Why Media Market Size Does Not Correlate to Endorsements
by Mac of the MIAC on Jul 2, 2009 7:05 PM CDT
36 comments
Will an athlete who signs with the New York Knicks make more money in endorsements than an athlete who signs with the Oklahoma City Thunder? Does the size of the media market an athlete plays in correlate to the amount of endorsement dollars said athlete brings in? The answer, statistically, is no.
I’ve compiled the top 25 money making professional athletes competing in team sports and correlated their endorsement wages against the size of the media market they play in. The results indicate that there is a slight negative correlation between media market size, and the amount of endorsement dollars an athlete collects.
Click here to read the full data, explanations, and analysis.
(Ed Note: I fixed the link and bumped this to the front page. Please head on over to the JFSC for the entire article...as well as telling us what you think about the findings in the comments.)
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The 50 highest-earning American athletes
Is the slumping economy finally affecting America’s premier athletes? For the sixth consecutive year, Sports Illustrated has compiled a list of the 50 top-earning American athletes in salary, winnings, endorsements and appearance fees. And for the first time, the average earnings of those on the list fell — down $1.5 million per athlete to $23.6 million.
http://sportsillustrated.cnn.com/more/specials/fortunate50/2009/index.html
by miguelsp on Jul 2, 2009 5:16 PM CDT reply actions 0 recs
While not debating the premise
the numbers really show the pickle that Rubio finds himself in. When All Stars such as Amar’e Stoudemire and Tim Duncan are only able to garner a few million in endorsements, it makes you realize how important it was for Rubio to be #2 vs #5. He absolutely needs the salary dollars to match the buyout. He is NOT going to see huge outside endorsement revenue – at least not right out of the shoot.
Going to be really interesting to watch this play out.
by Just A Fan on Jul 2, 2009 8:02 PM CDT reply actions 0 recs
Definitely..
….although I think the Wolves have played it perfectly so far.
The World's Leading Exporter of Small Area Quickness
www.canishoopus.com
by Stop-n-Pop on Jul 2, 2009 9:19 PM CDT up reply actions 0 recs
I have a feeling alot of people are going to get to chuckle over the thought that Rubio wouldn't play in Minny
Just my feeling. (But, I’m also hoping to see the Wolves do well.)
Evil Cowtown Inc: Screwin' Suckaz over since Nineteen Eighty-Five.....
No mistakes in the tango, darling. Not like life. Simple. That's what makes the tango so great. If you make a mistake, and get all tangled up, you just tango on.....
by pookeyguru on Jul 2, 2009 10:04 PM CDT up reply actions 0 recs
So, are you saying
that you think he really DOES have a strong desire to play for the Wolves (or at least, no particular aversion to being on the team)?
Rooting for a Rubio Revolucion since roughly 10:20 a.m. on June 24th, 2009
by PoorDick on Jul 2, 2009 11:40 PM CDT up reply actions 0 recs
Or is he thinking that Rubio is going to be a bust?
Cryptic indeed.
by Auswolf on Jul 2, 2009 11:44 PM CDT up reply actions 0 recs
I only wish
I were fluent in Sactese.
Rooting for a Rubio Revolucion since roughly 10:20 a.m. on June 24th, 2009
by PoorDick on Jul 2, 2009 11:45 PM CDT up reply actions 0 recs
I think I saw a sign...
…that said sactese in a red light district in Thailand.
The World's Leading Exporter of Small Area Quickness
www.canishoopus.com
by Stop-n-Pop on Jul 3, 2009 10:59 AM CDT up reply actions 0 recs
Your wife doesn't visit this site,
does she.
Rooting for a Rubio Revolucion since roughly 10:20 a.m. on June 24th, 2009
by PoorDick on Jul 3, 2009 12:29 PM CDT up reply actions 0 recs
:)
She was in the military too. We’re both big fans of potty humor ;)
The World's Leading Exporter of Small Area Quickness
www.canishoopus.com
by Stop-n-Pop on Jul 3, 2009 1:51 PM CDT up reply actions 0 recs
I so wanted to make the
“Where do you think he met his wife?” joke, but didn’t pull the trigger. A modicum of restraint, for once.
by Eric in Madison on Jul 3, 2009 2:09 PM CDT up reply actions 0 recs
;)
Although it is true that I did meet someone from a 3rd world country…rural Oklahoma.
The World's Leading Exporter of Small Area Quickness
www.canishoopus.com
by Stop-n-Pop on Jul 3, 2009 2:19 PM CDT up reply actions 0 recs
You gotta be quick
The World's Leading Exporter of Small Area Quickness
www.canishoopus.com
by Stop-n-Pop on Jul 3, 2009 2:33 PM CDT up reply actions 0 recs
No
that’s not what I was actually saying. I’m saying the Wolves hold his rights, and that’s their leverage. They will get 4 (if not 5) years out of him if not more. David Kahn will either get very high value for him, or hold onto him until he’s ready to come over.
