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9 of 9 people found the following review helpful
on August 18, 2007
Format: Hardcover
This is a very interesting book that I enjoyed, but there are certainly caveats to those who may be interested in reading this. This book isn't for everyone and there are a couple of recommended prerequisites from my vantage point.

For one, if you're just a casual baseball fan, this book is not for you. It goes into a lot of detail about the business side of baseball and on all levels, and many times I thought to myself that if I didn't know the game and players as I do, I'd probably be lost. It helped me greatly that I have played and coached in addition to having been a serious fan for many years.

Second, it doesn't hurt to understand a little about the business side of anything, as this book is very business-oriented. If you have no business intuition at all, the material in this book will just fly over your head. You don't have to be a Fortune 500 CEO, but at least know a little about how businesses are run and some of the terminology.

In short, while a very good book, it's not light reading and not for everyone. Officials of baseball teams are a primary audience, and this is a must-read for such people. If you're a baseball fan and know a little about business, you'll enjoy it, although even then there will be parts that aren't easy to digest. Early on, I had a little trouble keeping up with all the information being thrown at me, from pure numbers to other facts, and it's almost too much right away. But once I got past that, the rest of the book came much more easily for me.
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10 of 11 people found the following review helpful
on April 21, 2007
Format: Hardcover
I'm a big Mets' fan living in LA and found this to be a great read. The author gets into some pretty interesting ways for Major league teams to run their business. He talks about a way to put a dollar value on players that I hadn't seen before, since most methods use comparables for what similar players are paid in the free agent market, but this book talks about how much a player is worth to different teams at different level of competitiveness. He shows that the Carlos Beltran signing (which so many experts were criticizing) really paid off financially for the Mets in 2006. There's a lot more to the book than player value, but that was the highlight for me.
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6 of 6 people found the following review helpful
on April 6, 2009
Format: Hardcover
I am bringing up my background because as you will see it will become important in my view of this book. I graduated Magna Cum Laude with a B.S. in Business Administration with a double major in Accounting and Finance. Also, I have a M.S. in Taxation. As a result, I have a very good financial background.

If you want to have a good understanding of the material in this book, then I would recommend that you have a decent understanding of using basic fundamental analysis to value a business. Finally, I would highly recommend understanding models that are produced by regression. There is tons of data in this book, and the researcher used a lot of regression models. He went back 30 years, and if a team was not around for 30 years, then he used all the data they had since they started playing Baseball. The book is broken into 4 parts.

Part 1:
Discusses how wins effect the future attendance of a team. He uses the term "Win/Curve", and concluded that in general, attendance is maximized when a team wins around 92 or 93 games. The latter is most likely caused by a team in a Pennant Race. Also, the farther a team goes into the Playoffs, the more season tickets that will be sold the following season. Finally, there are different levels of revenue generated from the "Win/Curve" that are broken into different revenue categories, multiple revenue streams and multiple revenue layers. Revenue streams are the daily revenue such as cash from attendance, concessions, local broadcasts and sponsorships. On the other hand, multiple reason layers are broken into 4 categories (1) Win Dollars - represents the change in revenue from daily revenue sources when a team wins over a period of years. (2) Postseason Dollars - Teams do not make money for just making the Postseason because the revenue from daily operations is enough to cover the bonus salaries for the players. Teams make their money by increasing season ticket holders over the next 3 to 5 years. (3)World Championship Dollars are created when a team wins the World Series. More fans by season tickets just to have access to Playoff tickets. When the WhiteSoxs wonthe 2005 WS their seson ticket revenue jumped 12.5%.

The 2nd Part of Diamond Dollars focuses on valuing players. One of the techniques used to value a player is broken down in the following manner. Lets use Vlad. His stats are used to figure out how many additional wins he helped produce. Then, the additional/marginal wins are plugged in to win the marginal revenue he produced. If the amount of marginal wins he helped produce has no effect on the playoffs, then its over, but if his marginal wins helped make the playoffs, then postseason and possibly world series revenue is added.

The 3rd Part discusses the importance of a good Farm System. An MLB team would be hard pressed to define a more important leverage point of its on field and business success than its scouting and player development system. As a result, noting a team does will have a greater impact on their cost structure than a success or failure of their farm systems ability to feed talent to the Major League Team. Therefore, the team with home grown talent (aka Twins, Marlins, Tampa Bay), and does not have to waste money on high priced free agents just a few free agents to fill in missing pieces can maximize their revenue. As a result, a team that can make the Playoffs or World Series under the latter situation will make a higher net profit than a team that chooses to build their team around high priced free agents.

Part 4 discusses the economic value of building a team brand. Some teams such as the Cubs, Yankees, and Cardinals, realize a revenue cushion in form of loyalty of their fans in years when the team is less than competitive. AS a result of the latter, teams with strong brands are ore likely to spend to win because their revues sag less in down years. Also, there is a theory of a 3 phase program to build a brand (1) BUILD CREDITABILITY though ownership showing a commitment to win, team never quits, Front Office acquires several big name free agents (2) COMPELLING ENTERTAINMENT VALUE - ownership demonstrates their commitment to win in part 1 by adding more big name players, the farm system begins to produce a few quality players to go with their free agents, and as a result fans begin to feel optimism. Also, entertainment value can be increased by a new ball park, or add attractions to the park for families (3) CREATING AN EMOTIONAL BOND WITH FANS Fans believe that the owners are want to win as much they do, team maintains continuity with key players, team has several "likable" players, Ballpark has feel of a baseball theme park, team owns their own broadcast network so they not only have control of how information is presented they have the ability to bring back legends to call the game

Finally, the book has some fun, and discusses some unique topics such as the YES Network, and the effect it has had on every MLB team to broadcast their games. There is a chapter devoted to Babe Ruth, and how he would be valued in today's game. The author even pokes holes in the "Moneyball" philosophy of Billy Beane. First, he believes Beane's on ego hurt him in that he let the cat out of the bag too soon by writing "Moneyball", and basically rubbing his success in everyone's face. Another flaw is that Beane does not give enough credit to the players on the team that are not homegrown, or in other words the homegrown kids alone would not have been able to win solely on their own. Finally, Beane lets go of his arbitration players too soon. Yeah, he gets more value back this way, but why give up a Hudson, Zito, and Blanton when they have still have a chance to go far in the playoffs. Is an extra draft pick really enough of a reason to give up a chance at winning the World Series.

