NFL Fan and Brand Report 2018

Each year, I do an analysis of NFL fandom.  The analysis is grounded in economic and marketing theory, and uses statistical tools to shed light on the question of which teams have the most loyal or “best” fans.  The key point of differentiation is that this is a truly quantitative analysis.  It’s driven by data, not by emotion.

On a side note, I also regularly podcast on sports and sports analytics topics.  You can find the accompanying episode (and all sorts of other cool stuff) via the link below.

The fundamental question that guides the analysis is simple – Who has the best fans in the NFL?  For the business folks maybe we say this as – What are the best brands in the NFL? These are simple questions without simple answers.  First, we have to decide what we mean by “best”.  What makes for a great fan or brand?  Fans that show up even when the team is losing?  Fans that are willing to pay the highest prices?  Fans that are willing to follow a team on the road or social media?

Even after we agree on the question, answering it is also a challenge.  How do we adjust for the fact that one team might have gone on a miraculous run that filled the stadium?  Or perhaps another team suffered a slew of injuries?  How do we compare fan behavior in a market like New York with fans in a place like Green Bay?

My approach to evaluating fan bases is to use data to develop statistical models of fan interest (more details here).  The key is that these models are used to determine which city’s fans are more willing to spend or follow their teams after controlling for factors like market size and short-term changes in winning and losing.

I use three measures of fan engagement: Fan Equity, Social Equity and Road Equity.  Fan Equity focuses on home box office revenues (support via opening the wallet). Social Media Equity focuses on fan willingness to engage as part of a team’s online community (support exhibited by joining social media communities).  Road Equity focuses on how teams draw on the road after adjusting for team performance.   These metrics provide a balance – a measure of willingness to spend, a measure unconstrained by stadium size and a measure of national appeal.

To get at an overall ranking, I’m going to use the simplest possible method.  A simple average across the three metrics.  (similar analyses are available for the NBA and MLB).  The rankings are based on multiple years of data, use multiple performance measures and sophisticated statistical techniques.  But nothing is perfect and I’d be remiss if I didn’t discuss some of the issues and controversies surrounding the NFL.

Its an understatement, but it’s been a tumultuous last few years for the NFL.  Concussions, anthem protests and domestic abuse scandals have all “complicated” fan’s relationships with teams.  The analytics I present use historical data to provide insight into recent of fan interest.  The analytics provide a measurement of the “fandom” that has been built over decades.  So, what is the impact of the current controversies?  Its impossible to say.

The problem is that while we can measure current fandom with snapshots of spending and social media behavior, the impact of incidents or events such as the anthem protests or the concussion lawsuits may play out over years or decades.  These types of issues might have an immediate impact on some metrics but the salient question is how will they influence long-term preference levels.

There may be “signals” in the data such as changes in TV ratings or higher no-show rates, but it’s tough to tell if these are blips or trends.  In terms of the observed decline in TV ratings, there is no shortage of theories – the aforementioned controversies, key player retirements, the 2016 presidential election, too many games, and just too many entertainment options have all been mentioned as root causes.  The existence of so many theories means that an analytics based approach is going to be difficult if not impossible.  This is especially true because while fandom can dissipate faster than its built, fan loyalty and passion is more likely to fade over years rather than disappear over weeks.

My conjecture is that the concussion issue and the anthem protests are both very significant problems for teams and the NFL brand.  The issues related to concussions may lead to lawsuits and decreased youth participation.  The anthem protests are something about which I’m reluctant to write (given the unfortunate state of the modern university).  But to keep it simple – the anthem protests have inserted some ugly “politics” into what is fundamentally an entertainment category.  If the product becomes less fun, why would you expect fans to enjoy it as much?  And while the phrase “less fun” might seem to trivialize the issues, spending on sports entertainment is about as discretionary as it gets.

Nevertheless, while the NFL has challenges, it is still the preeminent US sports league.  How the league fares in the future is probably going to be based on the strength of its strongest brands.  Which brings us back to our fundamental question – What are the best brands or fan bases in the NFL?

 

The Winners

The top five fan bases (team brands if you prefer) are the Cowboys, Patriots, Eagles, Giants and Steelers.  This is unchanged from last year.  The first switch in the rankings is the number 6 and 7 positions with the Bears moving ahead of the Saints.

The Cowboys excel on all the metrics.  They win in terms of Fan Equity (a revenue premium measure of brand strength), Road Equity and finish second in social media.  The underlying data (I will spare everybody the statistical models) reveals why Dallas does so well.  The Cowboy’s average home attendance usually leads the league, fans are willing to pay high prices, and the team’s twitter following is exceptional.  The Cowboys are America’s team.

The similarity across rankings gives me faith in the results.  However, the fan in me still questions some of what I see.  In terms of full disclosure, I grew up a Steelers fan in the 1970s and lived in the Chicago during the Bear’s glory days.  As such, I bring my personal biases to the interpretation of the findings.  I can’t help but to think of the Patriots as having bandwagon fans, and the Eagles ranking above the Steelers just does not seem right.

The analyst in me understands that the value of using a statistical approach is that the data can help correct my biases.  A couple of comments.  Patriot fans may be bandwagon fans.  But they have been on the bandwagon a long time.  A couple of decades of success likely means that the Patriots will remain NFL royalty even after Tom Brady leaves the game.

The Eagles surprise me, and probably most of western Pennsylvania.  They do get a bump from playing in the NFC East in terms of the Road Equity metric.  The NFC East is a strong collection of brands that benefit each other.  The Giants also benefit.  It is not easy to disentangle these effects.  And perhaps we shouldn’t since we can make a case that the rivalries that benefit these teams are because of the interest in the individual team brands.

