SBJ Football: Are Visa and the NFL headed for a breakup?

Some of you might be under the impression the NFL has never had a pharmaceutical sponsor until today. But you’d be wrong. From 2003-2006, the NFL counted Bayer and GlaxoSmithKline as “proud sponsors of the NFL.” The deal marketed the erectile dysfunction drug Levitra before the league ended the relationship. Just to be triple sure, I checked the SBJ archives, too.

The exclusive negotiating window for Visa, a 30-year NFL sponsor, to renew its deal with the league has expired, and the NFL has contacted other financial services firms and consulting agencies to gauge the market for replacements, sources said.

The NFL’s second-longest tenured sponsor behind Gatorade, Visa’s current contract ends after the 2025 season.

The category hasn’t truly been up for grabs since Visa first signed in 1995, and the financial services world has completely changed since then. At the time, plastic payment cards were relatively straightforward, and cash itself was still widespread. Today, non-cash options proliferate, and payment processing has attracted extraordinary startup investment and involvement from some of the largest companies in the world.

It’s that new market that makes NFL CRO Renie Anderson and others believe that there might be more to be gained by abandoning the status quo (talks with Visa continue).

The ongoing inquiries could uncover a single upstart brand willing to overpay to get into the NFL rights, or -- more likely -- determine that payments could be split into several categories that, together, could yield more than Visa is willing to renew for.

Potential new players in a broken-up category include Amazon, a major NFL media rights holder, and Apple, which sponsors the Super Bowl halftime show.

The NFL’s information gathering is open-ended, but some obvious subcategories that could be created out of Visa’s rights include peer-to-peer payments, credit cards, debit cards, mobile payments and payment processing. Such a move would have knock-on effects in retail banking and affinity cards, which Visa has licensed to Truist and Bread Financial, respectively.

But breaking it all up is easier said than done. The politics of dividing a category held by one of the league’s longest continually running sponsors are fraught. Also, many of the newcomers are inexperienced in sports, with potentially long learning curves and varying levels of commitment.

While the huge range of potential players in digital payment processing may fit into distinct buckets now, all of them have visions of global domination. Visa has little interest in sharing the category, sources said, and insiders were especially skeptical that any direct competitor (Mastercard, American Express or Discover) would be interested in simply replacing Visa in an unchanged category.

In other category news, the NFL earlier today filled its pharmaceutical category, signing a multiyear deal with Novartis that will focus on the league’s health initiatives and the “Crucial Catch” cancer awareness program.

Roughly 34 NFLPA employees accepted the buyouts offered in February, just under half of those eligible, sources said.

Their last day was Feb. 28, meaning the union’s total workforce is now about 23% smaller than it was before the offer. The buyouts came with 12 months’ severance pay in most cases, an offer available to employees with at least seven years' experience, or about half the 150 workers there at the time.

There’s been no official word on involuntary job cuts, which were floated by NFLPA Executive Director Lloyd Howell if insufficient numbers accepted the buyouts. However, sources say Howell believes more work remains in his vision of modernizing the union staff’s capabilities, sources said.

Some NFLPA employees were perturbed by what they saw as Howell’s evolving explanation for the buyouts and potential further staff changes. In an internal meeting first unveiling the buyout package, sources said, he suggested the motivation was primarily financial. However, at the NFLPA’s regular pre-Super Bowl press conference, Howell called the union’s financial position “adequate,” and said players felt they needed “more sophisticated” support and communication from the union. The NFLPA declined comment.

The Dolphins have opened the Precision Drive Club, an ultra-luxury private club designed to monetize the Miami Grand Prix F1 track when it’s not in use by the pros. They’re aiming to sign up 100 members, whose fees buy the right to drive their own high-end sports cars on the track, along with hospitality, driver training simulators, car storage, safety oversight, video production tools and more.

To create the club, the Dolphins made a “eight figure” investment in building an inner loop on the F1 course, along with other amenities, said Dolphins CEO Tom Garfinkel. That figure doesn’t include the paddock garage and the original track. The club guarantees at least 40 days a year for its members and requires a staff of more than 100 to operate (though most are borrowed from existing Hard Rock Stadium, Grand Prix or Dolphins staff).

“It’s operationally pretty expensive, but it’s an expensive club to be a part of,” Garfinkel said. “It’s not something for everybody; it’s for a small group of people. These aren’t $80,000 cars -- these are $1 million cars. In some cases, they’re more.”

Membership fees are not public, but you can get a sense of the scale through Garfinkel’s explanation of the business plan. They recently eclipsed 20 members and hope to reach 50 this spring by leveraging the F1 race and Ferrari Challenge event in May. “Once we get to 75 to 100 members, it will start to be a nice, profitable business that adds to the profitability of the enterprise.” But it is a startup, and there no guarantees. “If we get stuck at 20 members, and don’t get to 50 or 60, it’s a bad situation.”

Miami GP President Tyler Epp took the lead to develop the initial concept and create relationships with the elite circles of wealthy race car enthusiasts. Precision’s charter member and a key consultant on the fine points of the club is Alex Krys, managing partner of Juniper Capital Partners and a motorsports enthusiast.

Krys, who recently bought a Ferrari to store full-time at the track, said Precision fulfills his longstanding desire for a luxury club that doesn’t revolve around golf and tennis, two sports in which he has little interest. In 2021, Miami’s first private driving club opened, the Concours Club. Krys was complimentary of Concours, but said the Dolphins’ F1-level track is a big differentiator.

“If you love driving and driving on a track, and you like cars, this is a bit of a candy store,” said Krys, who has entertained friends and his adult children at the club. “The real star of the show, even though the hospitality is fantastic and they have delivered on the full experience, is the track.”

Monetizing facilities that go unused except on game days is a sports industry challenge as old as pro sports themselves, but Krys sees it from a different angle -- the club experience is so much better than anyone could ever justify without an F1 track already there. “It would just get too expensive,” Krys said. “The fact we’re able to piggyback on the infrastructure is what makes it so unique. It’s a brilliant idea they had.”

Relo Metrics released their accounting of brand impressions for major NFL sponsors this week, tracking TV broadcasts and five major social media platforms.

On-field brands Nike and Gatorade led the way, but a blend of league sponsors and stadium naming rights holders also fill out the top 20.

• What are the Buccaneers planning for Raymond James Stadium’s future renovations? As Bret McCormick and I wrote in this week’s magazine, it’s hard to tell.
• Sometimes it seems like the offseason flurry of NFL free agency deals gets bigger every March, but the TV audience this year was stable. For coverage of the opening of NFL free agency on Monday, ESPN drew 425,000 viewers for a special in the 3:00-4:00pm ET window and then 447,000 viewers for “NFL Live” in the 4:00-5:00pm window. Those numbers are in line with 2024. The afternoon windows for the NFL didn’t fare as well as what ESPN had in primetime, as the SoCon Championship (Wofford-Furman) drew 549,000 at 7pm and WCC semifinal (St. Mary’s Pepperdine) drew 541,000 at 9pm.
• I jumped on Richard Deitsch’s Sports Media Podcast this week and talked about a number of issues, including the NFL’s decision to stay off Bluesky for now.