Revenue estimate

[FirstDownB]

Its easy to get ahead of ourselves, but it's been a long time since there's been reason for optimism, so why not..

If, hypothetically, this team were to pull the shocker against Michigan and go on to win 8 games, any estimates on what the total AD revenue would end up for this year? And what would be the dollar value increase over last year? Assume the rest of our home games are sold out and fans start going crazy buying merchandise and joining JPC and contributing in large numbers. Are we talking 10's of millions? And is that a fair approximation of Brohm's worth?

 

[BoilerBulldog]

15k more seats at $60 for 5 more games would be $4.5MM, right? (Someone check my math). So I think $10MM is a bit of a stretch. But not insignificant and would be nice pocket change.

 

[Frankie611]

I believe the gate is split between all the B1G schools. Probably no appreciable increase even if we sell out. Other than The bigger schools muttering under their breath "about time you guys pulled your weight."
The face on my tickets is $22, so not sure where the $60 came from. We arent fetching that price right now. I dont think I paid that much per seat even when i had the good seats in the middle a few years ago.
Buy lots of beer an popcorn while you are there, Purdue keeps concession sales.

 

[Wolegib]

Somebody pointed out 2-3 years ago, that Purdue's part of the BIG 10 network produced 75% of their revenue, and that amount and percentage were both growing. So I would expect that the BIG 10 network and revenue sharing probably now represents 80% of Purdue's athletic revenue.

With a packed house, Purdue definitely brings in more revenue. And a winning football team brings in additional money fro m alumni. and on a related note, they contacted me today after the victory hoping I was in a giving mood.

winning brings money both at the gate and also over the phone.

 

[FirstDownB]

I believe the gate is split between all the B1G schools. Probably no appreciable increase even if we sell out. Other than The bigger schools muttering under their breath "about time you guys pulled your weight."
The face on my tickets is $22, so not sure where the $60 came from. We arent fetching that price right now. I dont think I paid that much per seat even when i had the good seats in the middle a few years ago.
Buy lots of beer an popcorn while you are there, Purdue keeps concession sales.

Yeah I remember seeing a breakdown of total department revenue and didn't think ticket sales were the biggest part, but also didn't know about the split. TV revenue would not be changed as that is shared as well. There are other sources of revenue, donations would probably be the most significant and would be hard to estimate, but I'm up for wild ass guesses.

 

[FirstDownB]

Well, according to this link our ticket revenue (assume mostly driven by football decline) dropped by $7.5M between 2009 and 2016. Also dropped another $7.5M in donations. That's 15 million mf'ing dollars. Wow.

http://sports.usatoday.com/ncaa/finances/

 

[boilerbusdriver]

Gotta have people in the stadium, people eat and drink and eat and drink. Boom, you rake in Boatloads of $$$$$. No other way to put it.

 

[Frankie611]

Well, according to this link our ticket revenue (assume mostly driven by football decline) dropped by $7.5M between 2009 and 2016. Also dropped another $7.5M in donations. That's 15 million mf'ing dollars. Wow.

http://sports.usatoday.com/ncaa/finances/

I actually think this is one thing Burke got right. He predicted that when BTN and other tv services launched, attendance would drop across the all stadiums just out of convenience and cost of physically attending a game. He was right. It was pretty common knowledge that places like Nebraska and Michigan would hit up wealthy donors and businesses to buy up the last few remaining tickets so they could announce a season long sellout. I don't think these places even try to do that anymore. The big games still sell out but it is hard to sell 110000 tickets at $40+ to watch your team pound some directional school when you could watch it at home with instant replay.

 

[BoilerBulldog]

I believe the gate is split between all the B1G schools. Probably no appreciable increase even if we sell out. Other than The bigger schools muttering under their breath "about time you guys pulled your weight."
The face on my tickets is $22, so not sure where the $60 came from. We arent fetching that price right now. I dont think I paid that much per seat even when i had the good seats in the middle a few years ago.
Buy lots of beer an popcorn while you are there, Purdue keeps concession sales.

Good point on revenue splitting. I know that's the case but am not 100% sure how what works. I don't believe it is pooled together and split 14 ways. I believe each game is split 50/50 by the two teams.