 

The Losers

At the bottom of the rankings, we have the Browns, Jaguars, Chiefs, Rams and Titans.  This is an interesting group.  We have the struggling Browns, but we also have some teams like the Titans, Jaguars and Chiefs that have had recent success.

The important fact is that the statistical model I use, evaluates each team’s results based on how the league works on average.  If a team wins but does not convert the wins to increased revenues or social following, then the team will suffer in the rankings.

The good news for these teams (Jags, Chiefs, Titans) is that on-field success is the best way to create brand equity and fan loyalty.  The bad news is that it takes a good amount of success to move the needle long-term.

For the Rams and the Chargers, we should probably include an asterisk. Moving markets and playing in temporary stadiums can lead to some questionable findings.

 

The List

The complete list follows.  In addition to the overall ranking of fan bases, I also report rankings on the fan equity, social equity and road equity measures.  Following the table, I provide a bit more detail regarding each of the metrics.

2018 NFL Brand Rankings

 

Further Explanations

Fan Equity

Winners: Cowboys, 49ers, Patriots

Losers: Rams*, Raiders, Jaguars

Fan Equity looks at home revenues relative to expected revenue based on team performance and market characteristics.  The goal of the metric is to measure over or under performance relative to other teams in the league.  In other words, statistical models are used to create an apples-to-apples type comparison to avoid distortions due to long-term differences in market size or short-term differences in winning rates.

Just like last year, the 49ers are the interesting winner on this metric. After the last couple of years, it is doubtful that people are thinking about the 49ers having a rabid fan base.  However, the 49ers are a prime example of how the approach works.  On the field, the 49ers have not performed well.  Despite the on-field struggles, the 49ers still pack in the fans and charge high prices.  This is evidence of a very strong brand because even while losing the 49ers fans still attend and spend.  In terms of the overall rankings the 49ers don’t do all that great because the team does not perform as well as a road or social media draw.

In terms of business concepts, the “Fan Equity” measure is similar to a “revenue premium” measure of brand equity.  It captures the differentials in fan’s willingness to financially support teams of similar quality.  From a business or marketing perspective this is a gold standard of metrics as it directly relates to how a strong brand translates to revenues and profits.

One important thing to note is that some teams may not be trying to maximize revenues.  Perhaps the team is trying to build a fan base by keeping prices low.  Or a team may price on the low side based on some notion of loyalty to its community.   In these cases, the Fan equity metric may understate the engagement of fans.  I suspect that this is the case for the Steelers.

 

Social Media Equity

Winners: Patriots, Cowboys, Steelers

Losers: Rams, Jaguars, Titans

Social Media Equity is also an example of a “premium” based measure of brand equity.  It differs from the Fan Equity in that it focuses on how many fans a team has online rather than fans’ willingness to pay higher prices.  Similar to Fan Equity, Social Media Equity is also constructed using statistical models that control for performance and market differences.

In terms of business application, the social media metric has several implications both on its own merits and in conjunction with the Fan Equity measure.  For example, the lack of local constraints, means that the Social Equity measure is more of a national level measure.  While the Fan Equity metric focuses on local box office revenues, the social metric provides insight into how a team’s fandom extends beyond a metro area.

Social Media Equity may also serve as a leading indicator of a team’s future fortunes.  For a team to grow revenues it is often necessary to implement controversial price increases.  Convincing fans to sign expensive contracts to buy season tickets can also be a challenge.  Increasing prices and acquiring season ticket holders can therefore take time, while social media communities can grow quickly.  Preliminary analysis suggests that vibrant social communities are positively correlated with future revenue growth.

A comparison of Fan Equity and Social Media can also be useful.  If Social Media equity exceeds Fan Equity it is evidence that the team has some marketing potential that is not being exploited.  For example, one issue that is common in sports is that it is difficult to estimate the price elasticity of demand because demand is often highest for the best teams and best seats.  The unconstrained nature of social media can provide an important data point for assessing whether a team has additional pricing flexibility.

 

Road Equity

Winners: The NFC East, Raiders, Patriots and Steelers

Losers: Texans, Titans and Browns

Another way to look at fan quality is how a team draws on the Road.  There was a famous case in Atlanta just a few years ago, when Steelers fans turned the Georgia dome Gold and Black.

The Road Equity measure can be interpreted in multiple ways.  If a team has great road attendance, is it because the fans are following the team or because they have a national following?  In other words, do the local fans travel or does a team with high road attendance have a national following. When the Steelers turned the Georgia Dome Gold and Black was it because Steelers fans came down from Pittsburgh or because Steelers fans are everywhere.

I suspect that we are capturing a measure of national following rather than a tendency to travel.  The Road Equity rankings are dominated by high profile teams such as the Cowboys, Patriots and Steelers.  These teams also do very well on the Social Equity measure (which also measures national following).  This correlation gives me a confidence that the Road Equity picks up a measure of national following.

 

 

 

 

NFL Fan Base and Brand Rankings 2017

NFL Fandom Report 2017: The “Best” NFL Fans

Who has the best fans in the NFL?  What are the best brands in the NFL? These are simple questions without simple answers.  First we have to decide what we mean by “best”.  What makes for a great fan or brand?  Fans that show up even when the team is losing?  Fans that are willing to pay the highest prices?  Fans that are willing to follow a team on the road or social media?

Even after we agree on the question, answering it is also a challenge.  How do we adjust for the fact that one team might have gone on a miraculous run that filled the stadium?  Or perhaps another team suffered a slew of injuries?  How do we compare fan behavior in a market like New York with fans in a place like Green Bay?

