Kobe Bryant played his last game on Wednesday evening in the Staples Center, Los Angeles, ending a 20-year career. While fans across the world celebrate his accomplishments and the basketball megastar begins his transition into post retirement, this article ploughs into some financial insights on a celebrated sports career.
Kobe’s Asymmetrical Salary
Kobe earned US$25 million in salary for the past year. This is, in absolute terms, no small sum and certainly sits in the stratospheric tier of athlete salaries. Interestingly, however, he was drawing the highest salary in the NBA (National Basketball Association) despite being a less-than-sprightly 37 years of age. His on-court contributions to the team were highly limited while fellow superstars like LeBron James and Stephen Curry led their teams to victories with stellar performances on a nightly basis – all while earning notably less. This underlines the fact that there is a business behind basketball, and that an athlete’s salary is absolutely not a function of their in-game contributions exclusively, but more crucially correlated to how much revenue they bring in for their employers.
The Final Game & Some Numbers
While Kobe scored an astonishing 60 points in his final game – note that an entire team typically scores 80-100 points a game – he certainly scored for the Los Angeles Lakers organisation as well. According to a report from ESPN.com, the Staples Center sold a mind-boggling $1.2 million worth of merchandise that evening, setting a new world record. With a maximum seating capacity of 19, that equates to $63 per person. This is on top of ticket sales, and is a lot of money for every individual of a sell-out crowd to spend. This figure was undoubtedly propelled by some exorbitantly priced special-edition merchandise; these include $824 snakeskin jerseys and $38,248.08 caps – the latter is no typo and the caps have sold out. Getting to the game in the first place, was no easy (financial) feat. Prime seats cost from $7,000 to upwards of $30,000 for courtside, with the cheapest ticket costing $888. According to CNBC, the average resale ticket for the game was $2,100, more than 500% higher than the Lakers’ average for the year – and that average was already boosted since Kobe announced his retirement earlier in the year. Sporting supremacy and achievements aside, the final game also put an exclamation mark on a salient but sometimes understated point – that Kobe makes his organisation a lot of money.
So… How Much Money?
Fans who watched the game could see that the Lakers organisation spared no expense in producing a hero’s send-off. From the constant stream of tributes and videos throughout the game and the Staples Center being draped in Kobe, to the Goodyear Blimp doing an in-flight tribute and the diamond-studded retirement rings gifted to Kobe and his wife, the unbridled reciprocity shown in the final game was somewhat representative of the (financial) value Kobe has created for Los Angeles and the Lakers organisation. In fact, a basketball star does not just help his team win. The monetary impact can be as direct as boosting ticket sales because of the team’s improvement, to indirectly creating jobs for merchandise producers and sporting staff, etc. To illustrate the financial magnitude of the Kobe effect, the Lakers organisation signed, in 2011, a 20-year, $4 billion cable television agreement with Timer Warner Cable – $200 million a year. One must certainly wonder what Time Warner Cable would have been willing to pay if Kobe was not a Laker (and had not helped build up the Lakers brand). Put another way, would you watch the Lakers play basketball if not for Kobe Bryant? Being based in Los Angeles certainly played a part as well. Being a star of stars in a town full of (Hollywood) stars would undoubtedly drive up entertainment-related demand and revenue in general.
Kobe earned an astronomical $680 million in career earnings and has a net worth of $320 million. This means he has saved approximately 47% of his income throughout his 20 years of playing. Before one immediately wonders where the rest of the $360 million went and how it was spent – it would be prudent for all young earners to do a quick self-assessment on how much of their income they are actually saving.