Archive for April, 2010

Stats Midterm

Dear Friends,

My midterm exam is upon me.  If you were in my class, it would not be difficult to imagine why I will instead use the time I usually allot to writing my weekly article to studying.  I require about three hours or so to write the articles I post here, so that extra study time is a welcome bonus.  Graduate-level statistics at Northwestern University takes some work.

In the meantime, you can catch up on any articles you may have missed up to this point (hard to believe you would miss even one!)  Well, we will remain in touch until next Monday when all of this exam business is behind me and it is time to post the item of the week.

Best regards,

Cam Suarez-Bitar.

If You Know Statistics, the Truth Will Follow.

Introduction

Marketers, journalists, and a great many people in general throw statistics around like eggs on Halloween.  Those commercials on how coal is “the future” and how it is clean come to mind.  In fact, the conservatively dressed woman hired to convince the public – sound bite after witless sound bite – by stating that “most Americans” agree that coal is good for the environment uses an empty and unsubstantiated statistic in her harangue.   The coal lobby then throws an unlabeled pie chart in the viewer’s face that features magnified, smiling, “average-looking” people standing in the largest slice to drive home the point that you should support them because a majority of Americans believe in the alleged benefits of coal as an energy.

Statistics serve no other purpose than to draw inferences about the truth – a truth that depends both on the statistician’s ability to study a population and the size of the population itself.  When parameters (values drawn from studies of a population) are much too difficult to attain, statisticians redirect their efforts to derive a statistic instead.  She is left with the option of taking a “good” sample and drawing inferences on the population it represents.   Tips on how not to get bamboozled by vague statistics we find in the media and at work is the focus of this week’s article.

What the… I Thought This Was a Website on Sports Business?

It is, though success in all types of business depends on a thorough understanding of statistics and what they mean.  If you are not familiar with the fine art of inference that is Statistics, it would certainly help to have someone on your team who does.  Imagine for a second that you manage a tennis league and are looking for the right shoe sponsor.  The world’s largest shoe company tells you “hey, we have a great shoe that boasts a median life expectancy of 80 matches according to our latest tests.  We’ll sell you each pair at cost if you put our logo on all of your promotional items.”  Ah, fantastic!  The largest shoe company in the world wants to sponsor your league!  Life just couldn’t get any better, could it?

It’s not that simple.  That’s when you ask how they arrived at the 80-match number.  “Well, we tallied the number of matches each tested pair lasted before the sole completely wore out and listed them in order from least to greatest.  We found the number in the middle and determined that we expect our shoes to last 80 matches,” says the shoe rep.  Though the figure is impressive, one must always ask for the range and size of the sample when dealing with medians.  After all, they could have tested only 11 pairs and had the following results (measured in matches): 40, 45, 45, 47, 73, 80, 81, 84, 84, 85, 85.  Now, the median is not so impressive since we have discovered in this hypothetical example that the measurements are skewed.  Conveniently, you were told just a median and had you not asked for at least the range of measurements (40-85) and the sample size (11), you would not have known that the statistic you were given was terribly inaccurate but served the shoe rep’s purpose!

Averages are another story altogether.  Let’s say that you work for your favorite local roller derby team in their marketing department and you are averaging the amount of revenue the team generated in merchandise sales in the 2009 season.  You calculate the mean (another word for average) and determine that the team raked in an average of $1950 per bout in merchandise sales.  Your numbers could be thrown completely off if you included outliers (quantities way out of the norm… there is a way to determine which figures, if any, are outliers in your sample space, by the way) that brought your numbers way up or way down.  In this example, your team actually generated $1500 per bout, but due to the fact that you included the one day that your staff sold $2900 in your calculation of the mean, your average now looks more like $1950 per game.  This leads to faulty measurements of your team’s performance and may cause you to form an inaccurate assessment of your sales initiatives (among other possible errors.)

Now, after 10 years in roller derby you are hired by Hendrick Motorsports to make sure the garage always has enough spare parts, but not too many.  Your first duty is to choose and buy tires the team will use during practice and in every race next season.  The manufacturer claims that all but 2% or less of their tires will last an average of 50 laps.  Ah, but you are skeptical.  All those years of working long hours in obscurity have paid off, haven’t they?  Good job.  You tell the manufacturer that you would like more evidence.  The day after, their sales rep sends you information on the number of tires they tested, the conditions they were tested in, how much the measurements vary from one to the other (otherwise known as standard deviation), and they even tell you how they managed to get a “good” sample and the measurements are normally distributed (when graphed, they form a bell-shaped curve… that’s very good for your purposes, by the way).  When you run those numbers through the equation in the Central Limit Theorem, which is used to compare the mean of a sample to the mean of all the means of all the measurements drawn to answer a question, you discover that their “2% or less” guarantee was a gross exaggeration.  In fact, the probability that 7% or more will not last 50 laps is significantly larger than the probability that only 2% will wear out before their time.  The team thanks you and you remember why you chose this career over creating the layout for each year’s swimsuit issue.

