The Coronavirus Killed March Madness — Why It’s a Big Deal

For the first time since before World War II, there will be no March Madness. As the coronavirus pandemic strikes America, the NCAA has taken the extremely sensible but deeply tragic step of canceling the final college basketball event of the season — leaving hordes of graduating seniors without the final chance to suit up for their team.

On the one hand, times like these help remind people just how little sports matter in the grand scheme of things. No matter how much you love college hoops, the health and safety of fellow Americans — and people around the world — matters more. However, there’s also more to the cancelation of the NCAA tournament than just missing out on all the fun. The economic ramifications of this decision go well beyond sport, with millions of ticket sales, ad buys, lucrative sponsorship deals and sports betting essentially getting flushed down the drain. For a great many people, their entire year revolves around this single event, and its cancelation will likely have ripple effects well beyond being unable to crown a champion and giving college seniors one last chance to represent their school.

So, to put this all in a little bit more context, here’s a look at all of the projections for just how much money really matters in March Madness.

Last updated: March 13, 2020

Pictured: A general view of the March Madness logo during the first-round game of the NCAA Tournament between the Nevada Wolf Pack and Iowa State Cyclones in Milwaukee in 2017.

By comparison, Walmart’s net profit for the 2019 fiscal year came in at just $6.67 billion.

While it’s technically not legal to throw in for that annual office pool, well, that doesn’t seem to stop most people. A $4.6-billion sum would be roughly the equivalent of a March Madness pool with a $14 buy-in and every single person in America participating.

Sportsbooks are hurting right now as March Madness is just one of the many sporting events that have been delayed or canceled.

That’s about 1 out of every 5 adults in the U.S.

Some 149 million brackets — with each fan speculating on the outcome of 67 games per bracket — means that there would have been nearly 10 billion picks made by bracketologists.

The Super Bowl is the Super Bowl, after all, but the NCAA Tournament is the Super Bowl of gambling. At least, it is in most years. For 2020, that number is going to wind up at 0.

If you’re right half the time — meaning you perform about as well as flipping a coin — you have a 1 in 9.2 quintillion (or, to put it another way, 1 in 9.2 billion billions) chance of getting every game right. Normally. The math in 2020 is going to be a lot easier.

If you were to increase the accuracy of your predictions to about 2 out of every 3 right, your odds of getting that perfect bracket would be many millions of times better. And still really low. So, if everyone on the planet knew enough about basketball to get 2 out of 3 picks correct, and each of them had filled out 16 different brackets, and of course, had the NCAA tournament not been canceled, odds indicate that one perfect bracket would have emerged.

Note the language used here in the poll, conducted in 2019 by Morning Consult on behalf of the American Gaming Association: 57% of Americans “acknowledged” that if they had money on a team, the games in the Final Four would be more entertaining. The other 43% are just kidding themselves about how much more fun they would have had watching March Madness if next month’s rent were riding on it, though it’s now a pretty moot point.

That percentage would have been the highest in the nation.

Pictured: Kentucky’s Ashton Hagans looks to pass the ball during the first half of an NCAA college basketball game.

This percentage would have been the lowest in the nation.

This deal ensures CBS and Turner Broadcasting television rights to the tournament through 2024. That March Madness payday is a key contributor to the NCAA’s finances. The revenue from the NCAA Tournament usually represents more than 75% of the organization’s total annual revenue.

After the initial contract is up with CBS and Turner, the NCAA will take in more than $1 billion annually through 2032. That represents about a 42% raise for the NCAA starting in 2025.

Of course, there’s a reason why the television networks are willing to bid up these rights. Even paying $1.1 billion for the rights, CBS and Turner Broadcasting would be set to make more than $200 million if ad sales echo those in 2018. That leaves television broadcasters likely scrambling to make up for an enormous amount of lost revenue.

One group that’s not losing out on a lot of money? The people actually playing the games. They’re amateur athletes who don’t end up seeing a penny of that $1 billion-plus in ad revenues they’re creating.

But, that might be changing. In September 2019, California approved legislation that will allow college athletes to earn money from their likeness, potentially allowing the players to sign endorsement deals that would give them the chance to reap some of what they’re sowing. The California bill takes effect Jan. 1, 2023, and other states are likely to follow suit.