My approach to evaluating fan bases is to use data to develop statistical models of fan interest (more details here).  The key is that these models are used to determine which city’s fans are more willing to spend or follow their teams after controlling for factors like market size and short-term changes in winning and losing.

In past years, two measures of engagement have been featured: Fan Equity and Social Media Equity.  Fan Equity focuses on home box office revenues (support via opening the wallet) and Social Media Equity focuses on fan willingness to engage as part of a team’s community (support exhibited by joining social media communities).  This year I am adding a third measure Road Equity.  Road Equity focuses on how teams draw on the road after adjusting for team performance.   These metrics provide a balance – a measure of willingness to spend, a measure unconstrained by stadium size and a measure of national appeal.

To get at an overall ranking, I’m going to use the simplest possible method.  We are just going to average the across the three metrics.  (similar analyses are available for the NBA and MLB).

The Winners

The top five fan bases (team brands if you prefer) are the Cowboys, Patriots, Eagles, Giants and Steelers.  The Cowboys excel on all the metrics.  They win in terms of Fan Equity (a revenue premium measure of brand strength), Road Equity and finish second in social media.  The underlying data (I will spare everybody the statistical models) reveals why Dallas does so well.  The Cowboy’s average home attendance (reported by ESPN) is more than 10,000 higher than the next team.  The Cowboys average ticket price is also well above average and they have the second most Twitter followers after the Patriots.  The other thing to note is that the Cowboys achieve these year in and year out , even in years when the team is not great.  

There are likely some objections to the list.  Patriot fans are bandwagon fans!  The Steelers are too low!  The Eagles above the Packers or Bears?!   Way too much to get into in a short blog post but a couple of comments.

First, Patriot fans may be bandwagon fans.  But at this point it is tough to tell.  The team has been excellent and the fans have been supportive for a long time.  And even when things tend to go wrong for the Patriots they come out ahead.  I believe that the deflate gate controversy had a significant positive impact on the Patriots’ social media following.

The Steelers are low in Fan Equity and higher on the other metrics.  We can trace this to the Steelers pricing.  The Steelers seem to price on the low side of what is possible.

The Eagle do surprise me.  They do get a bump from playing in the NFC East interms of the Road Equity metric.  The NFC East is a strong collection of brands that benefit each other.  It is not easy to disentangle these effects.  And perhaps we shouldn’t since we can make a case that the rivalries that benefit these teams are because of the interest in the individual brands.

The Losers

At the other extreme we have the Bengals, Jaguars, Titans, Rams and Chiefs.  Some of these are no surprises.  At the top of the list we have the NFL’s royalty.  No one has ever placed the Bengals, Jaguars or titans in that category.

The teams at the bottom of the rankings all suffer from relatively low attendance, have below average pricing power and have limited social followings.  The Rams are a special case.  While not a great brand in past years, the move to LA tends to punish the Rams because their results have not kept pace with the higher income and population levels in LA.

The Chiefs are the tough one on this list.  The Chiefs fill their stadium but at relatively low price.  Keep in mind that the analysis includes factors such as population and median income.  In addition, Kansas City was ranked 29th in terms of Road Attendance last year and the social media following (Twitter) is middle of the road.  The fundamental issue is that that the Chiefs produce these below average fan-based results while performing well above average on the field.

The Complete List

The complete list follows.  In addition to the overall ranking of fan bases, I also report rankings on the social and road measures.  Following the table, I provide a bit more detail regarding each of the metrics.

Three metrics are used to get a complete picture of fans.  But there are other ways to look at fan behavior and brand strength.  For example, we could look at pricing power (which teams are able to extract significant price premiums) or bandwagon fan behavior (which fans are most sensitive to winning).  I’m happy to provide these additional rankings if there is interest.

Fan Equity

Winners: Cowboys, Patriots and 49ers

Losers: Rams, Raiders, Jags

Fan Equity looks at home revenues relative to expected revenue based on team performance and market characteristics.  The goal of the metric is to measure over or under performance relative to other teams in the league.  In other words, statistical models are used to create an apples-to-apples type comparison to avoid distortions due to long-term differences in market size or short-term differences in winning rates.

The 49ers are the interesting winner on this metric.  After the last couple of years, it is doubtful that people are thinking about the 49ers having a rabid fan base.  However, the 49ers are a great example of how the approach works.  On the field the 49ers have been terrible.  But despite the on-field struggles the 49ers still pack in the fans and charge high prices.  This is evidence of a very strong brand because even while losing the 49ers fans still attend and spend.  In terms of the overall rankings the 49ers don’t do all that great because the team does not perform as well as a road or social media draw.

In terms of business concepts, this “Fan Equity” measure is similar to a “revenue premium” measure of brand equity.  It captures the differentials in fan’s willingness to financially support teams of similar quality.  From a business or marketing perspective this is a gold standard of metrics as it directly relates to how a strong brand translates to revenues and profits.

One important thing to note is that some teams may not be trying to maximize revenues.  Perhaps the team is trying to build a fan base by keeping prices low.  Or a team my price on the low side based on some notion of loyalty to its community.   In these cases the Fan equity metric may understate the engagement of fans.

Social Media Equity

Winners: Patriots, Cowboys and Broncos

Losers: Chiefs, Rams and Cardinals

Social Media Equity is also an example of a “premium” based measure of brand equity.  It differs from the Fan Equity in that it focuses on how many fans a team has online rather than fans’ willingness to pay higher prices.  Similar to Fan Equity, Social Media Equity is also constructed using statistical models that control for performance and market differences.

In terms of business application, the social media metric has several implications both on its own merits and in conjunction with the Fan Equity measure.  For example, the lack of local constraints, means that the Social Equity measure is more of a national level measure.  so while the Fan Equity metric focuses on local box office revenues, the social metric provides insight into how a team’s fandom extends beyond a metro area.

