Sports

Why behavioural economics could be the Moneyball for sports sponsorships :-: City A.M.

Having popularised the term Moneyball with his book on Billy Beane’s pioneering use of baseball statistics at the Oakland Athletics, author Michael Lewis has most recently turned to behavioural economics as his subject of study.

The Undoing Project, his latest book, sees Lewis return to sport with a chapter on basketball – more specifically, how Houston Rockets general manager Daryl Morey used concepts from behavioural economics to spot biases when scouting potential NBA talent.

For his next foray, Lewis should perhaps consider Kevin Brilliant, a business strategist at the Chicago Bulls who proposes that the two disciplines — statistics and behavioural economics — can not only change how sports teams are run but also how they can make money.

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In short, Brilliant believes that sports sponsorship is due its own Moneyball moment.

Lewis’s book, which spawned a Brad Pitt-starring film, documents how Beane spotted limitations in orthodox statistics such as batting averages and developed his own more sophisticated metrics. It helped to propel his team of limited resources into back-to-back play-off appearances.

In a talk on how sports organisations could better understand and leverage their fans’ biases, loyalties and traditions, Brilliant last week suggested that, similarly, there may be a more useful measurement for sponsors than page impressions.

“Impressions — the most commonly relied upon metric for evaluating sports sponsorship effectiveness — are like batting averages in baseball,” Brilliant said at the Leaders in Sport summit.

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“A lot of sponsors want the brightest light possible shined on their brand for the longest amount of time possible and that, to them, is considered a good outcome. It’s not that it’s not important; it’s just nowhere near as important as it’s made out to be.

“When someone chooses to be a sponsor of ours [the Bulls], they’re trying to borrow our brand association in the hope it will run off on theirs. [Quantifying] the strength that association has with people and growing it over time — that to me is the holy grail.”

Brilliant cited research that suggests adverts featuring well-known brands are more effective when fast-forwarded by viewers than watched in real-time because they did not trigger the defensive part of the brain that does not want to be marketed to.

Such an idea may chime with Premier League clubs who have added sleeve sponsors to their shirts this season.

Everton’s addition of the Angry Birds app logo to their shirts last month met with howls of derision on social media. The brand had little prior relation to football yet suddenly had a prominent position.

Everton added the Angry Birds logo to their shirt sleeves this season (Source: Getty)

Sport accounted for 37 per cent of TV advertising spend in 2015, as brands recognised the unique ability of live programming to attract passionate fan-bases, yet Brilliant believes that behavioural economics concepts could be used to increase the effectiveness for sponsors looking at the sector.

“Delving into the unconscious, team networks have a long way to go to catch up to where behavioural scientists have gotten to,” he said.

"We’ve done almost nothing as an industry to investigate the impact that the contextual nature of the game has and what type of activation or commercial might have on the consumer.

"In basketball, time-outs are almost perfectly coordinated with something that’s happening in the game — they’re used by coaches when another team is on the attack, it’s either for one team or against another. So going into that set of commercials, a fan base will be feeling a very predictable way. And so it stands to reason that there will be certain types of content and commercials that will be more or less effective in that setting.

"For example, if the situation in the game is really tense — that might not be the right time for a comedy commercial. And so not only are fans not having a good experience, but the sponsors are also not achieving optimal value because you’re presenting it a time that isn’t right for the fan base."

It may be that maximising commercial revenue through behavioural economics-influenced metrics does not quite provide the kind of drama that persuaded Hollywood to make Lewis’s Moneyball and follow-up The Big Short into big-budget movies.

Yet in a global sports industry worth billions, the benefit of getting there first could be just as beneficial as it was for the protagonists of those stories.

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