That rate of growth, should it hold consistent, means that ad revenues will be between $1.62 billion and $1.86 billion by the time that new television contract takes effect in 2025.

Associating your product with something as wildly popular as the NCAA Tournament typically is good business, so it shouldn’t surprise you that 155 brands shelled out big bucks to spread their message or introduce their product during March Madness in 2019.

Last year’s NCAA Tournament saw those 155 brands shell out nearly $1 billion just for the TV spots aired during breaks in the action.

Those 155 brands clearly didn’t want to put all their eggs in one basket. There were enough different ads to represent more than two for every advertiser who bought a spot.

This means you should expect to see considerably more commercials than actual game action when you’re sitting in front of the TV. The entire tournament comes to 2,680 minutes of basketball — excluding overtime.

When it comes to spending on those ads, the people holding the checkbook aren’t dopes. The $932.7 million ad buy created some 24.2 billion impressions, or just about 26 impressions for every dollar spent.

Corporate sponsor AT&T had the biggest budget for NCAA Tournament games. The telecom giant shelled out more than $100 million for advertising during the 2018 Tournament.

AT&T also, unsurprisingly, aired the highest number of ads. That $101 million translated to the chance for AT&T to air its commercials a total of 473 times.

You needed $636 to grab a seat to the Final Four last year, which is a little over a quarter of a bi-weekly paycheck for someone earning the nation’s median income — before taxes.

Of course, $636 only sounds expensive if you aren’t thinking about it in context. Fans trying to get into the semifinals in 2018 spent nearly twice as much.

Two years ago, the price of a ticket to the Final Four jumped nearly 40% from the start of the tournament to the penultimate round of action.

Legendary Michigan State coach Tom Izzo was the biggest earner among those teams’ coaches, but he only edged out Virginia’s Tony Bennett by about $7,500. The two coaches each earn about $4.15 million a year, good for the third- and fourth-highest salaries in the game. The other two Final Four coaches — Texas Tech’s Chris Beard and Auburn’s Bruce Pearl — earned an average annual pay of $2,800,000 and $2,600,000, respectively.

Tom Izzo made the most of any of the coaches in last year’s Final Four, but it didn’t appear to affect the budget for his school. Michigan State’s annual cost of in-state tuition, plus room and board, totals $25,046.

Texas Tech’s tuition for non-Texas residents comes out to $23,770 a year for undergraduate students. Of course, when you add in the room and board and other expenses, it surpasses $39,000.

While the March Madness games are played all over the country, the Final Four rounds take place in one city. And that can be a lucrative proposition for the host city. The impact on the local economy of host Minneapolis was estimated to be more than $140 million last year. That means that businesses in Atlanta are not only left dealing with the consequences of coronavirus keeping people inside, they’re missing out on the millions that might have otherwise flown into their city.

With some 48 games played over the first weekend of action, the NCAA Tournament typically sprawls out across the country in mid-March. Arenas in 14 cities were scheduled to host games during the 2020 tournament, meaning the loss of revenue is going to have a nationwide impact as businesses and vendors won’t see the expected influx of fans looking to stay in their cities.

There would have been 63 games in the tournament proper, with four play-in matches to reach the first round.

At just over 19,000 fans in attendance at the average NCAA tournament game, 67 canceled games translate into some 1.27 million tickets having to be refunded.

The first NCAA Tournament was played in 1939, involved just eight teams split into “East” and “West” regions and culminated with Oregon beating Ohio State, 46-33.

More From GOBankingRates

• 24 Ways To Maximize Your Paycheck This Year
  
• Survey: Only 18% of Americans Believe Their Tax Dollars Are Being Spent the Right Way
  
• 24 Things To Do When You Have More Bills Than Your Paycheck Can Cover
  
• Best Travel Credit Cards

Pictured: Kenneth L. (Tug) Wilson (left foreground), secretary-treasurer of the NCAA Basketball Association, presents the championship trophy to coach Adolph Rupp of Kentucky after his team defeated Baylor 58-42 in the East-West NCAA final at Madison Square Garden in New York in 1948.