Among the many sports business headlines of the past week the news that generated the most discussion and speculation was word of the ten-year deal to stream all MLS matches on a new subscription service from Apple.
While most commentary focused on whether the deal—reportedly worth $2.5 billion—was a good one for MLS and its fans, little was mentioned about the brands that sponsor the league and its clubs, a roster than includes the likes of Allstate, Audi, AT&T, BetMGM, Coca-Cola, Heineken, Kellogg’s, Procter & Gamble, Target and Adidas, among others.
Although only time will tell how the move to a streaming platform will impact each of those marketing partners, the new agreement offers much for those brands to like, even if it also brings some significant limitations.
Let’s get the negatives out of the way first.
- MLS games will no longer be available for free in every TV home in the U.S., a disappointing fact for any sponsor looking to maximize exposure.
- Brands seeking in-game promos must contend with the fact that paying subscribers likely won’t have the tolerance for advertising and promotional clutter that free TV viewers are willing to tolerate as part of the quid pro quo.
- Team-level broadcast packages will be a thing of the past, eliminating the opportunity for locally targeted marketing opportunities. Beginning next season, local team sponsors will have to be content with radio and on-site inventory.
But despite those challenges, there is plenty of upside for sponsors.
- Historically, many league-level sponsorship deals have included a requirement to buy ad time on broadcast partners. With marketers wanting to exercise more control over how and where they purchase and place their media (See AB InBev’s decision last week to forego Super Bowl exclusivity in order to “better deploy its marketing spend throughout the year.”), the switch to streaming offers an opportunity to take off such handcuffs.
- Although less of an issue for a league with the viewership numbers of MLS versus bigger leagues, the potential for mass reach and exposure offered by broadcast television has long been baked into sponsorship fees, a relic that can also be removed thanks to streaming.
- Alignment with the target audience. As MLS commissioner Don Garber cited, more than 80 percent of sports fans watch streaming services regularly, well above the rate for all other TV viewers. Being younger than fans of other leagues, with an average age of 39.6 years and 58 percent being Gen Z and Millennials, MLS fans are highly likely to want to stream matches versus watch on linear TV. As SportTechie noted, “Soccer has a strong streaming culture in North America, with many fans having opted for Peacock, Paramount+ or ESPN+ to watch the major European leagues in addition to the MLS out-of-market package on ESPN+.”
- The one-stop-shopping aspect of having all the league’s matches and content in one place for fans to easily access offers the potential of increased visibility for sponsors, as does the elimination of local broadcast blackouts.
- Streaming produces more readily accessible fan data than broadcast, not to mention the potential of having a partner like Apple providing an assist in accessing, analyzing and deriving key consumer insights from that data.
- MLS will produce all matches, offering the possibility of sponsor-friendly camera angles, mentions, etc. that otherwise might need to be negotiated—i.e., paid for—with a broadcaster producing its own telecasts.
As current MLS sponsorships come up for renewal, it will be interesting to see how incumbent partners respond to the new environment and whether new sponsors will seek to join the fold.