Baseball may be America’s past time, but football is America’s obsession. September 5th marked the beginning of our countries annual football mania. Since the start of the season NFL games have been dominating the airwaves and have the ratings to prove it. Currently the NFL is responsible for 18 of the most watched programs on TV, with the average game drawing 16.8 million pairs of eyeballs across the country. This should help give an indication of the sheer amount of avid football followers we have in the U.S. When you consider that that many people take the time to tune in regularly, it isn’t hard to figure that the NFL is the most lucrative sports league around. This year the NFL is set to rake in just over 9 billion (that’s million with a ‘b’) dollars. But just how does the NFL make its money?
Tickets, Venue & Merchandise
NFL merchandise on its own is a $2.1 billion a year industry. The NFL produces everything from video games and toys, to high quality jerseys and even a line of cloths for PINK by Victoria Secret, and everything in between. Some of the most amusing pieces of NFL certified merchandise are: The NFL toaster, which sears your team’s logo onto your morning toast, NFL rain boots, and personal vending machines. There is literally no market untouched by NFL merchandise.
In addition to the cash free flow provided by the NFL’s diverse merchandise sales there is an additional $51 million per year which is brought in my ticket sales. Seeing as the average ticket to NFL game costs around $80, it is not surprising to see just how much it adds up. When someone buys a ticket to a game there are a lot of piggy back sales that go hand in hand. Buying a ticket means going to the venue. Obviously any sports fan is going to want a beer, something to eat, and perhaps a souvenir. So when a ticket sale is made it might as well be all of these. Last year the 49ers made $6.8million in sales at their venue, but they are only one team out of 32.
Television Rights Deals
Pacts with broadcasters earn the NFL more than a pretty penny. Between CBS, NBC, ESPN, and Direct TV, the NFL is poised to make somewhere around 43 billion dollars over the next 10 years. It makes sense that networks are willing to pay big, since the broadcast games are ratings monsters. It is more than likely when the NFL renegotiates with Direct TV this coming year they will be offered a significant bit more than the $1 billion five year deal they are currently in.
For any company that wants to get their product some lime light, advertising during televised games and at stadiums is the way to go. Between the average 16 million people watching at home and the fans in the stands the NFL provides a marketing paradise. This is never truer than during the Super Bowl. In the last 10 years, advertisers have spent $1.85 billion on Super Bowl advertising alone. During the regular season the amount spent is around $3 billion; each advertising spot costing roughly $ 4 million.
The NFL has itself involved in almost every industry you can think of. While many businesses would be worried about stretching themselves to thin, the NFL has no such concerns. In fact, the Commissioner of the NFL, Roger Goodell wants to make his giant even bigger. By the year 2027 Goodell says that he hopes to grow the NFL to $25 billion in annual revenue. Football is as popular as ever and gaining steam. With every endeavor the NFL is involved in coming up roses, it is hard to doubt that the next goal will be met.