In-game NFL advertising revenue, which increased for several years, experienced a 1.2 percent dip this year, from $2.45 billion in 2016 to $2.42 billion, according to Adweek.
Early in the season the NFL was enjoying an increase in TV ad spending even though their ratings were declining. During the month of September, ad spending during NFL games was up 12 percent for NBC, eight percent for Fox and four percent on ESPN.
The average cost of a 30-second TV spot increased from $499,000 to $505,000, growing 1.2 percent this season. The decrease in overall advertising revenue for the NFL was caused by makegoods, which were actually down for most of the season when compared to 2016. But by December, the NFL owed ad time to sponsors where networks didn’t reach ratings guarantees.
In 2017, 23 percent of the NFL’s ad inventory was freed up for makegoods, an increase from 21 percent in 2016. It’s clear the NFL was not anticipating a second season with a near 10 percent drop in overall television ratings, because their makegoods surged by the end of the season.
Even as TV ratings drop and ad revenue declined in the regular season, the NFL is still seen as a viable investment. NBC Sports expects to attract a record setting $500 million in advertising related to Super Bowl LII on February 4th.
The league’s Thursday Night Football package garnered interest from a variety of media companies including, Amazon, Turner and ABC, while receiving actual bids from CBS, NBC and Fox. In December, Verizon agreed to a new partnership with the NFL, paying the league $500 million annually, up from their previous $250 million per year contract.
Although NFL ad revenue declined by $300 million this season, NBC’s record setting day for the Super Bowl along with the interest its weakest TV package in Thursday Night Football received, will allow the league to present itself as strong moving forward.
Brandon Contes is a freelance writer for BSM. He can be found on Twitter @BrandonContes. To reach him by email click here.