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The Value Of A Win To A Losing Team

According to Mark Topkin, the Rays are close to completing a trade of Akinori Iwamura to an unnamed team. A more recent report from Dejan Kovacevic pegs the Pittsburgh Pirates as the potential partner. This post isn’t an analysis of that trade, because the details aren’t yet known and the topic is low-hanging fruit for RJ anyway.

I wanted to use the rumor to discuss a popular reaction to that kind of trade, however. The Pirates aren’t contenders in 2010, and will readily admit that they’re still in full on rebuilding mode. In general, whenever a team in that situation makes a move for an older player to fill a big league roster spot, there’s a swath of fans who claim that the team is wasting resources. This argument actually was used in favor of the Pirates decision to deal Nyjer Morgan and Nate McLouth this summer – they downgraded the roster but got younger in the process, and the wins that were lost by subtracting McLouth and Morgan were written off as unimportant.

I think this argument takes a kernel of truth – the varying marginal value of a win – to an extreme that doesn’t reflect reality. There is certainly less value in a win that takes you from a 69 to 70 win team than an 89 to 90 win team, but the value of the 70th win is not zero. It may have no real value from the perspective of playoff odds in the next season, but for the long term health of the franchise, those wins that take you from laughingstock to mediocre are still important, especially as they relate to revenue.

While rebuilding teams have to look towards the future, they also have to avoid the death spiral that can occur when a small revenue team fails to put a good product on the field, drives away the fan base, and in the process lowers future revenues. There is a financial cost to losing that is magnified when teams are uniformly awful, and that cost can inhibit a team’s growth potential in the long run. Developing a fan base is in many ways like developing a farm system – it requires a present term investment that theoretically returns greater future value.

Aki Iwamura is not going to lead the Pirates to the playoffs, but he’s also a potentially useful player who will improve the 2009 club without harming the development of any significant pieces and likely came at a low cost to the organization. There is value in these kinds of transactions, even for teams that aren’t going to be winners next year. Just because a team won’t be contending in 2010 doesn’t mean they should avoid investing in the 2010 product.

The key is to be smart about what kinds of investments you make. Russ Branyan’s signing by the Mariners last year is a perfect example of the kind of short-term, low-cost, quality acquisition that rebuilding teams should be looking to make. What the Royals did in throwing money at Kyle Farnsworth, Mike Jacobs, and Willie Bloomquist is an example of this kind of thinking gone badly wrong. The Pirates, and teams in a similar situation, should exploit the opportunities to find value in order to put a decent team on the field and develop revenue streams that will support a future winner. Sometimes, that value will come in the form of a thirty-something nearing the end of his career, but the value they can add in the short term can make that kind of player a better choice for a rebuilding team than giving an inferior young player playing time in the name of rebuilding.