For NFL teams, especially small-market franchises seeking to increase their fan base, winning may be everything, but so does team longevity in the market as well as the number of games played in prime time, according to research by a University of Illinois sports economist.

Scott Tainsky, a professor of recreation, sport and tourism at Illinois, says that many of the same factors that influence whether fans attend a game in-person also influence a team's television ratings.

"Sports economists have traditionally relied on attendance figures as a proxy for demand in order to figure out what's motivating fans to go to games," Tainsky said. "Even though the NFL is priced just a little bit below where it could maximize revenue at the gate, it still requires a large income or at least a large outlay of money for the average fan to see a game in-person."

According to Tainsky, whose research was published in the Journal of Sports Economics, since the vast majority of fans watch the games on TV instead of in-person, and with the NFL betting on over half of its revenue being generated through TV contracts, TV ratings might actually function as a better proxy for consumer demand in both the home and road teams' markets.
"We have a long history of studying consumer demand for major league baseball, but there's very little research done on the NFL, even though it's the largest revenue, most popular sport in the U.S.," he said.

Of the three factors that positively influence demand, fielding a winning team is the most difficult variable to account for on a year-to-year basis, especially for small-market teams.

"From the first day of training camp, winning is the goal for every team in the league," Tainsky said. "But that's going to be somewhat cyclical, since the league has a pretty hard salary cap. If the spending on player talent is virtually equivalent for all 32 teams, there's going to be parity, meaning that some teams will have good years while other teams will have bad years."

Since it's easier for the big-market teams such as Dallas and Chicago to weather the year-to-year swings in their win-loss records, small-market teams need to be even more proactive in courting fans when they're muddling through a losing campaign.

One way to do that, Tainsky says, is to promote the experience of going to the game.

"When you're a small-market team and you're having a down year, you have to promote other things besides the quality of the team," Tainsky said. "You have to market the tradition of sports being passed down from generation to generation, this notion of, 'I went to the game with my dad, and he went with his dad,' or the 'On any given Sunday…' mythology that the NFL likes to cultivate. If you can get this to be a habit of consumption on Sundays, that's ideal, because it's easier to take it on the chin when they're not doing so well."

Small-market teams mired in a rebuilding year are also at risk of having their broadcasts blacked out as a result of poor attendance. But Tainsky discovered that ratings for telecasts in those markets -- Atlanta, Buffalo, Jacksonville, Oakland, St. Louis and Tennessee -- were on par with the remaining 26 franchises. He blames market size rather than market demand for the teams' failure to sell out games.

"There are three different ways that Nielsen collects ratings, and one of them is the percentage of TVs in the area that are on, and those aren't appreciably lower in cities that experience blackouts," Tainsky said. "In fact, the per capita demand is often higher in small markets; they just have trouble filling 60- and 70,000- seat stadiums. A place like New York City has a low market share, but the sheer number of people it has in its surrounding metropolitan area allows it to sell out games."

In that respect, it may not be the fault of the smaller market cities that they can't get a larger percentage of a viewing audience, Tainsky says.

"The team might be doing everything it can do to attract fans, but because of the smaller population size, it has to be that much more popular to avert blackouts."

Although there was a slight ratings bump for games played in prime time, Tainsky said that sharing a home market with another team, as the San Francisco 49ers and the Oakland Raiders do in the Bay Area, represented a significant drag on consumer demand. The socioeconomic status of fans was also negatively associated with ratings. Tainsky noted that other research has shown that lower-income fans engage in homebound and sedentary activities, further indicating that TV ratings might be a better measure of consumer demand.

Using TV ratings to analyze demand also allows sports economists to look at the size of viewership in cities that don't have a home game that weekend, or in cities that don't have teams. There's also the "diaspora effect," where fans have been displaced either by the team moving to a different market (the Baltimore Colts moving to Indianapolis, for example) or the fans themselves moving from their home markets (for example, displaced Pittsburghers living in suburban Chicago).

"Population flow from city-to-city does seem to have an effect on ratings for games," Tainsky said. "If more people from western Pennsylvania have moved to the Chicago suburbs, the game featuring the Steelers will be popular but only if the game is being played at Heinz Field in Pittsburgh."

Tainsky said displaced fans won't watch in great numbers if the Steelers are playing on the road at, say, Jacksonville, which may indicate that viewers aren't necessarily tuning in for the game itself, but rather for the feelings of nostalgia that watching a football game on a Sunday evokes.

"It makes them think back to where they're from, and the good times they had watching those games in the past," he said. "So there's more to it than just the game itself."

Source: University of Illinois at Urbana-Champaign and Television Broadcast Demand for National Football League Contests. Journal of Sports Economics, 2010; DOI: 10.1177/1527002509355636

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