What increased attendance means for the Royals

Over the weekend, the Royals took yet another home series and had another weekend with over 100,000 Royals fans in attendance. The Royals are now fifth in the league in attendance, averaging 31,102 fans per game. They are on pace to draw 2.52 million fans, more fans than in any season in Royals history, which is incredible considering (a) school is not yet out; (b) the Cardinals have not yet come into town, typically guaranteeing three sell outs; and (c) the pennant season has really yet to heat up.

While the Royals may not benefit from the record television ratings (nor will Fox Sports Kansas City apparently, hooray for long-term contracts!), they will benefit from more fans passing through the turnstiles. Just how much will they benefit?

The average Royals ticket costs nearly $30 now, the eleventh-most expensive ticket in baseball, and a 50% increase over prices just a few years ago. Total attendance in 2013 was 1.75 million fans for the year with an average ticket price of $20, generating roughly $35 million in gate revenues for the club. If the team draws 2.52 million fans at $30 per ticket, that translates to roughly $75.6 million in gate revenues.

Bloomberg estimated the Royals concessions revenues at $11 million and parking revenues at $4 million in 2013. With the 44% increase in attendance between 2013 and this year, that could lead to a commensurate 44% increase in those revenues as well, totaling $22.6 million. The Royals also have revenues from its deal with Fox Sports Kansas City (reported to be about $20 million per year), revenue sharing from all local television deals ($36 million), its cut from the national television deal (roughly $40-50 million), revenues from MLB Advanced Media ($8-10 million), and revenues related to sponsorships (estimated at $14 million by Bloomberg in 2013). That is well over $200 million in total revenues right there with other miscellaneous revenues (radio rights, merchandising, MLB Investment Portfolio, etc.) as icing on the cake. Lucrative new TV deals for the Dodgers, Mariners, and Phillies beginning in 2016 and the new national TV deal that began in 2014 with escalating revenues each year should add to those revenues in the near future.

Make no mistake, however, the Royals are investing greater in the on-field product than ever before. In 2013, the club had an Opening Day payroll of $81 million. The Opening Day payroll this year was a club record around $110 million, or a 36% increase since 2013. The Royals have other costs including non-player personnel, operation costs, the costs of operating a minor league system, contributions to the MLBPA pension fund, and contributions to revenue sharing. With eight players eligible for arbitration next year, and free agent decisions to be made on Alex Gordon and Alex Rios, the club will be pressured to increase payroll even more to keep the club together.

The Royals no doubt expected a bump in attendance this year, but I don't think they quite anticipated this kind of increase in attendance. And the number of fans could increase if the team remains competitive and continues to play the exciting brand of baseball they have played. At the very least, Royals fans have shown that a true commitment to winning will be rewarded in this city. There is no reason why this franchise cannot cultivate a long-term fan-base the way the Chiefs did in the 1990s with their decade of winning. What it requires, however, is a continued "obsession" with winning from ownership.