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Sunday, May 6, 2018

KU football ticket sales down about $6 million per year; some question whether $300 million in new facilities will help

The University of Kansas' Memorial Stadium is pictured on Monday, Aug. 7, 2017.

The University of Kansas' Memorial Stadium is pictured on Monday, Aug. 7, 2017.

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Part of Kansas football and its falling fortunes involves a math problem. The key number in the equation is about $6 million.

A Journal-World review of Kansas Athletics Inc. finances found that KU needs to sell about $6 million in additional tickets per year just to get the program back to the brief glory days it had nearly a decade ago in the Mark Mangino era.

KU football ticket sales hit a recent peak of $9.5 million in 2009. In 2017, football ticket sales hit a new recent low of $3.4 million, according to NCAA reports filed by the university.

What to do? There is always the approach of hoping that Coach David Beaty’s system clicks in his fourth season, the wins come and so do fans in seats. KU athletic officials are banking on that strategy. There is certainly a segment of fans, though, who are not buying it.

What else to do? You could recruit The Six Million Dollar Man and redeem him for cash value. No? Well, then, you could undertake about $300 million in football stadium improvements — most of them fan amenities — in an attempt to lure people back into the stands. Maybe. KU officials have started the fundraising campaign.

About this series

When KU announced in September plans to build $350 million in new facilities, primarily for football, it marked the beginning of one of the biggest financial bets the program has ever made. The Journal-World decided to study the financial books, talk to leaders, and give readers a better understanding of the money game that is constantly a part of big-time college athletics. To see more articles go to: ljworld.com/kuath

To some, The Six Million Dollar Man strategy sounds more plausible.

Murray Sperber, a longtime critic of college athletic spending, doesn’t think a fancier stadium is going to draw more fans. He does think it is a heck of a financial risk.

Sperber — who became one of the first critics of college athletic spending with his 1990 book "College Sports Inc." — is now a professor emeritus at the University of California-Berkeley. That school has become the poster child of the dangers of such big bets. It renovated its Memorial Stadium — granted, costs were extremely high because the stadium is on a fault line — but now the Cal athletic department is swimming in red ink, despite football crowds that still top 40,000.

“They admit they lost $14 million last year,” Sperber said of the Cal athletic department. “But that is the low number. Really, it is probably $20 million to $25 million.”

The situation has become so dire at Cal that the university recently agreed to take over about $400 million in athletic department debt. The prospect of cutting some of Cal’s 30 sports programs, however, still remains.

The situations at Cal and KU aren’t entirely analogous. Even if KU debt-financed all of the $300 million in stadium improvements — which it won’t — KU’s debt totals still would be below Cal’s. But Cal also is a much larger university in terms of students and alumni base. While KU’s dollar figures may be less than Cal’s, the risks to KU are still great. Sperber urges KU officials to really think through making such a big bet.

“Nothing we have talked about points to $350 million in improvements,” Sperber said, citing the full fundraising goal that also involves improvements for volleyball and other sports.

KU Athletic Director Sheahon Zenger counters that he’s been thinking about it since his first day on the job. To people in the college athletic industry, it is clear that KU has a big bill looming.

“This day has been coming for decades, and we have kicked the can down the road as a collective group over the years,” Zenger told the Journal-World. “We had a beautiful stadium. It is still a beautiful stadium and setting, but it is getting older and we have to address it. There is no scenario where you can choose to not address it. I don’t think that is a feasible option.”

West Virginia linebacker Al-Rasheed Benton (3) runs back an interception late in the fourth quarter against Kansas to set up a WVU touchdown for a final of 56-34 on Saturday, Sept. 23, 2017 at Memorial Stadium.

West Virginia linebacker Al-Rasheed Benton (3) runs back an interception late in the fourth quarter against Kansas to set up a WVU touchdown for a final of 56-34 on Saturday, Sept. 23, 2017 at Memorial Stadium. by Nick Krug

The Numbers

KU, though, finds itself in a situation where its bill is coming due at a time that fan interest in the football program is hitting new lows.

The Journal-World recently asked the athletic department to provide numbers showing how many tickets actually have been purchased for KU football each year over the last 10 years. KU officials, though, said those numbers were not readily available.