Social Media Equity may also serve as a leading indicator of a team’s future fortunes.  For a team to grow revenues it is often necessary to implement controversial price increases.  Convincing fans to sign expensive contracts to buy season tickets can also be a challenge.  Increasing prices and acquiring season ticket holders can therefore take time, while social media communities can grow quickly.  Some preliminary analysis suggests that vibrant social communities are positively correlated with future revenue growth.

A comparison of Fan Equity and Social Media can also be useful.  If Social Media equity exceeds Fan Equity it is evidence that the team has some marketing potential that is not being exploited.  For example, one issue that is common in sports is that it is difficult to estimate the price elasticity of demand because demand is often highest for the best teams and best seats.  The unconstrained nature of social media can provide an important data point for assessing whether a team has additional pricing flexibility.

Road Equity

Winners: Cowboys, Eagles and Raiders

Losers: Texans, Titans and Seahawks

Another way to look at fan quality is to look at how a team draws on the Road.  In the NBA these effects are pronounced.  Lebron or a retiring Kobe coming to town can often lead to sell outs.  At the college level some teams are known to travel very well.  A fan base that travels is almost by definition incredible passionate.

This one has a bit of a muddled interpretation.  If a team has great road attendance is it because the fans are following the team or because they have a national following?  In other words, do the local fans travel or does a team with high road attendance have a national following.  When the Steelers turned the Georgia Dome Yellow and Black was it because Steelers fans came down from Pittsburg or because the Steelers have fans everywhere.

Furthermore, if it is a national following is it because the team is popular across the country or because a lot of folks have moved from places like Pittsburgh or Buffalo to the Sun Belt.  A national following is a great characteristic that might suggest that a team’s brand is on an upswing.  Or it might be that the city itself is on a downward trajectory.

 

 

NFL Bandwagon Fans and the Business of Fan Rankings

The Business behind Fan Base Analysis: Sponsorship Insights

Today’s post is a follow up to the NFL fan base rankings post.  The annual NFL Fan base ranking involves a combination of data analysis and marketing ideas (brand equity).  I do them as a single ranking to make it easily digestible and to encourage conversation.  Or in the case of Raider Fans – to generate threats.  Today, I go beyond a single ranking and present multiple fan base metrics.  The goal is to provide a richer description of how teams’ fans compare.  Specifically, we present rankings focused on brand equity, social media, road attendance and “bandwagon” behavior.

The fan analysis material is meant to be both instructive and to provide material for debate.  Sports brands are unique in the degree of loyalty that exists between fans and teams.  The reaction to the fan base rankings highlights the intensity of the relationships as people take it very personally when their fandom is questioned.  It’s interesting that it matters to fans not only that their team is competitive but that their passion for their team also exceeds the opposition’s.  As such it’s crucial for teams to thoroughly understand the strengths and weaknesses of their fan bases.

Something that tends to get lost in the discussion of fan base rankings is that the results have very significant business implications.  The fan equity and other measures that we discuss today tell an essential story about fans in each city.  If I am a brand looking to sponsor a stadium or a fast food company looking to do a deal with a team, then I very much want to know about the underlying long-term passion and behaviors of the fan base.

A common approach for valuing sports properties is the use of comparables.  The basic idea is that some entity, like a team or player, can be valued by looking at similar teams or players.  For example, a way to value a team is to look at previous sales and then make some adjustments for differences in population or income across markets.  Stadium naming deals are often similarly driven by past deals.

The Fan Equity work and rankings below provide extra factors that can be added to analyses based on comparables.  The rankings can be used to go beyond demographics driven comparisons to include a measure of engagement or loyalty.

In what follows, I provide a few insights about each of the metrics and then a Table that provides a complete breakdown.  I also discuss the business relevance of each of metric.  There are a number of caveats that should be offered such as the importance of looking at multiple metrics or noting that the results rely on public data.  But these explanations are a bit tedious and the key point is that the metrics should be carefully interpreted.

One important factor that should be stressed is that all of the measures are based on market place behaviors of fans like attending games and following on social media rather than consumer opinions collected via surveys.

The rankings should be interpreted with care.  A high ranking on the brand equity measures is something to strive for while a high ranking in the bandwagon category is something to avoid.


rankings16

Fan Equity

The Winners: Cowboys, Patriots and Ravens

The Losers: Jaguars, Raiders and Dolphins

Fan Equity is the core of the Dynamic Fan Equity (DFE) metric used to summarize fan bases.  It looks at home revenues relative to expected revenue based on team performance and market characteristics.  The goal of the metric is to measure over (or under) performance relative to other teams in the league.  In other words, statistical models are used to create an apples to apples type comparison to avoid distortions due to long-term differences in market size or short-term differences in winning rates.

In terms of business concepts, this measure is similar to a “revenue premium” measure of brand equity.  It captures the differentials in fans willingness to financially support teams of similar quality.  From a business or marketing perspective this is a gold standard of metrics as it directly relates to how a strong brand translates to revenues and profits.

However, the Fan Equity context is sports, and that does make things different.  At a basic level sports organizations have dual objectives.  They care about winning and profit.  That is important because sometimes teams aren’t trying to maximize revenues (Packers, Steelers, etc…).   When this is the case the Fan Equity metric understates the engagement of fans.

What is the importance of Fan Equity for sponsorship?  Fan Equity shows the relative commitment to spend to support the team.  If we make the assumption that paying a premium (remember the model controls for the income differences across markets) is correlated with passion then teams with higher fan equity have fans that are more deeply bonded to the team.  These teams should receive a bump in terms of sponsorship deals.

