Tech, gaming and booze helped the NFL earn nearly $2 billion in sponsorships


The National Football League is approaching $2 billion in partnership fees, the highest in professional sports.

The betting and tech company deals helped the NFL attract a record $1.8 billion in sponsorship revenue, sports partnership consultancy IEG told CNBC. The NFL figure is a 12% year-over-year increase from the $1.62 billion earned in the 2020 season. It pulled $1.47 billion in sponsorships over the course of the 2019 season.

Sports betting companies, casinos and lotteries have seen the biggest uptick in NFL sponsorship deals. DraftKings, FanDuel and Caesars became sports betting partners in 2021 after the companies entered into five-year pacts worth just under $1 billion combined. The NFL has also entered into secondary agreements with BetMGM, WynnBet, FoxBet and PointsBet.

Partnership deals with the NFL typically last three to seven years and cost at least $10 million a year for small businesses. The biggest companies could pay more than $200 million a year.

FanDuel app

Andre Harrer | Bloomberg | Getty Images

Verizon has one of the biggest deals in the NFL and has paid the league more than $300 million a year. Last September, the communications company struck a new 10-year deal with the NFL and added 5G rights. But the new deal does not include live game streams, which makes it less valuable. It also means NFL mobile rights are up for grabs, too.

IEG’s estimates come days after the NFL produced one of its most memorable playoff weekends, which included the thrilling overtime game between the Kansas City Chiefs and the Buffalo Bills. That game drew more than 42 million viewers, the highest postseason divisional game since 2017.

“It’s not coming from the traditional places,” said Peter Laatz, global general manager of IEG. “It comes from emerging categories. Not only do we see emerging talent in the field, but we see emerging categories. »

Although gambling sponsorships saw the biggest increase in the 2021 NFL season, technology deals ranked first in absolute dollar numbers for 2021, led by Microsoft. The tech giant has an on-field deal with the league, which uses Microsoft’s Surface tablet. This deal is worth about $100 million a year, according to IEG data.

Gambling offers ranked second and liquor offers third.

Last December, the NFL renewed its deal with Anheuser-Busch, which pays the NFL more than $250 million a year for beer and hard seltzer rights. The company lost control of the hard liquor duties, which Diageo took over for a time. grossed $30 million a year.

The NFL has put its rights to the wine and champagne up for auction, but has not yet entered into a partnership for this category.

« They’ve cut those categories (tech and alcohol) pretty well, » Laatz said, calling NFL sponsorship money a « track revenue train. » He then predicted that the NFL would undergo a « finer cut of categories » in the future to develop transactions in the United States.

NFL next targets global revenue

Although total NFL sponsorship revenue increased significantly, most of that growth went to league-wide sponsorships, which increased 23%. NFL clubs only received 4% more revenue in rights fees year over year.

To increase club revenue streams, the NFL is taking inspiration from the National Basketball Association’s playbook and allowing teams to take advantage of international markets. Last month, the NFL licensed 18 teams to market their intellectual property in 26 territories, including Canada, Germany, Mexico and the United Kingdom.

But it could be a while before teams see any real traction in this department.

There’s no doubt that the NFL is dominant domestically, but American football isn’t a big draw overseas like the NBA. Additionally, Canada and Australia have already established football leagues, so the NFL has some serious competition.

Laatz said he’s « skeptical » of the NFL’s overseas plan, which the league has called « International Domestic Marketing Zones. » The NFL tried to build its product in London with its annual games, and Germany showed interest in the NFL.

But those sporadic overseas games may not be enough to propel the NFL to international fame like the NBA.

« There’s a big difference between playing international games, which the NFL has clearly done, and having a significant footprint in the NFL to grow the sport overseas, » Laatz said.

Still, to get an idea of ​​the value a US-based sports club can derive from international deals: $10 million in total.

Laetz thinks NFL team deals could be even more lucrative.

A Bitcoin symbol on an advertisement at the Mass Transit Railway station in Hong Kong, China on October 27, 2021.

Tyrone Siu | Reuters

Still waiting for crypto offers

Meanwhile, the NFL is taking a wait-and-see approach to transactions in the cryptocurrency space.

Last October, at NFL owners’ meetings in New York, officials told CNBC that crypto-related deals were still being considered. Laatz called it the “secondary model” — as in, the NFL is waiting to see how other institutions maneuver.

“They are careful not to enter into speculative arrangements that can cause backtracking,” Laatz said.

As NFL stalls on crypto deals, companies pour millions into NBA.

In addition to the FTX-Warriors deal, crypto platform Coinbase has entered into a four-year, $192 million deal with the NBA. At the team level, the Los Angeles Lakers landed a $700 million naming rights deal with Crypto.com. And the Portland Trail Blazers landed the NBA’s first crypto jersey patch deal.

Outside of basketball, Major League Baseball has added a crypto patch deal for its umpires, and individual NFL players like Tom Brady are also making crypto deals.

But Laetz says the delay won’t really matter, given the NFL’s strong revenue growth. “The thing they’re leaving on the table right now is risk. »

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