Putting a Bow on the 2018 Football Season … and a Look Ahead
February 28, 2019
Senior business advisor Jeff Boyle looks at NFL viewership numbers for 2018, how they compare to the 2017 season, as well as lessons learned for next year. Jeff also gives some of his initial thoughts on the debut of the upstart Alliance of American Football (AAF) League.
DP: Let's start with the ratings for the 2018 season. Jeff, break it down for us as far as viewership of the regular season and the Super Bowl.
JB: Well, Dave, to no one's surprise, the NFL dominated viewership again this year, claiming 46 out of the top 50 telecasts during the regular season, with the most viewed game being the week 12 matchup on Thanksgiving between the Redskins and the Cowboys where they drew 30.5 million viewers on Fox. As for the Super Bowl, no surprise. Again, the NFL always dominates in the viewership where advertisers and broadcasters are all paying these big numbers. CBS cited 98.2 million viewers and even that was with the game ending in a 13-3 victory for the Patriots. It had the smallest viewership since the Patriots and the Giants back in 2008. This could be attributed to the fact that maybe they're getting tired of the Patriots. It wasn't as exciting of a game, but the fact that they drew 98.2 million viewers is extraordinary compared to any other broadcast that can be put on television.
DP: Okay. How do the 2018 season numbers compare to 2017?
JB: Overall there was a 5% increase in ratings from ‘17 to ’18, which is pretty good. The average viewership was around 15.8 million. That's excluding the London broadcast, which is hard to really tell how those impact the NFL—being it's early in the morning and not during the same times that usually the NFL is being played. And in addition, digital viewership for streaming of games spiked an astounding 86% from last year. Given all the different trends and wanting to get these videos streamed online with Amazon doing the Thursday night games, it was obviously very successful this year. And the ratings can also be attributed to the high scoring games. In the beginning of the year, offensive just dominated. There was one game in particular in week 11 where the LA Rams beat the Kansas City Chiefs 54 to 51 on Monday night. And this was the highest scoring Monday night football game in history, and the ratings for this game were up more than 57% over last year's week 11 matchup. So I think that people love watching the offensive game, seeing high scoring. Nobody really cares as much about a defensive grudge match, which we saw in this year’s Super Bowl. So I really think that the changes in the NFL to be in such a high-scoring league has contributed to better ratings.
DP: Got it. So, overall, a good year for the NFL for the regular season at least, but there appears to be some work to be done when it comes to Super Sunday. Let's now turn our attention to many people's favorite, the Super Bowl commercials. Talk about how they did this year.
JB: Yeah, it's funny you brought up the commercials. Because I feel like when we cited those numbers early on that the viewership, a lot of that is just casual fans who really turned in to watch these commercials. These advertisers obviously pay big bucks to get these commercials on the air. And frankly, I didn't really feel that the commercials were worth the money. USA Today is ad meter ranked. The NFL’s 100-year game commercial. It's a number one this year and many felt it had more energy than the actual game itself. The commercial shows more than 40 current and former NFL players at a banquet hall celebrating the 100th anniversary of the league and then all hell breaks loose when Marshawn Lynch reaches for a piece of cake. Generally speaking, besides that ad, I didn't really like any of these commercials. They were definitely not worth the hefty price tag. And I don't know where it went when we used to have these great Budweiser and Doritos commercials, and who can forgot "wassup."
DP: I agree with you. I didn't see any of the commercials blowing me away this year. So let's look forward as far as lessons. What business lessons can the NFL learn from this season that they may want to implement for next year?
JB: At the end of the day, you have to say that it was another successful year for the NFL. I mean, the ratings speak for themselves. I think there needs to be a change when it comes to the Super Bowl, but the fact of the matter is it's not the commercials, the city in which it takes place, or the halftime show that's going to make a massive difference. It really gets down to the teams in the game. I think the only thing you can attribute to these numbers is maybe that the New England Patriots being in it again and the LA Rams maybe not having the greatest football market really contributed to the decline and the ratings.
DP: Yeah, it's interesting. I'm wondering if similarly in the MLB, there was a NY Yankee fatigue in the ‘90s when they were in the World Series every year. I wonder what the ratings looked like when they started their dynasty and then when they ended their dynasty. We'll have to have our statistician look into that.
DP: Now let's turn our attention to the upstart Alliance of American Football League, the AAF. What's the early verdict here?
