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.

College Football Brand Equity Rankings: The Overall List

Over the last two weeks, we have been reporting our football fan base rankings conference by conference.  Today, we turn to our overall ranking.  We started the list with an analysis of the brand/customer equity of the major conferences.  The Big Ten and the SEC are the leading conferences largely because they have strong TV deals.  That being said, the number one team on our list is not a member of either the Big Ten or the SEC.

Number one on the list is the University of Texas.  The Longhorns have some built in advantages that make it such a powerhouse.  Texas is the flagship school in a highly populated state with an incredible football culture.  Texas is also interesting because it is such a frequent target in realignment discussions.   Texas would bring the most valuable fan base to any conference.   In fact, Texas football is such a valuable property that we doubt that they will move anytime soon.  Texas is a strong enough brand to keep the Big Twelve a viable conference.  This means that Texas has an immense amount of bargaining power within the Big Twelve; which would be lost in a move to the Big Ten or the SEC.

Number 2 on the list is a bit of a surprise.  Based on the numbers, we found Georgia to have the second highest customer equity.  We go into more detail about Georgia football in our SEC writeup.

Number three on the list is the Big Ten’s Ohio State Buckeyes.  Ohio State has many of the same advantages as Texas, as they are the flagship school in a highly populated and football crazy state.

Numbers 4 and 5 on the list also hail from the Big Ten.  We have Penn State in 4th place and Michigan in 5th.  These are two interesting cases, since PSU is obviously in a transitional stage, and may fade a bit over the next couple of years, while Michigan is making moves to become even more profitable.  In positions 6 through 8, we have Alabama, Auburn and Florida.  Our rankings seem to confirm that the SEC and Big Ten are college football’s top conferences.

The 9th place team is one that we haven’t talked about in any of our previous rankings, Notre Dame.  Our guess is that Notre Dame fans will feel slighted by their 9th place ranking.  But, at the end of the day, our approach is driven by a combination of revenue and team quality data.  What we find is that Notre Dame is a great college football brand, but far from the dominant brand their fans believe it to be.

In tenth place we have the lone West Coast team in the rankings.  The Washington Huskies were the surprise leader in the Pac 12, beating out teams like USC and Oregon.

Mike Lewis & Manish Tripathi, Emory University 2013.

PREVIOUS: RANKING THE SEC

Ranking SEC Football Fans: Georgia beats out Alabama

We are presenting a series ranking the “best” fan bases in college football.  The study uses data from the past ten years and the rankings are based on Revenue Premium Brand Equity.  For more information on the analysis/methodology, please click here.

As a rule, when we begin any analysis we start with no prior expectations about the results.  We let theory and numbers guide our findings.  However, living in the South, it is hard not to witness the extreme passion and loyalty of SEC fans on a daily basis.  The SEC football season is year-round (season, recruiting, spring football).  Therefore, we were not surprised when the SEC was the top rated conference in our college football Revenue Premium Brand Equity rankings.   Given the passion of SEC fans, we expect that our SEC conference rankings will engender a lot of “constructive discussion”.

The University of Georgia has the number one ranked football fan base in the SEC according to our study.  It should be pointed out that this study covers a ten year period, and that the top four ranked schools in the SEC are also among the top ranked football fan bases in the country.  So, what separates Georgia from Alabama?   Over the period of our study, both Georgia and Alabama averaged between 9 and 10 wins a season.  However, Georgia averaged 12% more in revenues per year than Alabama.  Alabama also had a couple of years in the beginning of our sample (2002 & 2004) where the home games were not all filled to capacity.  Thus, over the period of our study, when we control for team performance and other institutional factors, the Georgia fan base is just a bit more loyal and devoted.

Auburn University finished in third place, being just edged out by its friendly neighbor, Alabama.  The Crimson Tide generated slightly more revenue per year on average than the Tigers, despite averaging almost the identical number of wins.  Also, while Alabama’s revenues are growing, Auburn has been facing a decline.   The University of Florida finished fourth in our study.   The Gators actually average 6.9% more revenue per year than Auburn, however they also averaged 0.5 more wins per season during the period of our study.  Remember, our conjecture is that it is easier for a fan to shell out for a team when the team is winning games, thus we control for team performance.