I should have been clearer on $60. I assumed that was a conservative ticket, parking, concession number.

But I think the broader point remains. Tickets play only a small component of our total revenue. I remember debates here last year when the revenue rankings came out and people couldn't believe we weren't more competitive with MSU who had around $34MM more revenue than us. The point then as well as now is that it would take a lot more than a full Ross-Ade stadium to come even close to filling that gap.

On a positive side, I've bought two new Purdue shirts this season so I'm trying to help.

On the negative side, I traveled to Missouri this weekend but purchased my tickets from Stub Hub versus from our allotment to get better seats. I assume Purdue got 100% of the allotment sales. The irony is my "better" seats in the Mizzou section (right behind the student section) were completely in the sun and we moved to the Purdue section after halftime because they had shade.

 

[BoilerBulldog]

I actually think this is one thing Burke got right. He predicted that when BTN and other tv services launched, attendance would drop across the all stadiums just out of convenience and cost of physically attending a game. He was right. It was pretty common knowledge that places like Nebraska and Michigan would hit up wealthy donors and businesses to buy up the last few remaining tickets so they could announce a season long sellout. I don't think these places even try to do that anymore. The big games still sell out but it is hard to sell 110000 tickets at $40+ to watch your team pound some directional school when you could watch it at home with instant replay.

I believe Nebraska's sellout streak is still intact but you have to wonder for how long losing to schools like Northern Illinois at home has to hurt.

 

[Frankie611]

Good point on revenue splitting. I know that's the case but am not 100% sure how what works. I don't believe it is pooled together and split 14 ways. I believe each game is split 50/50 by the two teams.

I should have been clearer on $60. I assumed that was a conservative ticket, parking, concession number.

But I think the broader point remains. Tickets play only a small component of our total revenue. I remember debates here last year when the revenue rankings came out and people couldn't believe we weren't more competitive with MSU who had around $34MM more revenue than us. The point then as well as now is that it would take a lot more than a full Ross-Ade stadium to come even close to filling that gap.

On a positive side, I've bought two new Purdue shirts this season so I'm trying to help.

On the negative side, I traveled to Missouri this weekend but purchased my tickets from Stub Hub versus from our allotment to get better seats. I assume Purdue got 100% of the allotment sales. The irony is my "better" seats in the Mizzou section (right behind the student section) were completely in the sun and we moved to the Purdue section after halftime because they had shade.

Now that they have beer, $60 Is about right! I applaud you for making that Mizzou trip. That is the one thing I have found os a downside to being a fball/bball season ticket holder. I dont do any road games because I spend enough time/money at the home games. I will go to a bowl if they make it though.

 

[stout1]

Good point on revenue splitting. I know that's the case but am not 100% sure how what works. I don't believe it is pooled together and split 14 ways. I believe each game is split 50/50 by the two teams.

50/50 splits went away in the early 90's.

This is a bit dated as it is from an article in 2012, but continues in the same form today:

"But the Big Ten also splits its football gate receipts from league games, a step devoid of other conferences. Thirty-five percent of Big Ten home gate receipts — with a $1 million cap and a $300,000 floor — goes to the league office. From there it’s distributed into 12 equal pieces."

Also, this is based on face value of tickets only. It does not include actual suite or club seat cost or the seat license amount.

 

[TC4THREE]

I also believe that premium seating is excluded from the revenue share.

 

[BoilerStutz]

50/50 splits went away in the early 90's.

This is a bit dated as it is from an article in 2012, but continues in the same form today:

"But the Big Ten also splits its football gate receipts from league games, a step devoid of other conferences. Thirty-five percent of Big Ten home gate receipts — with a $1 million cap and a $300,000 floor — goes to the league office. From there it’s distributed into 12 equal pieces."

Also, this is based on face value of tickets only. It does not include actual suite or club seat cost or the seat license amount.

Yep, this is the incentive behind seating licenses, etc. I talked with a former Big Ten AD a couple of years ago, and he indicated that things are so competitive that all sources of revenue matter. Do not underestimate the importance of ticket revenue.

 

[pboiler18]

This is a decent discussion, so I will weigh in.