However, the school is required to report its total dollar value of football ticket sales to the NCAA each year. As expected, those numbers show ticket sales spiked in the aftermath of KU’s dramatic 2007 season that culminated with a 2008 Orange Bowl victory. It also shows that KU fans were still spending big in the seasons right after Mangino — the Orange Bowl-winning coach — was ousted. But gradually, the patience of KU fans has eroded, and the bottom has fallen out of ticket sales the last three years.

Here’s a look at the numbers:

— 2006: $6.47 million

— 2007: $5.88 million

— 2008: $6.81 million

— 2009: $9.50 million

— 2010: $9.28 million

— 2011: $9.25 million

— 2012: $6.56 million

— 2013: $5.51 million

— 2014: $5.24 million

— 2015: $3.99 million

— 2016: $4.09 million

— 2017: $3.41 million

From their peak in 2009, KU football ticket sales are down by $6.09 million or almost 65 percent.

A Kansas fan looks through the game program from the top of the stands during the fourth quarter of KU's football game against Texas Tech, Saturday, Oct. 7, 2017 at Memorial Stadium. The Jayhawks lost, 65-19.

A Kansas fan looks through the game program from the top of the stands during the fourth quarter of KU's football game against Texas Tech, Saturday, Oct. 7, 2017 at Memorial Stadium. The Jayhawks lost, 65-19. by Nick Krug

The $6 million figure, though, is just one to consider. A larger number is to look at how much revenue has been lost cumulatively. If KU had been able to sustain fan enthusiasm near 2009 levels — say, $9 million a year in ticket sales — KU Athletics would be ahead by about $25 million. That is the difference between $9 million a year in football ticket sales versus what KU actually sold in tickets, according to NCAA reports.

Basketball picks up slack

A 65 percent decline in football ticket sales would create a financial crisis for many athletic departments. KU's athletic department, though, has been successful in getting more money out of KU basketball fans. In 2006, KU was generating about $474 in ticket revenue per seat at 16,300-seat Allen Fieldhouse. That amount doesn't include any required contributions in order to have the opportunity to buy tickets. By 2017, the per seat revenue had grown to $926. Here's a look at the total dollar value of basketball tickets sold over the years:

— 2006: $7.72 million

— 2007: $9.47 million

— 2008: $10.85 million

— 2009: $10.91 million

— 2010: $11.79 million

— 2011: $11.34 million

— 2012: $11.93 million

— 2013: $12.86 million

— 2014: $14.52 million

— 2015: $15.63 million

— 2016: $14.91 million

— 2017: $15.10 million

NCAA numbers also show that KU’s three worst financial years of the last decade have coincided with the downturn in football ticket sales. The worst year was 2012, when expenses exceeded revenues by $8.7 million, largely due to a contract buyout for fired head coach Turner Gill. The second worst year was in 2015, when expenses exceeded revenues by about $347,000. The third worst year was 2017, when the NCAA report showed revenues exceeded expenses by about $540,000. As reported in last week’s article, KU’s audited financial statements — which are different from the NCAA report — showed a worse performance for 2017.

Zenger is mindful of the financial numbers, but they give him no pause in pushing ahead on the $300 million in football improvements. He knows KU’s fan base expects to compete in the top tier of college football, and, in some ways, these pending improvements are just a price of admission.

“Do you think Kansas ought to compete at the Division 1 level?” Zenger says, relaying past conversations he has heard. “The answer is always yes. If so, do you think we should compete in a Power 5 conference? The answer is yes. Then it is kind of a moot point.”

Others, though, wonder whether Kansas ought to rethink what the price of admission ought to be. David Ridpath is an associate professor of sports business at Ohio University and is board president of the Drake Group, an organization that advocates for more financial responsibility in college athletics.

He argues that Kansas ought to think about how much it needs to spend to remain a big-time player in college athletics. As long as it maintains its men’s basketball tradition, Ridpath contends, KU doesn’t have to spend as much as many other schools. Kansas can be a decent football program without a $300 million investment, and there are certainly no guarantees that KU will be a good one even with such an investment.

But being decent doesn’t do much to stir the passions of the alumni or donors. It would take a change in mindset, but perhaps not a radical one. The label “basketball school” has long been attached to KU.

“I think Kansas, because of who they are in basketball, is always going to be in a big conference,” Ridpath said. “They just may never be that good in football. But, then, they have to ask themselves how much do we want to spend trying to be good in football? It is going to be very tough.”