Vanderbilt is ranked 11th in our study.  We would like to point out that the last couple of years have been positive for the Commodores, and although lagged, the revenues for the football program seem to be improving.  Ole Miss and Mississippi State are at the bottom of the study of SEC fan bases.  During the period of our study, Ole Miss and Mississippi State actually averaged more wins per season than Vanderbilt.  However, Ole Miss generated roughly the same amount of revenue as Vandy, and Mississippi State generated 20% less.

Mike Lewis & Manish Tripathi, Emory University 2013.

PREVIOUS: RANKING THE PAC-12

NEXT: OVERALL RANKINGS

Ranking PAC 12 Football Fan Bases

We are presenting a series ranking the “best” fan bases in college football.  The study uses data from the past ten years and the rankings are based on Revenue Premium Brand Equity.  For more information on the analysis/methodology, please click here.

For those of you following along with our conference by conference rankings of fan support, you may have noticed an omission.  We skipped over the PAC 12 in our countdown to the top conference.  But, before we talk about the SEC and the Overall Rankings next week, we did want to make some comments about the PAC 12.

Or maybe it is just one comment: We have trouble understanding this conference.

The method we use to rank fan base support uses something called a “revenue premium” model of brand equity.  The big idea is that we look at fan support while controlling for team quality and market potential.  Like any method, there is room to critique our approach.  As an aside, we do enjoy the helpful comments provided to us via Twitter about our combined intelligence and lack of sports knowledge.  As a second aside you should be aware that our sports pedigree includes Manish’s time playing Tecmo Super Bowl (Wayne Haddix rules!) back in Maryland, and Mike’s experience playing a great deal of Madden on the Sega back in the early 90s.

The trouble with the PAC 12 is that its premier teams tend to have revenues that are far lower than teams of similar quality in other BCS conferences.  Oregon is the poster child for this issue.  This article from Rachel Bachmann highlights the difficulty in evaluating Oregon relative to its peer schools.  Over the last decade, the Ducks have been remarkably productive on the field, but the revenues are nowhere near that of the teams Oregon has been playing in BCS games.   As Bachman points out, Oregon’s revenues would place it near the bottom of the Big Ten or the SEC.

The second issue with Oregon is its stadium, and perhaps it’s pricing.  Oregon sells out (above capacity) regularly, but it plays in a ~50,000 seat stadium rather than a 90,000 or 100,000 seat stadium.  The strong demand data suggests that Oregon could easily improve revenues through a price hike (as a third aside, there is a lot of chatter this summer about efforts to grow revenues through dynamic pricing).  There are, of course, reasons not to raise prices.  Oregon may feel like it is in the process of still growing a loyal following.  They may be intentionally underpricing in order to invest in their future fan base.  Or maybe Oregon is the rare school that does not view the football program as a pure revenue generator (they seem to have other sources of revenue ).

So rather than provide an explicit ranking of the PAC 12 schools’ fan bases we decided to list the schools in different tiers.  As a fourth aside, we do realize this is a copout.

Tier 1: In tier one, we have the University of Washington, Arizona State University, Colorado and Utah*.  These schools make the list for different reasons.  Washington is the clear winner in terms of fan support relative to team performance, while Colorado and ASU have solid revenues given their on-field performance.  We have an asterisk next to Utah because it is hard to predict how its fan support will translate to the BCS.

Tier 2: In the second tier, we have USC, Oregon, UCLA, Oregon State and Arizona.  The USC story has some similarity to the Oregon story.  It’s a great program, but a program that often doesn’t sell out.  As a fun fact, the West Coast USC actually generates slightly lower revenues than the East Coast USC.

Tier 3: In third tier we have Cal, Stanford and Washington State.  Here, the biggest surprise to some may be Stanford, given its string of BCS bowl games, and fourth place ranking in the pre-season USA TODAY coaches poll.  However, it is important to note two things: 1) Before Coach Harbaugh, Stanford was terrible, and the fan support was negligible, and 2) Although Stanford has been to three straight BCS bowls, the fan support has been trailing the rate of success.  This is the first year where they have sold out their season tickets.