 

Social Media Equity

Winners: Patriots, Cowboys and Broncos

Losers: Rams, Chiefs and Cardinals

An issue with the Fan Equity measure is that it can be constrained by capacity or by team pricing decisions.  If teams have a small stadium or are NOT pricing to maximize revenues then the Fan Equity measure can understate the team’s following.  In contrast to buying a ticket, following on social media is free and not impacted by geography.  It’s just as easy to follow the Seahawks as it is to follow the Falcons while sitting in Atlanta.

Social Media Equity is also an example of a “premium” based measure of brand equity.  It differs from the Fan Equity in that it focuses on how many fans a team has online rather than fans’ willingness to pay higher prices.  Social Media Equity is also constructed using statistical models that control for performance and market differences.

In terms of business application, the social media metric has several implications both on its own merits and in conjunction with the Fan Equity measure.  For example, the lack of local constraints, means that the Social Equity measure is more of a national level measure.  The Fan Equity metric focuses on local box office revenues while the social metric provides insight into how a team’s fandom extends beyond a metro area.

Social Media Equity may also serve as a leading indicator of a team’s future fortunes.  For a team to grow revenues it is often necessary to implement controversial price increases.  Convincing fans to sign expensive contracts to buy season tickets can also be a challenge.  Increasing prices and acquiring season ticket holders can therefore take time while social media communities can grow quickly.  Some preliminary analysis suggests that vibrant social communities are positively correlated with future revenue growth.

A comparison of Fan Equity and Social Media can also be useful.  If Social Media equity exceeds Fan Equity it is evidence that the team has some marketing potential that is not being exploited.  For example, one issue that is common in sports is that it is difficult to estimate the price elasticity of demand because demand is often highest for the best teams and best seats.  The unconstrained nature of social media can provide an important data point for assessing whether teams have additional pricing flexibility.

 

Road / Diaspora Equity

Winners: Eagles, Cowboys, Giants and the Bills in TOP TEN!

Losers: Chiefs, Cardinals and Texans

This is a new metric for the blog and a vocabulary lesson all in one.  One way to look at fan quality is to look at how a team draws on the Road.  For example, in the NBA these effects are pronounced.  Lebron or a retiring Kobe coming to town can often lead to sell outs.  College football is especially noted for traveling fans (SEC!).  A fan base that travels is almost by definition incredibly passionate.

This one has a bit of a muddled interpretation.  If a team has great road attendance is it because the fans are following the team or because they have a national following?  In other words, are fans traveling to the game or just showing up because it’s the Cowboys or Steelers?  Furthermore, if it is a national following is it because the team is popular across the country or because a lot of folks have moved from Pittsburgh or Buffalo to the Sun Belt?

Road Equity tells a story and suggests a need for additional research.  A national following is a great characteristic that might suggest that a team’s brand is on an upswing.  Or it might be that the city itself is on a downward trajectory.  Road equity might also be a matter of temporary factors (beyond winning) if fans are drawn to star or controversial players.

 

Band Wagon Fans

Biggest Bandwagon Fans: Cardinals and Cowboys

Loyal to a Fault: Bills, Lions and Redskins

This ranking looks at how responsive attendance is to winning.  This is a fun one because there are two really different interpretation of the results.  The more negative one is that a team whose fans show up less when the team is losing has a “fair weather” or “band wagon” fan base.  The other interpretation is that fans that are sensitive to winning are more demanding of quality.  The former seems most likely.

The rankings come directly from a statistical model of attendance.  The top ranked bandwagon fans are the ones whose attendance is most sensitive to winning.  Based on the data and models the Arizona Cardinal fans are the most “Bandwagon” of all the fan bases.  On the other extreme we have the Bills, Lions and Redskins fans as the most loyal.

From a sponsorship perspective, a high bandwagon ranking might make a sponsoring brand leery.  If fans only show up when a team is winning then the team might not have the relationship intensity with fans that a sponsor is trying to leverage.  An important reason for sports sponsorships is that brands want to be associated with teams that fans live and die with.  If a team is just entertainment then maybe a sponsorship is not going to generate the associations and connections desired.

There is complexity in the real world and all of these measures have limits.  The Cowboy fans are an interesting case study.  The Cowboys rank #2 in bandwagon fandom but they also rank very highly in the other brand equity measures.  Cowboy fans buy tickets and follow their team on social media.  The national stature of the Cowboys also brings in fans on the road.  But in terms of actually showing up at games it seems like the fans need a winner.  Loyalty in terms of spending but fair weather in terms of showing up.

The Best NFL Fans 2016: The Dynamic Fan Equity Methodology

The Winners (and Losers) of this years rankings!  First a quick graphic and then the details.

2016B_W

It’s become a tradition for me to rank NFL teams’ fan bases each summer.  The basic approach (more details here) is to use data to develop statistical models of fan interest.  These models are used to determine which cities fans are more willing to spend or follow their teams after controlling for factors like market size and short-term variations in performance.  In past years, two measures of engagement have been featured: Fan Equity and Social Media Equity.  Fan Equity focuses on home box office revenues (support via opening the wallet) and Social Media Equity focuses on fan willingness to engage as part of a team’s community (support exhibited by joining social media communities).

This year I have come up with a new method that combines these two measures: Dynamic Fan Equity (DFE).  The DFE measure leverages the best features of the two measures.  Fan Equity is based on the most important consumer trait – willingness to spend.  Social Equity captures fan support that occurs beyond the walls of the stadium and skews towards a younger demographic.  The key insight that allows for the two measures to be combined is that there is a significant relationship between the Social Media Equity trend and the Fan Equity measure.  Social media performance turns out to be a strong leading indicator for financial performance.

