The NFL is supposed to make money on TV rights and from major sponsors. Most of these sponsors are among the largest branded companies in the United States. And virtually all of them already have huge consumer bases. However, the NFL has found another way to make money. It sells advertising at NFL.com.
The most recognizable league sponsors for 2013 are led by McDonald's Corp. (MCD) and PepsiCo Inc. (PEP). Each has the financial capacity to sponsor the league, as well as to spend tens of millions of dollars outside its sports sponsorships. That should come as no surprise. Both rely on a large portion of the American consumer population for revenue. For the two companies, there is no such thing as overexposure. Consequently, neither of them needs to market to the relatively small audience reached by the NFL's online site.
The companies that do spend money at NFL.com are unlikely to have the budgets that the largest league sponsors do, and they want an affordable way to more carefully target their messages to the football fan base. This gives the NFL another way to bring in marketing, and NFL.com has been set up to do that.
The NFL's online business includes avenues for advertisers to use standard Internet ads, video ads and messages aimed at consumers who access NFL.com on portable devices. During the holiday shopping season, the league had managed to lure retailers anxious for sales in their two most important months of the year. At the top of this list is Best Buy Co. Inc. (BBY), which uses NFL.com to promote holiday savings. Online marketing is particularly important to Best Buy as its tries to keep customers who have, for several years, moved to Amazon.com Inc. (AMZN) to shop for consumer electronics. NFL.com even solicits advertisers for its fantasy football online contents and has gotten Black & Decker to invest in reaching the visitors to this part of the NFL site.
Among all the major sports, the NFL is the largest, based on television rights and money invested by America's largest consumer-based companies. The league has figured out another way to enrich itself -- sell advertising for its online site the way that traditional sports sites do.