Diamond Dollars is a phenomenal book, and I would recommend it to anyone who wants to understand theories about the Front Office. Its nice to see well thought out theories backed up with real data. However, this not a book to read on the beach or for leisure. Each section is very similar to reading an article in an academic journal. Therefore, I would recommend to read about 20 to 30 minutes at a time so your brain can absorb what you just read. You can read it in one sitting, but it would be a waste.
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1 of 1 people found the following review helpful
on November 7, 2008
Format: Hardcover
This is a great, insightful look into the structure of MLB teams from the major leagues to the team's player development and minor league system. It delves into areas rarely discussed before and opens up new arenas of discussion for baseball fans.

I've read "Moneyball" and "The Baseball Economist: The Real Game Exposed," and I think Diamond Dollars goes places where these two reads don't. First off, it is the first piece of baseball literature I have ever read to identify a player's marquee and asset value to his team. Second, this book talks about all aspects of organizing a team, from acquiring the right players, to how to use the players to generate revenue for the team, to how to build the brand of your organization.

I would take the concepts in this book a step further and say they can be incorporated into any aspect of business management.

A great read and a MUST-READ for any baseball fan or business person (would make a great holiday gift!).
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Format: Hardcover
In 1972, St Louis Cardinals owner August Busch insisted on trading future Hall of Fame pitcher Steve Carlton, because the hurler requested a $10,000 raise. Clearly, Busch didn't understand how "saving" that lousy ten grand would ultimately cost him millions in lost revenue, since the Cardinals would be also-rans for the next ten years. Meanwhile, Carlton's new employer - the Philadelphia Phillies - were now on their way to becoming one of the NL's premier franchises, reaching the post season several times in the '70s, finally winning it all by 1980. Carlton was one of the biggest bargains in baseball history.

Nowadays, the business of creating winning baseball is far more challenging, with the multi-million dollar contracts that are routinely paid out to run-of-the-mill players; every contract signing has tremendous impact on a franchise's bottom line, which author Vince Gennaro explains in this fascinating book. The successful teams make the right free agent acquisitions; the unsuccessful teams make poor choices or stay on the sidelines altogether. The business of baseball can be a very lucrative enterprise for those making the post season on a regular basis; winning the World Series is icing on the cake.

The key to success in maximizing a baseball team's bottom line, is spending wisely; finding value where others don't, and understanding when the high-priced free agents quite often don't pay the dividends at the end of the season. Winning pays, much more than most casual observers understand.
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on February 17, 2008
Format: HardcoverVerified Purchase
I really liked this book, though more for it's mere existence than its independent value. It does a great job of highlighting the sources of revenue for sports franchises and how the various components of a business interact to create value.

Regarding baseball, it provides an excellent basic analysis of the challenges and opportunities faced by major league teams of all sizes. I would have liked to have seen more detailed rankings of all teams rather than focusing on a few at the top and bottom end of the value scales but I'll take what I can get. As far as I know this book provides the best accessible analysis of the economics of baseball so while I can see multiple areas where it could be improved (details of more teams, more insight via appendices into the valuation assumptions made at various points), it's still well worth reading.

As a side point, I think the real value of the book may be its applicability to teaching some business fundamentals. It provides a very readable introduction to a variety of valuation concepts that are not always easy to communicate. I could easily see this being a valuable addition to business schools reading lists.
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on June 26, 2008
Format: Hardcover
Thanks to Mr Gennaro for writting this book, i have found it very useful and very easy to understanding it. I can recommend it to those people already vinculated to baseball world in fact to any major sport just because some generic concepts could be use in them. for my this book works a lot.
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on December 14, 2014
Format: PaperbackVerified Purchase
Missing recent applications of Big Data to Baseball based on PITCHF/x etc. but a good discussion of interface between economics and baseball and why for example the Yankees and Braves could chose differently.
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1 of 2 people found the following review helpful
Format: HardcoverVerified Purchase
This book would have made a much better 20-30 page essay than a self-contained book. The four basic points made are:
A.) Winning teams draw more interest/make more money--especially if they are playoff contenders,
B.) Each player's performance increases/decreases a team's chance of winning to a certain degree. Finding out exactly how much a player impacts a team will help to determine if the player is worth signing/keeping.
C.) Players built up from the minors are much cheaper than free agents. Thus, each team should focus on developing their minor league/player development systems.
D.) There is a certain balance of free-agent/high-priced players vs. cheap, home-grown types that is optimal for winning.

While I don't disagree, there's nothing particularly innovative about the author's approach. The writing was rather business-textbook-like and not terribly engaging. I prefer BP's "Baseball Between the Numbers" for a primer on the economic concerns of baseball.
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on January 6, 2013
Format: HardcoverVerified Purchase
I am a sports enthuiast and this will help me with my fantasy teams, and give ge reading enjoyment. Thank you.
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