The field of sports economics has grown dramatically over the past few years. Unfortunately, much of this research (being published in academic journals and/or presented at academic conferences) is often not accessible to non-academics. To help remedy this issue, the Wages of Wins Journal has elicited the help of Jill Harris. Jill earned her Ph.D. in economics from Oklahoma State University. She has taught Principles of Microeconomic theory, Economics of Sport and Economics of Crime for more than 20 years in public and private institutions and is currently teaching at Pitzer College and Pomona College. Her research interests include cheating in the NCAA, detecting the Hot-Hand in sports (especially water polo), and non-compliance behavior in organizations and industry. In this post, Jill examines the role social media is now playing in demand for sports.
Here is a riddle: what does Boston, @twitter, and the World Beard & Moustache Championships have in common?
Okay. The last one gave it away: beards.
In No-Shave #Movember it is fitting to highlight the influence of social media in sports consumption. @BizballMaury reported the Nielsen Social Guide rated Game 6 of this year’s World Series as the most social program of the day with 1.6 million tweets from 623,000 unique authors. That is up 86% from 2012. What’s up with that? While some may suspect @jackdorsey of paying off twitter fans to bolster his IPO launch on Wednesday, there are a few more likely explanations.
Take, for example, the superstar effect. Economists like Berri & Schmidt (2006) show superstars can draw fans. Similarly, competitive balance or the lack thereof can also fill seats at live events. Some studies show no evidence of strong preferences for less certain outcomes (Buraimo & Simmons 2009, Borland & MacDonald 2003). Others indicate fan attendance peaks when the probability of a win is 60% or so (Knowles, Sherony, & Haupert 1992, McDonald & Rascher 2000).
But, this is a brave new world of socially interactive sports consumption (#hashtag). We are being ushered into front row seats in the theater of attendance demand. In the wake of the Boston Marathon tragedy, the 6th game of the World Series was destined, perhaps, for social media greatness. The #redsoxnation was Number 11 on the Forbes Top 50 sports teams social media list with 11.4 million followers (second only to the Yankees in the baseball social media subgroup). That was 3 months before the series began. (By comparison, last year’s sweeping San Francisco #Giants only have 2.1 million followers). Add to this platform the future series MVP, @davidortiz, was running for mayor, the Sox beards were longer than a pop fly to center field (#bostonbeards), and it had been 95 years since Boston won the Fall classic back at Fenway and you get the perfect social buzz storm.
If the @Nielsenwire data is any indication, this weather system is a slow moving force to be reckoned with. Viewership of the series by men (between 18-34) was up 33% over the prior year. Not only is this the group most likely to not be shaving this month, they are precisely the group the @NFL had in mind when signing a lucrative contract with @twitter in September to promote game films and highlights. Emarketer, Inc. estimates this will generate close to $1 billion in ad revenue for @twitter #notgooglesized #buttwicelastyearsrevenue.
Any empirical model of demand for sports consumption is probably incomplete; it is difficult to capture all the reasons fans buy tickets or tune in. However, since the curse of the Bambino has been reversed, we should swing for the fences while social media brings us into the minds (and #beards!) of the next generation of fans.
And we are not immune to this trend here: