The NBA has created some of the greatest legacies in American sports history. This includes the magic of the late, great Kobe Bryant, the indomitable character of Michael Jordan and the iconic Chicago Bulls team of the 1990s, and the Magic Johnson and Larry Bird era.
Basketball has long held a formidable place in the broader American sporting culture. However, recent figures over the last decade have identified that this once-great sport could decline.
So, what does this mean from a financial and economic perspective?
Positive Factors in Modern Day NBA
While the number of people watching the NBA in the US may still decline, overseas markets and other popular subsidiary markets are buoying the sport.
Online gambling has become a significant pastime for many Americans, thanks to a perfect cocktail of easy-to-access mobile gambling apps and a range of new legislation that has made the market available to millions.
Gambling on basketball is a sports betting market that continues to flourish, even amid uncertainty about the popularity of the wider sport. NBA odds cover a vast range of league and playoff games, and some analysts believe that the current slump may have been even worse without the rise of these betting markets.
While this might be the case in the US, and sports betting continues to find its feet, posting impressive annual growth figures, the NBA can take some comfort in how popular the organization is becoming abroad.
Some sports analysts believe it reflects the league’s diversity as there are more top international stars in the NBA than ever before. The sport becoming more international rather than American-centric certainly has its positives.
Advertising Revenue – The Domino Effect
The primary consequence of declining viewer numbers is less ad revenue. Some sports and business analysts have pointed out that all sports must deal with an ever-changing digital landscape and that other considerations also play integral roles.
However, the fact remains that advertising revenue is not as dependable or structured as it was 30 years ago; the internet has transformed this entirely, and this has hit traditional platforms hard.
Online streaming has provided a platform that has brought in many international fans who would have had great difficulty staying up to date with the results of basketball games. So many believe it is a net positive, even though the decline in advertising revenue is a cause for concern.
While this hasn’t happened overnight, it can impact the league’s overall budget, leave them negotiating from a weaker position with TV and streaming companies, and ultimately damage the brand.
Further Repercussions
The NBA still has enough presence in American sporting culture not to have to hit the panic button, not yet, anyway. It has approached a crossroads in the US and may have to revamp itself to regain its position alongside the NFL.
If inflows continue to drop, TV and streaming companies will gain the upper hand, offering less money for a weaker product.
When NBA franchises feel the pinch, this will bleed down to the fan and player levels. Salaries may drop, and ticket prices may increase, which will not help the sport regain its position in the elite bracket of popularity next to the ever-popular sporting stalwart of the NFL.
The Importance of a Marquee Name
Over the last decade, Steph Curry and LeBron James have cemented themselves into American basketball legacy. However, even with their unbelievable talent and charisma out on the court, many basketball fans believe they don’t have that true star power or generational legacy that the likes of Allen Iverson, Kobe Bryant, or Michael Jordan possessed.
Often, a sport is only as popular as its true crossover stars; you only need to take a look at the decline of boxing following the Mike Tyson era, which highlights just how crucial it is to have a dynamic, elite talent that can bring in vast numbers of casuals to the sport.
If a name like this entered the NBA, filling up arenas and getting people talking on social media, then the dwindling fortunes and the financial consequences could dissipate just as quickly as they emerged.
Final Thoughts
There’s enough money in the NBA and enough overseas popularity for the sport to consider the way forward.
While it’s certainly not at a crisis point and is unlikely to ever get to that stage, an assessment and action plan must be implemented to ensure that the sport doesn’t fall the pecking order and permanently out of the race as one of the top US sports.