Dynamic Fan Equity is calculated using current fan equity and the trend in fan equity from the team’s social media performance.  I will spare the technical details on the blog but I’m happy to go into depth if there is interest.  On the data side we are working with 15 years of attendance data and 4 years of social data.

The Winners

We have a new number one on the list – the New England Patriots. Followed by the Cowboys, Broncos, 49ers and Eagles.  The Patriots victory is driven by fans willingness to pay premium prices, strong attendance and phenomenal social media following.  The final competition between the Cowboys and the Patriots was actually determined by the long-term value of the Patriots greater social following.  The Patriots have about 2.4 million Twitter followers compared to 1.7 for the Cowboys.  Of course this is all relative a team like the Jaguars has just 340 thousand followers.

The Eagles are the big surprise on the list.  The Eagles are also a good example of how the analysis works.  Most fan rankings are based on subjective judgments and lack controls for short-term winning rates.  This latter point is a critical shortcoming.  It’s easy to be supportive of a winning team. While Eagles fans might not be happy they are supportive in the face of mediocrity.  Last year the Eagles struggled on the field but fans still paid premium prices and filled the stadium.  We’ll come back to the Eagles in more detail in a moment.

The Strugglers

At the bottom we have the Bills, Rams, Chiefs, Raiders and Jaguars.  This is a similar list to last year.  The Jags, for example, only filled 91% of capacity (ranked 27th) despite an average ticket price of just $57.  The Chiefs struggle because the fan support doesn’t match the team’s performance.  The Chiefs capacity utilization rate ranks 17th in the league despite a winning record and low ticket prices.  The Raiders fans again finish low in our rankings.  And every year the response is a great deal of anger and often threats.

The Steelers

The one result that gives me the most doubt is for the Pittsburgh Steelers.  The Steelers have long been considered one of the league premier teams and brands.  The Steelers have a history of championships and have been known to turn opposing stadiums into seas of yellow and black.  So why are the Steelers ranked 18th?

steeler_atl

A comparison between the Steelers and the Eagles highlights the underlying issues.  Last year the Steelers had an average attendance of 64,356 and had an average ticket price of $84 (from ESPN and Team Market Report).  In comparison the Eagles averaged 69,483 fans with an average price of $98.69.  In terms of filling capacity the Steelers were at 98.3% compared to the Eagles at 102.8%.  The key is that the greater support enjoyed by the Eagles was despite a much worse record.

One issue to consider is that of pricing.  It may well be that the Steelers ownership makes a conscious effort to underprice relative to what the market would allow.  The high attendance rates across the NFL do suggest that many teams could profitably raise prices.  It’s entirely reasonable to argue that the Steelers relationship to the Pittsburgh community results in a policy of pricing below market.

In past years the Steelers have been our social media champions.  This past year did see a bit of a dip.  In terms of the Social Media Equity rankings the Steelers dropped to 5th.    As a point of comparison, the Steelers have about 1.3 million Twitter followers compared to 2.4 million for the Patriots and 1.7 million for the Cowboys.

 

The Complete List

And finally, the complete rankings.  Enjoy!


2016complete

2015 NFL Fan Equity Rankings

Note: For Part 2 of our rankings (NFL Social Media Equity) click here 

For the past three years, we have tried to answer the question of which teams have the “best” fans. “Best” is a funny word that can mean a lot of things but what we are really trying to get at is what team has the most avid, engaged, passionate and supportive fans. The twist is that we are doing this using hard data, and that we are doing it in a very controlled and statistically careful fashion.

By hard data we mean data on actual fan behavior. In particular, we are focused on market outcomes like attendance, prices or revenues. A lot of marketing research focused on branding issues relies on things like consumer surveys. This is fine in some ways, but opinion surveys are also problematic. It’s one thing to just say you are a fan of a local team, and quite another to be willing to pay several thousand dollars to purchase a season ticket.

To truly understand fan engagement, it’s important to statistically control for temporary changes in the environment. This is a huge issue in sports because fans almost always chase a winner. The real quality of the sports brand is revealed when fans support a team through the tough times. The Packers or Steelers will sell-out the year after they go 6-10, not so much for the Jaguars. The other thing that separates sports brands from consumer brands is the cities themselves. The support a New York team gets in terms of attendance and pricing is always going to be tough to achieve for the team in Charlotte.

In terms of the nuts and bolts of what we are about to present, we use fifteen years of data on NFL team performance, ticket prices, market populations, median incomes, won-loss records and multiple other factors. We create statistical models of box office revenue, and then see which teams over- and under- perform the model’s predictions.   For a much fuller description, and some limitations about what we are doing click here.

So who has the best fans? The winner this year is the Dallas Cowboys followed by the Patriots, Giants, Ravens, and Jets. The Cowboys have a storied history, a market that loves all forms of football, and a world-class stadium. “Deflate-gate” hasn’t hit the window of our analysis yet (it is after the 2014-2015 season), but the Pats strong showing in our ranking suggests that the impact will be small. The Jets position might be somewhat surprising, but this team draws well, and has great pricing power without a lot of winning on the field.

Maybe the biggest surprise is some of the teams that aren’t at the top. The Steelers and Packers have great fan followings.  The Seahawks are slowly developing a great fan base.  And these teams will do better when we switch to non-financial metrics such as social media following. But for the current “revenue premium” model these teams just don’t price high enough. In a way, these teams with massive season ticket waiting lists are the most supportive of their fans.

At the bottom we have the Bills, Jags, Raiders, Browns and Dolphins. There are some interesting and storied teams on this list. The Raiders have a ton of passion in the end zone but maybe not throughout the stadium.   Cleveland may have never recovered from the loss of the Ravens, and the recreation of the Browns. Florida is almost always a problem on our lists. Whether it is the weather or the fact that many of the locals are transplants that didn’t grow up with the team, Florida teams just don’t get the support of teams in other regions.

