Philosoraptor’s Corner: Should the Giants trade down in the first round?

When the New York Giants hired Joe Schoen to be their new general manager, it was a marked departure from the status quo.

Not only is Schoen not a part of the direct line of succession that traces back to George Young, but he professes to be a forward thinker in way that’s new for the usually-conservative Giants. That isn’t to say that the Giants have been stuck in the football equivalent of the neolithic period until January of 2022. They were one of the first teams to make use of GPS tracking under Jerry Reese and Tom Coughlin. Likewise, Ben McAdoo’s reliance on 11 personnel to run the ball was a harbinger of things to come across the NFL. The problem has been that when the Giants have dipped their toes into the data science pool, they haven’t used those tools particularly well — or consistently.

Schoen talked a lot about making use of analytics, or as he put it, “data innovation” in his introductory press conference. He talked about incorporating data science into every facet of the Giants’ decision making process, from informing their free agency strategy to optimizing their training methodologies.

Schoen said, “It’s not going to drive the entire process, but it’s another tool that we need to use in order to get whatever competitive advantage we can and make the best decisions we can for the New York Giants.”

We understand that the difference between winning and losing an NFL game often comes down to inches and instants. A third-down conversion failed, a kick bouncing off the goal post, or a finger tip just deflecting a pass — or not — can be the difference in the game. What’s less obvious is that the offseason margins are often that close as well. Not correctly compensating for bias in an evaluation can throw off a scouting report and a whole big board. While perfectly tailoring a free agent’s skill set to your scheme can net your team a difference maker at a great value — such as Shaquille Barrett for the Buccaneers or Stefon Diggs for the Buffalo Bills.

As Schoen said, “Any tool that can help us win games or give us a competitive advantage, we’re going to continue to push the envelope and find out what those are.”

NFL teams have to be resourceful in finding every legal competitive advantage, and looking at historic data points for trends and insights is absolutely one of those tools. And as Schoen says, it’s a multi-purpose tool that can be used everywhere from in-game coaching decisions to draft strategy.

This brings us to one of the pressing questions regarding the 2022 NFL draft and the Giants: Should the Giants’ trade down at the top of the first round?

Playing the odds

Conventional wisdom lands somewhere between “No” and “Hell no!”

After all, Top-10 picks are among the most valuable commodities an NFL team can have. They allow a team their pick of the best prospects in the whole draft: Top 10 players are expected to start immediately and be foundation pieces for the next five or 10 years. If your goal is to “build through the draft,, you should be acquiring as many of those players as you can.

The counter argument is that the draft is, ultimately, a game of chance.

Even the best scouts and general managers miss a lot more often than they hit on draft picks. Depending on your sample period, first-round picks have somewhere between a 50 and 67 percent success rate. As a whole, GMs talk about wanting to get half of their picks right for a whole draft. But in reality, if a team gets two or three players from a draft class to be positive contributors for most of their rookie contract, it’s a successful draft class.

That’s the primary argument given for trading back. Being able to make multiple picks gives you better odds of finding a contributor. Even though a later pick means a reduced talent pool, if we accept that teams picking earlier have a decent chance of drafting a bust then making multiple later picks improves your overall odds of a hit.

Every situation is, of course, unique. And while there are no “sure things” in the NFL draft, teams have to do a cost-benefit analysis for every decision. If they trade back, there’s the chance that a player they like won’t be there when they get to make their new pick. Is “Player A” likely to have a greater impact than “Player B AND Player C”?

It’s certainly possible, particularly if Player B or C busts. That said, it’s often unlikely that a single great player will have a bigger impact than two good player — excepting, of course, the quarterback position. There’s also the fact that, on average, there generally isn’t a massive drop-off in production from players drafted in the same round.

So for the most part, and particularly when we zoom out to look at trends across multiple drafts, the data favors trading back whenever a good deal is offered.

The economic angle

Up above I used the term “cost-benefit analysis,” and there’s a pretty good reason why. The imposition of a hard salary cap and a rookie wage scale has made it so just about every decision at every level in the NFL can be viewed though an economic lens.

Investopedia defines “cost-benefit analysis” like this:

A cost-benefit analysis is a systematic process that businesses use to analyze which decisions to make and which to forgo. The cost-benefit analyst sums the potential rewards expected from a situation or action and then subtracts the total costs associated with taking that action.

Basically, every decision has a potential reward but also a cost associated with it. In real terms for NFL teams, the cost is both human (player personnel) and financial (salary cap).

In the personnel leg of the equation, selecting “Player A” means that a team is explicitly NOT selecting “Player B” (or Players “B” and “C”, in the event of a trade). Or to put it bluntly, by drafting Saquon Barkley in 2018, the Giants were explicitly NOT trading back and drafting Quenton Nelson and Darius Leonard.

In the economic leg of the equation we find the rookie wage scale. Put simply, higher picks are paid more than lower picks. And on the face of it, that makes sense. By any measure, high draft picks (on average) perform better than lower draft picks. The first overall pick should be expected to be a better, more productive player than the 32nd pick.

But here’s where things get sticky: the first pick in the draft will be paid $7,874,404.00 in 2022, while the 32nd pick will be paid $2,335,292.00 — That works out to be about three times as much this year. So unless the first overall pick gets more than three times the production of the 32nd pick, the team picking last actually gets more production for their dollar.

The rookie wage scale also means that players on rookie contracts who produce at a level roughly equal to veterans are more valuable since they’re paid less.

Cade Massey and Richard Thaler put forth the idea of “Surplus Value” in their paper “The Loser’s Curse: Decision Making and Market Efficiency in the National Football League Draft”, which was published in 2013 by the Wharton School at UPenn.

