Daniel Snyder Likely to Reap Substantial Benefits from Washington Football Team's Rebranding Effort
As the Washington Football Team awaits its new name, team owner Daniel Snyder stands poised to receive substantial financial benefits from the yet-to-be-announced brand. Sports economists project that fresh branding will likely result in new revenue streams from merchandise marketing, licensing arrangements, and other lucrative deals.
This extensive rebranding effort results from the team's July 2020 decision to drop its old brand due to increasing pressure from corporate sponsors and the general public. Dan Snyder announced that the team will be called the "Washington Football Team" until it receives a permanent name, likely within a year.
The Washington Football Team's playing field performance could also benefit from some new energy. The team has only reached the NFL playoffs five times in the last 21 seasons, and hasn't won the Super Bowl since 1992.
The franchise's game attendance has also trailed off over the years. In 2019, the Washington Football Team's Landover, Maryland stadium drew the 13th-lowest attendance in the NFL's 32-team league. Now 23 years old, FedEx Field could soon require increased facility maintenance and upgrades.
Despite those limiting factors, the Washington Football Team franchise hasn't lagged in the income category. In early August 2020, Forbes assigned a $3.4 billion value to the franchise, making it the NFL's seventh most valuable team. A team's valuation refers to its expected selling price.
The $3.4 billion figure is $300 million higher than the 2019 valuation and more than twice the valuation completed 10 years ago. In 1999, franchise owner Daniel Snyder purchased the team for $800 million.
Currently, Dan Snyder is personally worth $2.6 billion. According to Forbes' calculations, this number ranks him in the top 400 richest people in the United States.
As Dan Snyder prepares to rebrand the Washington Football Team, a noted sports economist emphasizes that this strategy could eventually increase the team's valuation by up to $100 million. Andrew Zimbalist, a Smith College-based sports industry economist, expects that even the interim Washington Football Team name will enhance Dan Snyder's and investors' bank accounts.
Zimbalist and Nola Agha, a University of San Francisco associate professor of sport management, are convinced that Dan Snyder's adoption of the straightforward "Washington Football Team" name was the right move. Snyder's move enables team officials, corporate sponsors, and fans to focus their attention on the permanent franchise name during the upcoming year.
Financially speaking, the name itself isn't the overriding issue. As long as the name is amenable to corporate sponsors, almost any franchise name will be acceptable. Many Washington Football Team fans appear to share that sentiment.
As the unveiling of a less-controversial franchise name draws closer, there is increasing speculation about the construction of a new stadium. Whether located in downtown Washington, D.C. or a nearby suburb, the brand-new facility would likely enhance Dan Snyder's football team's value.
Nola Agha, of the University of San Francisco, states that a new stadium increases any team's valuation. In fact, a professional sports franchise's valuation typically jumps by $400 to $500 million several years after new stadium construction.
Now that Dan Snyder's football franchise is changing its name, District of Columbia officials are open to the construction of a new stadium within city limits. In fact, John Falcicchio, D.C. Mayor Muriel Bowser's chief of staff, noted the benefits of bringing the team back to the city.
However, the stadium's location has yet to be determined. The Robert F. Kennedy Memorial Stadium site seems to meet the specifications. However, many residents (and certain lawmakers) don't want an NFL stadium to be built there.
While Dan Snyder's Washington Football Team prospects look increasingly brighter, it's necessary to consider the evolving elephant in the room. Because of the COVID-19 pandemic, fans will probably not attend the NFL 2020 season games. That represents a huge revenue loss of gate receipts along with stadium concession proceeds.
Although every NFL team will likely experience a huge financial shortfall, the Washington Football Team franchise will be especially hard hit. An eye-opening 41 percent of the football team's yearly income is derived from its stadium, says Forbes. Although the team's rebranding revenues may soften the effect of the stadium losses, it's impossible to predict the franchise's net operations outcome for the near future.