Mike Lewis & Manish Tripathi, Emory University 2013.

PREVIOUS: RANKING THE BIG 10

NEXT: RANKING THE SEC

 

Ranking the “Best” Football Fans in the Big 10: Buckeyes are on Top!

We are presenting a series ranking the “best” fan bases in college football.  The study uses data from the past ten years and the rankings are based on Revenue Premium Brand Equity.  For more information on the analysis/methodology, please click here.

As a conference, the Big 10 finished second only to the SEC in overall football brand equity.  The conference added Nebraska in 2011, and will add Maryland and Rutgers in 2014.  The Big Ten has been very successful at creating a network that capitalizes on the appeal of its members.  This fan appeal is also manifested in the top three schools in our rankings; all three schools have football stadiums with capacities over 100,000, and are regularly sold out.

The Ohio State University finished in first place in our ranking of Big 10 fan bases.  In the ten year period of our study, the Buckeyes averaged 2.5 more wins per season than Penn State and Michigan, but also generated 20% more revenue.  Remarkably, Ohio State made this revenue with fewer fans in attendance, on average, than Penn State or Michigan.

Penn State very narrowly edged out Michigan for second place in our study.  Over the course of the study, Penn State and Michigan averaged almost the same number of wins (Michigan had more) and football revenue per year.  However, Penn State’s second place ranking may be short-lived.  The last couple of years have seen a decline in attendance.  This may, of course, in part be due to the recent scandal and sanctions at Penn State.

Indiana and Northwestern are at the bottom of the Big 10 fan base rankings.  Indiana seems to suffer from the same issue faced by Kansas or Duke.  That is, how do you build football brand equity in a “basketball school”?  Northwestern is an interesting case.  A comparison with in-state “rival” Illinois (ranked 8th) is quite revealing.  In the period our study, Northwestern averaged 1-2 more wins per season than Illinois.  However, Illinois average 88% of capacity attendance, while Northwestern averaged 62%.  Illinois also produced 30% more football revenue than the Wildcats.

Michael Lewis & Manish Tripathi, Emory University 2013.

PREVIOUS: RANKING THE BIG 12

NEXT: RANKING THE PAC 12

 

Ranking the “Best” Football Fans in the Big 12: Texas & Oklahoma on Top

We are presenting a series ranking the “best” fan bases in college football.  The study uses data from the past ten years and the rankings are based on Revenue Premium Brand Equity.  For more information on the analysis/methodology, please click here.

The Big 12 has undergone dramatic changes in the last two years, with the loss of Nebraska, Colorado, Texas A&M, and Missouri, and the addition of Texas Christian University and West Virginia.  While the overall strength of the conference has suffered from these moves, our analyses indicate that entry into the Big 12 has been a positive for TCU and West Virginia.  The conference remains precariously top-heavy, with the Texas Longhorns accounting for a significant portion of brand equity.

The University of Texas is number one on the list of most supportive fan bases in the Big 12.  This finding should not come as a shock to anyone familiar with college football; however what is surprising is how loyal/supportive Longhorn fans are compared to the rest of the Big 12.  Oklahoma, which is ranked second, won approximately the same number of games as Texas over the ten year period of the study.  Texas football, however, produced 65% more in revenues than the Sooners.

Despite being a new entrant into the Big 12, TCU ranks third in the study.  While TCU does not fill up the stadium as regularly as Texas or Oklahoma, it has enjoyed solid financial support given the size of its stadium and student body.  West Virginia, similarly, has received a high level of financial support despite not always selling out.

Baylor and Kansas are in the cellar of the Big 12 fan rankings.  Baylor is an interesting case.  In RG3’s last year at Baylor, the school performed very well in terms revenue.  However, prior to RG3, Baylor averaged fewer wins, and even fewer fans.  Kansas seems to struggle with a problem endemic to many “basketball” schools: the ability to achieve high brand equity in both basketball and football.

