A detail view of a Pepsi ad at FedEx Field during an NFL football game between the Washington Football Team and the New York Giants, Thursday, Sept. 16, 2021, in Landover, Maryland.
Aaron M. Sprecher via AP
Pepsi retains sponsorship rights with the NFL but will give up a key asset – the Super Bowl halftime show.
The soda and snack company officially renewed its nearly four-decade partnership with the league on Tuesday after the NFL’s spring meeting in Atlanta. Team owners voted to ratify the renewal, which allows Pepsi to use the NFL’s premium rights for its brands, including Frito Lay and Tostitos.
As part of the deal, Pepsi gets broadcast rights to major NFL events, including the NFL Draft. The company’s sports drink maker, Gatorade, retains its high profile on the NFL sidelines. Additionally, Pepsi and the NFL are teaming up to unveil a Gatorade pre-workout product for players this fall. The line is expected to be available to consumers in 2023.
Terms of Pepsi’s renewal were not disclosed. The previous deal was worth $2 billion over 10 years.
“Our priorities and their priorities have evolved, and we wanted to make sure that while continuing this partnership, we are all working towards the same goal,” Tracie Rodburg, senior vice president of NFL sponsorship management, told CNBC.
This time, however, Pepsi will not be sponsoring the Super Bowl halftime show. This is the second time since 2012 that these rights have come to market. Auto parts maker Bridgestone held the Super Bowl halftime rights before Pepsi.
The 2022 Super Bowl halftime show featured iconic hip-hop stars Dr. Dre and Snoop Dogg. The NFL is teaming up with Jay-Z’s Roc Nation to produce the halftime show.
Snoop Dogg, Mary J. Blige and Dr. Dre speak during the Pepsi Super Bowl LVI Halftime Show press conference at the Los Angeles Convention Center on February 10, 2022 in Los Angeles, California.
Jeff Kravitz | Filmmagic, Inc | Getty Images
CNBC reported in October that Super Bowl halftime rights could hit the market and the NFL would be asking up to $50 million for them. Industry executives suggest Bridgestone pays between $5 million and $10 million a year.
“It’s getting hard to justify,” Tony Ponturo, former vice president of global sports and entertainment marketing at Anheuser-Busch, said of the potential cost. As important as the Super Bowl is, there are always executives who will say a company has a lot more to do with the money it saves, he added.
In larger deals with professional leagues, companies also spend a portion of the total money on buying TV ads. For the 2021 season, Pepsi spent approximately $114 million on NFL games, including the playoffs. That’s about $127 million for the 2020 NFL season, according to media measurement firm iSpot. Pepsi also has 15 team deals with NFL clubs, including the Dallas Cowboys.
Team owners have also approved keeping the combined league event in Indianapolis in 2023 and 2024, the NFL announced Tuesday.
NFL officials have considered moving the pre-draft scouting event to Dallas or Los Angeles. Still, logistics around hotel space and access to medical facilities played a role in keeping the combine at the Colts’ Lucas Oil Stadium.
In 2022, the event generated approximately $9.6 million in economic impact, according to the league. Indianapolis has hosted the NFL Combine since 1987.