10. The NFL's Best Real Estate Isn't For Sale. Yet.

[0] How do you think it would change football if players had big fat sponsor logos across their chests?

[1] It would be a change of epic proportions.

[2] I think in any sport you have a large base of purists that don't want to see the game change too much.

[3] And I don't think we're quite ready for that.

[4] Michael, who is your favorite football team?

[5] The New York Jets.

[6] The Jets.

[7] Now, how would you feel if the Jets came out?

[8] next season with Budweiser on their chests, or maybe Viagra?

[9] I don't think that's in the best interest of the New York Jets franchise, their brand, their fan base, or the NFL.

[10] I'm cultivating a future New York Jets fan with my five -year -old son, soon to be six -year -old son, and it's really easier for him to form a relationship with the Jets as a brand than with a malt beverage or a pharmaceutical drug.

[11] I think I could live with it.

[12] That's not Michael's son.

[13] That's Philip Schneider, a 10 -year -old Buffalo Bills fan.

[14] He was watching a game a couple of Sundays a dad at Blondies, a sports bar in New York.

[15] Othered as much because of the history and all that, and I really wasn't like, you know, I'm growing up now.

[16] It wasn't like I was growing up with the bills.

[17] You know, it's now, so...

[18] Dad, how about you?

[19] How do you feel if the bills come out next year with a corporate sponsor on the jersey?

[20] If it would help them win, be all in favor of it.

[21] The NFL is the most successful sports league in history, with revenue of about $9 billion a year.

[22] It likes selling ads and making money.

[23] So, why doesn't it sell ad space on the one piece of real estate that football fans can't help but see, the players themselves?

[24] The answer is trickier than you might think.

[25] It has to do with Peyton Manning, with Eli Manning, and and with Tevia.

[26] Tradition.

[27] From WNYC and American Public Media, this is Freakonomics Radio.

[28] Today, we hit you right between the numbers with a very forward pass, selling the most sacred spot in football.

[29] Here's your host, Stephen Dubner.

[30] It's hard to think of a bigger pack of purists than British soccer fans.

[31] The English Invented Soccer, and their Premier League is still home to many of the world's best players and teams.

[32] Their fans are legendary.

[33] They follow their clubs around the country, around the world.

[34] They care about their clubs more than they care about just about anything.

[35] The same is true throughout much of Europe.

[36] This devotion is evident by the number of people who wear team jerseys.

[37] But you know what's strange?

[38] If you're visiting Europe and you don't know any better, you might think, huh, that's interesting.

[39] Vodafone has its own soccer team and Carlsberg beer, even UNICEF.

[40] Because that's what you see on the chest of the jerseys in big, bold letters.

[41] the club's name, but the name of the corporate sponsor.

[42] The most lucrative deals bring in about $30 million a year.

[43] Probably the best day in the world.

[44] Michael Newman, I'm the founder and president of New York City -based Amplify Sports and Entertainment.

[45] So here's the funny thing about Michael Newman.

[46] He's the guy you heard from at the top of this show, the one who doesn't want his kid to see a Budweiser logo on the Jets' jerseysies.

[47] You want to know what Michael Newman actually does at Amplify Sports and Entertainment?

[48] Or a sponsorship, consulting agency and we buy and sell sponsorship for our clients.

[49] I've been in the industry for almost 20 years, and I've put together hundreds of sponsorship deals for Fortune 500 brands totaling well over 150 million.

[50] And I've worked on sporting events ranging from the Olympics to the women's half marathon here with the New York City Roadrunners Club and everything in between.

[51] In 2006, Amplify helped put together the first major Jersey sponsorship deal in North American sports.

[52] Real Salt Lake, a major league soccer team, put a big Zango Juice logo on its players' chests.

[53] Now, roughly three quarters of the MLS teams have similar sponsorship, which brings in more than $2 million per year for those clubs.

[54] If the NFL went the same route, a guy like Michael Newman could make a lot of money.

[55] All right, pretend for a minute that I'm Roger Goodell, Commissioner of the NFL, and we run into each other in an elevator, and you tell me what you do for a living.

[56] You probably know what I do for a living.

[57] Give me your pitch on putting corporate logos on NFL jerseys.

[58] Well, I'm going to probably tell me something.

[59] I mean, he's already heard.

[60] I mean, just the upside in revenue opportunity for an NFL team and what they're going to garner through an association with a corporation that wants their name on their jersey is going to set all sorts of records.

[61] And I don't mean just domestically.

[62] I also mean globally.

