Look for Yi (and Lebron) to max in 2010
With thanks to TrueHoop for all the links today, I've been inspired by this article on BrewHoop, the Bucks' resident blog, and others reporting on the Bucks' newfound revenue through on-court signage and whatnot by Chinese-based firms, to say this:
When Yi Jianlian's rookie contract expires after the 2009-2010 season, barring any NBA salary rules I'm not sure about (hey if I'm not getting paid to know all the rules, I won't know all the rules), the kid deserves a MAXIMUM CONTRACT.For a small premium over your standard on-court signage fees, you can advertise your brand to about 200 million Chinese. Wow.
Memo to the Warriors: better free up some cap space, otherwise Atma Brother ONE's dream of a "Yi Movement" over at Golden State Of Mind will never come to fruition. I think it's fair to say that owner Chris Cohan can only drop the ball on this one. It's pure marketing to tout the power of the Bay Area market and how it relates to Yi. Assuming Yi is merely as good as he is now and without a debilitating injury (knock on wood), Yi's play would be the icing on the cake, not the other way around. Think ROI.
Btw, why is Yi playing in the Rookie/Sophomores Game instead of Joakim Noah or the miffed Al Thornton? What, you forgot there was signage at the Rookie/Soph Game? You forgot this was a corporate sponsor thank-you weekend, not a real All-Star gathering?
Yes, as a sophomore count on Yi being at All-Star Weekend no matter what in 2009. I mean, I really hope he improves, but he might be the one of the few max-contract guys not to make the All-Star Game in 2010 (Stephon Marbury, et. al.?), barring an upsurge in his fan voting -- he needs to more than double his votes this year. You heard it here first.
Speaking of ROI and 2010, here's hoping my comment to Sports Business Radio's post about Lebron not being a good investment -- seconded by Cavs beatwriter Brian Windhorst -- gets posted...
You really need to talk to someone in the shoe industry before talking about Nike/Lebron's ROI. I don't have those resources, so my speculation is hereby just as good as yours.
Look, if Starburys can have a RETAIL price of $15, that would suggest that Nike's cost of goods can't be more than $15 per shoe -- okay, let's be conservative, let's DOUBLE that to $30. Economies of scale, baby.
If Lebron's shoes are selling for $150+, do the math. That's a nice profit margin.
Let's look at it another way. If Nike Golf is bringing in $600 mil and Nike's revenues are $2 bil, then perhaps we can safely say Jordan and Lebron brands are bringing in at least $1 bil. Then perhaps we can safely say Jordan is bringing in 2/3rds of that, so maybe Lebron is bringing in $333 mil.
Invest $90 mil to get $333 mil? I'd say that's a pretty good ROI. In fact, I'd say that $90 mil to get only $90 mil would have been good ROI in terms of merely the marketing. Like you said, Lebron will win MVPs and championsips. You can see why Reebok was willing to pay up for Lebron.
In 2010, what Lebron goes for will be more Lebron than Nike. Especially with Adidas unwilling to go for one-guy stratospheric numbers (hence the 1-of-5 "team" campaign with KG, Chauncey, Gil, et. al.). Esp. when you know LRMR has got to know the real numbers. It's entirely what the brand can bear without jeopardizing Lebron's ability to rake it in in the future. And right now I'd speculate that Nike the brand with $2 bil in revenues can bear a lot.
$90 mil was pretty much how it balanced out at the time. In 2010, I'm sure the forces of supply and demand will yield a larger number.