SBD/January 9, 2014/Franchises

Browns' Alec Scheiner Stresses Importance Of Gate Revenue As Media Deals Surge

Scheiner before joining the Browns was Cowboys Senior VP & General Counsel
Browns President Alec Scheiner said gate revenue remains "a significant part" of the team's business, because the NFL's "media product is not as good if our in-person product isn't as good," according to Kevin Kleps of CRAIN'S CLEVELAND BUSINESS. Scheiner: "A lot of that stuff is driven by ticket sales -- concessions revenue, in-game merchandise sales. It's only 10 games, but it's still a big part of our business." He added of the NFL's TV deals accounting for the majority of each team's media-rights revenue, "We do put a high importance on those local media rights. We place high importance on corporate partnerships. As long as we continue to take that approach, we think we'll be successful." Scheiner also addressed whether the team's ticket prices will be affected by the team's $120M renovation of FirstEnergy Stadium, saying, "We don't link those two things. We haven't raised our ticket prices in five years, and I believe we were 31st in the NFL in average ticket price this year." Meanwhile, Kleps cited a study by PricewaterhouseCoopers on the North American sports industry as showing that merchandising "will grow at a compound annual rate of 1.3% between 2013 and 2017, compared to 7.7% for media rights, 6.0% for sponsorships and 3.9% for gate revenues." Scheiner said, "That becomes a very local business. That can be focused on which players you have. If you talked to the Washington Redskins last year, their merchandising business was probably off the charts because of RG3. In Dallas, we ran our own merchandising. We opted out of the NFL deal. Marketable players really drive your merchandise sales" (CRAINSCLEVELAND.com, 1/8).
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