[63] If you look at some of the deals that have happened across the globe relative to some of the soccer deals with some of the premier global soccer brands.

[64] I believe that the upper tier NFL teams have the ability to execute deals at levels far greater than what we're seeing elsewhere.

[65] In European soccer, for instance, the top 10 teams, their average Jersey sponsorship money is about $17 million a year.

[66] Correct.

[67] You think the top NFL team could do better than that?

[68] I do.

[69] I really do.

[70] I absolutely do.

[71] So let's do a little math.

[72] We'll assume a fairly conservative average of $15 million a year for each NFL team.

[73] There are 32 teams in the league.

[74] That's $480 million, nearly half a billion dollars a year, the NFL is leaving on the table.

[75] Although they're starting to scrape some of it off quietly into their laps.

[76] Last season, for the first time, the NFL allowed teams to start selling sponsorship on their practice jerseys.

[77] Not right across the front, but a three and a half by four and a half inch patch on the left shoulder.

[78] Teams have sold this space to everyone from AT &T to the local hospital network.

[79] I think at the moment the view would be it's okay for practice.

[80] It's not going to happen in the game.

[81] But as you know, all ideas evolve.

[82] That's Mark Waller.

[83] Don't be fooled by his accent.

[84] He grew up in Kenya, Hong Kong and Wales, but now he works on Park Avenue in New York as the chief marketing officer for the National Football League.

[85] His international background helps him see his job not just in terms of what is, but what might be.

[86] We never used to allow sideline advertising at all.

[87] Now, the game that we play in Wembley in the UK, we have on -field signage.

[88] We did it for a year and tested it, and for the four years that we played there now, this will be the fourth year.

[89] We've allowed that to continue, and we're very comfortable with it.

[90] for the UK because that's kind of how the UK culture works.

[91] They're used to sporting events where, you know, advertisers are on the field on the sideline.

[92] So I think we will always allow, we should always allow our thinking to be open and we should always take a view that any decision that we make is a decision for today.

[93] During a typical NFL game, the only visible sponsors on the field are those that the league says are related to the playing of the game itself.

[94] So the Gatorade cooler, a little Reebok logo on the uniforms, the Motorola headsets, Wilson Balls, Riddell helmets.

[95] But during the NFL's once -a -year game in London, that's not the case.

[96] The league gets to experiment, just like they're starting to experiment with corporate sponsors on practice jerseys.

[97] Maybe just to gauge how outrage the fans were going to be.

[98] What's that, you say?

[99] You didn't hear about any of this outrage?

[100] Yeah, neither do we.

[101] In a minute.

[102] Some of the men who help run football teams explain why game day jerseys don't have sponsors.

[103] From WNYC and American Public Media, this is Freakonomics Radio.

[104] The official beer of Freakonomics Radio is, well, we don't have one yet.

[105] Here's your host, Stephen Doverner.

[106] If the NFL put a corporate logo on its game jerseys, it could bring in hundreds of millions of dollars a year.

[107] You'd think the players themselves would love this idea.

[108] After all, they get a cut of league revenues.

[109] But listen to Keith Gordon, the president of NFL Players, Inc., the marketing arm of the Players Union.

[110] You know, from our perspective, I think it's something we certainly have a cause for concern.

[111] The reason being, if an NFL player has a sponsor logo on his jersey, it could simply prevent him from actually acquiring another deal with, let's say, another competitor.

[112] So whether a player is prevented from getting a deal today or tomorrow or even a deal that could last him two or three years into his departure from football, into his post -football career, anything that's going to do that we're obviously going to have an issue with.

[113] Unstoppable.

[114] Eli Manning is.

[115] New York Giants quarterback Eli Manning is one of the NFL's highest paid players.

[116] He's also got his own set of commercial endorsements.

[117] One of them is for citizen watches.

[118] The Giants recently signed a far -reaching sponsorship deal that includes logo patches on the team's practice jerseys.

[119] But there's one problem.

[120] They signed it with a different watch company, Timex.

[121] Once the team decided to throw another competitive brand on the jersey, it essentially nullified the deal that Eli Manning had with his sponsors.

[122] So what Eli finds himself doing is not being able to deliver 100 % on the community.

[123] commitments that he's made to his sponsor because of what the team has done, you know, with the practice jersey.

[124] What happens in a case like that?

[125] What are the conflicts that need to be resolved there?

[126] Like any sponsor who's put out a lot of money for a player to be their endorser, if the player's not able to completely make good on all the commitments for which he signed in the contract, then obviously, you know, reparations of some sort must happen.

