I have two mantras that I tell our gameday people[...], “I want you to pretend two things: One, I want you to pretend that every fan at Safeco Field is sitting next to a seven-year-old child, and if behavior is not appropriate for a seven-year-old child, you warn them. And if it’s still not appropriate, you ask them to leave. The second mantra is that even though you cannot affect what is going on the playing field, and even though you see the same ticket holders every day, I want you to pretend that this is the only day in that fan’s life that they will come to Safeco Field, and we want them to have a positive experience.”

In order to get the roof–because it was a huge expense–I personally went down to Olympia and lobbied with the legislature and told them that it was our goal that, within five years, we wanted Safeco Field to be the No. 1 tourist attraction in the entire Pacific Northwest. Last year, in 2004, our fifth season, Zagat’s Family Guide ranked Safeco Field as the No. 1 family tourist attraction in the Pacific Northwest–ahead of Mount Rainier, the Space Needle, Snoqualmie Falls–all those things. I think that’s what we market to, and that’s one of the reasons why our attendance has done so well in spite of our poor record on the playing field the last two seasons.

I think that says a lot about the team’s attitude towards winning. I think it also explains a lot about why the Mariners seem to hold on to those “face of the franchise” players for so long: it appeals to those kids and families, the casual fans.

A article in Forbes magazine (4/25/05 article) also had a few choice quotes about Mariners’ money-making:

The Mariners rank third in television ratings–measured as a share of each team’s local market–behind the Red Sox and the Cardinals. Five years ago the team negotiated a ten-year deal with Fox worth $250 million. Only the Yankees, Mets and Braves generate more local media revenue.

and

The team charges an average of $24 per ticket, fifth highest in the league. According to Chicago’s Team Marketing Report, a family of four is going to spend $173 at the ballgame, including parking and food; the league average is $156. Pretty good for the owners, who persuaded King County taxpayers to pick up 63% of the $517 million bill for construction of the six-year-old stadium.

Also helping the bottom line is a sweetheart stadium deal. The team runs the stadium and keeps all revenue from food and beverages, suites and parking. In addition, the Mariners book 150 to 180 nonbaseball events like graduations, parties and proms each year, from which they generate an estimated $5 million to $8 million. The team does not have to begin sharing 10% of its operating profits with the county (as specified in the 1996 lease) until the team’s “cumulative net loss” is eliminated.

The team’s cumulative net loss in 1999, when the agreement began, was $200 million, including $47 million in aggregate losses from 1995 to 1999, plus $153 million in stadium debt. With the cumulative loss currently down to $108 million, it will be years before the team has to fork over any profits to the county. Says Richard Walden, a team lender for J.P. Morgan Chase: “The Mariners have one of the best stadium deals in the history of baseball.”

I think all of this shows that the Mariners don’t need to win to do well. I’m sure they’d like to win, but I don’t think we should assume that it is the top priority of the ownership/management team. Meanwhile, there are teams like the Indians. Teams that probably NEED to win to make money. Poor bastards.

By: joser

joser — Wed, 10 Oct 2007 01:02:43 +0000

So there’s another way to look at those graphs/numbers. From a business perspective, gross revenue is nice but profitability is better. There are a bunch of other factors in this (I don’t know how the ticket prices at the Jake compare to the Safe, nor how concessions or memorabilia sales stack up) but just looking at the raw payroll and attendence numbers, again taking 2001 as the basis for Cleveland and 2003 as the basis for Seattle, we can divide payroll by attendance to talk about how much was spent by the team in payroll for each marginal spectator:
Year CLE SEA
..1..$29..$27
..2..$30..$28
..3..$28..$33
..4..$19..$36
..5..$21..$40

In other words, Cleveland was spending half as much to get a butt in a seat as Seattle was at the same stage of the rebuilding process. And while we’re comparing different years, overall year-over-year salary growth across MLB as a whole has only been in the %6 range since 2003. Even if we compare to the same years, Cleveland has been spending less than $30 in payroll per spectator each of the past couple of years vs $40 for Seattle this year (and $36 last year).

Again, it may be that the person walking through the turnstile at Safeco produces more revenue than the same person at Jacobs Field, but I doubt it’s 33% more. So while the Mariners may feel happy about their attendance numbers, they shouldn’t be feeling very comfortable about the costs they’ve been paying to achieve it. If efficiency and profitability are a measure of success as a business, Cleveland is making them look bad.

By: galaxieboi

galaxieboi — Wed, 10 Oct 2007 00:18:01 +0000

Okay, thanks Grizz.

By: Steve Nelson

Steve Nelson — Wed, 10 Oct 2007 00:15:43 +0000

It was only slightly worse than the 2001 draft (Garciaparra/Rivera — yes, Rene Rivera was a 2nd round pick/Wilson)

I believe that Rivera was taken with the compensation pick from A-Rod signing with Texas.

That’s right. We lost A-Rod and took Rivera as compensation.

By: Grizz

Grizz — Tue, 09 Oct 2007 23:55:55 +0000

I’m pretty sure Baseball America gave the M’s horrible grades for the ‘05 and ‘06 drafts. Didn’t that just come up here in the last few days?

No, I believe those were BA’s retroactive grades for the catastrophe known as the M’s 2002 draft. That was the one where the first three picks were Mayberry (unsigned)/Womack/Martinez-Esteve (unsigned).

It was only slightly worse than the 2001 draft (Garciaparra/Rivera — yes, Rene Rivera was a 2nd round pick/Wilson) and the 2000 draft (no picks in rounds 1 through 3/Hays/Van Dusen/Strong).

And people wonder why the M’s have produced so little homegrown talent the last few years.