NFL Fandom Report 2019

 

Time for our yearly look at NFL fandom.

Each year, I do a quantitative 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 fundamental question that guides the analysis is simple – Who has the best fans in the NFL?  For the business folks, maybe we phrase this as – What are the best brands in the NFL? It’s a simple question that requires some complicated analyses.  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 social media? Fans that show up to see the team play in other markets? All good options.

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 uses data on attendance, revenues, social media following and road attendance to develop statistical models of fan interest (more details here).  The key is that the 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.

Similar to past years, 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 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 balanced analyses of fandom – 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 use a statistical tool that looks at the correlation across the three metrics to create a “Brand Equity Factor”.  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.  This is unchanged from the last two years – leaving me with little to say. The Cowboys have long been NFL royalty and the Patriots are now firmly established at the top of the league. It remains to be seen if the Patriots will remain near the top when Brady and Belichick move on.

In past years I have noted that the Eagles are a bit of a surprise.  But the strong social and road scores keep the Eagles near the top. The Steelers could probably be a bit higher on the list. The Steelers tend to price near the middle of the league and this limits their Fan Equity score.

The Giants are an interesting case. They do well on Fan Equity (especially compared to the Jets) and the Road Equity score is impressive.  The Social Equity score suggests that the Giants are more of a regional brand but when your region is NYC it’s not a major problem. The Road Equity score is an interesting one to debate. The teams in the NFC East all do well on this measure. I could adjust for divisional affiliation but the NFC East is, for whatever reason, the glamour division of the NFL. My feeling (like I said it’s debatable) is that the teams in that division should be given credit for the divisions appeal.

The next group of five includes the Packers, Broncos, Bears, 49ers and Saints.  A lot of face validity to these results. The 49ers might raise some eyebrows, but it is a team that does very well in terms of attendance and pricing power. The Bears, Packers and Broncos are all strong brands with impressive histories. The Saints are the relative newcomer in the top ten. Like the Patriots, it will be interesting to see how Saints fandom responds when Drew Brees retires.

 

The Losers

At the bottom of the rankings, we have the Bengals, Jaguars, Titans, Chiefs and Rams. Only minor changes from last year. The Browns have edged out of the bottom 5. These teams all suffer from the same issues – relatively weak pricing power and limited social followings.

The Chiefs are the team that will generate push back. The Chiefs have had some success and they have significant star power. The problem is that the Chiefs lack pricing power and do not have much of a social following (I use Twitter). However, the Chiefs and Browns are probably the best positioned teams to make moves up the charts the next few years.

For the Rams (and the Chargers), we should probably include an asterisk. Moving markets and playing in temporary stadiums can lead to questionable data. The Rams – like the Chiefs and Browns – are well positioned for on-field success over the next few years.  The good news for these teams 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.

 

The Business Implications: Why does this Matter?

This study is about measuring fandom intensity or engagement. The logical foundation is that we attribute over or under performance in revenues or social following to fan engagement. To do this, we have to control for factors like market size and winning. This is the key point. Fan engagement is a little different from brand equity (the value of a brand) because we are controlling for market differences. The preceding results are more about intensity or passion of a fan base rather than the value of the fan base.

Fandom intensity is an important and often overlooked part of brand equity. In a full brand equity analysis, I would want to combine structural elements of a market (population, income, arena, etc…) with a fan engagement factor to assess a team’s brand equity. The value of the fan base is probably best thought of as a product of the passion (or intensity or engagement) and the size of the fan base.

Why do we care about fan intensity?

A standard approach to value sports assets (teams, players and sponsorship deals) is to use comparables. The idea is that you evaluate a future deal based on the characteristics of similar past deals. It’s the same concept used in real estate where housing prices are usually dictated by factors such as square footage, number of bathrooms and the previous sales in the neighborhood.

In the world of sports, there are many deals that are valued based on the fans. Stadium naming rights and sponsorships are two prime examples.

But in the case of sports deals, it’s important to consider the passion of the fan base. Let’s consider a non-NFL example to illustrate the point. How might an analyst value similar deals (naming rights, sponsorships, etc…) related to the Clippers and Lakers. Both teams play in the same city so there is little difference in market related factors. If we tried to rely on current winning rates then the Clippers would appear to be the more valuable deal. The missing factor is that the Lakers have a fan base (created through a history of All Star Players and Championships) that is incredibly engaged with and attached to the Lakers brand. If we were valuing competing deals across the two clubs, it is critical that we also consider the passion (and staying power) of each team.