Comments

Brian Skelly 4 months, 2 weeks ago

By not doing the renovations when we were swimming in football money after the Orange Bowl was a huge mistake.   Or at least pushing for them.    Im all for some renovations,  but it's entirely unrealistic to think with the place our football program is at that this makes sense to the level they are talking about.

Simply getting a better football coach -- and I'd argue new AD -- would work wonders.

Michael Leiker 4 months, 2 weeks ago

Your second to last paragraph misses the mark. KU fans are willing to pay for competitiveness. Maybe not to the tune of 9.5 mil a year, but easily to the tune of 6.5-7. Look at the 2006 figure. I’d love to see the 2004 and 2005 numbers. This is where KU always seems to miss it. With football they’re always looking to walk before they crawl, run before they walk. Whether it’s the type of offense that’s adopted, plans to renovate the stadium or how they market for the upcoming season, they’re trying to score 60 points a game before they’re capable of doing the things necessary fundamentally to score 25 a game, they’re going to tell all of us that “this is the year” year after year without any sign of progress to justify it.

The magic bullet mentality is so grossly pervasive in the football program and athletic department in their actions regarding the football program that it has contributed to the complete lack of resiliency in the football team for the last 8 years. Coaching staffs change philosophies game to game, half to half. Players heads go down as soon as the first score goes on the board for the opponent because it doesn't jive with their expectation of reality for how hard it is gong to be to be competitive. Coaches have to demand manufactured excitement on the sidelines.

The renovation is another and the largest example of the thinking that there is some singular idea out there that can bring back the glory days. It screams "we're willing to do whatever it takes to kickstart this thing back to 2007." But the fans who watch the program closely and have for years can see every time they watch Beaty give a press conference (and Weis and Gill before him for that matter) that although he's a great guy (who we all wholeheartedly would love to see succeed) and very hard working man is just not capable of requiring what is necessary of his players to get the team playing and competing like they were in 2004, 2005, 2006, even 2003, much less 2007.

KU needs to be proud of Memorial. It's coaches need to recruit the kind of players that are attracted to it's simplicity and not the kind of guys that want to wear a different flashy helmet every game, which is exactly what the new renovations as designed are, another big flashy uniform change with -0- substance. We continue to just be so far off the mark.

Len Shaffer 4 months, 2 weeks ago

You absolutely nailed it, Michael. Very well said.

Joe Ross 4 months, 2 weeks ago

This is called looking a gift horse in the mouth. Nicely done, Chad.

The revenue from ticket sales is rooted in performance.

The price tag for the stadium supports performance and will help ticket sales indirectly (facilities/stadium will help with recruiting and perception, recruits can help the team perform). The only thing I see wrong with the whole thing is what is produced for 300+ million dollars seems underwhelming (artist renditions), which argues for the total amount being spent and not less.

Len Shaffer 4 months, 2 weeks ago

The other problem, Joe, is that all the spending in the world on facilities isn't going to make much (if any) of a difference as long as this coach and this athletic director (and perhaps this chancellor as well) are in charge.

Joe Ross 4 months, 2 weeks ago

I don't disagree!

Take regime change out of politics and apply it to Kansas Athletics. Except for Bill Self, of course. Damn near the ONLY guy doing his job.

Brad Farha 4 months, 2 weeks ago

I'd include Coaches Bechard, Francis and Redwine to those that are doing their job. I'm sure I'm missing some, but they have been putting out good and great teams.

Brett McCabe 4 months, 2 weeks ago

They might want to rename the new stadium Zenger's Folly with a performance of No No Nanette during half-time on opening day.

I consider it the greatest slight-of-hand trick in college athletics, "look over here, don't look over there". Or in a great Kansas tradition, "pay no attention to the man behind the curtain".

What's stunning to me is that if you take what is approximately a three-quarter-mile walk due South, you will find a building that isn't modern, that's been gently upgraded through the years, features mostly bleacher seating, no luxury boxes, bad food, too few students and is generally referred to as a barn by most of the visiting players. And yet.........

Larry Knzas 4 months, 2 weeks ago

Chad, this is a thought provoking article. Thank you.

Causes someone to stop and consider the economics of Power 5 sports and value they bring to Universities. Specifically as to the value of football to the University of Kansas.

Is there a possiblity that you could compose a similar article regarding the value of a Sports Page to a local newspaper? To go back and review circulation over the last 12 to 14 years of the LJW and the percentage of print advertisement by type of advertiser, by secition? Align that to the Editors and Writers at the time of print revenue, of course not to confused with online revenue or changes in writers that have come and gone, but instead by total revenue paid to the LWJ ownership.