The Wolves are in a win-win position here. If Rubio doesn’t come over right away, fans will still have that to talk about. If he does come over right away, than they will talk about him anyway.
Talking about Nicola Pekovic is one thing. Talking about Ricky Rubio is quite the other. I think a lot of fans want to see Rubio not come over because of Minnesota. I want to see Rubio in the NBA, and do well with the team that drafted him. (I say that knowing I will be a little bitter if Flynn and Rubio are considerably better than Evans.)
There isn’t anything more to it than that.
Evil Cowtown Inc: Screwin' Suckaz over since Nineteen Eighty-Five.....
No mistakes in the tango, darling. Not like life. Simple. That's what makes the tango so great. If you make a mistake, and get all tangled up, you just tango on.....
by pookeyguru on Jul 5, 2009 3:31 AM CDT up reply actions 0 recs
Tim Duncan gets limited ads because he's boring.
Amare isn’t in a ton of ads- um, I’m not sure why. But Rubio is more telegenic than Amare, and his game is super flashy, and will translate extremely well into little video clips designed to sell shoes, sports drinks, pop drinks, whatev.
But you’re right, Rubio can’t count on making huge endorsement money right out of box (although he’ll definitely get at least a couple of endorsements even a rook).
by princelyfrank on Jul 3, 2009 11:50 AM CDT up reply actions 0 recs
Yes
The numbers do show that many endorsement numbers are small.
As for the study:
It’s a mistake to look at only the top 25 athletes, this are the outliers and outliers are weird. The key would be to look at your semi-stars and see how much endorsement money they make and how this relates to their market size.
We might ask: Would Kent Hrbek have made more endorsement money if he had played for the Yankees? I don’t think this study answers that question.
by littleboxes on Jul 2, 2009 8:17 PM CDT reply actions 0 recs
Good points....
….it would be very interesting to see this done with the top 250. As for Herbie, I can’t answer that with anything approaching objectivity. I grew up playing on what would become Kent Hrbek fields before going to Kennedy. I grew up right next to his house (and not far away from Tony Oliva) and he should have had each and every single one of Don Mattingly’s Gold Gloves. ;)
The World's Leading Exporter of Small Area Quickness
www.canishoopus.com
by Stop-n-Pop on Jul 2, 2009 9:21 PM CDT up reply actions 0 recs
If I remember
Herbie made less ~$50K per year doing all those Lennox ads (and personal appearances). (Or was it Trane? – its was one of the heating/ac companies)
by Just A Fan on Jul 2, 2009 9:42 PM CDT up reply actions 0 recs
I think it does...
Derek Jeter is nowhere near the best player in baseball, yet he leads the MLB in endorsements….why? He plays for the Yankees.
If anything this study supports the notion that market size matters. You need to adjust the endorsements $ relative to the players standing (productivity-wise) in their respective sport.
by DougW on Jul 2, 2009 10:41 PM CDT up reply actions 0 recs
its this simple...
Does LeBron make more in endorsements in Cleveland or LA? Its Cleveland vs. LA, not Lebron the young, ultra athletic, clean stud vs. accused rapist, smug, selfish Kobe…little boxes is correct…these guys are outliers. Never mind the sample size is inadequate.
by DougW on Jul 2, 2009 10:48 PM CDT up reply actions 0 recs
Exactly
my thoughts. Thing the data isn’t all that perfect.
My conclusion from that data would be a lot different:
I’d say that it seems that … if you’re a real superstar with a lot of charisma and are winning or close to winning championships you’re probably right, it doesn’t matter. This shows as the highest earning players are all over the place.
BUT, if you’d go and single out the middle of the earners (especially 5mil to 15mil) it seems that most are in big market teams. Hence … if you AREN’T a super-mega-star it probably does help to be in a big market since the middle of the pack and lower numbers seem to be mostly found in bigger markets. This doesn’t show in the original analysis because the very high numbers of the supersuperstar players (those who are not related to the market size) have a much higher impact than the players with a lot less salary.
So my conclusion would be … it’s not like the all-star team; It’s like with KG that he didn’t get selected in the years Minnesota got worse and then immediately got selected again when he went to winning Celticland … If you’ve got it, you’ve got it and you’ll earn big endorsement deals … BUT if you’re just special but not “the man” .. it might help…
I’d love to see the different correlation numbers for 5-15mil … too bad there’s not more athlethes to work with in that category as the result will probably be pretty undependable.
All that said, gotta applaud the clear working method. I always like me some good statistical analysis and it’s clearly well tought of and logically put together.
Rec.
We got Rubio!
by Wim (Belgium) on Jul 7, 2009 4:58 AM CDT up reply actions 0 recs
Maybe
It’s possible to include not only current athlethes but all athlethes from x amount of years back? It would be a bit screwed by the economy and inflation and all that but It’d sure give us some more people in that 5-15 category I think.