Mike Lewis & Manish Tripathi, Emory University 2013.

PREVIOUS: RANKING THE AAC

NEXT: RANKING THE BIG 10

 

The American Athletic Conference: Surprising Results that Portend a Bright Future

We are presenting a series ranking the “best” fan bases in college football.  The study uses data from the past ten years and the rankings are based on Revenue Premium Brand Equity.  For more information on the analysis/methodology, please click here.

The American Athletic Conference (AAC) is the product of conference realignment, and a fascinating story.  The former Big East schools are desperately trying to construct a league that can keep the AAC in discussion of the Power 6 conferences rather than fading back into the pack.  To some degree, our analyses suggest that the AAC has made a few good moves.  We already rank the AAC as the number five conference, and there is reason to believe that the AAC has landed several programs with bright futures.

Number one on our list of the most supportive fan bases is SMU.  This is both a surprising result, and also a result that illustrates the benefit of our approach.  While the last few seasons have seen SMU take a step forward and qualify for bowl games, over the ten years of data, the team has tended to play sub .500 football.  The fan support provided to SMU relative to the on field performance has been outstanding. This issue is best illustrated via a comparison between SMU and Cincinnati.  Over the ten year period of our analysis, SMU was a four win per year team while Cincinnati was a seven or eight win team.  However, while Cincinnati won almost double the number of games as SMU, their revenues were about 20% less.  Our interpretation of these results is that SMU has a sleeping giant of a fan base, and it would like make sense for SMU to invest heavily in their program.

In second place, we have the Memphis Tigers.  Memphis is fairly similar to SMU in that they have very solid support (30K+ attendance) for a team that has been average on the field.  It is these two programs that tell us that the AAC may have a chance to remain a major conference.  We suspect that if SMU and Memphis become on-field successes their fans will be highly supportive.

One the bottom half of our rankings, we had a couple of surprises.  We have already mentioned the issue with Cincinnati.  UCONN has generated revenues similar to SMU but these have been generated with a better performing team, and as a member of the former Big East.  Likewise, Louisville was also a bit of a surprise.  And again, the issue was that the fan support is just not what we should suspect given the Cardinals’ on-field success.  The Louisville story is also interesting because in our analysis of the brand equity of college basketball teams, Louisville finished number one overall.  The UConn and Louisville results suggest that it is a challenge to build fan equity in football when you are historically a basketball school.

Mike Lewis & Manish Tripathi, Emory University 2013.

PREVIOUS: RANKING THE ACC

NEXT: RANKING THE BIG 12


The “Best” Football Fan Bases in the ACC

We are presenting a series ranking the “best” fan bases in college football.  The study uses data from the past ten years and the rankings are based on Revenue Premium Brand Equity.  For more information on the analysis/methodology, please click here.

While the ACC is best known as a basketball conference, the economics of college sports are primarily driven by football.  So, who in this “basketball” conference has the most loyal and supportive football fans?

Number one on the list are the Clemson Tigers.  In the past decade, Clemson has had very good attendance and revenues in comparison to what would be expected from a team then tends to be just above average on the field.  Clemson’s revenues are especially good given that they operate in the ACC (and lack the revenues from being part of the Big Ten network or an SEC television contract).  In comparison to other major ACC programs, Clemson has revenues that are in the range of 30%-60% higher.  Second on the list are the Virginia Tech Hokies.  Virginia Tech has revenues that are very similar to Clemson, but the Hokies have been significantly more successful on the field.  As a reminder, our approach controls for team quality when assessing fan support (it’s easy to be an Alabama fan but it takes character to be a Duke Football fan).

In third and fifth place, we have two new entrants to the conference.  Syracuse is ranked third, and Pitt comes in ranked fifth.  Syracuse finishes relatively high because their fans continue to support a team that has often struggled over the past decade. The high rank of these two entrants suggests that the ACC making very good expansion decisions.

