When the Chicago Bears lowered the lid on another disappointing season, it was easy to view them as an NFL franchise in disarray. The head coach hadn’t panned out, the general manager was a flop and the news conference put on Monday by Chairman George McCaskey and CEO Ted Phillips got the worst reviews since “Police Academy 4.”
But when you look at things another way, the Bears are doing just fine.
Every home game was a sellout, or close to it. TV ratings remained high. And when Forbes released its annual list of estimated team values, the Bears had shot up 16% year-over-year, to $4.1 billion. Only six NFL teams are worth more.
That’s not even counting the new stadium the Bears appear ready to build in Arlington Heights.
Sports economists say those results show that in the NFL, a bad season on the field is usually belied by a good one at the bank. No matter how poorly they play, teams get a share of the ocean of revenue generated by TV deals and national sponsorships.
For most franchises, that accounts for the bulk of their value.
“(Winning) matters a little bit but it certainly doesn’t matter as much in the NFL as it does in other leagues,” said Jason Winfree, a University of Idaho professor who co-wrote a textbook on sports finance. “Even the bad NFL teams get a cut of the huge media contract.”
Like most NFL teams, the Bears do not release financial results. Asked for comment about the team’s commercial performance, Phillips said: “After the NFL’s COVID protocols during the 2020 season saw no fans in attendance for all Bears home games last season, the return of fans to Soldier Field in 2021 allowed us a more normal business operation this season.”
The shareholder-owned Green Bay Packers do furnish numbers, and they offer a window into the health of the league.
The most recent annual statement covers the COVID-19-restrained 2020 season, when fans were not allowed into Lambeau Field. The Packers’ local revenue plunged from $211 million to $62 million, a 71% drop, but national revenue, which includes the team’s share of TV money, rose from $296 million to $309 million.
Overall, the Packers had an operating loss of $39 million but technically still finished the fiscal year $61 million in the black, thanks to strong gains in their investment portfolio.
The team portrayed the loss as a blip, and sure enough, when it offered fans the chance to buy shares in November, it quickly raised a reported $61 million earmarked for stadium renovation.
The Bears’ financial condition isn’t so clear. Forbes estimated the team lost $3.6 million during the 2020 season, in contrast to its usual nine-figure earnings.
The Bears’ estimated revenue per fan, measured by dividing locally generated revenue by the population of the metro area, was a measly $6. Only the Los Angeles Chargers fared worse.
The Dallas Cowboys, meanwhile, brought in an estimated $55 per fan (unlike the Bears and Packers, they allowed spectators during the 2020 season, albeit at a reduced density). Forbes says the Cowboys, who for decades have marketed themselves as “America’s Team,” are the most valuable sports franchise in the world. The Bears rank 18th on that list.
The numbers likely will get a reality check soon when the Denver Broncos, owned by a trust, go up for sale. Forbes puts the team’s value at $3.75 billion, but David Berri, a Southern Utah University professor who co-wrote a book about the economics of the Super Bowl, said it could sell for much more.
“(The ultrawealthy) will throw tremendous amounts of money at a team to own it,” he said. “The reality is there are only so many teams that exist, and the number of billionaires who want to own them is higher than that.”
To put hard numbers on it, there are 32 teams in the NFL and more than 700 American billionaires, with another 2,000 scattered around the rest of the world. Berri noted that when former Microsoft executive Steve Ballmer bought the NBA’s Los Angeles Clippers in 2014, the $2 billion purchase price was almost four times the Forbes estimate.
The Bears’ value is no doubt constrained by Soldier Field. The stadium is owned by the Chicago Park District, limiting the income the team can wring from it.
Team officials and city leaders have reportedly bickered over making changes, and in September the Bears signed a $197 million purchase agreement to buy the former Arlington International Racecourse and surrounding property — the first step, many expect, in building a stadium there.
Winfree said the most lucrative outcome for the Bears would be to have the state and local governments pick up much of the tab. Gov. J.B. Pritzker and Illinois lawmakers have been cool to that idea, and Arlington Heights Mayor Thomas Hayes has vowed, “We’re not going to give away the store.”
Phillips said Monday that the team envisions the 326-acre site as “an entertainment destination” that will go beyond football games. That’s in keeping with the real estate developments that have sprouted outside stadiums everywhere from Los Angeles to Milwaukee.
While that could tap a gusher of new income for the owners, Berri said Bears fans should not expect it to make a difference on the field. His research shows no correlation between an NFL team’s revenue and its winning percentage, demonstrating how the “purely socialistic enterprise” of pro football ensures there are no financial losers.
“There is a salary cap,” he said. “This isn’t like Major League Baseball, where there are teams that can’t afford a $200 million payroll. In the NFL, they can all afford the payroll. A new stadium will enhance the revenue of the Bears, but it won’t change how often they win. They’ll win more if they make better decisions and have more luck.”