I have a feeling that writers can take numbers and turn them into just about any story they desire to tell.

Brett McCabe 4 months, 2 weeks ago

It's always interesting when people who are too afraid to post under their own names try and question the integrity and ethics of trained and experienced professionals. You see the numbers, how about a specific argument instead of a vague accusation?

Larry Knzas 4 months, 2 weeks ago

What are you talking about? I read your posts all the time. You spend more time on this site than anyone. My point is that if you fire the entire athletic department and bring in a new one, then you need something to attract a decent AD, you need something to attract a new FC. I have never read a direct statement from Zenger or Beaty that said, “we lost this game because our facilities are bad.” So to connect a facility improvement project to, “whether it will help” as the headline states is way off base. Help what? Win games? Bring in greater revenue? Are you kidding me?

Joe Ross 4 months, 2 weeks ago

You may have never read "we lost this game because our facilities are bad", but the commitment to facilities including a stadium as well as thoughts about what kind of environment they'd play in plays in the minds of recruits. You need to be able to connect the dots between attracting recruits and performance. Once you can do that, the rationale makes sense. Not only this, but if another round of conference realignment comes up, venues will be considered. This is not a small matter!!!

Sae Thirtysix 4 months, 2 weeks ago

Ouch. BMcCoob!! If integrity questioned . . . LKnzas should have referenced your thoughtful and articulate prose, every single one of them reads like pure Longfellow or Chaucer. You challenge [“] - - racking up winning arguments right and left. Somehow you must be employed by the LWJ. BMcCure you are spending a lot of time protecting and towing the company line - - don’t fool yourself. Repeating TKegs is not original.

Aaron Paisley 4 months, 2 weeks ago

KU has long had among the worst facilities among P5 programs. That tells prospective coaches you don't care about football. This is how you get stuck with the coaches KU has had recently and historically.

The argument that KU needs to wait until they are competitive to do a project like this is a load of crap. Post WWII, when has KU ever been consistently good? Since WWII, the most consecutive winning seasons KU has had is 3 in row and the last time they did that was from '60-'62.

If you want to attract the quality of coaches capable of stringing together multiple winning seasons in a row, KU has to keep moving forward with the remodeling of Memorial Stadium.

Baty is not wrong when he says conference realignment is coming again soon. We're going to start hearing about it again in the next 2-3 as the Grant of Rights gets closer to its end.

Committing to this project will show other conferences as well that KU is committed to trying to make football competitive. This doesn't change what David Beaty is doing now, but it shows potential coaches that KU is trying to upgrade and that KU could end up being more than a graveyard for head coaches because that's what KU is currently. When KU can start hiring coaches other P5 programs are going after, that'll be a sign that something is changing.

Kenny George 4 months, 2 weeks ago

Well put Aaron...these other idiots don't get it! And they are idoits!

Humpy Helsel 4 months, 2 weeks ago

This "gamble" is tied to the age old question. Which one is the horse and which is the cart? Is recruiting and field performance/success the horse as many argue? Or is the development of top tier facilities the horse that will pull the wagon? It would appear Zenger et al. (he isn't doing this without the thumbs up from other pieces of leadership) has decided the facilities will have to be the horse because the performance has fallen so far. The answer may not be a "there is only one right answer" proposition. I would argue either can work and you can find examples of both. TCU in basketball is an example of building facilities to attract a marque coach and to help with recruitment. How much did they invest? Are they getting a return? I would argue the arrows are pointing in the right direction for them. In our instance, the football program is so far down, the strategy is to build the facilities to attract the next coach (unless Beaty completely shocks the football world and there is no evidence to support that premise). Additionally, should realignment take off again (and it will), Kansas will be positioned as far as stadium and facilities, like it or not, to be an attractive target which can meet the bar in the big money world of college football. To wait until the next coach can hopefully recruit and coach their way out of this mess, AND THEN RAISE THE MONEY AND BUILD THE FACILITIES, could be too late. Actually, when the equation has all of the variables included, I think the proposed strategy is the right strategy for us at this time.

