A detailed view of a Pepsi ad at FedEx Field during an NFL football game between the Washington Football Team and the New York Giants, Thursday, September 16, 2021, in Landover, Md.
Aaron M. Sprecher via AP
Pepsi is retaining its sponsorship rights with the NFL, but will be giving up on one vital asset: the Super Bowl halftime show.
The soda and snack company officially renewed its nearly four-decade partnership with the league on Tuesday following the NFL spring bout 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 overpayment rights to major NFL events, including the NFL Draft. The company’s sports drink maker, Gatorade, maintains its high visibility on the sidelines of the NFL. Additionally, Pepsi and the NFL are teaming up to unveil a Gatorade pre-workout product for gamers this fall. The line is expected to be available to consumers in 2023.
Terms of the renewal of Pepsi were not disclosed. The previous deal was reportedly worth $ 2 billion over 10 years.
“Our priorities and priorities have evolved and we wanted to make sure that as we continue this partnership, we are all working towards the same goal,” Tracie Rodburg, senior vice president of sponsorship management at the NFL, told CNBC.
This time around, however, Pepsi will not sponsor the Super Bowl halftime show. This is the second time since 2012 that these rights have hit the market. Auto parts maker Bridgestone owned the Super Bowl halftime rights before Pepsi.
The Super Bowl 2022 Halftime Show featured iconic hip-hop stars Dr. Dre and Snoop Dogg. The NFL partners with Jay-Z’s Roc Nation to produce the halftime show.
Snoop Dogg, Mary J Blige and Dr. Dre speak during the press conference for the Pepsi Super Bowl LVI Halftime Show 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 seek up to $ 50 million for them. Industry executives suggest Bridgestone paid between $ 5 million and $ 10 million annually.
“It’s getting hard to justify,” said Tony Ponturo, the former vice president of global sports and entertainment marketing at Anheuser-Busch, of the potential cost. As great as the Super Bowl is, there are always executives who will say there’s a lot more for a company to do with the money they’re saving, he added.
As part of broader deals with pro leagues, companies also commit a portion of the total money to purchase TV ads. For the 2021 season, Pepsi spent approximately $ 114 million on NFL games, including the playoffs. This is down from about $ 127 million for the 2020 NFL season, according to the media measurement company iSpot. Pepsi also has 15 team deals with NFL clubs, including the Dallas Cowboys.
The team owners also approved the holding of the league’s combined 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. However, the logistics around the hotel space and access to medical facilities played a big part in keeping the combine harvester at the Colts’ Lucas Oil Stadium.
In 2022, the event generated an economic impact of approximately $ 9.6 million, according to the league. Indianapolis has been hosting the NFL Combine since 1987.