Kyrie Irving and the business of an NBA superstar

The thought hit me just before Christmas on Newbury Street, where a two-story image of Kyrie Irving on the windows of Niketown invited tens of thousands of holiday shoppers who passed.

Man, Kyrie Irving is a business.

This was after sorting through piles of Kyrie T-shirts at the Prudential Mall in search of a toddler size for my daughter. A week later, Nike unveiled Kyrie’s new sneakers at the Sneakeasy pop-up shop on Tremont Street, where Bostonians lined up around the block in freezing temperatures.

I’m not here to suggest the Celtics traded Isaiah Thomas, Jae Crowder and a 2018 lottery pick to the Cavaliers solely because Irving is better for the bottom line, but there’s an added benefit to acquiring a superstar who’s played for a worldwide audience in three straight NBA Finals and made one of the biggest shots in basketball history: Kyrie Irving is better for the Celtics brand.

Let’s get this out of the way up top: Danny Ainge dealt Thomas for Irving because he felt it was the best move for the long-term prosperity of the basketball team, and, as the Celtics are quick to remind you, on-court success is the primary driver of financial growth for any NBA franchise.

We don’t often think of the Celtics in a business sense, because they’re part of a billion-dollar corporation that operates on a level we can’t comprehend, and we’re too busy worrying about how they’ll fare against the Pelicans on Tuesday night. It’s like the Earth’s rotation. We don’t put much thought into the fact we’re traveling 1,000 miles per hour; we just ride the momentum.

(OK, so some of us put more thought into it than others.)

But NBA teams build their individual brands through four main revenue streams — media rights, ticket sales, sponsorship deals and merchandising. And there is mounting evidence that Irving could prove more valuable to the Celtics than Thomas in all four of those facets of the business.

“It’s difficult to isolate the effect of one player,” Celtics team president Rich Gotham (who is to business operations what Ainge is to the basketball side of the organization) told Parquet Post, but “even if we can’t isolate the impact of one player, we can definitely feelKyrie’s effect.”

The business impact Irving is having on the Celtics may not pay huge dividends this season. Following the 2017 conference finals run, they renewed season tickets at a rate higher than any other team in the league, and upon signing Gordon Hayward, they projected to sell out every home game for the 2017-18 season. The national television schedule was set when they acquired Irving in August, and the local TV deal with NBC Sports Boston was negotiated seven years ago. Sponsorship deals were largely locked into place. And merchandise, despite its branding benefits, is “not that material” to teams, because all 30 split those profits evenly.

The real value comes in years two and beyond, should they reach a contract extension before Irving can test unrestricted free agency in 2019. If the current trend continues with Irving on board, the Celtics will see increased competition for tickets, media rights, sponsorships and brand awareness, and that’s where financial gains for an individual franchise begin to multiply.

In other words, Kyrie Irving is a long-term investment.

“Kyrie has that it factor that people tune in for,” said Gotham, in his 11th year as president. “They want to see what he’ll do. People show up wondering, ‘What’s he going to do tonight?’ They’re on their feet in the arena, and they’re rewinding at home, because they want to see it again. That’s the effect of a box-office player. Kyrie has that style and charisma that draws people in.”

It’s easy to quantify Irving’s basketball influence in Boston. He’s unquestionably the best player on the team with the NBA’s second-best record — a bona fide MVP candidate enjoying the most efficient season of a career that already includes four All-Star appearances, an All-NBA nod and a 2016 championship ring. But how exactly do the Celtics measure Kyrie’s business impact?

Gotham was kind enough to let us behind the curtain.

When we spoke at the end of the calendar year, local TV ratings for Celtics games on NBC Sports Boston were up 140 percent season over season. That’s no small return, since in addition to an estimated $20 million annual rights fee through 2038, the 2011 extension the C’s signed included an equity stake in the regional sports network that could increase to 20 percent.

The C’s have gone from the middle to top-of-the-league in social media metrics . They are top five in followers, and engagement (forwarding, liking, retweeting, etc.) is up “substantially.” Five of the NBA’s top 25 most viewed Instagrams and three of the league’s top six tweets are Celtics- and Kyrie-related. This is the NBA’s most-watched highlight on Twitter this season:

And video of Irving gifting his jersey to servicewomen after a November win over the Nets drew 3.3 million views, one of the most-watched sports videos in Instagram’s history:

“That was one of those ones that broke the internet,” said Gotham.

The Celtics have also found creative ways to monetize their social media content. Everything from postgame highlight packages to off-day interviews, injury reports and social-specific videos are sponsored. While many of those were agreed upon before the trade, partnerships will only grow along with a following that has reached 4.8 million on average across Twitter, Instagram and Facebook. It certainly won’t hurt that a photo of Kyrie arriving to the arena or video of his game-winner against the Hawks can respectively draw 54,000 likes on Instagram and 33,500 views on Twitter for the regularly scheduled JetBlue Runway and JetBlue Play of the Game.

