Friday, December 1, 2017

Viewers Aren't Having a Knee Jerk Reaction to NFL Player Protests

TLDR: There has been "a 17% decline in the television audience of [...] NFL games."

"The decline in these measurements of NFL viewership is not entirely due to kneeling protesters. Nor is it due to the increased awareness of head injuries."

This decline can be seen as "a shift in how fans consume NFL products not a shift in how much fans consume NFL products."

The National Football League (NFL) has seen no end of issues as of late: deflated balls, alleged-doping scandals, concussion lawsuits, and now, the twitter account of the president of the United States:

Instead of debating the issue, I want to evaluate and contextualise this final sentence, "attendance and ratings way down," which we may have missed if not for the additional 140 character allowance.

While Mr. Trump is mostly true, I find that the decline in these measurements of NFL viewership is not entirely due to kneeling protesters. Nor is it due to the increased awareness of head injuries. In fact, we probably don't really know what is causing the majority of this shift in demand away from live NFL television.

What is true is that Nielsen has measured a 17% (unconditional) decline in the television audience of nationally broadcast NFL games in 2017 over 2015. Attendance, on the other hand, is a bit trickier to measure....

Because of the difference between paid attendance and turnstile attendance, we will only know how many tickets are sold to each game instead of how many fans show up. Therefore we cannot know the impact of events such as anthem protests have on the number of people attending live football games. In fact, the average attendance as reported by teams is on par with past seasons. Ultimately, without insider access to each NFL team's in-seat attendance data, we cannot fully evaluate the statement that attendance is down because:
  1. Season ticket holders and individuals who purchased tickets in advance of the game are always included in the paid attendance figures. Therefore these individuals cannot elicit a response to new information, such as inclement weather which may cause some to not attend, and;
  2. Reported attendance is typically at or near capacity for the eight home games of most teams. With few observations and such little variation in a dependent variable, we are unlikely to pick up an effect of an explanatory variable.
Instead we can focus on the television ratings to demonstrate what is the cause for the modest viewership of the three nationally broadcast games the NFL airs each week. These three broadcasts are aptly named Monday, Thursday, and Sunday Night Football, with the latter having the largest viewing audience. Note that for exhibition, I focus on Sunday Night Football, however these results can be generalised to each of the three prime time broadcasts.

I begin by collecting the Nielsen-estimated number of viewers of each of the prime-time games since 2014, as summarised by Sports Media Watch. I then collect information on the quality of each team using FiveThirtyEight's ELO.

I also want to consider other factors that may be affecting the viewership such as the focus of head injuries in contact sports or the aforementioned anthem protests. For head injuries, I use information from Google Trends for the weekly number of searches for "concussions" in the United States. In the case of anthem protests, ESPN publishes a weekly list of players who have made some sort of protest-like gesture during the Star-Spangled Banner before their respective game. I define a anthem protest as a player kneeling or sitting during the anthem (therefore I do not consider the numerous players who raise a fist or choose to remain in the locker room during the anthem).

Next, I run a simple regression to predict the natural logarithm of viewers using weekly or game-specific data on the games, the teams, and the number of protesters. A graphical depiction of the results is below. To interpret the graph, consider the following example: if the quality of the teams featured on Sunday Night Football in 2017 was equivalent to that of which we saw in 2015, we would expect to see the number of viewers increase by the area of the white bar.

So, what do we learn from this exercise?

The first thing to note is that the vast majority of people are still watching Sunday Night Football through traditional methods (i.e., live television). Additionally, there has been a slight increase to (licit) online viewing of live NFL.

Second, the largest share of the explained loss in viewership can be mitigated through something I have talked about once before - better matchups. The NFL does have the power, especially in the latter half of the season, to make use of Flex Scheduling and change which teams are featured in the Sunday night broadcast. If done correctly, this could strongly increase the overall viewership for the remainder of the season: I have previously suggested the NFL could have used a better strategy brought in an additional 7-16 million viewers in the 2016 season alone.

Third, kneeling protests have only a small negative effect on viewership (only 200k viewers!). This effect is really no bigger than concussions which is another issue I have talked about that has been plaguing the NFL.

Instead, I cannot definitively say what is it that has been driving the majority of viewers away from Sunday Night Football. The red area of 'unexplained' decline in viewership may point to larger trends, such as cord-cutting wherein homes are selecting to forgo cable in favour of on-demand services such as Netflix.

Finally, some context: a simple comparison of other measures of demand for football point to a less worrying trend for the NFL. First, the unexplained decline in viewership of Sunday Night Football is not all that far off from the decline in viewership of arguably the closest substitute, NCAA Division I Football Bowl Subdivision (FBS).

Now compare the NFL viewership with the increase in the Fantasy Football memberships and the non-change in NFL ticket sales (keeping in mind the limitations of reported attendance numbers) and the NFL does not look to be in such bad shape. (Not to mention the $7B the league will receive each year for broadcast rights until 2021)

What I would interpret this as is a shift in how fans consume NFL products not a shift in how much fans consume NFL products: Nielsen measure neither mobile viewership nor viewership of a recorded program more than a day later, not to mention illicit online viewership.

And while Mr. Trump may be correct in saying NFL viewership is down, it may be a little overstated to think that it is all driven by player protests.

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