Major League Soccer announced a major corporate sponsorship deal with Procter & Gamble on Tuesday, a move that could help the league recover some of its Covid-19 losses.
P&G will sponsor some top football events as part of the five-year deal. These events include the MLS All-Star Game, the Mexican National Team’s US Tour, and the Leagues Cup.
The financial terms of the deal have not been disclosed, but according to someone familiar with MLS partnerships, the deal is believed to be worth $80 million to $100 million. The source agreed to speak on condition of anonymity as the financial terms of the deal have not been made public.
P&G will use MLS intellectual property on product brands such as Gillette, Old Spice and Crest to promote the competition. MLS Deputy Commissioner Gary Stevenson called partnership “symbiotic.”
“Those brands serve the broadest group of consumers in our country,” Stevenson told CNBC on Monday. “When we perform in the way we both want to perform, we help increase awareness of their brand with our audience, and they also help increase awareness of our brand.”
Football’s popularity is on the rise among younger sports fans in the U.S. With the activation of P&G, the company joins MLS to serve an emerging fan base.
“The sport of soccer is the sport for the new North American. It’s crossing a really valuable audience and it’s multi-generational,” Stevenson said. Referring to P&G, he added, “Their strength in the marketplace and ability to interact with so many consumers is valuable to us.”
Like other American sports leagues, MLS is recovering from the impact of the pandemic. MLS Commissioner Don Garber has said the league has lost nearly $1 billion due to Covid. He expects sales to fall further in 2021, as attendance at major sporting events is still limited.
MLS also faces other challenges.
The league settled a labor dispute with players in February, but it delayed the debuts of three new franchises. One of those franchises – in Sacramento, California – is unlikely to launch. MLS is now considering new markets, and Las Vegas could be in the mix.
MLS is also counting on baiting a top media rights package to raise fees by about $90 million a year. The current agreement with Disney’s ESPN and Fox Sports will run through the 2022 season.
Keep in mind that the two media giants have each given the National Football League $2 billion to run football games on their networks. Fox also surrenders Major League Baseball $700 million per year, and ESPN returned the National Hockey League for $400 million per year. In a few years, the National Basketball Association plans to increase its broadcasting rights.
But the partnership with P&G comes at the right time. The league welcomes a top market in Texas as the Austin FC team makes its MLS debut on Saturday. Outside of college sports, MLS will have a market for itself in Austin, as there are no other professional sports teams in the city.
“Major League Soccer is one of the most dynamic sports leagues in North America and this is a time of significant growth for the sport,” Marc Pritchard, P&G chief brand officer, told CNBC via email. “Our multifaceted partnership enables our brands to connect with millions of passionate fans, while also partnering with MLS to be a positive force by helping communities across the country.”