Tech, gambling, alcohol helped NFL earn almost $2 billion in sponsorships
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Nearly $2B in partnership fees is the National Football League, which has become one of the largest professional sports leagues.
CNBC reported that the NFL attracted a record $1.8 Billion in sponsorship revenue from technology firms and betting houses. From $1.62billion in 2020, the figure for NFL is up 12% year-overyear. The 2019 NFL season saw it pull $1.47billion in sponsorships.
Most significant increase in NFL sponsorships was witnessed by sports gambling firms, casino operators, and lotteries. DraftKings FanDuel and Caesars were made sportsbook partners by the NFL in 2021 following five-year deals that totaled just over $1 billion. Secondary deals for the NFL were also signed with BetMGMGM and WynnBet as well as FoxBet, FoxBet and PointsBet.
For smaller businesses, partnership deals with NFL typically last between three and seven years. They cost at least $10 million annually. The annual cost for more well-known firms is higher than $200 millions.
FanDuel app
Andrew Harrer | Bloomberg | Getty Images
Verizon was the NFL’s most well-known partner and it paid more than $300 million per year. The communications firm signed a 10-year contract with the NFL last September and also added 5G rights. The new deal does not include live streaming of the games which makes it less value. This also means that the NFL’s mobile rights can also be up for grabs.
IEG has released its estimates days after NFL’s most memorable weekend, including the exciting overtime between the Kansas City Chiefs & Buffalo Bills. This game attracted over 42 million viewersThis is the most high-ranking postseason game in a division since 2017.
Peter Laatz is the global managing director of IEG. He stated, “It’s certainly not coming from conventional places.” “It is coming from emerging sectors. We are not only seeing new talent in the field, but we also see emerging categories.
Gambling sponsorships experienced the largest increase during the NFL’s 2021 Season, but tech deals were first in absolute dollars for 2021. This was led by Microsoft. This tech company has an agreement with the league that allows them to use Microsoft’s Surface tablet. IEG data shows that the deal is valued at around $100 million each year.
Deals in gambling were ranked second and deals with alcoholic beverages third.
The NFL’s deal with Anheuser-Busch was renewed last December. This agreement pays more than $250million per year to the NFL for beer rights and hard seltzer rights. Diageo was appointed to take over control of rights for hard alcohol. reported $30 million per year.
While the NFL has put up its Champagne and Wine Rights for Auction, they have yet to form a partnership.
Laatz said that the NFL’s sponsorship money is a “runway income train” and “they’ve cut those (technical and alcohol) categories pretty well.” In order to expand deals in the U.S., he projected that the NFL would see a more drastic reduction in categories.
NFL targets global revenue next
The NFL saw a significant increase in sponsorship revenues, but the majority of this growth was due to the league-wide sponsorships which increased 23%. Only 4% more revenue was earned by the NFL clubs in rights fees each year.
In order to grow club revenue streams, the NFL has taken a leaf from the National Basketball Association and allowed teams to tap international markets. The NFL granted 18 teams permission to sell their intellectual property across 26 countries, including Canada and Mexico.
However, it may take some time before the department sees real success.
The NFL dominates domestically. However, American football isn’t as popular overseas as the NBA. The NFL also has competition from Australia and Canada, which already have their own football leagues.
Laatz expressed doubts about the NFL’s plans for overseas expansion, which Laatz called “International Home Marketing Areas”. With its annual London games, the NFL tried to increase its product. Germany expressed interest in the NFL.
These sporadic international games might not be enough for the NFL to rise in the ranks of the NBA.
Laatz stated that there is a huge difference in playing international games, as the NFL clearly has done. However, having an NFL presence overseas to help grow the sport abroad, is a different thing.
Still, to get a sense of the value a U.S.-based sports club can earn from international deals: The Golden State Warriors – one of the most popular NBA teams abroad – agreed to a multi-year global rights sponsorship with crypto platform FTX for roughly $10 million total.
Laetz thinks that NFL team deals might be even more lucrative.
An advertisement for Mass Transit Railway Station in Hong Kong (China) on October 27, 2021 features a Bitcoin symbol
Tyrone Siu | Reuters
Crypto deals still pending
The NFL continues to wait and see how deals will pan out in cryptocurrency.
Officials from the NFL told CNBC last October that they are continuing to investigate crypto-related transactions at their owner meetings in New York. Laatz called it the “sideline model” – as in, the NFL waits to see how other institutions maneuver.
Laatz said that “they’re cautious about not getting into speculation arrangements that could cause backtracking.”
While the NFL holds off on cryptocurrency deals, the NBA is being funded by millions of dollars from companies.
The FTX-Warriors contract was not the only deal. Crypto platform CoinbaseThe NBA offered a $192 Million deal for four-years. The Los Angeles Lakers secured a $700million naming rights agreement with Crypto.com. Additionally, the Portland Trail Blazers have the NBA’s very first cryptocurrency jersey patch deal.
Major League Baseball has added a crypto patch arrangement for umpires. Individual NFL players, such as Tom Brady, have also made crypto agreements.
Laetz believes that it won’t matter if the NFL experiences a delay due to its high revenue growth. “The risk they’re leaving out is the one thing that they don’t want to take on.”
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