At the risk of (vastly) over-simplifying Massey and Thaler’s work, the basic concept is that because rookies are usually paid far less than veterans at the same position they offer a value surplus over veterans for similar production.

That surplus value isn’t static, either. As we just noted, higher picks generally are more productive than lower picks. However, they aren’t so much better as would be implied by the differences in their pay. The salary cap hit of a high first-round pick is much closer to that of a veteran, and as such, it offers worse value.

To quote Massey and Thaler, “Our findings are strikingly strong. Rather than a treasure, the right to pick first appears to be a curse. If picks are valued by the surplus they produce, then the first pick in the first round is the worst pick in the round, not the best.”

I know, it makes my head spin a bit, too.

Timo Riske of Pro Football Focus visualized the concept like this:

Timo Riske (@PFF_Moo)

The blue line represents the average value of a veteran’s contract, the orange line is the value of a rookie contract. The green line is the surplus value or the difference between the blue and orange lines.

As we can see, top picks only offer marginal value for most positions. Or, as Massey and Thaler write, “Specifically, we believe teams will systematically pay too much for the right to draft one player over another.” They add later that, “In paying a steep price to trade up, teams are paying a lot to acquire a pick that is worth less than the ones they are giving up.”

This is the other part of the reasoning behind the general rule of thumb that it’s almost always better to trade down and not up.

The exception is, predictably, the quarterback position. No position has a more profound effect on the field than the quarterback, and as a result, no position is paid anywhere close to a QBs contract.

Going strictly by surplus value, the math is pretty clear: If you’re drafting in the top 5, you aren’t drafting a quarterback, you should be looking to trade back or you’re leaving money on the table.

So, what about the Giants?

Let’s bring it all back to the Giants and the 2022 NFL Draft: Should they be trying to trade down in the first round?

It’s unfair to say that it’s “devoid” of talent, but the differences between the Giants and the best teams are pretty plain to see. The Giants’ roster is weak, and Joe Schoen has his work cut out in getting the Giants to a place where they can be consistently competitive.

On the one hand, a more highly drafted player is likely better than a player drafted later, and more likely to be good than a player drafted later. Having two picks in the top 10 gives Schoen two good chances at landing two top players. It isn’t a given that they would be “superstars” or even “great” players, but the odds are somewhat better than at later picks.

However, there’s a lot of weight on the other side of that scale.

We know that the draft is a crapshoot, and evaluators tend to be overconfident in their own abilities. Highly drafted players often don’t pan out, while players drafted later become stars. In fact, Massey and Thaler found that teams that trade down net an average of 5.4 more starts over a five-year period at the cost of no lost Pro Bowl appearances. In fact, they found a 48 percent chance that the player drafted later goes to a Pro Bowl while the more highly drafted player does not.

In other words, trading down doesn’t hurt a team from a performance perspective, and there’s a decent chance they might wind up with a better player. By taking more swings, teams (significantly) improve their odds of a hit.

This year, this means asking just how likely are players like Evan Neal, Ikem Ekwonu, or Ahmad Gardner to be better than Trevor Penning, Bernhard Raimann, Andrew Booth Jr. or Kaiir Elam — AND at least one other player.

Then there’s the economic argument.

Barring a pretty massive surprise, and a truly excellent organizational poker face, the Giants won’t be drafting a quarterback in the first round. That means that their top 10 picks very well could offer less overall monetary value than a pick later in the draft.

And as I noted above: if you aren’t going to pick a quarterback in the top 5, you need to be talking trade. From a financial perspective, anything else risks wasting money. The math gets a bit better by the seventh overall pick, but there are still positions that wind up financially under water until after the 10th pick.

And as we’ve been talking about all year, the Giants literally can’t afford to waste a cent.

The Giants are still right up against the salary cap, with only a couple million dollars worth of wiggle room. They still don’t have enough cap space to sign their rookie class. And even trading James Bradberry won’t net them enough to sign their rookie class and make mid-season signings to fill out the roster in case of injury.

The fifth overall pick is due $6,582,955.00 this year, while the seventh overall pick is due $5,130,077.00. All told, the Giants’ rookie class will cost $18.86 million, though OverTheCap estimates that they’ll need a bit over $12.5 million in actual cap money to sign their class.

[Over the Cap explains the difference this way: “The Rookie Pool is the total cost in cap dollars that a team needs to sign its rookies in the summer. The cap space required to do this is less than the rookie pool. This is because every draft pick signed will replace a player already counting against the cap.”]

Dropping even one of those picks into the 20s could save the Giants $3-4 million in cap space. Particularly if they defer some of that cost by acquiring future compensation with a first-round pick in the 2023 NFL Draft. Not only do the Giants have much more salary cap space to absorb that pick, the cap as a whole is rising.

So yes, there is a very good argument for trading back with at least one of those two picks. In fact, I would suggest that based on the surplus value of the pick, they trade the fifth overall pick.

Of course, every trade needs a partner, and the perceived weakness of this year’s quarterback class could be a stumbling block when it comes to getting the most value from the Giants’ picks. That said, the old chestnut remains: If you don’t have a quarterback, you need a quarterback. And teams that don’t have a quarterback are often willing to pay a premium just for the chance to cure that deficiency. Particularly if they “fall in love” with a prospect and their confidence their evaluation leads them to over-value the right to select that quarterback.

There’s also the fact that the Giants could be one of those teams that needs a quarterback next year. And then, barring another top 5 draft pick, they would be the team looking to pay a premium for a passer. Trading down this year could be viewed as investing in future value that could pay dividends in 2023.

If the Giants don’t trade down, we may never know if they got a good offer. However, if they do get a good offer for one of their top picks, the math says they need to at least consider the trade.