NBA Brand Report 2019
Click on the logo below to listen to the NBA Fan Rankings podcast episode! You can also listen on iTunes, Spotify, Google Play Music, TuneIn and Stitcher. Don't forget to rate, review, and subscribe! With the 2019-2020 NBA season on the horizon, it’s time to take a look at NBA fandom through an analysis of the team fandom and brands. I do these for the various pro leagues on a near-annual basis, though the last NBA ranking was 3 years ago. When thinking about NBA fandom, we need to acknowledge that the NBA goes to market a little bit differently than the other major leagues. In the current era, the NBA has been a star driven league. Over the last 40 years, the NBA’s story has been the tale of Julius Erving, Larry Bird, Magic Johnson, Michael Jordan, Kobe Bryant, LeBron James and Stephen Curry. And maybe Charles Barkley Tim Duncan, Shaquille O’Neal, Kevin Durant and a few others. Those last two sentences are important, debatable, and maybe enraging. Does Kevin Durant belong in the first group or the second? What about Kareem? How about Karl Malone and John Stockton? My list is off the cuff and subjective but what’s important about those two sentences is that those players (plus or minus a few) represent the story of the NBA going back two generations. In most sports, fan loyalty is about teams first and players second. In the NBA it is often the reverse. LeBron James is probably the best example. When LeBron was in Cleveland the Cavs were a top brand. A TV ratings draw and an arena filler when the team was on the road. As he moves on the Cavs quickly reverted to being a second tier NBA brand. The upside of this approach is NBA players can become true cultural icons. This means that the NBA generates a lot of “Free” media. I suspect that the daytime ESPN talk shows pay as much or more attention to the top 5 NBA players as they do to all of MLB. The downside is that the players have more control over the fortunes of the league than in the NFL or MLB. I should probably be more specific – a small group of NBA players has enormous power over the league. This can create challenges for individual teams and can create issues for the entire league. What happens when a team (Toronto?) loses a star player? How do they recover? Try to talk a free agent into coming to a small market (OKC?)? Good luck. At the league level, is there "face of the league" succession planning? When do you stop emphasizing Michael Jordan? Or even better – how do you decide who to market next? Why is LeBron a bigger star than Kevin Durant? As we go into this next season the big on-court topic (written before the NBA-China relationship blew up) is the same as the big marketing topic. How does the shift towards player empowerment (or player collusion to circumvent the CBA if you prefer) impact the league? This is relevant to today’s article because the focus is on analyzing the loyalty and engagement of fans across the NBA. Specifically, I am taking a look at and ranking the NBA teams in terms of fan engagement and loyalty. Player movement is a major part of the story. In the NBA, it is tough to disentangle the loyalty to teams versus loyalty to stars. This past off-season, saw significant player movement towards teams that have not historically been iconic NBA brands. The Metrics I’m going to skip the details (no one reads them) but I will say my analysis of team brands is different because it’s based on the statistical analysis of 20 plus years of data on winning, attendance, pricing, population and just about any other factors for which I can collect data. The basic idea is that I look at how teams perform in terms of several marketing performance metrics after controlling for factors such as winning rates and market population. I evaluate NBA team fandom using three metrics. Fan Equity is based on how teams perform in terms of home revenues. This captures pricing power and attendance. Social Equity is based on team’s reach via Twitter. Road Equity is based on how teams draw on the road. Each metric has advantages and limits. Fan equity is based on consumer’s willingness to attend and spend. This is the gold standard for measuring consumer engagement as it is based on opening the wallet and taking the time to sit in traffic and make it to the arena. On the downside, this metric does not consider a team’s national following and may be constrained by arena capacity. The Social Media metric has advantages as it can capture out of market fandom and fans who are priced out of an arena. I also think social media following skews younger so it is more of a forward-looking metric. A problem with social media is that social followings are “sticky” in the downward direction. When LeBron moves to a new team, we see a huge jump in the team’s social following. But when he moves again, relatively few fans make the effort to stop following the previous club. Road Equity is based on a combination of national following and willingness to travel. In the NBA this is probably almost all about national following. The weakness of the Road equity metric is that national following may be much more about a star player than the team itself. To get an overall ranking I combine the three metrics using a weighting scheme that treats the Fan equity measure as twice as important as the other two. Debatable but simple. The Winners It has been a few years since I did the NBA rankings and there are some significant changes. The overall winner going into the 2019-2020 season is the Los Angeles Lakers. The Lakers score consistently high across the three metrics. Number 1 in Road Equity and Social Equity and number 2 in Fan Equity. The Lakers are followed by the Warriors, Bulls, Celtics and the Cavs. The significant changes from the previous ranking are the elevation of the Warriors and the fact that the Knicks are absent from the top 5. The Bulls and Celtics have long been iconic NBA brands. Different histories but similar results. The Bulls are the house that Michael built while the Celtics were built by many. The Warriors are a great example of how powerful brands are created. Golden State was long a second tier team. Now, after years of Stephen Curry and Kevin Durant winning championships, the Warriors have become a premier brand with a national following of engaged fans. The lesson is that it is not enough to win once. Like the Bulls, brands are built through repeated championships. The Knicks are ranked 7th on the overall list. The Knicks win the Fan Equity measure but fall short in terms of the Social and Road metrics. I suspect that the control variables do not adequately capture the unique advantages that the Knicks enjoy based on location. What about the Cavs being ranked 5th? Two quick thoughts. First, I use three years of data to measure current brand equity. This is done because brand equity usually shifts slowly and to average out noise in the data. The problem is that using three years means that the Cavs still benefit from seasons that include a now departed player. The downward stickiness of social media is also an issue in the Cavs results. The Losers At the bottom of the list, we have the Washington Wizards, Memphis Grizzlies, Charlotte Hornets, Brooklyn Nets and Detroit Pistons. For this group, it has been different paths to the bottom. Did the Wizards ever recover form the name change from the Bullets? Memphis and Charlotte have never had a history of success. The Pistons are interesting because they also had a period of success at about the same time as the Bulls. Why is the legacy of Isiah Thomas so much less than that of Michael Jordan? Its likely about the scale of winning and maybe something related to the dynamics of Detroit versus Chicago. The Brooklyn Nets are also a curious case. The move from New Jersey to Brooklyn came with a lot of hype. So what happened? First, there was no period of great success to take advantage of the hype. Second, the Nets fall short in comparison to the Knicks (and other major market teams like the Bulls and Lakers). While they play in the same market, the Nets results do not compare to the Knicks on any of the fan metrics. What is really necessary for a team to move up the rankings is consistent winning. And not just winning in terms of making the playoffs – brand equity seems to be built by winning and contending for championships. The List Finally, the overall list. Please enjoy and tell me what you think in the comments. I expect 80% hostility.