The NFL is America’s most popular sport by demand, and every week the masses confidently place bets on football games. Today’s games bring many channels to bet on, whether it be fantasy football, “pick ‘em pools”, or traditional betting. Even a simple bet on a team allows you to bet “straight up” or bet against the latest line (odds established based on each team’s probability to win).
If I haven’t lost you at this point, then you probably know football well–or you want to find out exactly what this has to do with marketing.
People LOVE Their Teams
Here’s the thing…sports are highly emotional. Therefore, there are many factors taken into consideration when your average Joe tries to predict a game. Think of this in terms of a fictional characters Dan and Erin. Dan lives in Florida and spends his weekends on a yacht enjoying the sun. Erin lives in Denver and spends her weekends going out downtown and snowboarding the Rocky Mountains.
Dan is going to typically lean towards teams in his own state, simply because he has a natural connection with them. Dan’s favorite color is green. This could cause him to overvalue a team like the Packers for no statistical relevance. It just so happens that Dan’s favorite place to vacation is San Diego. Now he has biased towards the Chargers. See where I’m going with this?
On the other spectrum, Erin is a die-hard Broncos fan. She bets on the Broncos no matter the matchup simply out of principle. It just so happens that all of her family is from New York, so she will also support the Giants and Jets to be a part of that “family camaraderie”. Erin is making poor decisions based on emotion and personal factors, just like Dan.
Ok now you’re thinking, what is the point of these long stories about Dan and Erin? It goes to show us that every person is going to bet differently based on intuition, preferences, and inherent behaviors. Intuition is important, in marketing and football, but you don’t want to depend on your intuition when you have a high-cash bet at stake, or if you’re trying to identify your total addressable market (TAM) when it comes to marketing. This is why we need a predictive system to filter out our own bias and make a bet based on data, thus improving our chances of winning.
Using Data to Make Predictions
Predicting the Super Bowl can be compared to Predictive Marketing. Many businesses THINK they know what their best customer looks like, but we often find that predictive models bubble up insights that no human being could pick up on. This opens up channels to market & sell to that are based on signals surfaced by machine learning.
OK, back to our sports betting example. I’m from Denver. Born & raised, and went to college at the University of Colorado. Naturally, I’m inclined to predict that the Broncos will win the Super Bowl. Now I take a step back and look at the data. The Panthers offense led the entire league this season with 31.2 points per game (#1)! The Broncos were 19th on that list with 22.2ppg. Carolina was 6th on defense in points allowed per game (19.2), Denver was 4th (18.5). Based on entire season averages, it becomes clear that Carolina is the favorite to win.
Again, like predictive marketing, we need to factor in as many data points as we can get our hands on. If you consider the quarterback position which is widely accepted as the most important on the field, Cam Newton significantly outperformed Peyton Manning (edge: Carolina). Vegas betting odds (essentially weighting a massive population of normal and expert opinions) has the odds at 5.5, basically suggesting that Carolina is favored to win by 5.5 points. In conclusion, when you use all of this data the signals are weighting stronger to predict Carolina will win the game.
If I had followed my gut only and “what I know to be my traditional customer (home team)”, I may be losing some cash this weekend for nothing. Instead, thanks to predictive, I’m putting my money on Carolina. As long as I do this consistently using data every game, I’ll set myself up in the best position to come out ahead in the long run.
Sorry, Denver. I’ll still root for you to beat the odds, but my gut now tells me I will be enjoying a free meal and beers Sunday night…