Sports live in an awkward place today. All sports leagues such as the NFL, NBA, MLB, and NHL have struggled in recent years as viewership and ratings plummet. It’s no secret that younger viewers aren’t as interested in watching sports as they used to be. Then came COVID-19, and sports went on a bumpy ride with delayed seasons, limited attendance, and further rating decreases.
However, some leagues do better than others. The NFL is the 800-pound gorilla in the sports world and tends to outperform other sports. The NBA does some things well, while the MLB seems completely lost. I’ll skip the NHL (hockey) as I don’t watch it despite being Canadian.
What are the distinctions of success? Why does the NFL do better than other leagues, and if you were in charge of any of these organizations, what strategy would you undertake? These are the questions for our post today. Let’s get started.
“It Was the Pandemic” Isn’t a Valid Reason
Sports leagues might be tempted to submit the “pandemic” as the reason for why they are struggling. However, there’s no denying that the 2020 and 2021 seasons were unusually tough for all sports. Some played shorten seasons while others, like the NBA, played in a safe bubble that extended beyond their regular schedule and prevented fans from attending.
We can’t accept the pandemic as a valid reason, though, because most sports trends have been playing out for years. The pandemic didn’t force young people to change their minds about baseball while in lockdown. They haven’t shown interest in a long time, and that’s a major issue.
Here’s a quick overview of how each league performed over the few years.
The NFL generally does well, but here are some numbers to show the good and bad. The 2021 NFL Draft was the third most-watched of all time. The three most-watched drafts have occurred in 2019, 2020, and 2021. However, Superbowl LV in 2021 had one of the lowest ratings in over 30 years. On the other hand, the AFC and NFC Championship games in 2021 did see an increase in viewership from 2020. The NFL is also currently dealing with racism (poorly, in my opinion) and the fallout of health risks like CTE.
MLB has a variety of issues. There was the cheating scandal with the Astros, pitchers using sticky substances to make it harder for hitters, and an overall sense that games are too long and/or slow. The World Series viewership in 2020 was the lowest in 20 years (9.78 million). However, there were glimpses of hope in the 2020 season as the opening day shattered MLB ratings while the playoffs drew a sizable audience.
The NBA was unique in how they approached COVID. Their 2020 bubble worked from a health perspective though ratings were down for the entire season. The 2021 finals weren’t as strong as the 2015 and 2016 finals — which included Lebron James. On the plus side, the NBA happens to have the youngest audience across all major sports, which could help the future. Also, the 2021 NBA playoffs did better than in 2020 (during the bubble). Finally, I think the NBA has done a good job of handling racism and social issues.
Let’s think of each sports league across two dimensions: strategy and operations. Strategy is how they are thinking about the future and their adaptation. For example, all sports leagues need a strategy to deal with decrease viewership and ratings. Operations is their ability to execute in the present and make progress on their strategy. So here’s how I would organize these three sports leagues on a 2 x 2 chart, with the top right corner being an organization that is good at coming up with a strategy and executing it.
The NFL has a poor strategy but great execution. They merely ignored the social issues like racism, and they see issues with the participation of younger children because of potential health injuries from tackling. On the other hand, they execute extremely well in terms of marketing and how they run the league.
The NBA has a great strategy and great operations. Their adaption to the bubble worked well, and they are constantly thinking about how to make the game more entertaining. You can see them exploring NFTs and have done a good job at letting players express their opinions. The NBA may never match the NFL in terms of viewers, but the players, teams, fans, and owners will continue to be successful.
The MLB has a poor strategy and poor operations. They didn’t adjust well to the pandemic, ignored social issues, and make unusual choices. They recently cracked down on sticky substances from pitchers, but it’s unclear if that will actually help the game. They likely need to change their game format, but they would have to go against tradition.
Your placements might be different, and that’s ok! The point is to have a logical way of organizing organizations and being able to support decisions. You can run the same exercise for companies, non-for-profits, and even governments.
Why Makes a Sports League Successful?
So what makes a sports league successful? In the previous section, we saw elements of success among the 3 options we analyzed: NFL, NBA, and MLB. They each approach their sports slightly differently, but I think they would benefit from learning from each other. I think there are 4 elements that a sports league needs for long-term success.
1) Capturing Days of the Week, e.g., Monday Night Football
The NFL has done a fantastic job at capturing days of the week in their marketing. Everyone knows Monday Night Football, and people can organize their schedules around this. Being able to connect your business to a fundamental routine is hard, but the rewards can be well worth it. Think about restaurants that have well-known happy hours or movie theaters and their discounted Tuesday offers.
2) Quality of Quantity: NFL = 17 , NBA = 82, MLB = 162
The NFL has the fewest games in the regular season at just 17. The NBA has 82, and MLB has 162. You might think that more games mean more opportunities for sponsors and for people to enjoy the sport. However, more games also translate into less important games. A baseball team doesn’t have to win every single game, and in fact, there’s a good chunk that are basically pointless. The same happens in the NBA. Quality over quantity matters more than ever.
3) Big Shows e.g., Superbowl
The NFL has also done a great job expanding their finals, i.e., the Superbowl, into a major must-see event. Even non-football fans will watch because of the half-time show where major artists tend to perform. The NBA and MLB haven’t quite done that though I would say that the World Series in baseball is likely better known than the NBA Finals.
4) Parity in League
No one wants to watch the same teams battle for a championship over and over again. This is why people love March Madness (college basketball) because you never know who will win. The NBA and the MLB struggle with parity as some teams can easily outspend others. The NFL historically has done much better with parity (excluding Tom Brady), but I think the best league for parity in the NHL. Leagues have to impose taxes, limitations, and other regulations to ensure that one team can monopolize the entire sport.
Sports aren’t going away, and their content will continue to be hugely valuable to advertisers and companies. Netflix can easily create amazing TV content, but they can’t replicate an entire sports league. However, sports organizations will have to adapt to modern times and change their game to suit what fans want to see. That’s where the value of strategy comes in.