Love is sometimes pursued at all costs, but it’s a little cheaper at Heinz Field.
A recent analysis by Michael Lewis and Manish Tripathi, professors at Emory University’s Goizueta Business School, found that while Steelers fans outpace all the rest in social media engagement, they are only in the middle of the pack in terms of how much they pay to follow their team.
The authors generated two metrics from 13 years of data. The first was “fan equity,” measuring how much fans are willing to pay to support their team through ticket sales and merchandise purchases. The second, “social media equity,” measured fan devotion in the online arena. Both measures were statistically adjusted to control for stadium size, local population, median income and team performance.
The Steelers were No. 1 in social media equity, a proxy for fan loyalty and engagement, but ranked 11th in fan equity, which can be thought of as per capita payment.
The second-ranked team in social media equity, the Dallas Cowboys, were at the top of the fan equity list, meaning their fans were willing to pony up more than any other team’s fans.
Both professors have doctorates in marketing and apply standard techniques from the discipline to NFL teams. Their model treats teams as brands, like any other in the marketplace.
Yet, in contradiction with what simple economics might predict, Steelers prices have not risen to meet the high demand.
“Ownership might be more benevolent,” Mr. Tripathi said of the apparent mismatch between the “obviously huge following” of the Steelers and the prices charged by the owners, who could probably raise ticket prices and still hold sell-out games. The Steelers have sold out 351 consecutive games, the third-longest streak in the NFL.
“It’s probably not true that teams are profit-maximizing,” said Mr. Lewis, who has been a Pittsburgh sports fan since childhood. “[The Steelers] have a relationship with their fans that is not exploitative.”
Team Marketing Report, a Chicago sports marketing analysis firm, found that the 2013 average ticket price for the Steelers was $81.13, below the NFL average ticket price of $81.54. The New England Patriots topped the list at $117.84, with Dallas not far behind at $110.20.
“We try to keep our ticket prices reasonable and affordable to our fans. We are happy to be No. 1 in the survey’s analysis of social equity. It is a testament to the hard work of our staff,” said Steelers spokesman Burt Lauten.
But experts say those prices could be higher.
“If it was $100, instead of $81, they’d still find buyers because of the resale market,” said Jon Greenberg, executive editor of Team Marketing Report who grew up in Churchill and Steubenville, Ohio.
But in Mr. Greenberg’s view, Heinz Field can’t command the sky-high rates in AT&T Stadium because “Cowboys football is everything in that market,” but in Pittsburgh the relatively cheaper Pirates and Penguins games compete for attention.
“It’s clear that Steelers tickets are underpriced by the team,” said Connor Gregoire, an analyst for SeatGeek, a company that studies secondary markets for sports and concert ticketing. A modest increase of 10 percent in ticket prices could net an additional $4 million annually, according to Mr. Gregoire’s analysis.
Teams may be hesitant to increase prices by more than a few percentage points a year, for fear of a fan backlash. That leaves a windfall opportunity for scalpers and ticket resellers, who can mark up prices by nearly 200 percent if a team is doing well.
“The biggest influence on the resale market is team performance. [In 2013], later season games were far less expensive, coinciding with the Steelers falling out of the playoff race,” Mr. Gregoire said.
Based on secondary market sales, Steelers ticket prices were the 12th highest in the league, at $164. In the 2012 season, when the Steelers were in playoff contention for much longer and came off a 12-4 record the season before, the secondary market ticket average was $228, the fourth highest in the league.
Bad seasons often don’t damper fan enthusiasm in sports-loving cities like Pittsburgh though, where social media engagement thrives even when sports teams don’t. With 737,000 followers, the Steelers have the third-highest Twitter following in the league, bested by the New England Patriots and the Cowboys. The team Facebook page also boasts 5.8 million likes, second only to Dallas’ 7 million.
“Social media equity can often be the better metric for NFL teams where most games are sold out,” Mr. Lewis said. “There’s no worry about pricing, stadium size or the local market in social media equity.”
But on the financial rankings, a Forbes analysis of NFL team valuations placed the Steelers 14th in the league, with an estimated value of $1.12 billion. The team’s operating income of $28.3 million in 2012 was the league’s 17th highest. The Post-Gazette previously reported that Steelers revenue in 2013 increased $34 million to $300 million, a number that likely puts the team in the league’s top 10 despite an 8-8 season.
Of course stats aren’t everything.
The Dallas Cowboys lead the league in franchise value, revenue and operating income. According to Mr. Lewis and Mr. Tripathi’s analysis, the team also led the league in fan equity for the last five years.
In that time, the Cowboys made the playoffs just once.
Idrees Kahloon: email@example.com, 412-263-2743 or @ikahloon.