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The Billion Dollar Impact of Giannis Antetokounmpo
Milwaukee Bucks star Giannis Antetokounmpo signed a five-year, $228 million extension yesterday, but is that a bargain for the city and franchise?
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Friends,
Giannis Antetokounmpo, the NBA’s reigning two-time MVP and Milwaukee Bucks star, signed a five-year, $228 million extension yesterday — officially the richest contract in NBA history.
For a quick visual, here’s how Giannis’ salary will change when the extension kicks in next year:
2020-21: $27.5M
2021-22: $39.3M
2022-23: $42.5M
2023-24: $45.6M
2024-25: $48.8M
2025-26: $51.9M
The best part?
At the age of 26, he’s just getting started.
This is what “The Greek Freak” had to say via Twitter:
“This is my home, this is my city.
I’m blessed to be able to be a part of the Milwaukee Bucks for the next 5 years. Let’s make these years count. The show goes on, let’s get it.”
Given it’s the largest contract in NBA history, I think most people realize it’s a great deal for Giannis—championships aside—but what does locking up one of the top NBA players for 5 more years mean to Milwaukee financially?
Let’s take a look…
First, let’s start with the obvious.
Giannis has become an incredible player, but as the 15th overall pick in the 2013 NBA Draft, it was hardly a given.
Here are a few players that were selected before him:
Anthony Bennett (1st overall)
Cody Zeller (5th overall)
Nerlens Noel (6th overall)
Trey Burke (9th overall)
Michael Carter-Williams (11th overall)
Shabazz Muhammad (14th overall)
Most NBA executives say they saw an underdeveloped but talented player in Giannis, but let’s be honest, if they knew he’d be this good, they would have picked him 1st overall.
Point being, the Milwaukee Bucks not only had the courage to pick him when others didn’t, but the patience to let him grow into the player he is today — now they’re being rewarded.
When it comes to Giannis’ impact on local economic activity in Milwaukee, I think we can all agree on one thing — Giannis is a key piece to the Bucks winning games.
Given that, think about this:
Estimates suggest that a single playoff game in Milwaukee, with fans in the stands as normal, generates $3 million in economic impact to the downtown area — in addition to approximately 2,500 hotel room nights and 700 jobs.
The interesting part?
Since Giannis was drafted in 2013, the Bucks have made the playoffs five out of seven years — compared to the seven years prior where they made it just twice.
Outside of a pure increase in local economic activity, which is almost impossible to measure accurately based on the impact of one singular person, there are more tangible things to look at like attendance & merchandise.
From an attendance perspective, the Milwaukee Bucks have seen a nice increase since Giannis joined the team in 2013.
2013: 13,487 average fans per home game
2019: 17,602 average fans per home game
Some will point to the Fiserv Forum—a new $550 million arena the Bucks opened in 2018—but the capacity for basketball is actually smaller than their older arena.
Still don’t believe me?
Get this…
In 2019, the Milwaukee Bucks had 36 sellout games—their most all-time—while TV ratings were up 32% in the regular season.
Without Giannis, that doesn’t happen.
Aside from attendance, the increasing popularity of Giannis has made him one of the most lucrative players in the NBA from a merchandising standpoint.
Here’s an example…
In 2019, not a single NBA player outside of LeBron James sold more jerseys than Giannis Antetokounmpo — including popular players like Stephen Curry, James Harden, and Kevin Durant.
Furthermore, check out the impact Giannis had on overall team merchandise sales.
Top 10 NBA Merchandise Sales 2019
Los Angeles Lakers
Boston Celtics
Philadelphia 76ers
Toronto Raptors
Milwaukee Bucks
Golden State Warriors
Houston Rockets
Chicago Bulls
Miami Heat
Brooklyn Nets
For a small market team like Milwaukee to sell more merchandise than the Golden State Warriors, Houston Rockets, Chicago Bulls, and even the New York Knicks, that’s extremely impressive.
Ultimately, the combination of Giannis’ ability to increase local economic activity, fill the seats at their brand new $550 million arena, and consistently sell merchandise, has had a direct financial impact on the Milwaukee Bucks.
Here’s a look at how Milwaukee’s revenue has accelerated since 2013:
New league-wide media deals have obviously helped, but considering the Milwaukee Bucks consistently stayed between ~$70M and ~$90M in revenue throughout the prior decade, the impact of Giannis Antetokounmpo is undeniable.
Even more interesting?
The franchise valuation has exploded.
Again, the entire NBA has done well financially under the leadership of Adam Silver — but in case you think that’s normal, consider this.
The average NBA franchise has appreciated about 300% since Giannis Antetokounmpo entered the league in 2013, while the Milwaukee Bucks have seen a ~400% increase.
As I said before, the financial impact of Giannis is undeniable.
Have a great day and we’ll talk tomorrow.
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