Wednesday, September 17, 2008

You know it's bad: Economy hits the NFL

Terry Lefton of Sports Business Journal was interviewed on American Public Media's Marketplace report today about the NFL's budget shortfalls.
The NFL is still the biggest, most profitable sports property in the U.S., says Lefton, but Roger Goodell's recent memo to the league even hints at layoffs in light of less-than-projected revenues.
For the first time in Lefton's memory, the NFL started the season without a new corporate sponsor. Financial services and the auto industry are traditionally big sponsors, and both sectors are struggling.
Smaller leagues and teams are likely in much worse shape than the NFL. On top of that, what Lefton calls the "false economy" -- ad money and sponsorships pumped into sports via the U.S. election and the Olympics -- will dry up next year.
Are there any bright spots? Yes -- the WNBA recently announced a banner year for marketing, media and revenues.
Credit increased publicity because of the Olympics, the infusion of Candace-Parker star power, and better marketing by teams and the league. It's good to see the WNBA -- which has struggled in a market dominated by male leagues -- continue to grow.


pt said...

I wonder if the WNBA's success has a lot to do with being more dependent on the gate than larger leagues are.

When ad revenue dries up, leagues like the NFL really suffer - could the NFL function if its only source of revenue were ticket sales? Whereas smaller leagues have some insulation from economic fluctuations due to low ticket prices in general, strong fan loyalty and a greater reliance on turnstile traffic.

Terry said...

The WNBA is growing? Based on what mertric. This league is unprofitable and would not exist without the support of the NBA.