Analyzing MLB's Sponsorship Renaissance and its Impact on the Sport: An Exposé of the Data
MLB sponsorship revenue surged 23% despite game changes and declining beer deals, highlighting the success of attracting new advertisers and showcasing top brands
MLB's restructuring earlier this year generated a lot of hype. The implementation of new rules resulted in shorter, more captivating gameplay, and it was supported by a major campaign in March that marked a new era for baseball. Despite the shorter duration of games, recent data from SponsorUnited reveals that quality triumphs over quantity, as team sponsorship revenue has increased by 23% this season to reach $1.5 billion. The league has attracted 500 new sponsors, surpassing the deal volume of the NHL and NFL.
Additionally, the combination of shorter games and more exhilarating play has led to a significant increase in the league's viewership, surpassing that of top primetime shows in core markets by 125%. This surge in visibility has resulted in 135 additional deals compared to the previous season. Furthermore, the introduction of new advertising opportunities, such as dynamic dugout signage, has provided a significant boost. This option has been purchased by 67 brands, making it the most popular asset of 2023.
“There is a shorter time frame for brands to gain exposure and fewer opportunities for signage and partnerships during a typical three-hour-plus game,” stated SponsorUnited's CEO and founder, Bob Lynch. He also noted the impressive growth of their business, with a 23% increase in sponsorship revenue year over year, which is noteworthy even when compared to other professional sports leagues.
The research encompassed 850 brands and 3,500 deals, analyzing a total of 13,500 assets from the league, teams, athletes, and brands. This data was collected using SponsorUnited's exclusive platform and covers the period from January 1, 2019, to September 30, 2023. Social media data was gathered from branded posts across all 30 team accounts, including Instagram, X, TikTok, and Facebook, between February 1, 2023, and September 26, 2023. Data on player endorsements is based on the frequency of a player actively promoting or advertising a brand through a campaign or brand activation within the past 12 months.
New game, new blood
The games have been reinvigorated by the introduction of new rules, one of which encourages stealing bases. However, it is not solely the new rules that are generating excitement. The influx of fresh talent, including 38 highly regarded prospects, has also played a significant role. Players like Corbin Carroll and Gunnar Henderson have witnessed remarkable surges in their social media presence, with their followers increasing by 327% and 97% respectively. The presence of these emerging players has attracted the attention of advertisers, who recognize the immense potential for growth in their social media following.
"Major League Baseball has placed a strong emphasis on leveraging their athletes to lead and build their brands, particularly their younger athletes," stated Lynch.
During this season, Henderson secured two deals, while Carroll secured four deals. This indicates that brands are keen to collaborate with rising stars at the early stages of their careers. Player sponsorships have proven to be an avenue for numerous brands to engage in baseball-related endeavors. Notably, Julio Rodriguez, a player for the Seattle Mariners, acquired 20 endorsements within the past 12 months, making him the most endorsed player of the season. Following closely behind was Vladimir Guerrero Jr. of the Toronto Blue Jays, with 13 endorsements.
Social media engagement has emerged as a crucial factor in driving brand engagement. Notably, the Los Angeles Dodgers and the Houston Astros are leading the pack in terms of engaging teams. Similarly, Chevrolet and T-Mobile are the frontrunners when it comes to brands that have garnered the highest levels of audience engagement.
Top dog advertisers
Financial services, the top advertiser for the league, contributed around $200 million in revenue. This category experienced a 38% increase in investment compared to the previous year (2022). However, there was one category that outdid this growth. Technology witnessed a substantial 53% increase from the previous year, generating approximately $80 million in revenue. The automobile industry was the only top 10 advertiser to reduce its spending, which declined by 8%.
There have been significant changes in MLB marketing, particularly in the alcohol industry. While beer has traditionally played a crucial role in baseball marketing, its dominance in MLB sponsorship deals has decreased by 10% this season, now making up 45% of the deals. This is equal to the combined share of ready-to-drink products and spirits, indicating a shift in consumer preferences.
According to Lynch, there has been a notable increase in sponsorships from other categories. This expansion allows MLB to diversify its portfolio of sponsorships, moving away from the limited number of large endemic categories that typically secured sponsorships in the past.
Not only changing consumer tastes, but there are also other factors contributing to the MLB advertising shakeups. To encourage advertising purchases, the league has gone beyond jersey patch deals and now offers additional assets such as video board advertising, ribbon board advertising, outfield advertising, and two types of backstop signage. According to Lynch, other sports leagues can learn valuable lessons from the MLB. By prioritizing the fan experience and accommodating brands, the league's strategy has proven successful. "Putting the fan experience first is crucial... It's not always about having more time or more events. What matters is delivering value to consumers and brand partners by creating special events in a condensed period of time and introducing innovative ways of displaying signage," Lynch commented.
