Going International: New Canadian Marketing and Advertising Opportunities Available to NFL Clubs
National Football League (“NFL”) teams have new international marketing and investment opportunities in their sights, thanks to the recent implementation of the International Home Marketing Areas (“IHMA”) program. The IHMA program grants NFL clubs access to international territories for marketing, fan engagement and commercialization, part of a strategic and long-term effort to increase global brand awareness and grow the NFL fanbase.
As a result, Canadian markets will see an influx of marketing efforts courtesy of the Minnesota Vikings and Seattle Seahawks. Globally, the Philadelphia Eagles are the first team to enter an African market, via Ghana, while other clubs are now able to expand engagement into Australia, China and various European countries.
The NFL’s Regulatory Changes
Home Territory and Home Marketing Area
The marketing opportunities for NFL clubs are strictly regulated based on demarcated territories. The provisions relating to “Home Territory” with respect to the clubs participating in the NFL is found under Article IV of the Constitution and By-Laws of the National Football League.
Home Territory is defined to include: (1) the city in which such club is located; (2) the city for which the club holds a franchise and plays its home games; and (3) the surrounding territory to the extent of 75 miles in every direction from the exterior corporate limits of such city.
A club’s Home Territory informs its Home Marketing Area (“HMA”), which is the geographic territory in which the club may enjoy exclusive marketing rights. Subsection 4.4 of Article IV expressly defines HMA to mean: (1) the club’s respective Home Territory; (2) the portion of a foreign country within a club’s Home Territory, provided however, that those activities within a foreign country are co-ordinated with and approved in advance by the NFL’s International Committee (Subdivision); and (3) the state within which the city for which the club holds a franchise is located.
The HMA provides each club with exclusive commercial rights vis-à-vis other clubs to use its trademarks, including without limitation, the names, nicknames, logos, colours, slogans, symbols, or other identifying indicia within its demarcated territory with respect to NFL football activities involving the following:
(1) local advertising, sponsorship, naming rights and related promotional arrangements;
(2) retail stores and other club-identified physical structures and ventures;
(3) promotional and public awareness campaigns, including “image” advertising; and
(4) club-sponsored events.
However, these exclusive commercial rights are subject to the NFL league agreements (such as with manufacturers of licensed products), the rights of league sponsors and business partners (such as television partners and the NFL network), the right of the NFL to promote league initiatives and events, and the rights of the NFL and individual clubs to reach fans through e-commerce and other internet-related activities.
International Home Marketing Areas
On December 15, 2021, the NFL announced the IHMA program, led by its International Committee. The IHMA program grants clubs exclusive opportunities within an approved international territory to pursue marketing and advertising for a five-year term. The rights granted in the approved international territory are identical to the rights to marketing and advertising that clubs have in their domestic HMAs.
The IHMA program invites clubs to submit a proposal for an IHMA to market (each IHMA being an entire country), which is reviewed and approved by the International Committee. There can be more than one team that is granted approval to a single IHMA. An NFL announcement on May 24, 2022, confirmed that 19 teams have been granted access to 30 IHMAs across 10 different countries and that the initiative officially launched in January 2022.
The IHMA program introduces a profound shift from the tightly prescribed and demarcated territories that teams were limited to in their marketing and advertising. The program opens the prospect of a club internationally marketing an entire country. Opportunities that could result include cross-sport marketing partnerships, media broadcasting or streaming within their approved IHMA, localized engagement through youth football camps, merchandise and international sponsorships, as well as fan events, official fan clubs, social media, player promotional tours and online marketing.
The Minnesota Vikings and Seattle Seahawks receiving approval to make Canada their second home provides these clubs with an unprecedented opportunity to capitalize on building their brand and growing their fanbase north of the border.