Playoff Diversity

While I stick to writing about baseball, the NFL lockout garners much of my non-baseball attention these days. A couple weeks ago, I read this straightforward article about NFL commish Roger Goodell wishing negotiations would resume. That wasn't very surprising news, but I bet we all read newsworthy things every day that aren't all that surprising.

What caught my eye though was a side comment made by Clark Hunt, owner of the Kansas City Chiefs. Quoting the article linked to above:
Chiefs owner Clark Hunt told callers that small-market teams such as the Chiefs could be at a competitive disadvantage with big-market teams if the NFL does not adjust to the times.

For an example, Hunt needs only to watch the small-market Kansas City Royals. Unable to match the richer clubs' salary offers for top players the Royals have developed, Kansas City has been shut out of baseball's postseason since 1985.
Even though the Royals were a small sidenote in the article, it burned me to read the quick, skin-deep analysis. Yes, the Royals are a small market team, and yes, they have struggled mightily. However, I refused to believe it was all about money. It felt to me like the Royals had made too many poor decisions in the past quarter century to compete with any amount of money.

I had to put my theory to the test. How bad is it for small market MLB teams?

It was time to study what I've coined "playoff diversity."How many different teams make the playoffs over an extended period in each league? Do we see the same jerseys every year, or do they switch up? There is this perception that it is so much harder to make the playoffs in baseball, and that only a handful of teams really have a chance.

Going back only five seasons for the four major sports (which does not include the current seasons for the NBA or NHL), a vast majority of franchises have made the playoffs in all of them. In the NBA, only the Timberwolves have not made the playoffs in the past five seasons. In the NHL, 28 of 30 franchises have made the playoffs in the same time span. Each league features 16 playoff spots for 30 teams though, so literally over half the league makes the playoffs every year.

As for the NFL, 24 of 32 franchises made the postseason at least once in the past 5 seasons, despite only 12 total slots available in a given season. The NFL has a reputation as the shining example for parity, and to be honest, I think it has rightfully earned that reputation. Therefore, it's fair to assume that more NFL teams would have made it to the playoffs with more available playoff slots.

Finally, let's take a look at baseball. It has the least amount of playoff berths each year, with only eight up for grabs - or in other words, just two thirds of the slots available in the NFL, and half the slots in the NBA and NHL, despite having just as many teams.

Not surprisingly, the MLB had the fewest number of franchises make the playoffs the past five seasons of the four major sports, with 22 of 30 teams making it. However, it's only a few behind the NFL, the beacon of parity. Moreover, in the past five years at least, the leagues with the most playoff spots available also featured the most diversity. Perhaps the issue really is the size of the postseason...

...which brings us back to the Royals. They are one of only eight MLB franchises that hasn't reached the postseason in the past five seasons. Are the other seven also small market teams? Do small market teams really have it that much worse in baseball than in other sports?

I dug a little further. Using Forbes team valuations, I parsed playoff teams in each sport into major, middle, and small markets. My criteria was simple: the 10 most valuable teams in a league for the season I was looking at were deemed major market, the bottom 10 the small market, and the 10 in the middle (or 12 for the NFL) were the middle market. Here are where the playoff teams came from in each sport:

MARKET SIZE: 
 MAJOR 
 MIDDLE 
 SMALL 
MLB
22
7
11
NFL
21
25
14
NBA
38
29
13
NHL
33
32
15

Also, here are where the top eight teams (top four seeds in each league in each sport) came from. In other words, what the playoffs would look like if every league shrunk their postseason to baseball's size:

MARKET SIZE: 
 MAJOR 
 MIDDLE 
 SMALL 
MLB
22
7
11
NFL
11
17
12
NBA
24
11
5
NHL
15
17
8

First of all, the NFL is amazing (making their lockout even more improbable). It's reasonable to argue that franchise value has no bearing on success in football. For some reason, at least recently, major-market teams have grabbed a majority of the five and six seeds, but we are only talking about 10 total slots. It's a small sample size. When only looking at the top eight teams, the distribution looks an awful lot like the natural distribution of market sizes (remember that with my definition there are more middle market NFL teams than major and small).

Like the NFL, the NHL now has a hard salary cap, and has since their ugly lockout six years ago. It doesn't seem like there is much of a difference between major and middle markets, but there still seems to be a disadvantage for the smallest markets. I do not know enough about hockey's economic structure to take good guesses as to why that might be. It does suggest to me that there is more to the NFL's parity than a hard cap (which I guess should be obvious since parity continued this past season without a cap at all). That's worth pointing out since many say that a salary cap would help competitive balance in baseball.

Finally, there is the National Ballin' Association, which makes me laugh. They artificially manufacture playoff diversity with a gargantuan playoffs that lasts forever. Overall, their numbers skew towards the richest teams, especially when looking at only the top half of their playoff teams.

By the way, just further exacerbating the point, no team lower than a four seed in the NBA has made the Finals in the past decade. The streak might be longer too, because I only bothered to go back a decade. It very clearly pays to be rich in the NBA.

In the NBA's defense, an absurd amount of a franchise's value is tied up in individual players. For instance, Forbes estimated that LeBron James was worth $80-$100 million for the Cavs, and sure enough, their value dipped $81 million (26% of their estimated worth!) this season. The best NBA players tend to play for the best NBA teams, so franchise values appear to be relatively elastic in the Association.

Still, if the NBA weren't so interested in milking every penny it can out of its fans, it would cut its playoffs in half.

Major League Baseball is the anomaly of the bunch. Not only is it top heavy, it's bottom heavy at the same time! It's the middle market teams that are badly underrepresented. Maybe this odd data can be explained by the relatively small sample size I'm using for this study, but I think it is deeper than that. My theory on why it's so bad to be in the middle in baseball is worth a post on its own.

Clark Hunt owns a team in the one sports league where money doesn't seem to matter, and watches a baseball team across the parking lot that just so happens to be the most moribund franchise in the American League the past quarter century. It's easy to see where his quote comes from. The problem is that his view resonates, and it shouldn't. MLB has more parity than it gets credit for. Its small market teams have about as good of a chance to compete as in any other sport.