2015 NFL FAN EQUITY

Mike Lewis & Manish Tripathi, Emory 2015.

NFL Fan Equity: Maybe the Cowboys are America’s Team?

Note: This was originally published on August 15, 2013

The NFL is America’s favorite professional sports league, but which of its teams has the most loyal and supportive fan base?  This is not a straightforward question.  A ranking based on attendance would be skewed toward teams that play in more populated metropolitan areas, and a ranking based on profitability or revenues would be biased in favor of teams that are currently enjoying more on-field success.

In our series of fan base analyses across leagues, we adjust for these complicating factors using a revenue premium model of fan equity.  The key idea is that we look at team box office revenues relative to team on-field success, market population, stadium capacity, median income and other factors.  The first step in our procedure involves the creation of a statistical model that predicts box office revenue as a function of the aforementioned variables.  We then compare actual revenues to the revenues predicted by the model.  Teams with relatively stronger fan support will have revenues that exceed the predicted values, and teams that under perform have relatively less supportive fan bases. We provide more details on the method here and here.

The top fan base was the Dallas Cowboys.  Professor Lewis grew up a Steelers fan in the 1970s so this was a bit of a painful result.  Professor Tripathi grew up as a Redskins fan, and is terribly disturbed by the results of the study.  What are keys to the Cowboys’ ability to create a passionate and supportive fan base?  We think it’s a long legacy of success, a football mad Texas culture and a state of the art stadium.  Over the last three seasons (the time period used to calculate fan equity) the Cowboys have played sub .500 football but generated above capacity attendance (at least according to ESPN).

In positions two and three we have the New England Patriots and the New York Jets.  New England has an all-around strong fan base, while the Jets are somewhat similar to the Cowboys in that they draw consistently well, regardless of the on-field product.  In fourth and fifth place we have the New Orleans Saints and the New York Giants.  The Saints are a more recent success story, but the team’s new success combined with limited professional sports options in New Orleans has created a very strong fan base.  Two New York teams in the top five is an interesting result when viewed in relation to our college football fan base analyses.  New York is (no surprise here) a pro sports town.  As an aside, we will be interested to see how much value the Big Ten gains from acquiring a foothold in the NYC market starting in 2014.

At the more unfortunate end of the scale we have a bottom five of Detroit, Tampa Bay, Arizona, Atlanta and Oakland.  Detroit, of course, suffers from a relative lack of on-field success and a struggling local economy.  But we should note that our method does explicitly control for these factors.  It may well be a matter of the Wolverines & Spartans winning the battle for fans against the Lions.  Similarly, teams like Atlanta and Tampa Bay may suffer from being located in SEC territory.

Note: Here are the first and second follow-ups to our study.  For an alternative fan ranking using “Social Media Equity,” click here.

Mike Lewis & Manish Tripathi, Emory University 2013.

Social Media Equity in the NFL: Another Metric for Evaluating Fans

Please click here for our NFL Fan Equity Rankings

Please click here for our NBA Social Media Equity Rankings

Our approach to NFL fan equity begins from the premise that teams try and maximize revenues.  This is an important assumption, and one that one that seems to be justified by teams pursuing practices like dynamic pricing and personal seat licenses.  But, if a team is pricing below what local market conditions would allow, our method can be problematic because NFL stadiums are of finite capacity.

What we would ideally like to have is a fan metric that is not constrained by stadium sizes.  The world of social media can provide this type of metric.  In today’s installment we assess NFL fan base quality using information on teams’ ability to acquire Twitter followers.

The simplest measurement of social media strength is to look at Twitter follower counts across teams.  Using this metric, the top 5 teams are the Patriots, Cowboys, Jets, Steelers, and Packers.  The bottom five includes the Titans, Buccaneers, Rams, Jaguars and Cardinals.  While gathering this data we did come across some interesting results.  The Patriots lead the league with about 650,000 followers while the Cardinals are in 32nd place with 62,000 followers.  Notably the Cardinals had only 31 more followers than the Cowboy Cheerleaders.

But as always, the raw numbers can be deceiving. The Jets play in a market that dwarfs the Steelers, and Twitter success is probably highly correlated to teams’ recent on-field success.  To calculate “Social Media Equity” we start by building a statistical model that predicts Twitter followers based on team winning percentage from 2012, market population and median income.  We then compare this prediction with the actual follower count.  The difference between actual and predicted followers provides a measure of over or under performance in the social media space.  Note: We could also have used Facebook fans for the analysis.

In terms of this measure of “social media equity” the top 5 were the Steelers, Cowboys, Patriots, Packers and Saints (and the Jets in 6th).  In terms of our previous fan equity ranking, the biggest change was for the Steelers and Packers.  The Cowboys, Patriots, Saints and Jets were strong in both rankings.  In terms of the critique that some owners may systematically underprice, the Steelers and Packers seem like two of the most likely candidates.

At the other end of the list in last place are the Arizona Cardinals.  The Cardinals play in a larger market than the Steelers but only have 11% of the Twitter followers.  Another notable bottom dweller is the Redskins.  The Redskins play in a large market but have less than half the Twitter followers as do the Cowboys.

We have noted the advantage of using Twitter followers as a metric.  This measure is not constrained by stadium capacity and fans are able to show there interest without an economic sacrifice.  However, this measure could also be criticized.  For example, if the goal is to assess fan passion or loyalty it is not clear how correlated an unobservable trait such as loyalty will be with Twitter follow rates.  A second issue is that teams may invest different levels of resources into their social media efforts.  If team A emphasizes their Twitter handle in ad copy while team B does not, then a straight comparison can be misleading.  A third issue is that the data available for this type of analysis is very limited.  While attendance rates are observable for decades, social media data is a very recent phenomenon.

