Analyzing the NFL's Future in London

Analyzing the NFL's Future in London

In an effort to expand their presence outside of the United States, the National Football League launched the “International Series” in 2007 by hosting one regular season game in London per year. The NFL has expanded this series by adding two more games in the city on an annual basis, including this past weekend’s contest between the New York Giants and the Los Angeles Rams.

The success of the NFL’s international series has had numerous effects. The NFL is already planning overseas matchups in other places like Germany and Brazil. Roger Goodell, the NFL’s commissioner, says he wants a Super Bowl in London in the near future. Most notably, the league seems set on relocating a team to London full-time.

How serious is the possibility of an NFL franchise moving to London? Simply put, plenty of business and logistical questions must be answered before it happens. Where would the team play? What preparations need to be made? When could a franchise be ready? All these questions must be answered.

Luckily, perhaps the biggest issue the NFL would have to face- finding an appropriate facility- is being taken care of right now, and the NFL did not have to do a thing. The Tottenham Hotspurs English Premier League football club is in the midst of building a brand new stadium in London right now, which is specifically designed to support both an NFL and an EPL team. Daniel Levy, chairman of the Tottenham franchise has been quoted by Ashley Fox of ESPN that the stadium “needed to be viewed as a combined joint soccer and NFL stadium. In fact, the way we designed the whole experience is one side of the stadium is a dedicated soccer entrance and the other side is a dedicated NFL entrance.” If there was ever a sign to the NFL that London is suitable for a franchise, this is it.

The next question is the potential financial success of the new franchise. By partnering with a popular club like Tottenham, all of their supporters will be exposed to the NFL franchise when they attend matches, which will boost local support. In addition to the support of the fans of Tottenham, all of the business that sponsor Tottenham, and more importantly their stadium, will by extension be sponsoring the NFL franchise. It would make sense that the owner of the new London NFL franchise would contribute to stadium costs and upkeep, and in exchange would receive an equal proportion of advertising revenue and other revenue streams offered by stadium fare, i.e. concessions and other consumer goods. This ensures that the new franchise would have at least one guaranteed revenue stream upon moving to London.

However, despite the NFL’s success in London thus far, the franchise may face some problems becoming profitable, at least to the extent NFL owners are used to. The first issue is attracting fans, which will come with more time and exposure. However, attracting fans will be difficult when the average NFL ticket price is $85.83, according to statista.com. In contrast, the average English Premier League ticket price is only $40.92 according to The Independent. While people may support the franchise by watching televised broadcasts, how can the NFL expect fans to pay almost twice as much for NFL games when the EPL is far more popular? They would be offering

a product with much, much less public demand for twice the price. On the other hand, all of the games at Wembley have sold out, and tickets up in the nosebleeds from Ticketmaster for the game between the Colts and the Jaguars on October 2nd of this year sold for around $109.03. If the games this year are going to follow the trend of its predecessors, then maybe a team could be financially successful.

However, we also see a price disparity on merchandising. The average EPL jersey price, according to the BBC, is $51.24, once again converted from English pounds. Meanwhile, the NFL sells jerseys for around $150. Here we have NFL prices being 3 times higher than EPL prices for the same product. How will the NFL convince British citizens, once again, to buy a much less popular product for higher prices?

There are other cultural differences as well concerning the fans. Many EPL teams, like Manchester United, Chelsea, or Liverpool, are firmly embedded in British culture. Plus, they do not have mascots. Will fans feel enough passion about a new franchise such as, say, the London Red Coats or whatever name the NFL might choose? Moreover, how will American fans react towards a London team? After all, the NFL is the last American sports league made up of only American teams. Do fans really want to see their team play a playoff game in London? Will they watch a Super Bowl at Wembley Stadium?

Nonetheless, if a London team is successful, imagine what the limits are, if they even exist. The NFL could create a mind-boggingly lucrative sports empire. The question is whether the NFL would be willing to commit to a franchise that not only poses a multitude of challenges, but may very well lose money in its infancy. Given the clear financial and cultural hurdles as well as some public perception issues domestically concerning the future of the sport, I do not think the NFL is ready to pull the trigger on a deal with this much at stake. A final decision may ultimately come under another NFL commissioner.

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