NFL Ad Sales Soar 14% to $4.43 Billion With No Slowdown in Sight

Anthony Crupi
·7 min read

Mere months after securing a skull-clutchingly lucrative package of media-rights deals, the NFL last fall went on to deliver its highest TV ratings in six years, a show of force that generated a record $4.43 billion in advertising revenue for the league’s network partners.

According to a new report from Standard Media Index, sales of in-game NFL inventory last season grew 14%, which translates to a gain of $545 million compared to the 2020-21 campaign. SMI derives its ad-spend data by tapping directly into the billing systems of the top global media agency holding groups and a number of independent shops, a form of direct sourcing that gives the company a window into more than 90% of all U.S. ad bookings.

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While the expansion of the regular-season calendar accounted for at least a portion of those monetary gains—NFL owners agreed to tack on a 17th game to the schedule in March 2021, marking the first such addition to the slate in 43 years—much of the lift in dollar volume was powered by modest boosts in pricing. Per SMI, the average unit cost for a 30-second spot grew 3% to $480,000, and while that’s already an outsized figure, the rates for ads sold closer to the actual airdates were far steeper.

The networks reserved about 13% of their in-game inventory for the fall scatter market, when dawdlers and legacy advertisers looking to expand upon their original upfront investments found themselves forking over $600,000 a pop. That works out to a 25% increase versus the year-ago scatter rate, when the market strained under the weight of the coronavirus pandemic.

Scatter rates for units in NBC’s Sunday Night Football averaged out to some $800,000 per spot, good for a 14% lift compared to the year-ago prices. Fox’s Sunday package, which includes regional coverage as well as the alternating late-afternoon national window, boasted scatter rates that averaged out to some $754,000 a pop, a gain of 36%, while last-minute buys across CBS’ NFL showcase came in up 23% to nearly $500,000.

As with Fox, the CBS figures represent the rates advertisers paid for time in the network’s early- and late-afternoon windows, with pricing in the highly coveted coast-to-coast broadcasts coming in a bit higher than the primetime averages.

ESPN’s Monday Night Football, meanwhile, saw a 16% lift in autumn trading, with scatter rates averaging out to around $400,000 a throw. SMI’s figures include the five NFL simulcasts that aired on ESPN’s broadcast sibling, ABC. In addition to the gains Disney realized via a pair of additional network transmissions, the introduction of the Manningcast on ESPN2 added another $507,000 in sales to an overall in-game haul of $318 million, up 18% versus the year-ago take.

That Peyton and Eli’s sideshow seemed to have a limited impact on Disney’s overall Monday night sales is a function of the way the first season was sold as part of a package deal. “They were a last-minute addition in 2021, but now we’re looking at various ways to sell the show that will be incremental in terms of the overall experience, and that is shaping how we’re thinking about bringing it to market,” Disney ad sales president Rita Ferro told Sportico, before the spring upfront bazaar got underway. “While traditional football advertisers are all about the game, the format and content of the simulcast presents a number of unique opportunities for our sponsors.”

Fox’s Sunday games and its final run of 11 Thursday Night Football broadcasts scared up a grand total of $1.55 billion in ad revenue, edging NBC’s $1.37 billion, while CBS took in some $1.01 billion in NFL sales. NFL Network’s Thursday night simulcasts and its seven standalone telecasts tossed another $83 million onto the pile.

As one might expect from the enterprise that delivered 75 of the 100 most-watched programs on TV, the NFL boasts the tube’s highest ad rates. In fact, nothing comes close; the going rate for a unit in TV’s most-watched and highest rated scripted series, Paramount Network’s neo-Western Yellowstone, was just $42,000, or a good 11.5 times shy of the average NFL rate.

The Kevin Costner cable oater—which, in its fourth season, beat out every show on broadcast TV with an average draw of 7.84 million viewers, of whom 1.87 million were in the adults 18-49 camp—managed to put up such uncharacteristically huge deliveries despite airing directly opposite Sunday Night Football. Spots in NBC’s primetime package, which last season averaged 18.5 million viewers and some 6.66 million adults under 50, often sold for 20 times what Paramount booked during its first-run Yellowstone telecasts.

Per SMI, about 87% of in-game NFL ad revenue was secured during the 2021-22 upfront sell-off, while the remaining units were sold off in scatter. The previous year gave rise to a traditional 75%-25% split. Given the speed with which NFL inventory was auctioned off during this year’s upfront, and fears that a looming/extant recession will curb consumer spending and media budgets, the 2022-23 season looks to be a repeat of the one that ended in February. In other words, in anticipation of what could be some truly gnarly headwinds come fall, the networks have elected to lock in the vast majority of their NFL transactions ahead of time, saving just enough in-game inventory in the event the fall scatter market proves more resilient than current indicators would seem to suggest.

While sales execs are confident that the supply-chain disruptions plaguing the auto industry are beginning to sort themselves out, a continuation of the global semiconductor shortage is unlikely to have a material impact on the NFL ad sales market. As is the case with any brand that makes advance commitments in the upfront, the fourth-quarter orders are practically set in stone once the checks clear. The networks give advertisers options to back out of a percentage of their first-, second- and third-quarter buys, but it’s next to impossible to wriggle out of a fall TV investment after the contractual ink dries. The Earth could fly straight into the heart of the sun on Halloween, but you’re still not going to talk your way out of those $900,000 spots you reserved in the Oct. 30 Packers-Bills game on NBC.

Given that fall deals are effectively intractable and taking into account the single-digit rate increases that were negotiated during the upfront, this year’s NFL sales should exceed last season’s already generous windfall. Assuming that the ratings momentum carries over (NFL deliveries improved 9% in 2021-2022), and makegoods/audience-deficiency units are held within the standard range of 10% to 15%, the league’s TV partners should be largely shielded from the worst of whatever headwinds may be in store at year’s end.

As theatrical schedules begin to normalize with the help of a few much-needed blockbusters, studio dollars are flowing back into sports—and streaming remains a gusher. Pharma, tech and credit card companies are increasingly accounting for a greater share of in-game investments, while emerging categories such as sportsbooks/online casinos and cryptocurrencies are poised to take up even more of your headspace when football returns in the fall.

However things shake out on the macroeconomic front, the networks that have gone all-in on football look to be well-covered as veteran players begin reporting to training camps this week. Of course, volatility being what it is, future investments are likely to come under greater scrutiny from investors if the stinky stuff starts hurtling in the direction of the Dyson oscillating tower.

Strangely enough, and while all the dollar figures cited above would seem to argue against this, fiscal probity is yet another area where the NFL really shines.  With an average CPM (industry shorthand for the cost of reaching 1,000 viewers) that hovers around the $60 mark, the cover charge for reaching the NFL’s audience is often effectively cheaper than buying into the typical underperforming primetime scripted series. The cost of entry may require some cavernously deep pockets, but the payoff in tens of millions of impressions makes the NFL a relative bargain compared to just about everything else on the market.

Well, everything but Yellowstone … although you can bet that those rates will expand proportionately as Season 5 goes on the block.

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