[127] And to the degree that that's going to prevent, in this particular case, Eli, from either getting additional opportunities or being able to fulfill.

[128] fill those that he currently has, you know, you can do the math and put together what those reparations could potentially be.

[129] Reparations?

[130] Ouch.

[131] Much as we'd like to do the math, those numbers aren't public.

[132] But we do know this.

[133] When Eli Manning signs a deal with Citizen Watches, most of that money flows to Eli Manning.

[134] When the New York Giants sign a deal with Timex, the team is taking a big cut.

[135] The king of all NFL endorsers is Eli's big brother, Peyton Manning.

[136] He earns an estimated $9 million a year off the field.

[137] You've probably seen him in those Sony ads on TV.

[138] But what if Peyton's teen, the Indianapolis Colts, sold space on their jerseys to say, Panasonic?

[139] Peyton Manning suddenly becomes a lot less attractive to Sony.

[140] And if you're Peyton Manning, this starts to look like some kind of a socialistic wealth redistribution scheme where the money that used to go directly to you is now being spread among your 52 teammates, robbing Peyton to pay Paul and Dwight and to Shea.

[141] That's not funny.

[142] Fix that.

[143] So that's why some players, at least the big dog players and the people who represent them, might not want Jersey sponsorships.

[144] But what about the league?

[145] It's extra money, right?

[146] Hello?

[147] Was it?

[148] Not quite.

[149] As the NFL's Mark Waller explains, there's the fear of Canada.

[150] The league currently sells more than $4 billion a year in TV rights, money that the TV networks recoup by selling commercials.

[151] So the half billion dollars a year that could come from selling Jersey sponsorship might not represent new money at all, might just be siphoned off from an already sweet deal.

[152] I think the best comparative value you could get is the $4 .5 billion that we currently get from our broadcast partners.

[153] for the rights to our game.

[154] So if you were going to do a very simplistic equation, you'd say at the moment the marketplace has valued that time and that content at $4 .5 billion.

[155] But I think at the moment, we'd be very comfortable that the model that we've got, more or less, and, yeah, obviously every year we look at it and review it, but more or less strikes the right sweep spot for us of keeping all of those factors in balance.

[156] There's one more big reason that your team hasn't plastered its jerseys with an ad yet.

[157] It's a single word.

[158] You talk to anybody associated with the NFL for more than a few minutes, and this word will come up.

[159] Take it away, Tevia.

[160] Tradition.

[161] Joe Ellis, chief operating officer of the Denver Broncos.

[162] You're one of two lucky teams that gets to go to London this year to play an NFL game, the one annual game.

[163] You're playing the 49ers on Halloween.

[164] And now this is an audience there in the UK who's very accustomed to seeing their sports teams, their beloved football, soccer players, where on the jerseys, not a team name, not even a big, nothing on the front but a corporate sponsor.

[165] So you're the CEO of the Denver Broncos.

[166] You've got to think, boy, for this one game only, wouldn't it be lovely to sell a naming rights on our jerseys in London?

[167] pick up an extra few million dollars.

[168] I don't think our owner would look at it that way, and I don't think I would either, because I think the tradition of the league and how it presents its product on the field comes first.

[169] And right now, today, I don't think the owners collectively, who would make this decision for something like this, to allow this to happen, to have corporate sponsorship on a jersey that is worn on game day, I don't think they're prepared to do that yet.

[170] I've said that someday it may happen and I've said that I probably won't be around to see that happen but for now today I think they respect the tradition of the game the tradition of the uniform, its formality, how it's presented to the public on the field and while they have allowed it to happen in our practice jerseys here that we wear I don't see it happening anytime in the near future on the field for regular games.

[171] Is that your suspicion or is that your hope as well?

[172] In other words, do you as a CEO of a very successful NFL team feel that it's a step too far?

[173] I'm of the camp that we shouldn't do that.

[174] I mean, I think the tradition of the uniform and how it's presented to the public, both in the stadium and on television, has some longstanding value.

[175] And to go the other direction, I think at this time, is not the right thing to do.

[176] I will tell you that if you did do it, people would get over it very quickly.

[177] Did you catch that?

[178] People would get over it.

[179] Joe Ellis doesn't think this will happen in his lifetime, but NFL teams might be less afraid of breaking this kind of tradition than they're letting on.

[180] When the Denver Broncos replaced the beloved Mile High Stadium with a new stadium whose naming rights were sold to Invesco, it was Joe Ellis who took the heat.

[181] Here's another team official, Jerry Jones Jr., chief sales and marketing officer for the Dallas Cowboys, the team is father owns.