Somebody above was right...that through the Hope and Hazell years the average worked out to be about $7.5M in missed gate revenue per year over the 8 years. That's $60M we missed out on. That's the new football faculty AND THEN SOME totally paid for. We could be deep into stadium renos had we have collected that gate, invested earlier and been able to move into deeper phase projects much sooner.

Burke pinching pennies and not striving to expand revenue...only striving to meet budget is what killed us. That fact is well discussed and while I appreciate that he wasn't trying to suck us into crushing debt, it was clear that you had to spend money and take risks to move the department forward. Not only was he unwilling to do that, so we're his bosses at the time and they were never going to attempt to convince them otherwise.

I have a good friend who is in college athletics admin and they used to parade Burke around 5-6 years ago as the model example of how to run an athletic program with a balanced budget. That shine has since worn off and it's really become a textbook case of how NOT to grow your programs and department as a whole.

 

[arcb102000]

I have been told that the licensing fees for t-shirts, hats, etc. are approximately 6% of the selling price of the item. More wins = more sales. The revenue gains would be quite significant if the Boilers were to become a nationally recognized team. Plus, donors give more to winners.

 

[TC4THREE]

This is a decent discussion, so I will weigh in.

Somebody above was right...that through the Hope and Hazell years the average worked out to be about $7.5M in missed gate revenue per year over the 8 years. That's $60M we missed out on. That's the new football faculty AND THEN SOME totally paid for. We could be deep into stadium renos had we have collected that gate, invested earlier and been able to move into deeper phase projects much sooner.

Burke pinching pennies and not striving to expand revenue...only striving to meet budget is what killed us. That fact is well discussed and while I appreciate that he wasn't trying to suck us into crushing debt, it was clear that you had to spend money and take risks to move the department forward. Not only was he unwilling to do that, so we're his bosses at the time and they were never going to attempt to convince them otherwise.

I have a good friend who is in college athletics admin and they used to parade Burke around 5-6 years ago as the model example of how to run an athletic program with a balanced budget. That shine has since worn off and it's really become a textbook case of how NOT to grow your programs and department as a whole.

Just like anyone else in athletics, if you win then you're a star. When you start to lose, it's a problem.

Let's not forget that Burke hiring Hazell WAS a step up in commitment. Hazell got all kinds of things that Hope never did. Hazell was just a brutally bad choice as were most of his top assistants.

 

[JohnnyDoeBoiler]

Gotta have people in the stadium, people eat and drink and eat and drink. Boom, you rake in Boatloads of $$$$$. No other way to put it.

Hence allowing beer sales in the stadium. That alone will generate a potential of $500k or more this season. I'm not sure of the price but I do believe they sold out during the first home game.

 

[BoilerBulldog]

50/50 splits went away in the early 90's.

This is a bit dated as it is from an article in 2012, but continues in the same form today:

"But the Big Ten also splits its football gate receipts from league games, a step devoid of other conferences. Thirty-five percent of Big Ten home gate receipts — with a $1 million cap and a $300,000 floor — goes to the league office. From there it’s distributed into 12 equal pieces."

Also, this is based on face value of tickets only. It does not include actual suite or club seat cost or the seat license amount.

Thanks for this detail. I was foggy on the specifics.

 

[FirstDownB]

Good discussion, but how about some estimates?
Returning to 2009 gate+donation revenues seems like the absolute floor. That would be a $15M increase. A $20M increase isn't too hard to imagine. That's all due to coaching upgrade. It is easy to envision keeping the staff happy for something much less than $20M with revenue to spare for facilities or whatever. Takeaway is hopefully we now have leadership that doesn't gasp at the thought of arms races and paying a ball coach $5M and assistants seven figures if it is a sound investment as PROVEN by recent history.

 

[stout1]

I also believe that premium seating is excluded from the revenue share.

Partially. The face value of the ticket is included but not the whole cost.

For example, I have a couple tickets to a suite at the Colts game in a few of weeks. The face value on my ticket is like $200, but if you add up all the tickets in the suite that is only $4,000/game or $32,000/year. The suites at Lucas start at $14,000/game.