We got Rubio!
by Wim (Belgium) on Jul 7, 2009 5:01 AM CDT up reply actions 0 recs
OJ Mayo (again)
It would be interesting to see what Oj Mayo is getting in endorsements. He would be a good comparable example to Rubio. Young basketball prodigy, hyped up from a young age, playing in a small market, drafted top 5 and (hopefully with Ricky) a ROY candidate.
Additionally Ricky would also appeal to the white and European markets
by WhaHuh on Jul 2, 2009 9:43 PM CDT reply actions 0 recs
Huh -- an old article, pre-college, talking about Mayo's potential marketability
http://www.hoopsvibe.com/nba/nba-draft/kicksvibe/got-mayo-ar45043.html
The population of NBA players itself is so darned small, and in that little discussion one gets a feel for how individual decisions like this on the part of advertisers really are.
I lived in Ann Arbor during the second of the Pistons’ back-to-back Bad Boys championships. Joe Dumars was the most prominent Piston in local ads, easily. Isiah was the bigger star, though.
by feral on Jul 2, 2009 9:49 PM CDT up reply actions 0 recs
I guess the step that is missing in all this
is that Rubio has to actually perform at NBA level to be worth a zack.
by Auswolf on Jul 2, 2009 9:53 PM CDT reply actions 0 recs
yep
he’s done nothing so far.
The World's Leading Exporter of Small Area Quickness
www.canishoopus.com
by Stop-n-Pop on Jul 2, 2009 11:06 PM CDT up reply actions 0 recs
He certainly doesn't need to be an All Star to be worth money in endorsements.
He’s the kind of guy that will get more attention than he “deserves” because of his style of play. And his white, cuteness. All he has to do is continue to be exciting and create highlight-worthy plays.
by princelyfrank on Jul 3, 2009 11:54 AM CDT up reply actions 0 recs
your comment reminded me of Jason Williams. the last supposed “Pistol Pete reincarnation”
by homer simpson on Jul 4, 2009 1:01 PM CDT up reply actions 0 recs
Rubi is way funkier than Williams was.
And the comparisons to Pistol Pete, in Rubio’s case, are somewhat apt. The difference is that Pete was a brilliant shooter and scorer, while shooting is not Rubio’s thing. But both Pete and Rubio were highly hyped basketball prodigies, dominating much older players at a tender age. Plus, they both have the floppy hair.
by princelyfrank on Jul 5, 2009 1:20 AM CDT up reply actions 0 recs
I disagree with the idea
that there is a strong correlation between success on the court/field and endorsement money. Sure, being good at a particular sport is a prerequisite. But “appeal” is much more important in the minds of consumers and advertisers.
Note that many of the biggest earners play sports that allow long, facial close-ups (golf, basketball, baseball—but not many in football). That’s one stroke in Rubio’s favor. The second advantage is his looks, which are at least as important as winning/success (see also Kournikova, Anna, and Wie, Michele). The third is his youth in chronological years, versus his perceived age in basketball years. The fourth is his particular skill in passing and gathering assists. Not only are these traits viewed favorably as “teamwork,” but they are also treasured by mainstream audiences, and offer ESPN a chance to show something other than threes and dunks on the NBA highlight reel.
Rooting for a Rubio Revolucion since roughly 10:20 a.m. on June 24th, 2009
by PoorDick on Jul 3, 2009 12:13 AM CDT reply actions 0 recs
Phil Mickelson made $46M?!?!
Jim Furyk made $10M?!?!
How do you explain that? Is that golf equipment industry THAT lucrative?
by Sulla on Jul 4, 2009 10:24 AM CDT reply actions 0 recs
"Appearance fees"
They show up at an event sponsored by a company, golf a few holes with the company’s best customers, and pocket $50,000 for their trouble.
Rooting for a Rubio Revolucion since roughly 10:20 a.m. on June 24th, 2009
by PoorDick on Jul 4, 2009 1:48 PM CDT up reply actions 0 recs
They're walking advertisments on the course...
Hats, shirts, clubs, shoes, balls, sunglasses. They basically choose their own uniform.
by pagingstanleyroberts on Jul 4, 2009 4:01 PM CDT up reply actions 0 recs
I've always wondered...
….what the markup is on golf equipment. I golf maybe once every other year and I have a set of hand-me-downs but I have seen how much some of these clubs cost when I go to Scheel’s. Somehow, I don’t think a Nike driver costs nearly $400 to make.
The World's Leading Exporter of Small Area Quickness
www.canishoopus.com
by Stop-n-Pop on Jul 4, 2009 5:36 PM CDT up reply actions 0 recs
Mark-ups..
Vary somewhat, but generally range between 300-400%. The reason it is so high is because they have a limited shelf-life. Each model-year is pulled from retail stores as soon as it expires. All of the big names (Nike, PING, TaylorMade, Callaway, etc) are notorious for this practice, as “liquidation sales” and the like would be diluting the brand name. The understanding that 10-15% of stock will be bought back at the end of the model-year is built into the mark-up.
by Boss10 on Jul 5, 2009 11:08 PM CDT up reply actions 0 recs
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