The Point

Statistics are used to draw inferences when the truth is inaccessible.  The truth and related inferences are very powerful and, believe it or not, are often used incorrectly on many levels.  The decision-making process depends on one’s intuition and empirical data; exclusive use of one or the other can lead to undesired results in many cases, though.  When you are presented with a statistic, always ask (at the very least) who or what was measured, how many, why they were included in the study, who performed the study.  Often, we are fed very vague and poorly calculated and derived statistics that work only to further someone’s agenda.

Be very careful when basing an important decision on a statistic.  When dealing with a survey, one simple question you can ask is whether or not the sample was self-selected (respondents chose to participate on their own) since such participants tend to hold extreme or biased positions on a subject and will compromise the sample’s ability to represent the entire population (i.e. when polling your fans, you do not want only the opinions of the die-hards if you wish to understand your entire fan base altogether).  It is also good to ask how many people participated in the survey or poll (i.e. asking for the sample size.)  You could also ask if sampling was done with replacement (whoever was randomly chosen from a group to participate in a study is “replaced” in the pool and could be chosen again) as that could affect the variance of the answers you receive.  Lastly, you could ask if participants were part of a systematic random sample in which, for example, every 50th random passerby was chosen to participate in a survey.

So, the next time you hear someone make a claim based on a statistic/probability, ask as many questions as you can.  You could be reading a pie graph that tells you the respective proportions of general managers who who felt that certain specific issues must be addressed by the Chicago Cubs’ new ownership before they return to the World Series, but without knowing which teams or leagues those general managers work for and if they understand the sport and business of Major League Baseball, you probably should not attach too much importance to that graphic until you know more.  Finally, the next time you watch that commercial by the coal lobby or anyone else who misuses a statistic, ask yourself how many people out there would believe such claims without asking for more evidence.  It would not hurt for the source to be credible, either.

Basically, when dealing with a population much too large to study, we use a sample (a statistic) to draw inferences that will bring us closer to the truth.  When interpreting a statistic, critical thinking is key.

Cam Suarez-Bitar.

Thank you for your readership.  By no means was this article a comprehensive analysis of either the complexities of statistics or the decision-making process in sports business.  It was meant to introduce the reader to the important role statistics play in the decision-making process and how to avoid being tricked by either careless or unethical advertisements or claims.  Hopefully, this week’s article will make the study of statistics seem more relevant.

A Week Off

Dear Readers and Subscribers,

This quarter, I am enrolled in a graduate level statistics class that has thoroughly consumed my time.  So, with 100% “confidence” (pun very much intended for all you stats fans) I can say that I am taking the week off.  There’s a GPA to maintain, you know?

In any case, next week I will be back with a new article.  Maybe it will be on the Cubs… maybe it will be on the Sox… or maybe it will be on STATS!

As always, thanks for your readership.  Email me if you have any suggestions for next week’s article or you want to talk about anything else.  Otherwise, it might just be on STATS!

–Cam Suarez-Bitar.

Why Joe Namath is in the Pro Football Hall of Fame

Today, we take for granted that the NFL is – in the sports brand life cycle – in its maturity.  The period beginning in 1958 after the “the Greatest Game Ever Played” that spiked in the mid-to-late 1960s and smoothly blended into the 1980s and 90s marked the league’s developmental stage (otherwise known in sports marketing as the “growth” stage).  The 1980s and 1990s saw the league enter the maturity stage: though the NFL continues to grow and new records are set nearly every year as more people around the world watch the Super Bowl, the NFL is peaking and we are not seeing the dramatic changes today that we saw in the 1960s.  That decade defined the sport forever and the man most responsible for the sport’s growing appeal and supplanting baseball as the national pastime is none other than Joe Namath.  Arguably, from the administrative side, one can say that Pete Rozelle is the greatest catalyst in the league’s growth in the time period I referred to above.  However, Namath brought the sport and the league into the modern era and cemented its place in American popular culture; in fact, it was for this very reason that “Broadway” Joe was inducted and consequently immortalized in the Pro Football Hall of Fame.  His success in Super Bowl III proved that the AFL could compete with the NFL and led to the merger in 1970.

What Good is a Stage Without the Actors?

As you read in last week’s article on Mark McCormack and Roone Arledge, the former practically invented sports marketing and the latter revolutionized sports media.  In fact, it was during the 1960s that McCormack grew IMG and Arledge created Monday Night Football.  So, by 1969, sports marketing had become much more sophisticated and sports media evolved and entered “prime time.”  In the 1960s, Arledge built the stage and most of the interesting and attractive angles from which fans could watch “the show” and McCormack’s type of sports marketing sold it.  This may be so, but the marquee belonged to Mr. Joe Namath – he was the principal actor, the protagonist, and star attraction.

