Title: Soaring Sports Sponsorship Rates, with Shohei Ohtani and MLB Leading the Charge
In the second year of Shohei Ohtani's jaw-dropping $700 million, 10-year contract with the Los Angeles Dodgers, the National League MVP and World Series champion is undeniably showing his worth, both on and off the field.
Research firm SponsorUnited has reported that the Dodgers raked in an impressive $70 million in additional sponsorship revenue in 2024, mainly from the involvement of 12 Japanese-based partners. The advantages of this deal are not limited to the Dodgers, as they are spilling over to other Major League Baseball (MLB) teams as well.
When Ohtani plays away games, take a look at any backstop. More often than not, you'll see Japanese brands advertising with their opponents. Bob Lynch, CEO of SponsorUnited, estimates that teams hosting the Dodgers collected approximately $15 million in total cumulative revenue from Japanese brands inking signage deals for those games. This phenomenon of following Japanese brands across the nation, paying either teams or Van Wagner for backstop signage, has greatly contributed to MLB's total sponsorship revenue growth.
In the aforementioned report released by SponsorUnited, MLB experienced a staggering 16% year-over-year jump to $1.84 billion in overall sponsorship revenue for 2024. This figure represents a substantial 36% increase compared to the previous three seasons. Out of the five major North American professional sports leagues, only the NFL exceeds MLB's sponsorship revenue, estimated at $2.3 billion during the 2023 season.
The NFL, NBA, NHL, and MLS experienced double-digit growth over the past three seasons, signaling strong industry growth. Hockey, through the introduction of "digitally-enhanced dasherboards," which allow broadcasters to replace the ads around rinks, managed to come closest to MLB, with a three-year growth of 32%. This has pushed its sponsorship revenue to $1.35 billion. MLS' $665 million in team sponsorship revenue for 2024 may lag behind others, but its 18% increase in sponsorships represents a significant step forward.
When it comes to sponsorships, over $7.66 billion was generated across nearly 14,000 deals in 2024, showing a 12% year-over-year growth. Advertisers such as almost 200 brands spent more than $1 million each on new sponsorship deals, and around 15% of sponsorship revenue stemmed from new deals across the five pro leagues and the Power 5 colleges.
The surge in sponsorship revenue can be attributed to various factors. In addition to the demand for major professional sports involvement, teams and leagues have been creative in their offerings for partners. Stadiums and arenas are focusing less on traditional luxury suites and diversifying their premium experiences, each tailored for a sponsor's name. Furthermore, brand exclusivity is less rigid than before, and digital advertising has allowed partners to enjoy a new level of customization.
Expanding the sponsorship segment will be crucial for MLB and the NHL, which lack massive media deals like the NFL or NBA, and are facing uncertainty with another critical revenue source as regional sports network operators face challenges. However, Ohtani's contract has indeed set a new standard for MLB, proving that there are numerous opportunities to increase sponsorship revenue, thanks to his global fame and following. An impressive 150-foot mural of Ohtani in Los Angeles' Little Tokyo further underlines his global appeal and the Dodgers' continued success.
- The Dodgers' record-breaking sponsorship revenue increase can be partially attributed to Shohei Ohtani's influence, as Japanese brands follow him to opposing teams' stadiums.
- The NFL, NBA, and NHL, along with MLS and MLB, have seen substantial growth in sponsorship revenue over the past three seasons, with MLB leading the way due to its partnerships with brands like the Los Angeles Dodgers.
- SponsorUnited's report highlighted that the Los Angeles Dodgers gained an additional $70 million in sponsorship revenue in 2024, primarily through their partnerships with 12 Japanese companies, showcasing the value of global stars like Shohei Ohtani.
- Just like the NFL, MLB, NBA, NHL, and MLS, SponsorUnited has experienced a remarkable 12% year-over-year growth in overall sponsorship revenue, reflecting the increasing importance of partnerships in the sports industry.
- The Los Angeles Dodgers, under the influence of Shohei Ohtani's global popularity, have cemented their status as a lucrative sponsorship opportunity for brands, contributing to MLB's growing revenue figures.