[182] So here's the $64 million question.

[183] Why don't NFL teams have corporate sponsorship on their game day jerseys the way European soccer clubs do?

[184] Well, first I would say that we do.

[185] And what we have is on our jerseys, as if right now, it is Reebok.

[186] And so we do have branding on our jerseys with our apparel manufacturer.

[187] And do you feel there's an opportunity there, though, well beyond Reebok?

[188] But what about if, you know, the Dallas Cowboys could across the breast of that beautiful white jersey have, you know, you fill in the blank, the biggest corporate sponsor you could imagine?

[189] Does that seem like an opportunity that you'd like to be able to take advantage of?

[190] Well, I think always you're looking at opportunities to generate revenue.

[191] And as we know, that's what we're in the business.

[192] business of doing to help us field of a competitive team in the National Football League.

[193] I think that when you look towards what we are doing from a sponsorship standpoint, specifically your question with our jerseys, you know, we, there's a philosophy that less is more.

[194] All right.

[195] Fair enough.

[196] I got to tell you, I'm a little surprised only because a few people in the league said, well, if anybody would go for the idea of sponsorship on of Jersey.

[197] It's going to be the Dallas Cowboys.

[198] It's going to be the Dallas.

[199] Well, I'll take that as a compliment, and our organization and our family will take that as a compliment.

[200] We do try to get aggressive.

[201] And when it comes to the marketing of the sport and generating revenue, we do try to push the envelope and be creative, but we also firmly believe in the integrity of the game.

[202] Jerry Colangelo has owned everything from a Major League baseball team, the Arizona Diamondbacks, to an arena football club.

[203] He's still the chairman of the Phoenix Suns, the NBA team, which also runs the Mercury, a WNBA franchise.

[204] Last season, the Mercury became the first American basketball team to put a big sponsor logo right across the front of their jerseys.

[205] So you've had experience with many, many professional sports leagues.

[206] They all have their own culture, their own history, their own way of doing business.

[207] Which league do you think of the four major professional men's team sports?

[208] Which one do you think would be the first to embrace sponsors on jerseys?

[209] NBA, NHL.

[210] And then I would put the NFL and MLB behind those two.

[211] So the odds of our seeing a city group logo on the New York Yankees pinstripes.

[212] You think that's quite a ways down the road?

[213] Not necessarily.

[214] At the right price, they could jump from fourth to first.

[215] What I'm guessing is that the future where we might see every player in the NFL plastered wall -to -wall with logos like a NASCAR car, you know, the line, the offensive linemen's right shoulders sponsored by Ben Gay, let's say, and the wide receiver's gloves are in all states good hands.

[216] I gather that's a ways off.

[217] But if we - Oh, wait a minute, I'm multiplying those numbers in my head.

[218] Sounds pretty good so far.

[219] You like it?

[220] No, you know, I think this.

[221] I think we live in a time in society where advertising is all over the place, and sponsorship is such a big part of the economics of sports.

[222] I think we will continue to see more and more proliferation.

[223] I think leagues will always try and maintain as much as they can in the way of legacy, history, tradition and keep a clean uniform, but there's not, I don't think there's any question that as time goes by and the demands are as great as they are, that we'll see more and more sponsorship attached to the uniform in all sports.

[224] Jerry Colangelo is 70 years old.

[225] He's seen enough time go by to know that professional sports are a money magnet.

[226] Football's finances may be in fine balance now, but the pressure for new revenue, for new ad inventory, probably won't subside.

[227] If Jersey logos do happen, are you really going to turn off the TV on Sunday?

[228] Or, as the Broncos Joe Ellis says, will you just get over it?

[229] Yeah, some parts of the game might take a little bit of getting used to.

[230] Manning back to pass.

[231] Has a man open downfield?

[232] It's Hakeem, Knicks.

[233] Manning to Nick's touchdown.

[234] Manning put that ball right between Nick's number and the Chevy logo on the front of his jersey.

[235] Freakonomics Radio is produced by WNYC, American Public Media, and Dubner Productions.

[236] On the roster for this episode, Ryan Hogan, Christina Russo, and Colin Campbell, are producers.

[237] This podcast was mixed by David Herman, who wore one of the first sponsored jerseys ever in Little League.

[238] Special thanks to Jay Cowett, who really should be the next John Madden.

[239] Subscribe to this podcast on iTunes, and you'll get the next episode in your sleep.

[240] You can find more audio at Freakonomics Radio .com.

[241] And as always, if you want to read more about the hidden side of everything, go to the Freakonomics blog at NYTimes .com.