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Changes to marketing policies could help NFL teams recoup revenue

Like venues around the league, AT&T Stadium has plenty of signage, but new options that could be considered include logos between goal posts or on players’ jerseys.getty images

Facing the prospect of greatly reduced attendance this season, NFL teams and sponsors are pressing for league policy changes that would add valuable new local marketing assets.

 

No decisions are close, but a committee of team revenue and marketing executives, along with the league’s club business development department, are debating a wish list. Some of the most radical ideas include bringing camera-visible signage to local sponsors for the first time in the NFL, including sideline boards, logos between goal posts or even on jerseys. Other more incremental ideas include more freedom to post and monetize highlights on social media and the ability to promote sports betting sponsors online.

Unless public health guidance about large gatherings changes quickly in the next few months, owners will press the league hard, industry experts predicted. Already beset by gate revenue losses, teams should expect sponsors that depend on live person-to-person impressions to demand givebacks, exacerbating losses already likely to climb well into the eight figures because of attendance restrictions.

“They’re going to push the league and say, ‘Guys, this is horseshit,’” said John Tatum, CEO of Genesco Sports Enterprises, whose clients include NFL sponsors Anheuser-Busch InBev, Pepsi and Frito-Lay. “Jerry [Jones] just did a monstrosity of a beer deal with MillerCoors, $180 million over 10 years, and they didn’t do that on a pro forma of no fans or 10,000 or 40,000 people in the stadium.”

This conversation is playing out at every sports league as each analyzes the economics of fan-free games. The NFL, however, is in a unique position because of its robust all-national broadcast deals, strong relationships with league sponsors and significant revenue sharing.

NFL sponsorship and club business development executives declined to comment.

“The networks invest a lot of money for the broadcast rights, so they don’t want stadium signage encroaching, but this is a different world,” said Steve Ryan, senior vice president of business development for the Arizona Cardinals. “Certainly, we’ll let the league figure that out and they’ll be fair and judicious in whatever they allow that’s new. We’re seeing a lot of innovation about how sports are delivered to the consumers and that will continue.”

Already during the pandemic, the NFL has shown a willingness to relax traditionally rigid rules protecting national revenue streams to help teams. For instance, teams were permitted to broadcast live during and before the draft for longer than usual, and teams were allowed to publish their own schedules 30 minutes before the league released the full document on May 7.

Earlier this month, the NFL relinquished control of display advertising on team websites, sources said, giving that to clubs to sell or use for their own content.

None of those changes drive major revenue by themselves, but together they constitute a real shift in attitude, multiple club sources said, giving them optimism that more progress could be coming.

But every change that might protect club revenue has to be evaluated for its effect on national sponsors, or the broadcasters. Field-level signage to a local sponsor might boost a team’s books only to undermine a national deal with a Gatorade or a Microsoft that counts on scarcity.

“It’s all interdependent,” said one team exec. “If you pull the card of exclusivity of the sidelines, what falls down?”

Michael Neuman, managing partner at Scout Sports and Entertainment, said his firm is developing new ideas with clients while networks are starting to talk about what would be OK from their side.

“The one focal point of our conversations has been, how do we replace the time that cameras were fixated on fan reaction in the past?” Neuman said. “What would be acceptable, relevant, and is there a way to tie with a brand? If there ever was a time to roll the dice on something like this, it’s now.”

A key variable in the league and teams’ ongoing debate is whether any of these changes would be permanent. Tatum said sponsors have already been reconsidering the value of sports during the pandemic, and the NFL’s goal should not be just a stop-gap solution.

“The past 10 weeks without sports, since 3/11, unfortunately has taught all of us that life goes on without sports,” he said. “I think everyone’s taking a completely new look at this.” 

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