The two Florida schools are interesting cases.  Prior to running the numbers, we would have thought that Miami and FSU would have been the leaders of the conference.  The issue is that despite the success these programs have experienced on the field, their revenues are not exceptional.  For example, Miami invests a great deal in their program, almost always participates in bowl games (and many major bowls), but attendance is regularly far short of capacity.

The University of Maryland being near the bottom of the rankings is another remarkable story.  The new entrants (Syracuse & Pitt) seem to be better football schools than Maryland, so by some measures the ACC has been a realignment winner.  On the other hand, the Big Ten wants Maryland (and Rutgers) not so much for the schools’ current fan bases but for the schools’ locations in major media markets.

Mike Lewis & Manish Tripathi, Emory University 2013.

PREVIOUS: RANKING THE BEST OF THE NON-BCS CONFERENCES

COMING SOON: RANKING THE AAC

The “Best” Football Fan Bases in the Non-Automatic Qualifying Conferences

For our first look at the “best” college fans, we start with schools from Non-Automatic Qualifying (NAQ) conferences (as of the 2013 season affiliation).  As in our previous studies of fan/brand equity, we use a revenue premium model that measures fan support over the last ten years while controlling for team quality (click here for details).  The NAQs are an interesting group as there has been a significant scramble to join major conferences (e.g. TCU, Houston, Utah, etc…) over the past few seasons.  The current “NAQ” plan seems to be to try and build a strong brand in order to generate an invite to one of the more financially lucrative conferences.

This trend towards joining “stronger” conferences places NAQ programs in a curious position.  To get an invite, schools need to be successful and develop significant customer equity.  But as schools like Utah and TCU have found out, shifts to higher profile conferences can also result in less competitive teams.

The number one ranked school on our list was a surprise, as we identified San Diego State as having the most supportive fan base of the NAQ schools.  Surprise, we say?  Actually, this was more of a shocker, but this is the beauty of looking at the numbers.  The thing about San Diego State is that it receives fairly consistent support even when the team struggles.  The best and most illustrative comparison is between Boise State and San Diego State.  Over the last decade, Boise State has won about twice as many games as San Diego State, but only has a slight advantage in terms of attendance and revenues.  What does this mean?  It means that San Diego State has a very valuable asset in its customer base (and could likely benefit by investing more in the program).

The second place team BYU is a solid program both on the field and at the box office.  The ability to attract 60,000+ crowds makes BYU something of an outlier in the NAQ world.

Wyoming in third place was another surprise.  Again, we need to point out that we are controlling for team quality.  The key to Wyoming’s ranking is that revenues and attendance are solid despite some on-field struggles. On the plus side, this level of support for an often struggling Cowboy team suggests that Wyoming might benefit from investing into their program.  On the other hand, perhaps there are just fewer entertainment options in Laramie, and the quality of the team just doesn’t matter since people are looking for things to do.

The Idaho Vandals finished fourth in the rankings.  This is an easy entry to write.  Just replace Idaho wherever you see Wyoming in the paragraph above.  In the fifth position on the list we have the Marshall Thundering Herd.  Marshall is again a solid program that usually averages between 25,000 and 30,000 fans regardless of the team’s record.

As we computed our rankings for the NAQs and for the bigger conferences, the NAQs generated the least intuitive results (e.g. Where’s Boise State?).  As we drilled down, the story became clearer.  First, we are looking at the conferences where schools are currently, rather than where they have been.  This removes traditional powers like Utah and TCU.  The other eye opener came from looking at revenues and attendance figures.  Often the highest profile NAQs do not convert their success to revenues.  While Boise State is arguably one of the most successful programs at any level, the fan support is often not what one would suspect.  Boise State has 20,000+ students, a metro area population of more than 600,000, regularly wins more than 10 games and doesn’t sell out.

The Boise State story also says something about the economics of college sports.  In the absence of significant BCS revenue sharing and conference specific television deals it is hard to justify the investments needed to develop a high quality on-field product.  In other words, Boise fans should probably be grateful for the program they have, and should provide more support.

Mike Lewis & Manish Tripathi, Emory University 2013.

PREVIOUS: OVERALL CONFERENCE RANKINGS

NEXT: RANKING THE ACC