Phillies Merchandise Sales Reportedly Down 60 Percent, But Does It Matter?
First went the sellout streak. Next, according to Philly.com, has gone the Phillies non-ballpark merchandise sales, down 60 percent in 2012. (Should be noted, such sales MLB-wide are down 25 percent.)
If it holds up through the end of the season, that precipitous a drop would be unprecedented. For any team. Ever.
Both it and the sellout streak ending at 257 games earlier this month indicate waning fan interest in a fading season.
But, big picture, does any of it matter? Probably not.
For one, the likely $31 million losses in team-licensed merchandise sales this year don't significantly affect the team’s bottom line. All such revenues are funneled into the sharing pool for redistribution among the 30 major league teams.
Do the math. The Phils stand to lose about $1.03 million.
Needless to say, that’s probably not going to challenge what management’s said about its willingness to breach the luxury tax threshold. (Even if it pushes the team further into their $11 million operating hole from 2011.)
On the sellout streak: The Phillies still top baseball in average attendance, and are on pace for a fifth-straight year of 40,000-plus fannies in the seats. That swell in interest since 2008 has boosted annual profits $66 million.
Ultimately, this all comes down to what happens in 2015, when the Phillies broadcast deal with Comcast SportsNet Philadelphia expires. Then? On the table include re-upping the existing agreement (which, according to Forbes, could easily triple or quadruple the team’s current $25 million broadcast rights revenue), and, maybe just maybe, a Phillies-owned TV network, a la YES. (All you need to know: Estimates have YES valued between $2-3 billion, more than the value of the Yankees franchise itself.)
The course hasn't exactly been charted for landing a partially-owned TV network. (YES is the only one.) But considering the market trend, the Phils don't have to do much more than maintain status quo for a big regional broadcast deal.
Consider: Among the biggest regional sports network deals are those of the Angels (with Fox Sports Southwest, for $3 billion over 20 years), the Astros (45 percent ownership of the impending CSN Houston, projected to be worth $80 million per) and the Padres ($1.2 billion over 30 years). All were inked in the midst of or right after pretty poor 2011 TV seasons.
The Phillies, meanwhile, have been a solid TV draw for about a decade, pulling a ninth-straight year of local ratings increases in 2011, when they topped MLB with average nightly viewership of 9.7. Yeah. That’s really good.
So too, then, should be the payout, which you figure they'd pump into payroll.
Though given the way the team's spent more and more money (from No. 12 in MLB in 2008 to No. 2 in 2012) yet fallen out of the postseason earlier by the year, you almost have to wonder whether that’s really even the model for success in this sport.