“Social media doesn’t add up on its own to business growth, but it feeds demand for all things Celtics,” said Gotham, whose tenure coincides with the digital age. “The more people watching and following, the more likely casual fans become avid fans, so there’s an indirect benefit.”

Celtics tickets are also selling 80 percent above face value on the secondary market, “well beyond what we’ve seen the past few years,” said Gotham. While the immediate impact may be padding resellers’ wallets, demand can generate more business in the form of increased future costs for ticket packages and corporate suites (to be clear, this is my analysis, not his). There were reports of season-ticket prices increasing 10 percent when renewals requests were issued in February, and the Celtics ranked ninth in average ticket price last season, per Vivid Seats.

Through November, the Celtics saw a 250 percent increase in online merchandise sales. They added 10 new faces over the summer, including Gordon Hayward and Jayson Tatum, and they too helped the C’s claim the seventh spot in team jersey sales from the period of October through December, according to data Parquet Post obtained that was embargoed until now. As Gotham said, “The more people who are wearing green, the bigger the marketing impact.” And Irving now ranks 12th on the NBA’s list of most popular jerseys — the only Celtic in the top 15.

“Kyrie was playing in Cleveland alongside LeBron, and while I think everyone knew what a great player he was, he’s been more of a focus with the Celtics than perhaps he would’ve been otherwise,” said Gotham. “When stars change teams, that stimulates interest. No question.”

Most remarkable, perhaps, is the fact that all these sharp increases are occurring after an extremely likable Celtics team enjoyed a wildly entertaining run to a No. 1 seed this past spring. “It’s not like adding Kevin Garnett to a bad team,” said Gotham, who was promoted to team president in the months before the C’s added Ray Allen and KG to a less-alluring 24-win team.

So, could interest decline once the natural bump the Celtics got from adding Irving subsides? Not if they keep winning the way they are. As far as merchandise sales are concerned, Thomas didn’t appear on the list of top 15 jersey sellers until April 2017, when he was 14th, and he rose as high as seventh in the playoffs. It’s safe to assume Irving will rise along with the C’s, too.

“I don’t know how much specifically we owe to Kyrie jerseys or T-shirts, but he’s definitely helping fuel that,” said Gotham. “That’s been a good indicator that says, ‘Hey, in addition to doing well and that success building business over time, some metrics have grown specifically.’”

Two more good indicators: 1) Kyrie’s last signature sneaker was the top-selling shoe in the basketball market, and his shoe line is second in U.S. sales to fellow Nike pitchman LeBron James; and 2) Irving was third behind only LeBron and Giannis Antetokounmpo in All-Star voting in the latest round of results — the leading vote-getter among guards in a league that features perennial MVP candidates Stephen Curry, Russell Westbrook and James Harden.

Part of that is surely due to Irving’s popularity in Asia, where there are 400 million NBA fans in China alone and where Kyrie made five stops on a “Kyrie Nike Clutch Buckets World Tour” over the summer. But Asia isn’t the only place internationally where Irving is drawing fans to the C’s.

Gotham traveled to London a few weeks to to further lay the groundwork for their visit in advance of last week’s game, and when a customs agent saw the Boston tag on his luggage, the Brit said, “You guys have Kyrie now.” And Gotham wasn’t even sporting a Celtics logo.

Thomas was beloved locally. Kids wore No. 4 jerseys, too. But Irving is a global superstar.

“I do think Kyrie is one of the bigger names and bigger stars in our sport,” said Gotham. “We always say it’s about the name on the front of the jersey, not the name on the back, and he’s boughten into that, but at the same time, Kyrie is one of the biggest star players known globally.”

Following the loss of Hayward, the 16-game win streak sustained much of the increased fan interest, and while everyone contributed, Irving was the straw that stirred the East-leading drink. Hayward’s injury, unfortunate as it was, further elevated Irving’s status as the main attraction.

“With Boston fans, it’s all about winning,” added Gotham. “It’s great to have Kyrie on the team, but if we weren’t winning, we wouldn’t be having this conversation. And it’s not just him as an individual, it’s how he has made the team better, and that’s what has driven business.”

So, Celtics business operations, just like the basketball side, must be eagerly awaiting the addition of Hayward to a mix that already appears to be a legitimate contender without him.

“The most important thing is you get him back healthy. The business doesn’t factor into that,” said Gotham, as you should expect. “There was a ton of excitement generated by his signing, and now because he’s not playing, there’s been an inordinate amount of attention on Kyrie. Gordon was a huge signing for us. People were all in prior to Kyrie, because we were a conference finalist that added Gordon Hayward. That on its own drove a lot of excitement, so when he’s back, we’ll see another bump. The most important thing is he takes his time.”

Yup, the business of basketball in Boston is booming.

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