Superstar Effect Research Paper
The Superstar Effect Professional athletes are some of the most recognizable figures in the entire world. Generally, fans of a sport or of a team have a favorite player and often times pursue opportunities to see that athlete compete live. The more fans admire an individual player, the greater the demand for that player is. The higher the demand for a product, the higher the price for that product is. The organizations that these athletes play for recognize this and take advantage of the opportunity to maximize profits. When professional sport leagues identify the marketable players that fans love like LeBron James, Michael Jordan, and others, they use the athlete’s names as a way to promote their product. These leagues, owners, and
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However, according to studies from Hausman and Leonard (1997), Berri, Schmidt, and Brook (2004), Taylor (2008), and Berri and Schmidt (2006), these athletes also generate substantial additional revenues for their opponents in away games as well. Berri, Schmidt, and Brook (2004) claim that the true power a superstar carries lies in his ability to enhance attendance, and therefore revenues, on the road. We have already identified that Michael Jordan increased his own team’s revenue, but did he enhance the revenues of his opponents as well? From 1989-1998, every road game that Jordan played in, excluding only a single contest, was sold out (Hausman & Leonard 1997). Some of the struggling teams at the time experienced an increase of fan attendance by upwards of 50% when playing the Bulls (Hausman & Leonard 1997). Jordan’s influence on fan attendance increased revenue at the gate by over $2.5 million for other teams during the 1991-92 season (Hausman & Leonard 1997). And perhaps the most astounding figure is that when all factors are taken into account including TV deals, NBA properties, and gate revenue is that during the 1991-1992 season, Jordan’s estimated value to other NBA teams was $53.2 million (Hausman & Leonard 1997). Jordan exemplified what it meant to be a superstar and possess to ‘star power’ and generated millions of additional dollars in
However, according to studies from Hausman and Leonard (1997), Berri, Schmidt, and Brook (2004), Taylor (2008), and Berri and Schmidt (2006), these athletes also generate substantial additional revenues for their opponents in away games as well. Berri, Schmidt, and Brook (2004) claim that the true power a superstar carries lies in his ability to enhance attendance, and therefore revenues, on the road. We have already identified that Michael Jordan increased his own team’s revenue, but did he enhance the revenues of his opponents as well? From 1989-1998, every road game that Jordan played in, excluding only a single contest, was sold out (Hausman & Leonard 1997). Some of the struggling teams at the time experienced an increase of fan attendance by upwards of 50% when playing the Bulls (Hausman & Leonard 1997). Jordan’s influence on fan attendance increased revenue at the gate by over $2.5 million for other teams during the 1991-92 season (Hausman & Leonard 1997). And perhaps the most astounding figure is that when all factors are taken into account including TV deals, NBA properties, and gate revenue is that during the 1991-1992 season, Jordan’s estimated value to other NBA teams was $53.2 million (Hausman & Leonard 1997). Jordan exemplified what it meant to be a superstar and possess to ‘star power’ and generated millions of additional dollars in