Coronavirus Halts Major US Sports Leagues, Significant TV Marketing Implications Ahead

Amid the major outbreak of the novel COVID-19 virus, many US sports leagues have taken preventive measures to slow the spread of the pandemic. What seemed like a never-ending cycle of cancellation on Wednesday & Thursday, many questions have arisen for what impacts will be left on the sports marketing industry.

The National Basketball Association was the first to implement a wide concept of social-distancing in major sports on Wednesday night. The NBA suspended the rest of the 2020 season until further notice. The news unfolded as the NBA’s first player confirmed case was confirmed.

As the first major US sports giant took action, a domino effect ensued with many leagues taking action. The NCAA then quickly retracted their plans to hold their annual Division I basketball tournament and canceled all conference play together. A slue of announcements followed the news with Major League Baseball, the National Hockey League, Major League Soccer, the PGA Tour, and the XFL all suspended and or canceled their season slates as well.

Major Sports TV Networks Halted

TV networks that rely heavily on ad revenue are scrambling to maintain profit streams. With no certain future of when play will return for many sports, it is difficult to forecast the potential losses ahead.

We are familiar with many consumers already cutting cable, the current global pandemic could expedite this process to some degree. eMarketer reported in August of 2019, that 25% of people will ditch their cable providers for live streaming services. Considering this, the coming months will determine whether we see cable subscriptions diminish.

Traditional cable is not only affected by this crisis, many Live TV bundles may be as well. Of course, this can be contingent on when exactly major sports leagues will resume play. According to Michael Nathanson, an analyst for MoffetNathanson, “The NBA’s suspension could potentially accelerate pay-TV cancellations.”

The NBA can serve ubiquitously as a model for other leagues with major network contracts as well. We can attempt to ascertain that losses are inevitable for live sports TV providers. What we will watch is the response from major sports organizations to make it worth it for brands with major TV sponsorships. According to Kantar Media, the 2019 NBA Finals grossed $288 million in ad revenue in just six games.

Many networks have developed relationships with their respective leagues over the years in partnerships. These long-term partnerships have been serving each other in a symbiont circle of revenue. We will be closely monitoring networks and leagues’ responses in financially supporting each other during this time. As for now, many are concerned with the protection of life above all.

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Carson Boykin

Assistant Account Executive, Sports