Few teams in NBA history have come off the blocks with such ferocity as this year’s Cleveland Cavaliers, who at 13-0 hold the longest undefeated start to a campaign since the 2015-16 Golden State Warriors went 24-0. Those Dubs ended with the best regular season record in history at 73-9 but were infamously dispatched by the LeBron James and Kyrie Irving-led Cavs in the NBA Finals.
Led by new Cleveland head coach Kenny Atkinson and the dynamic backcourt Donovan Mitchell and Darius Garland, the league’s best offense has taken the league by storm. While the unbeaten record is a surprise, the business side of the franchise has prepared for its return to the top of the Eastern Conference for some time.
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In 2018, the Cavaliers and team governor Dan Gilbert embarked on a $185 million renovation of Rocket Mortgage Fieldhouse. Nic Barlage, the team’s CEO, said the changes—completed in September 2019—were an opportunity to increase ticket accessibility for the fans while also maximizing the value of every ticket sold.
“We wanted to be able to be in, from a success perspective, the top 10, the top seven, whatever the case may be,” Barlage said in a phone interview. “It’s really hard to challenge and get to New York (Knicks) and Golden State’s levels just because they’re behemoths from a ticketing perspective. But we’ve always known we’ve got incredible fans. We’ve got a great fabric of support across the entire state of Ohio. And so for us, we said we’re gonna get really aggressive.”
The Cavs capped season tickets at a very small percentage of the seats in the arena. In turn, the team also tripled availability for partial ticket plans, group packages and single-game tickets. One objective was to give fans more opportunities to attend games at different entry points, whether for one game or several. The second, more dynamic reason was that buying smaller plans or single game tickets allowed the Cavs to raise their average ticket price.
“If you sell a seat four times, you can sell that same seat four times at a little bit higher price than if you just sell it once,” Barlage said. “And so that model has been borne out when you see 191% up in single-game tickets, 89% up at membership and partial plans year over year. Group tickets are up 22%. Leases are up 279% year over year. That’s a tribute to the performance of our overall building.”
The ticketing strategy, used by several NBA teams, was also a safeguard when James left the Cavs for a second time after the 2017-18 season. There was significant falloff in multiple business areas for the Cavs after the star’s departure for the Miami Heat in 2010, but Barlage said the team embraced the transition the second time around, spending the prior year-and-a-half preparing for James’ potential 2018 exit.
Citing shrewd drafting and roster management by team president Koby Altman—drafting Garland and Evan Mobley, trading for Mitchell and Jarrett Allen—Barlage said the team didn’t see the massive dips [in attendance] compared to 2010.
“We had a sustainability to our business, and a lot of that was due to the transformation, renovating all of our spaces, having a lot of contractually obligated income and agreements across the board,” Barlage said. “But we also didn’t have a lot of fans asking to get out. They trusted the organization. They knew that (Gilbert) is going to invest to the hilt to rebuild a franchise.”
The experience is translating to the fans’ screens as well. Viewership through the first nine games shown on the Diamond Sports Group-owned FanDuel Sports Network Ohio has gone up 31% through the same period last season. The regional channel’s footprint spreads beyond the state of Ohio, reaching as far east as Buffalo and Pittsburgh.
Within the Cleveland-Akron-Canton DMA itself, local telecasts have averaged a 4.2 rating, a 29.2% year-over-year increase. Prior to Wednesday’s game against Philadelphia, the last four telecasts averaged a 5.2 local rating. The Cavs also said an aggregate of almost 2 million viewers in the DMA have watched the Cavs over the first 12 games.
The metrics will help inform the team’s decision-making process on local rights in the future. As DSG continues scrambling for its survival, the Cavs’ own holding company, Rock Entertainment Group, launched an over-the-air network this summer, RESN, to broadcast games for some of its sibling properties such as the G League affiliate Cleveland Charge and the AHL’s Cleveland Monsters. In July, Cavaliers EVP Mike Conley told Sportico that the team will continue to monitor DSG’s bankruptcy proceedings while remaining on FanDuel Sports.
“The strength of the regionality of our brand is really what’s going to be the foundation for us as we go forward, whether we stay with FanDuel Sports Network or whether we transition over to RESN,” Barlage said. “I think that’s why FanDuel Sports has been so motivated to keep us as well. The NBA is strong, and it attracts a great younger demo for advertisers, and so I think we are as confident as ever about where our local rights are going to be.”
Though the team has worked out accessibility for tickets, something it has full control over, it doesn’t have the same influence over the RSN’s reach.
“I think seeing the viewership numbers is great, and being up 31% is great, but accessibility is still an issue,” Barlage said. “We’re only in 33 or 36% of the homes in our television market. That’s not good enough.”
The Cavaliers, worth $3.22 billion, rank 22nd of the 30 NBA teams in Sportico’sfranchise valuations. Gilbert, the Quicken Loans founder, purchased the team for $335 million in 2005.