Mike Lewis & Manish Tripathi, Emory University 2013.

More on NFL Fan Equity: Dynamics & Mascots

Last week we presented our ranking of NFL fan bases.  The Cowboys, Patriots, Jets and Saints headed this list, and every other city in America let us know that our study was garbage.  As in any study of this nature, there will always be limitations that leave room for debate.

One such source of debate is in how much data we use for assessing fan equity.  We use 11 years of data to develop a model for forecasting expected consumer demand (the forecast is based on winning percentage, pricing, stadium capacity, metro area population, metro area median income and other factors).  We then determined fan equity (fan loyalty and support) by comparing the model forecasts to each team’s last three years of results.

One important question is whether three years is sufficient.  In our minds three years is a compromise.  An argument in favor of a lengthier time horizon is that fan loyalty is a persistent trait that moves slowly.  If this is the case, it might make sense to look at relative performance for the last five or ten years of data.  On the other hand, the world is constantly changing and evolving so it also makes sense to focus on recent history.  In the case of sports, if championships and post season success are the sources of long-term fan equity then using a shorter horizon that is sensitive to near term changes makes sense.

The top five for the last the last decade would be New England, Washington, Kansas City, Denver and Pittsburgh.  This list will likely make other fans happy but it will still result in significant unhappiness in Green Bay.  Later this week we will discuss in more depth why some of the teams that conventional wisdom would suggest to be at the top of our list fell short.

We can also look at who is rising and who is falling.  For this analysis we compare the fan equity rankings using the first 3 years of the data (2002 to 2005) with the last three years (2010 to 2012).  The analysis finds that the biggest risers were the Cowboys, Jets and Colts.  The four biggest drops were the Chiefs, Buccaneers, Rams and Redskins.  This list shows both the pros and cons of using short versus long horizons.  The short horizon allows us to capture the long-term impact of what Peyton Manning delivered the Colts and the importance of the Cowboys’ new stadium.  On the negative side, the early success of the Rams and the Bucs seems to have turned out to be short lived.

There is one other element of the preceding list of teams that have suffered a decline in fan equity that may raise some eyebrows.  Two of the teams that suffered dramatic drops have Native American oriented team names: The Chiefs and the Redskins.  Over the last decade we have witnessed an increase in efforts to eliminate Native American team names and mascots.  Lewis is an Illinois grad and Tripathi is a Redskins fan so they know firsthand how a mascot controversy can split a fan base.  There are, of course, alternative explanations for why these two teams’ fan equity has decreased (but keep in mind that we do control for team performance) but it is at least noteworthy that two of the four teams with the biggest drops have controversial team names.

Mike Lewis & Manish Tripathi, Emory University 2013.

NFL Fan Equity: Maybe the Cowboys are America’s Team?

Note: We have been getting a lot of questions about our study.  Here are the first and second follow-ups to our study.  For an alternative fan ranking using “Social Media Equity,” click here.

The NFL is America’s favorite professional sports league, but which of its teams has the most loyal and supportive fan base?  This is not a straightforward question.  A ranking based on attendance would be skewed toward teams that play in more populated metropolitan areas, and a ranking based on profitability or revenues would be biased in favor of teams that are currently enjoying more on-field success.

In our series of fan base analyses across leagues, we adjust for these complicating factors using a revenue premium model of fan equity.  The key idea is that we look at team box office revenues relative to team on-field success, market population, stadium capacity, median income and other factors.  The first step in our procedure involves the creation of a statistical model that predicts box office revenue as a function of the aforementioned variables.  We then compare actual revenues to the revenues predicted by the model.  Teams with relatively stronger fan support will have revenues that exceed the predicted values, and teams that under perform have relatively less supportive fan bases. We provide more details on the method here and here.

The top fan base was the Dallas Cowboys.  Professor Lewis grew up a Steelers fan in the 1970s so this was a bit of a painful result.  Professor Tripathi grew up as a Redskins fan, and is terribly disturbed by the results of the study.  What are keys to the Cowboys’ ability to create a passionate and supportive fan base?  We think it’s a long legacy of success, a football mad Texas culture and a state of the art stadium.  Over the last three seasons (the time period used to calculate fan equity) the Cowboys have played sub .500 football but generated above capacity attendance (at least according to ESPN).

In positions two and three we have the New England Patriots and the New York Jets.  New England has an all-around strong fan base, while the Jets are somewhat similar to the Cowboys in that they draw consistently well, regardless of the on-field product.  In fourth and fifth place we have the New Orleans Saints and the New York Giants.  The Saints are a more recent success story, but the team’s new success combined with limited professional sports options in New Orleans has created a very strong fan base.  Two New York teams in the top five is an interesting result when viewed in relation to our college football fan base analyses.  New York is (no surprise here) a pro sports town.  As an aside, we will be interested to see how much value the Big Ten gains from acquiring a foothold in the NYC market starting in 2014.

At the more unfortunate end of the scale we have a bottom five of Detroit, Tampa Bay, Arizona, Atlanta and Oakland.  Detroit, of course, suffers from a relative lack of on-field success and a struggling local economy.  But we should note that our method does explicitly control for these factors.  It may well be a matter of the Wolverines & Spartans winning the battle for fans against the Lions.  Similarly, teams like Atlanta and Tampa Bay may suffer from being located in SEC territory.

We will continue this discussion next week so please check back.

Mike Lewis & Manish Tripathi, Emory University 2013.