Although the Chicago Cubs continue to have trouble winning on the diamond, the team can still put fans in the seats. In 2014 thus far, it's 12th in baseball in attendance by capacity, and it finished ninth last year. Part of the reason for its fandom is the Cubs' marketing machine, which remains as strong as ever. So with Wrigley Field turning 100 years old this season, is it any surprise the team is taking advantage?
100 years of Wrigley Field
I attended a game at Wrigley Field this week, and it's clear the stadium has reverence for what came before.
In addition to a collection of historical murals, the team isn't shy about promoting Wrigley's 100th birthday.
It's on every piece of marketing imaginable, from T-Shirts to souvenir cups.
Of course, the team didn't transform Wrigley for fun. It's part of a much broader marketing campaign that includes a website, WrigleyField100.com, merch, and historical food. The park's "Decade Diner," for example, will sell meals based on popular trends in each decade since 1914. And depending on the time of the year, certain hot dog venders will offer "Decade Dogs," such as the "1910's Rueben Dog," the "1930's Cheese Steak Dog," and the "1970's Pulled Pork Dog." Decade-themed drinks are also available.
Will it draw fans to games?
Still, it's too early to tell how these efforts will affect ticket sales. Fansided reports prices are down a little over 5% from 2013, while Team Marketing Report calculates a 0.9% decline. According to the latter, though, a seat at Wrigley Field still costs more than 27 other MLB teams. At an average of $44.16, the Cubs are behind only the Boston Red Sox and the New York Yankees in terms of price.
Among the eight teams above the $30 mark, only the Cubs have experienced four consecutive losing seasons. But ticket sales continue to be in high demand. Tobias Moskowitz and L. Jon Wertheim teamed up to study this phenomenon in their book, Scorecasting, and their findings are nothing short of fascinating. They write (emphasis mine):
Calculating the response of home game attendance to season performance for every MLB team over the past century, we get a measure of how sensitive fans are to team success.... How do the Cubs stack up? It turns out that their attendance is the least sensitive to performance in all of baseball.... If the Dallas Cowboys are America's Team, the Cubs are America's Teflon team.
In other words, the Cubs could stink on the field -- literally or figuratively -- and still draw fans. Moskowitz and Wertheim don't fully explore why this relationship exists, but hint that it may be because "the Cubs play in a picturesque, idyllic old ballpark ... in the gentrified North Side of Chicago." That's not the whole story, they say, though, as the Giants, Orioles, and Red Sox play in similar areas, but have more delicate attendance. My guess? The Cubs might simply have the best -- or most delusional -- fans in baseball.
Regardless of the answer, at least this explains why the team is putting so much marketing power behind Wrigley's 100th birthday. The Cubs may not have an MVP on the field, but they arguably have the most revered park in the MLB. Why not celebrate it?
How do the rest of the Cubs' finances stack up?
According to Forbes, ticket sales only accounted for $117 million of the team's $266 million in revenue last year. TV also makes up a huge piece of the puzzle. It's thought the team makes about $60 million per season from broadcast rights fees.
After its deal with Comcast SportsNet Chicago ends in 2019, Forbes reports Scott Milleisen, a sports banker with JPMorgan Chase, "believes the Cubs are in line for a television rights fee package worth an average of around $200 million a year." The Philadelphia Phillies' new deal pays them a figure near this estimate.
The Cubs also rank well among the rest of Forbes estimates:
|Chicago Cubs Ranks, Forbes 2014 Estimates|
|Operating Income||$27 million||8th|
The bottom line
The team has a clean bill of financial health, and a potentially massive TV deal down the road. While you could argue the Cubs should spend more on players, recent research suggests on-field performance might not matter as much in Wrigleyville as it does in other MLB cities.
And at the end of the day, fans should continue to pay a boatload for seats at Wrigley Field because the ballpark is the Cubs' best attribute. With this season's new "100-Year" marketing campaign, that's even harder to miss.
Jake Mann has no position in any stocks mentioned. The Motley Fool recommends PepsiCo. The Motley Fool owns shares of PepsiCo. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.