The 2020 Football Fall: How COVID-19 Will Reshape College Football and NFL Marketing Forever
Posted on: August 20th, 2020
The business of mainstream sports has always been lucrative. And advertising has benefited as much as any industry. Until now.
Amidst a global pandemic, health and safety concerns are prioritized over everything, including the business of college football. For academic institutions that have relied upon these significant dollars for decades, COVID-19 has them scrambling and one thing is certain: today marks the most concerning time in college football history as nationwide colleges and universities focus on the health and safety of students, athletes and faculty, as well as the health and safety of critically important revenue streams.
The question remains, is this a temporary anomaly or a permanent reality?
So, what’s at stake? At last count, the National Collegiate Athletic Association (NCAA) is a billion-dollar non-profit entity. And even though the football line items of these revenues are limited (by virtue of the FBS mainly), the NCAA is the enabling economic engine for all collegiate athletics, and the institutions themselves are the gas that fuels it.
The inevitable 2020 revenue losses extend significantly into the colleges and universities. For some, gone are 100% of season ticket sales, game-day sales, broadcasting rights, licensing fees, vending revenues, and advertising sponsorship dollars (for starters). Similarly, the economies of local college town communities are on the cusp of taking a seasonal financial hit like they’ve never experienced with widescale losses driven namely by the lack of travel and hospitality spending.
Throw all of this onto a sports marketing whiteboard and recognize these colleges and universities trickle those football dollars down to support dozens if not hundreds of other athletic and non-athletic interests. But while the colleges and universities are scurrying to find alternate ways to generate revenue while also tapping endowments to help cover costs, the average American football fan isn’t too worried. Rest assured, college football loyalists will get their fix somehow, someway this fall. And the most likely scenario has college football fans spending their dollars on the National Football League (NFL) instead of the NCAA.
With the macro-economic footing established, let’s take a deeper look at the cause and effect the compromised 2020 college football season presents, what this means for college basketball, and how the NFL could potentially benefit in unprecedented fashion.
NCAA Football and Basketball Seasons Unlike Any Other
In a move that was somehow simultaneously predictable and shocking, The Big Ten became the first “Power Five” conference to cancel football for the upcoming NCAA season. And while the cancelation means it will actually postpone, delay, suspend (whatever you want to call it) playing until the spring, it means there will be no major college football coming out of the Midwest this fall.
What does this mean for college hoops in 2020-2021? Assuming NCAA basketball moves forward with its season (one way or another), the “March Madness” moniker will be further realized when both basketball AND major football games are played. What’s more, the NCAA is more than likely going to dramatically reduce the number of eligible teams and conduct their annual Division I basketball championship tournament in a bubble. Given the fact that the NCAA generates a disproportionate percentage of their revenues from March Madness, it’s safe to presume continued financial shortcomings for all NCAA-enabled economies.
Significant Sales and Sponsorship Revenue Losses Coming
Several of college football’s largest powers are set to lose more than $100 million each from a washed season this fall, as studied by Ryan Brewer, an associate professor of finance at Indiana University-Purdue University Columbus.
Furthermore, school revenues and losses could total “nine figures in the case of no competition,” according to Sandy Barbour, Pennsylvania State University’s vice president for intercollegiate athletics.
The canceling of the season may affect the large television networks that have invested billions to secure broadcast rights, including the companies that planned to spend millions to advertise their products.
In a report in The New York Times, last year college football (not necessarily the NCAA) generated roughly $1.7 billion in television advertising, according to the research firm Kantar. Companies such as Allstate, Chick-fil-A, and State Farm invested more than $30 million for advertising during games, and AT&T spent more than $70 million, Kantar found.
Those are just the near-term financial consequences of a wiped-out fall without a conventional college football season. The longer-term financial and marketing ramifications will undoubtedly run much deeper.
Will the NFL Play on Saturdays?
Typically, the NFL only plays Saturday games in January after the NCAA’s regular season concludes. Given the limited (if not completely canceled) NCAA fall football schedule, a scenario in which the NFL (blackout rules and the 1961 Sports Broadcasting Act notwithstanding) decides to play more of its regular-season schedule on BOTH Saturday and Sunday is a likely possibility.
With reduced or no college football September through December, the NFL and hungry football viewing audiences may want both halves of the 2-day weekend, including mornings, afternoons and prime time. Should this happen, will the NFL ever give the NCAA their fall Saturdays back? Will the NFL be legally allowed to keep playing football on fall Saturdays? Will corporate sponsors realize more value from advertising commitments associated with Saturday broadcasts and in-game visibility?
“Not only will sports marketing advertising contracts be executed much more judiciously across college and pro football in 2020, but corporate sponsors will also demand more value from these investments as well as make-good commitments for 2021 and beyond,” said Mark Reino, CEO of Merit Mile. For more on this specific topic, listen to the full SiriusXM Radio NFL Network interview conducted with Merit Mile CEO, Mark Reino.
Even if it takes an act of Congress, or perhaps a smartly negotiated win/win deal between the parties, one thing is for sure: the NFL, driven largely by business-savvy team owners, will pounce on new Saturday opportunities for growth and bolstered top-line League revenues. Look no further than the now year-round business of the NFL with steady increases across the number of teams, regular-season games, and international showcases the League has added to support this conclusion. And let’s not forget that adding fall Saturdays to the ever-expanding NFL global showcase, will increase viewership, which in turn drives up the broadcasting rights fees and the price of everything with an NFL logo on it, including TV commercials, digital display ads, corporate hospitality, licensing rights, and even game day tickets and stadium parking lot revenues.
Marketing, PR and the Challenges facing NCAA Athletics
The influence of advertising, marketing and public relations will be showcased in the level of spend (or lack thereof) of football viewing audiences this fall.
Although there may be limited, if any, college football this fall and basketball in the spring, you can confidently predict the NFL will play out their season, in one manner or another. And if the NFL dominates the gridiron and television airways this autumn without a significant college football presence, the reality is that all associated leagues and conferences among the NCAA could be temporarily, if not permanently damaged.
For more NFL sports marketing insights from Merit Mile, check out our FOX-Chicago TV interview on the Washington NFL franchise retiring its controversial brand name with plans to find a new identity after the 2020 season. And to learn more about Merit Mile advertising, PR opportunities for your brand please reach out to a Merit Mile brand strategist today.