Sports Biz with Darren Rovell

What Does Strasburg Have To Do To Be Worth It?

Stephen Strasburg

Late last night, the Washington Nationals signed their No. 1 pick Stephen Strasburg to a four-year, $15.6 million contract.

So can the Nationals make back their money?

It first will depend on Strasburg turning into the real deal. That hasn’t exactly been a given over the years with previous top pitchers. But if Strasburg is everything the Nationals thought he would be, it actually wouldn’t be that hard to make this contract make sense.

We dialed up one of our favorites, Vince Gennaro, author of Diamond Dollars and consultant to few Major League teams, to break down the dollars and cents.

Gennaro first pointed to the fact that Strasburg’s contract, while record-breaking, is pretty close to the $10.5 million deal Mark Prior received in 2001. Why? Because the average ticket price in the league is 45 percent higher now than it was when Prior signed.

Gennaro then did the math for us, evaluating the deal on ticket sales alone. (More fans to the ballpark will obviously increase the Nationals the per cap, but that equation is a bit more complicated).

According to Team Marketing Report, the Nationals average ticket price this year is $30.63 per game.  Therefore, in order for Strasburg to pay off, he’d have to sell 2,250 additional season tickets or keep 2,250 people who were going to give up their tickets –- per year.

The average premium ticket is $193 per game. So Strasburg, Gennaro reasons, would also be worth it, if his performance would lead to 360 premium tickets sold for the season.

If Strasburg doesn’t inspire people to buy or keep their season tickets, perhaps he’ll help draw a huge walk-up crowd. Gennaro says that if Strasburg can draw an extra 13,000 fans per game when he pitches, he’d also be worth it.

But if Strasburg stays healthy and pitches at his projected level, he will likely sell a variety of these tickets – premium and average season tickets as well as generate a sizeable walkup crowd, Gennaro said.

“This could be a bargain, if he turns out to be great,” Gennaro said. “And even if he’s a good, steady number two pitcher, they can still make their money back on him.”

Questions?  Comments?