The National Football League (NFL) has seen a record of $1.8 billion in sponsorship revenue this season, according to new data from IEG.
In particular, the league’s partnerships secured during the 102nd season with prominent American gaming firms DraftKings, FanDuel and Caesars Entertainment contributed combined sponsorship revenue of $1 billion, whilst additional deals with BetMGM, FoxBet WynnBET and PointsBet also yielded success.
The rollout of the North American betting and gaming industry over the past few years has prompted a huge surge in gambling sponsorships across US sports, with many leagues and teams looking to secure deals in 2020 and 2021 following the financial disarray of the COVID-19 pandemic.
The NFL’s $1.8 billion figure is a 12% increase from 2020, where it made $1.62 billion, following on from $1.47 billion in 2019, and the spike has been attributed to the large number of partnerships with aforementioned sports gambling companies, casinos and lotteries.
Speaking to CNBC, Peter Laatz, IEG’s Global Managing Director, stated: “It’s not coming from traditional places. It’s coming from emerging categories. Not only are we seeing emerging talent on the field; we’re seeing emerging categories.”
One of the ‘emerging categories’ referred to by Laatz is 5G, with Verizon having secured one of the most lucrative agreements. Under its arrangement, the company is paying the league over $300 million annually in a 10-year partnership that utilises 5G to support innovation and technology adoption.
Figures of this size are apparently not uncommon, as although payments of $10 million a year are the usual minimum for sponsorship of the NFL, it has been reported that bigger brands have often paid over $200 million.
Furthermore, although gambling firms saw the biggest increase in revenue last season, tech firm Microsoft revealed that it placed first in absolute dollar figures. The company continues to provide NFL teams with Surface tablets, in an agreement worth around $100 million a year, according to IEG data.
Additionally, in June 2021, Diageo and the NFL completed a spirits marketing pact, which became the league’s first sponsorship in that field. Sources stated the talks of the partnership had been ongoing for around a year and had been estimated at $30M per year, with around half of that being rights fees.
However, league-wide sponsorships grew 23%, with NFL clubs taking in only 4% additional revenue in rights fees year-over-year. In looking to improve this, the NFL is looking to allow teams to leverage international markets, similarly to the National Basketball Association (NBA).
The league permitted 18 teams to market their intellectual property in 26 territories last month, including Canada, Germany, Mexico and the United Kingdom, to name a few.
The NFL may be benefiting extensively from betting arrangements, but in terms of the growing cryptocurrency space, although individual NFL players like Tom Brady have formed crypto deals, the NBA has taken a lead and is seeing a huge increase in income from such companies.
For example, in October 2021, Coinbase became the exclusive cryptocurrency platform partner of the NBA, Women’s National Basketball Association (WNBA), NBA G League, NBA 2K League and USA Basketball in a $192 million deal. Meanwhile, LA Lakers landed a $700 million naming rights deal with Crypto.com.
Although one of the most significant US sports, the NFL still faces competition with other organisations as cryptocurrency partnerships continue to grow globally.
The data follows what has been described as one of the League’s most memorable playoff weekends, with Kansas City Chiefs game against the Buffalo Bills gaining a peak of 51.6 million viewers.