The 1950s belonged to the Baltimore Colts and Johnny Unitas.  The quarterback from the University of Louisville captured the imaginations and the hearts of fans all over the country.  Boys and their fathers, brothers, and friends would gather around the radio and TV to witness Unitas’ greatness; relatively few women in America followed football at that time.  His golden arm, black cleats, buzz cut, leadership in the closing moments of a close-run game, toughness, and measured disdain for public attention and recognition were but a few of the qualities that fans appreciated the most.  By the time the whistle blew to initiate the opening kickoff of Super Bowl III in 1969, though, the Colts were much older and Unitas was injured.  Nearly 11 years had past since Unitas led the Colts to victory over the New York Giants in 1958 and after Namath and the Jets defeated Unitas’ Colts that fateful Sunday afternoon, the era of white cleats, long hair and fu manchu mustaches, brash guarantees, flashiness, and publicity and glamour had begun.  Football evolved that year as the underdog Jets won in one of the greatest upsets in the history of sports; in fact, now it did not only inspire and captivate… it entertained.

Roone Arledge put Monday Night Football on the air the year after Namath’s Super Bowl victory.  So, who do you think was the star of the first installment of Monday Night Football in 1970?  None other than “Broadway” Joe.  That’s who.

Pro football was ready for the evolution of sports marketing.  Namath’s charisma, personality, and good looks attracted women who otherwise would not have cared much about the sport.  The Pennsylvania native’s transition from his hometown of Beaver Falls, PA to Tuscaloosa, Alabama and ultimately New York is an allegory for the birth and development of pro football: from small town teams of players hailing from their home’s environs to college football players becoming professionals and honing their skills on Saturday afternoons and their ultimate success on the world’s greatest stage on Sunday evenings.  Namath was the sport’s first modern celebrity and prima donna.  He helped the NFL take its next big step.  He is stylish, educated, charming, talented, and always convinced those around him that they could win as long as he was there.

We can surely qualify his exploits, but it proves to be a bit more difficult to quantify them.

It is Not Just a “Numbers Game”

This brings me to my point.  Football is not just a “numbers game” and there are a multitude of intangibles that can propel a man, a team, and a league to succeed that cannot be represented by numbers.  Well, in this case, the record amounts of revenue that properties like the NFL, ABC, and sponsors generated in the years that Namath played (1965-1977) and thereafter would be of prime interest here, since their success depended largely on Namath’s exploits on the field and screen.  Detailed research would surely help my claim, but its inclusion in this article would be a bit superfluous.

When we look at Namath’s career statistics, however, the numbers are not as impressive as those posted by other Hall of Fame quarterbacks.  Other modern-era quarterbacks like Dave Krieg and Randall Cunningham, who posted more passing yards over a career (38,147 and 29,979 respectively), a better completion percentage (58.5 and 56.6 respectively) and touchdowns (261 and 207 respectively) compared to Namath, who passed for 27,663 yards, completed 50.1% of his passes and threw 173 touchdowns (vs. 220 interceptions), most likely will not be inducted into the Pro Football Hall of Fame any time soon.  Namath won a Super Bowl as did Trent Dilfer, though fellow Hall of Famers Fran Tarkenton and Jim Kelly did not.  Other modern-era Hall of Fame quarterbacks posted much better numbers, but there is no one on that list who contributed more to the NFL’s success as a property since the 1960s or helped make it a prime time sport more than “Broadway” Joe.  Career statistics do not necessarily matter on their own.  Besides, the rules of the game have been changed countless times since the days of Broadway Joe.  The NFL “protects” quarterbacks and promotes scoring with some of the new rules that allow quarterbacks to think less about survival and more about “managing the game.”  This was certainly not the case in Namath’s days.  For example, pass interference is a completely different call today than it was 40 years ago.

At the Pro Football Hall of Fame’s website (http://www.profootballhof.com/hall/missionstatement.aspx), one could find the Hall’s mission statement and easily conclude that against popular belief, football really is not just a “numbers game.”  The site clearly states that players “who have made outstanding contributions to professional football” are enshrined in Canton, Ohio and it simply cannot be argued with strong logic nor empirical evidence that Joe Namath did not make outstanding contributions to the sport.  No one who ever played the game was more important to its survival and success.  No one.

Thank You, Joe Namath

The picture headlining this week’s article is a still image from footage of Super Bowl III.  Joe Namath delivered on his promise and the one finger he held high could signify that the New York Jets are “number one.”  Instead, after learning about Broadway Joe and the history of the NFL throughout my life, it is my firmest contention that, with that very gesture, he was telling the world, “I told you so.”

So, thank you, Joe Namath, for everything you did to move the game forward.  It probably was not your primary goal, but because you committed to yours and your teams’ success and shared your talents and personality with the world, an entire sport grew at a record rate and, consequently, inspired and changed the lives of a great many people.  Your success in Super Bowl III made more than one young man or young woman believe that success is always attainable when you have faith, confidence, and fun no matter what the odds or challenge at hand.  The concept of the modern athlete, in general, exists because of you and those who emulate you.  While you inspired viewers with your tenacity and confidence when facing any opponent in spite of injury or distraction, more than anyone else, you made it fun.  You not only guaranteed victory in Super Bowl III… you guaranteed the sport’s place in popular culture forever.

Cam Suarez-Bitar.

Thank you for reading.  If you have questions or comments, please add them all here and we’ll discuss them a bit.

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