John Brazelton 4 months, 2 weeks ago

The KU Athletic Department is not going to raise and spend all $350 million in the same year. It's going to done over a period of years, probably 8 to 10. The football program now has rebuilt their roster to where they can now compete in the Big 12. Wins will come slowly, hopefully 3 to 4 wins this year. Only after KU can compete for highly ranked high school recruits, especially in Kansas and the Kansas City area, will we be able reach the .500 win level and beyond.

[''] 4 months, 2 weeks ago

You're hoping for 3-4 wins in the FOURTH year of a HC? Beaty has barely done that in 36 total games yet he magically will double his win total this season and you will call that progress? Wow.

Robert Brock 4 months, 2 weeks ago

KU will find an excuse for not investing in football and just letting football slip into a slow and agonizing death.

The Hawks may have to find a new conference; KU doesn’t show the effort to remain in a Power Five conference. The GOR is expiring soon.

4 months, 2 weeks ago

John, what facts do you have that-in Any way-would support This argument: “The football program now has rebuilt their roster to where they can now compete in the Big 12” We have, what, ONE big12 w in 3 years? ok. nice. 👍

Doug Merrill 4 months, 2 weeks ago

The assassination of KU Athletics by the LJW has officially crossed the line. Baldly and ineptly manipulative headines and innuendo t now characterize 100 per cent of coverage. Those of us who have been reading the LJW since the days of Bill Mayer and Chuck Woodling would welcome a return of balanced.reporting and opinion. The journalism has been lost.

Kenny George 4 months, 2 weeks ago

Doug, I agree with you 100%!! More like 200%. Poor journalism and a clearly biting the hand that feeds them. They are worse than 3-33 in my opinion!

John Fitzgerald 4 months, 2 weeks ago

Matt Baty bit the hands that were feeding him when he said the fans were to fault for the low ticket sales and failing program. The administration has no accountability. It’s pathetic and simply embarrassing.

https://hawkjock.com/2018/05/04/dear-matt-baty/

Kenny George 4 months, 2 weeks ago

I did not react negatively to what Baty was saying. He is simply saying the time is now and don't be a negative influence on the program. The time is for everyone to band together as one and move forward. You John, are part of the problem.

Waylon Cook 4 months, 2 weeks ago

You cucks blaming KUSports for reporting what KU football is. Worse than Zenger and Beaty. Zenger should never have survived the Weis hire. Total joke !

Jay Scott 4 months, 2 weeks ago

Good news for the deranged Zenger haters!

American football is dying. It won't exist in 25 years. KU are ahead of the curve on this and Zenger deserves the credit. Now let's get a men's team in the beautiful game, real football.

Question - When football is no longer an NCAA sport, will the Chicken Littles still complain about not hiring the right coach?

Jonathan Allison 4 months, 2 weeks ago

in 25 years we can all look back and laugh at the time that KU hired Charlie Weis.

In the mean time American football is still the cash cow of the US sports market, and KU is wise to invest in it's football program (better late then never).

Joe Greenwell 4 months, 2 weeks ago

How is it that college educated people are so frigging stupid? At times I wonder what happened to our University. WINNING football games bring fans and money back in. Winning only twenty games in the last ten years may be why nobody watches or cares.

John Joseph Gorski 4 months, 2 weeks ago

There are people, some but not a lot, who buy Season tickets to KU football just for the points they get for better seats at KU basketball games. They don't actually attend KU games as they give their tickets away or if they can sell them. I'm interested in what the tickets sales vs actual attendance is. If Beaty loses 3 of the first 4 games then that ticket sales income number will be below 3 million this year.

Kenny George 4 months, 2 weeks ago

To Joe and John and the rest of the negative posters...you don't get it and never will... if you doint care then just go away....forever...but the rest of us that understand will continue to support our football program. If you have a truly better answer then put in your application f or AD or HFBCoach.

Joe Ross 4 months, 2 weeks ago

List any evidence that I'm trying to be anything other than supporting of the football program. And "GO!"....

Craig Carson 4 months, 2 weeks ago

the stadium does suck but it wouldnt seem as bad if the product on the field wasnt so god awful...I have no intention wasting my time and $$ watching a team that struggles to beat D2 FBS teams or watch them be down 35-3 at halftime to EVERY Big 12 team they play..until the improve the product on the field, it doesnt matter how immaculate the stadium is..Im not expecting 8+ wins seasons every year but man, at least 5-6 wins, a couple NFL caliber guys and a bowl game every other year..there's like 80 bowl games

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