Gauging value in the NBA Draft – An Analytical Approach

{This in-depth article was written by guest contributor NOLA Analytics. Please be sure to follow them along @NolaAnalytics!}

With the NBA Draft Just two weeks away, I wanted to share some thoughts on the draft, first from an analytics perspective and secondly what that means for the New Orleans Pelicans. Contrary to popular belief, analytics don’t necessarily focus on identifying the best prospects (though they can certainly assist with that). Rather, analytics can best help in shaping your overall draft philosophy.

There are countless analytical draft findings, but this article will focus on four key ones.

MVP candidates are worth exponentially more than superstars who are worth exponentially more than stars who are worth exponentially…

This is part A to the first point. Before we even get into the draft itself, it’s important that we establish this point. This is an analytics article so let’s get a bit nerdy for a second. If we were rating players like in 2K, we shouldn’t view the differences in ratings as linear (ex. an 88 overall player is equally between a 95 and an 81). Instead, we should view it like the x² graph.

Let me explain: As we just showed prior, linearly, an 88 overall player is 7 points better than 81 and 7 points worse than a 95. But let’s square each of those numbers. Now, an 88 overall player is 1,183 points better than an 81 but 1,281 points worse than a 95. This isn’t a perfect comparison (squaring the numbers probably isn’t enough to show the difference), but the overall point is that as We’re looking at players, we care most about the top levels of guys.

And that holds true if we think about the NBA logically: it wouldn’t particularly matter what the Suns tried to add on, there is basically nothing they could do in which the Bucks would trade Giannis for Booker. And in the same sense, there is essentially nothing the Bucks could do to convince the Suns to trade Booker for Middleton.

So that’s the first rule of the draft: we’re valuing MVP equity far and away the most followed by All-NBA equity, followed by All-Star equity, etc. Shamit Dua wrote about this in 2020 About how teams are far too keen in the draft and simply try to hit singles when the optimal way to draft is going for homeruns and grand slams.

All else being equal, we’d prefer the guy who is a 75 in his median outcome and a 90 in his 80th percentile compared to the guy whose median outcome is a 78 whose 80th percentile outcome is an 85. Even though, on average, We get the worst player, the upside of those top 20% of simulations is so valuable that we should draft for upside and hope for the best.

From a pure asset play perspective, it is essentially always better value to trade down compared to trading up.

This is especially true in the NFL Draft, but it carries across all sports. In general, if two teams are trading picks in the NBA Draft, the team moving up is going to have to pay an extra premium in terms of assets to do so. That doesn’t mean it isn’t always “worth it.” Remember rule 1: if you are trading for a guy with a superstar upside, that can more than mitigate the draft premium you’ll have to pay.

It’s similar to the NFL in that way: trading up for a regular player is almost never worth it, but trading up for a QB that would go in the same spot is actually positive value because the benefits of hitting on a QB are so enormous. But for the most part, especially once we get out of the top few picks, you’re better off trading down than trading up.

There’s no such thing as a “safe” pick or a guy who we know will “be a year-1 contributor.”

These are two phrases that get thrown around a ton every year during draft season even though there is essentially no evidence supporting either theory. Guys who contribute as rookies or second year players aren’t necessarily the upperclassmen, overseas guys, or guys who played big minutes and produced in college. It’s simpler than that: the guys who produce early tend to be the guys who wind up being the best players in the draft.

Pelicans fans especially should be acutely aware of this: the Pelicans drafted Buddy Hield over Jamal Murray because they wanted a rookie who could come in and contribute immediately alongside Anthony Davis. Instead, Murray quickly caught and passed Hield simply because he was a better NBA player.

So don’t fall for guys who you think can contribute in the 22-23 season because they’re older or more developed because the guys who wind up contributing will most likely simply be the best players of the class. Focus on finding those guys.

Positions/Roles matter across the spectrum

This could fall under the first point, but you must consider that if a player reaches his 80th percentile, how valuable really is that, and size/position/role matters greatly. The Boston Celtics under Danny Ainge essentially made their entire draft philosophy, “we’re going to draft the best available wing who has the ability to shoot and defend” knowing that big wings who can shoot, create, and defend are far and away the most valuable and most scarce players in the NBA.

On the other end, centers have among the highest replacement value in basketball. Willy Hernangomez as a starting center in 2020-2021 on a minimum contract averaged 12 points and 11 rebounds. With those two points in mind, a 6’8 SF who projects to be an average starting wing is likely more valuable than the big man who projects as a top 10 center.

How can we apply these rules to the draft this year and to the Pelicans?

First, obviously, we’re focused on seeing which players have the best chance of turning in to an All-NBA or MVP level candidates. By picking at 8th, most of those guys with those possibilities in their 80th-90th percentile outcomes are off the board. But you can still focus on maximizing your chances of grabbing an All-Star level player as opposed to shooting for a solid starter.

For example, while it’s easy to envision a shooter like AJ Griffin sliding in next to Zion Williamson and Brandon Ingram, it’s difficult to envision a scenario where he’s a max contract player. On the other end, a guy like Ousmane Dieng may not possess any trait in particular that’s as tantalizing as Griffin’s 3-point shooting, but his all-around game might lead to better 80th percentile outcomes because if he develops an outside shot (and perhaps working with the best shooting coach in the NBA could help there), the rest of his game laps a guy like Griffin’s.

Secondly, if the Pelicans aren’t enamored with anyone as a potential All-NBA player at his 80th-90th percentile outcome, it would likely behoove them to explore trading back a few spots. The Thunder in particular stand out as a team with such a hoard of assets sitting at #12 that they might be willing to overpay a bit more to consolidate those assets into a better player at #8. The dip in the quality of player will be small, the player will be on a slightly cheaper contract, and the Pelicans should be well compensated for making the move.

Additionally, depending on how you view certain players, you should be cautious with wanting the Pelicans to trade up. Personally, I view a guy like Jaden Ivey’s 80th percentile as a slightly better prime Oladipo. Therefore, I’m not willing to make a negative expected value asset trade for him instead of taking a guy like Dyson Daniels, Bennedict Mathurin, etc. Alternatively, if you viewed Ivey’s 80th percentile outcome as a guy like Ja Morant, then that can negate the negative asset play.

Next, be wary of guys whose key attributes describe him as a “safe” pick, and resist the urge to try to focus on guys who can contribute as a rookie. Often, you’ll lead yourself further astray doing so.

In the draft this year, I’m a bit lower on Johnny Davis and Ochai Agbaji, two guys who have been described as potential day-1 contributors. Alternatively, I’m a bit higher on Jeremy Sochan and Ousmane Dieng, two guys who are viewed as potentially being “slower developers” and who “need more work.” Not only do each possess higher upside (in my opinion), but I’m not as worried about guys who scouts think need a few years as prospects. Chances are, if they wind up being good players, they’ll contribute as early as if not earlier than guys like Davis and Agbaji.

Finally, understand how the value of a player’s role/position accentuates or limits his potential upside. It might not matter that Chet Holmgren projects as a big man who can only play the 4 or 5 if he hits his 80th percentile, but for a guy like Jalen Duren, even if he turns into a borderline All NBA Center, how valuable is that compared to if Keegan Murray turns into “just” a Siakam level player? Especially in the NBA draft where nothing is guaranteed, it would behoove a team like the Pelicans to lean towards wings over centers or small guards if your prospect grades are similar.