While I present my results as rankings, behind the scenes there are a set of numerical scores for each metric. These numerical scores provide a tool for valuing promotions and sponsorships. The numerical scores provide a basis for valuing the passion of fans across teams. The use of multiple metrics is again useful because each metric has a different behavioral interpretation.

Two quick examples.

The Fan Equity metric is a measure of willingness to spend. Critically, it is a measure of willingness to spend that controls for differences in market characteristics (population, income levels, etc…) and current team performance. In this year’s results, the Cowboys rank number 1 in Fan Equity and the Texans finish number 21. The (behind the scenes) analyses suggest that Dallas’ spend premium relative to the league average is positive 7.79% while Houston’s premium is .39%. This suggests that in a sponsorship deal where all things are equal (number of impressions, median income, etc…) that the sponsorship of the Cowboys would merit a 7.4% premium versus an identical partnership with the Texans. In some ways, this seems like a conservative estimate given the prominence of the Cowboys. But, NFL fandom is intense everywhere and the Fan Equity metric is geared towards local markets.

The Social Equity metric is a measure of transmission or amplification. In terms of Social Equity, the Cowboys rank 3rd and the Texans rank 12th. For this metric, the differences across teams are much more substantial. Relative to the league average the Cowboys have a social media equity index score of 87% (the Cowboys social amplification factor is 87% greater than the average team). The Texan’s index is 1% above the league average. The results suggest that the Cowboys would merit an 86% premium for a nationwide or social media oriented promotion versus the Texans. Again, these results are based on models that adjust or control for differences in team performance and market characteristics.

The Complete List

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Fanalytics Podcast: Super Bowl Advertisements

Goizueta Marketing Association’s Vice President of Career Services Nihar Thadani and Professor Mike Lewis do a live podcast on 2019 Super Bowl advertisements. They watch and analyze different advertisements to see what brands are trying to do.  For timing purposes, we have cut out the full version of advertisements being watched in the podcast.

Who are the winners and losers? Opinions are from Emory MBA students who answered a survey.

WINNERS:

  1. Stella Artois – Change Up The Usual
  2. Pepsi – More Than OK
  3. Bud Light – Game of Thrones

LOSERS:

  1. Mint Mobile – Chunky Style Milk
  2. Avocados From Mexico – Top Dog

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Fanalytics Podcast: Super Bowl History

Super Bowl LIII is right around the corner! With the big game being less than three weeks away, Mike and I wanted to talk about the history of the Super Bowl on this episode of the Fanalytics podcast. Talking about all 50+ Super Bowls would be a bit excessive so we picked the ones we felt were the most significant. Our goal was to see how much the Super Bowl has evolved and how it got to become the big sporting event it is today. Hope you enjoy!

Here’s some notes about the games we talked about.

1967 (AFL/NFL championship game):

  • The NFL champion Green Bay Packers defeated the AFL champion Kansas City Chiefs by 35–10
  • 51 million viewers – CBS and NBC two networks because it was the AFL/NFL championship game
  • Ticket pricing: $10 ($74.98 in 2018)
  • The halftime program was University of Arizona and Grambling State marching bands

1969 (Super Bowl 3):

  • First Super Bowl to be called by a number (Super Bowl III)
  • This championship proved the AFL was on par with the NFL for the very first time
  • New York Jets quarterback Joe Namath promised his team a victory – a guarantee that was obviously out of place, as the Colts were favored to win by as much as a 20-point margin
  • The Colts were unable to keep the game within one score, and the Jets took the title, 16-7
  • Ticket price: $12 ($83.15 in 2018)

1973 (Super Bowl 7):

  • Miami 14 – 7 Redskins
  • Miami was undefeated
  • Super Bowl ads did not become ‘famous’ until 1973 when Noxzema ran a commercial for their shaving cream featuring Joe Namath
  • Ticket price: $16 ($86.86 in 2018)
  • Halftime show: “Happiness Is.” with University of Michigan marching band and Woody Herman

1976 (Super Bowl 10):

