Recalibrating the valuations of women’s sports franchises: report

Women’s teams and leagues in the US have had quite the year, but they’re still playing catch-up when compared to men’s sports.

Given the fact that women’s teams and leagues still tend to have fewer resources, media coverage, and infrastructure than men’s sports properties, “a new blueprint for team valuations is needed,” according to a report from Wasserman’s women-focused advisory business The Collective and the Royal Bank of Canada.

Comparison is the thief of joy value: The report’s authors argue that when women’s properties are compared directly to men’s using traditional metrics, they often end up being undervalued. To rethink their value, the authors put forward a new framework for “redefining the value of women’s sports franchises” based on 40 indicators, including:

• Team attributes like performance and access to venues or facilities dedicated specifically to the team;
• Revenue sources like jersey sponsorships and other brand deals;
• Growth factors like broadcast, streaming, in-person, and social audience size.

“Our model projects growth and recalibrates revenue multipliers to better reflect long-term investment potential in women’s sports,” the authors wrote.

The price of fandom: The “growth factors” largely encompass the value of women’s sports fans, who tend to be more engaged—and can be more valuable for marketers and other sports stakeholders—than fans of men’s sports, according to research from The Collective.

• Fans of women’s sports are “18% more likely to be younger…than fans of men’s sports.”
• They’re also “67% more likely to have higher household incomes.”
• Fans of WNBA teams are 13% more likely to buy merch than NBA fans, even though the women’s sports merch market remains relatively untapped.

“As fandom and viewership of women’s professional sports grows, so too does the value of women’s franchises,” according to the report. “But traditional valuation models often fall short, failing to account for the unique fandom fueling the growth of the sport.”

The “B” word: Brand sponsorships are one of the biggest drivers of women’s team valuations, according to The Collective, and because many WNBA and NWSL teams don’t generate revenue from venue naming rights, jersey-patch sponsorships play a major role in revenue and valuation for women’s teams.

• The estimated average annual value of a WNBA team jersey deal is more than $2.1 million, per the report.
• The average NWSL team kit sponsorship goes for about $1.7 million a year, according to the report.

Know your (media) rights: In-person, broadcast, and streaming audiences also contribute to the revenue and valuation of women’s teams. Teams with higher valuations regularly fill 88% of the seats at their home games, and league-wide broadcast rights deals tend to be the largest source of revenue for teams aside from venue naming rights, per the report.

Women’s leagues also tend to renew their media rights deals more often than men’s leagues, “creating fresh opportunities for revenue and prime-time exposure” each time, the authors wrote.

The Collective predicts that the value of WNBA and NWSL teams will increase by “at least $1.6 billion over the next three years,” primarily driven by growth in live and broadcast audiences. While their audiences don’t yet match those of the W and NWSL, the report notes that leagues like the USL Super League, League One Volleyball, Women’s Elite Rugby, and the Northern Super League in Canada could offer opportunities for investors and sponsors that get in early.