JB: I think that the fans are enjoying it. It's early course. I mean they're getting nowhere near the viewership of the NFL, which can be expected. Their broadcast on CBS drew 2.9 million viewers, which actually exceeded the 2.5 million viewers of ABC's competing primetime broadcast of the Houston Rockets and Oklahoma City Thunder, two good NBA teams. But as you can expect, as time goes on, the viewers were going to come down because everyone wants to tune in to that initial broadcasts. So on Sunday, Arizona hosted Salt Lake on the NFL Channel, now we're going to APM and drew a 0.4 rating that amounts to about 408,000 viewers, which the league is said to be happy with. And if you want to look, by comparison, a very polarizing figure such as Johnny Manziel, his Friday night debut with the Canadian Football League was on ESPN 2 and had a 0.3 rating. So it's not apples to apples, but it gives you a little context of why people are drawing into it and that people are at least enjoying it.
DP: It's about managing expectations. You know, they saw what happened with the old XFL and the USFL, and I think maybe this time around they've tempered their expectations.
JB: Yeah. And I think there's been a lot of news recently on the AAF, a lot of places speculated that they were having trouble making payroll when Tom Dundon, who's the founder of Dundon Capital Partners and the owner of the NHL’s Hurricanes who provided $250 million of financing, though the reports of possibly missing payroll were never verified. And I think that this investment is far more than what's required for payroll purposes. If you look back to the XFL, you mentioned they lost about $70-$80 million in total in the first year. So if you see what these players are being paid, a $250 million investment is not just missing payroll. That's an investment on the future of this league.
DP: And I think as you've mentioned to me in the past, it continued the march of private equity into professional sports.
JB: Yes—100%. And especially in this league, I feel like you can't just view this as a sports league, it's also a technology company.
DP: Okay. Now turning from the dollars and cents to the AAF’s marketability. What did you like? What didn't you like so far?
JB: So as a startup league, the one negative thing that stuck out to me is that they broadcast its two games on CBS at 8:00pm on Saturday. I don't think that they can do this for now—having concurrent games. They just don't have a big enough following yet where I feel like they need to be air just one game at a time. That way, people are not choosing between two local cities and just getting as many viewers as they can at this time. And another con, which also could be viewed as a positive to some people, but the AFF is focused on the southern markets where the NFL isn't already king. I mean they abandoned all the northeast media markets as well as the largest cities in California. So I feel like abandoning cities could be a big problem for media coverage down the line.
DP: That's a good point.
JB: You know what I do really like is that the AFF has not come out of the gate with any promises and it is moving through the space thoughtfully. There haven't been aggressive, “in your face promotions” like the XFL did. They've had a really good relationship with the NFL, in my opinion, because the NFL Network has picked up two games per week. So I think that really shows that possibly an NFL partnership down the line could be inevitable. It could maybe be as a developmental league or maybe it's just a league that the NFL uses to more or less float ideas out there and see how the fans take to it. The XFL came out years ago and says “we're going to change all the rules.” But the AAF has really put new rules more or less as a response to what the NFL has seen, making it more entertaining—with quicker games, they don't have as many ads in the broadcast and being potentially safer. They've eliminated kickoffs. And that to me was the biggest draw in the NFL is every year they constantly tried to essentially eliminate kickoffs without really actually doing it. Just to try to make the game safer because they do know that the speed of the game when two people are colliding at each other on a kickoff because it really creates a lot of injury risk.
DP: Yeah. I tuned into one of the week one games and it was interesting and enjoyable. It looked like they had a good crowd. So you know, we'll see. It's off to a fast start. For the moment, it's somewhat of a novelty. But let's see if it has staying power. I wish them all the luck.
JB: Yeah. I think the biggest thing is going to be the app. If they can create the app the way they envision it to integrate sports gambling, that way they can turn this into a revenue generator in the future.
DP: Yeah. That could be the difference maker as far as what the older leagues, the upstart leagues didn't have is the technology behind it. So we'll see. Thanks, Jeff, for this valuable information. Always a pleasure talking the business of sports with you.
JB: Thanks for having me.
DP: And thank you for listening to “The Boiling Point” as part of the EisnerAmper podcast series. Visit EisnerAmper.com for more information on this and a host of other topics, and join us for our next EisnerAmper podcast when we get down to business.