  • Pittsburgh defeats Dallas 21-17
  • 1976 Up with People performs in Super Bowl X in Miami, FL for a live audience of 80,100 and 57.7 million TV viewers
  • Ticket price: $20 ($88.73 in 2018)

1984 (Super Bowl 18):

  • Raiders 38-9 Redskins
  • Apple MAC ad is a big deal
  • Halftime show: “Super Bowl XVIII’s Salute to the Superstars of the Silver Screen”
  • Ticket price: $60 ($145.24 in 2018)

1985 (Super Bowl 19):

  • Bears Super Bowl shuffle
  • Halftime show:”A World of Children’s Dreams”
  • Highlighted some trends in terms of the super bowl creating celebrities
  • Ticket price: $60 ($140 in 2018)

1991 (Super Bowl 25):

  • This Championship game had a lot of patriotic pride, as the U.S. was in the middle of the first Gulf War
  • The New York Giants were on their way to winning two Super Bowls in 5 years as they played the Buffalo Bills
  • New York had possession of the ball for a record 40 minutes and 33 seconds, with their longest drive clocking it at 9:29 in the third quarter before scoring on a one-yard run by running back Ottis Anderson
  • The Bills had one final chance to win the game on a field goal with seconds remaining, but the 47-yard attempt by Scott Norwood sailed wide, and the Giants sealed the victory, 20-19
  • Ticket price: $150 ($274.89 in 2018)
  • Halftime show: “A Small World Salute to 25 Years of the Super Bowl” featuring New Kids on the Block

1999 (Super Bowl 33):

  • Denver beat Atlanta 34-19
  • WASSUP Ad

2002 (Super Bowl 36):

  • With the attacks on the World Trade Center and the Pentagon on September 11 earlier in the season, it should only seem fitting that the New England Patriots would be competing in Super Bowl XXXVI. Though labeled as the underdogs
  • New England jumped to a 17-3 lead over the St. Louis Rams by the end of the second quarter. The game switched gears in the second half, as the Rams made up the points necessary to put the game at a 17-17 tie
  • On the final play of the game, Adam Vinatieri made a 48-yard field goal to give the Patriots the championship, 20-17. This game marked the first time a Super Bowl was decided on the points from the final play of the game
  • Ticket price: $400 ($554.94 in 2018)
  • Halftime show: U2

2004 (Super Bowl 38):

  • Super Bowl XXXVIII turned into a shootout in the fourth quarter, as the New England Patriots and the Carolina Panthers combined for a record 37 points in that period
  • When it was over, the New England Patriots came on top, 32-29, to win their second Super Bowl
  • The game was also noteworthy for its halftime show and the famous “wardrobe malfunction” when Janet Jackson’s breast was exposed by Justin Timberlake
  • Ticket price: $400 ($529.90 in 2018)

2015 (Super Bowl 49):

  • The hype leading up to Super bowl XLIX was some of the biggest of any game in the decade before it
  • The defending Super Bowl Champion Seattle Seahawks and their Legion of Boom on defense would take on one of the greatest post season quarterbacks of all time in Tom Brady
  • Brady and the Patriots had lost their two previous Super Bowl appearances and were looking for redemption
  • A back and forth game saw the Patriots take the lead with just over 2 minutes remaining in the game. But Russell Wilson and company drove the ball the length of the field and had a 2nd and goal situation with 26 seconds remaining. The game looked all but won for the Seahawks, when Malcolm Butler stepped in front of a slant route, to intercept Wilson, and seal the Patriots 4th Super Bowl win
  • Ticket price: $1,750 ($1,839.07 in 2018)
  • Halftime show: Katy Perry, Lenny Kravitz and Missy Elliott

2017 (Super Bowl 51):

  • Patriots 34, Falcons 28
  • It was the greatest comeback in Super Bowl history — the Patriots once trailed by 25 — led by Tom Brady, the greatest quarterback in NFL history, who threw for 466 yards. It gave Bill Belichick and Brady their fifth championship in seven trips, and it cemented the Patriots as one of the league’s top dynasties
  • Ticket price: $1,700 ($1,721.40 in 2018)
  • Halftime show: Lady Gaga

Sources:

ABC

TicketCity blog

History

 

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Fanalytics Podcast: 2018 NFL Playoff Fandom Preview

Before the 2018 NFL season ends, Mike Lewis and passionate sports fan Rhett Grametbauer give their general impressions of various teams’ fan bases. Grametbauer has visited every NFL stadium in the country so who better to ask than someone who has interacted with football fans across the country? What are Pittsburgh Steelers, New England Patriots, Kansas City Chiefs, Chicago Bears, Green Bay Packers, New Orleans Saints, and Los Angeles Rams fans like?

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Fanalytics Podcast: A Visit To Every NFL Stadium

In this Fanalytics episode, sports enthusiast and author Rhett Grametbauer joins Mike Lewis to talk about his thrilling journey visiting every NFL stadium in 16 weeks. Grametbauer took his 1967 Volkswagen bus named Hail Mary to visit the 32 football teams. He wrote about his adventure in his book called “25,000 Miles to Glory.”

This episode delves into the incredible escapade, study of consumers, ethnography, childhood memories, and what makes a stadium special.

To learn more about Rhett Grametbauer: https://www.rhettgrametbauer.com/

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Fanalytics Podcast: Super Bowl Economic Impact

Ever wonder about the economic impact a Super Bowl has on a city? Super Bowl LIII is taking place in Atlanta. Emory University Finance Professor Tom Smith and Marketing Professor Mike Lewis talk about the cash flow going through the city when the big showdown happens. Does it matter who’s playing in the Super Bowl from Atlanta’s economic perspective? Where does all the spending money go? What are the long term impacts a Super Bowl has on a city?

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Fanalytics Podcast: Nike and Colin Kaepernick

In this episode, economist Tom Smith and I analyze Nike’s decision to feature Colin Kaepernick in its “Just Do It” campaign.  This is a complicated and controversial issue with lots of moving pieces.  It’s also a great topic because there are elements of branding, demographic trends and politics.

Is Nike pursuing the right branding strategy?  Are they using Kaepernick to reposition the brand closer to Millennial and Generation Z sensibilities?  Does growing the relationship with this segment make-up from alienating the segment that is currently burning shoes and cutting up socks?

Why has Nike waded into this perilous political territory?  Are they doubling down and supporting the existing star who also happens to be in a feud with the current president? Can brands in the entertainment space be non-political in 2018?

It’s a wide ranging and fuzzy conversation.  But it’s a fun subject.  Multiple elements of fandom with a backdrop of politics.

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Fanalytics Podcast: NFL Marketing Preview

The NFL has long been considered the premier American professional sports league.  In this episode, I sit down with a former professor colleague and current tech industry analytics leader Manish Tripathi to discuss some of the marketing challenges facing the NFL as the 2018 season approaches.

It is an interesting conversation because after years where the NFL almost seem to be impervious to scandal and on an ever upward trajectory when we think about the NFL in 2018 we seem to run into one marketing challenge after another.

We talk about the perennial issue of the “Washington Redskins” team name and symbols, concussions and youth football, and (of course) the anthem protests.  In each case, we actually find ourselves talking more about politics than analytics.  This is important because it serves to highlight the marketing challenges faced by the league.  While the NFL has seemed to be a “Teflon” brand for decades, is it impervious to the political and cultural upheaval of 2018?

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Fanalytics Podcast: The Analytics of Paying NFL Running Backs

The Le’Veon Bell contract situation was one of the more interesting NFL stories of the past month. In today’s Fanalytics podcast, economist Tom Smith and I talk about the story from a statistical and economics perspective.

NFL running backs are an incredibly interesting position for analytics and salary cap management.  The dilemma for teams and the frustration for players comes from the nature of the position.  Running backs are often at their peak during the early career years when the player’s salary is most constrained by the leagues collective bargaining agreement.

In the case of Le’Veon Bell, he is entering the region where past carries (and touches) combined with age start to build some uncertainty about future performance.  This future uncertainty combined with the fact that running backs are a relatively inexpensive position create an interesting situation for the Steelers.  Bell may be the best running back in the league but can they “replace” a significant amount of his production at a much lower cost?

This conversation was wide ranging and had some technical elements.  Probably our most technical episode yet as terms like “hedonic pricing model” and “constrained dynamic optimization” were thrown around.  That said – it was a great conversation.  The economist (Tom) combined with the Operations Researcher (Mike) offers a unique perspective of analytics and decision making.

Hope you all enjoy the podcast and please rate and subscribe on iTunes.

Mike

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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.