The league sells the virtual ads for national broadcasts on ESPN and TNT while the teams handle inventory for their regional broadcasts. The rates for the DEDs are negotiated individually between the sponsors and the team or the league based on existing sponsorship packages. Brands must have existing sponsorships with teams and/or the league, in some capacity, to be featured on the DEDs, and it appears a majority of team sponsors who already advertise on the physical boards have DED activations as well. The teams and NHL also have their own DED ads, which often highlight the league’s app and social media pages, as well as a team’s ticket offerings.
“That was a huge negotiation as you can imagine with 24 marketers, 24 agencies for every club to be able to say, ‘Ok, you used to get this board, you still get it but now I am going to give you two minutes, three minutes, four minutes—whatever amount of time they negotiate with their brands,” Wachtel said.
The NHL made it clear to sponsors that the DED ads were not being sold as media and that the league would not let sponsors pull 30-second TV commercials just because of the new ad format.
“If it cannibalizes local and national media partners, then that would be penny wise and pound foolish,” Wachtel said.
Last season the NHL brought in a league-record $1.4 billion in sponsorship revenue compared to $1 billion the prior season, according to a person familiar with the league’s finances, and the windfall could grow due to the DED deals. The league has ramped up in-game advertising efforts over the last decade, with on-ice virtual ads, virtual ads on the glass, helmet ads and limited ads on jerseys.
There are five dedicated areas for the DEDs: behind each net and in all three zones of the ice. For regional broadcasts, the teams can split up the areas any way they want. The Florida Panthers, for instance, prefer to have one sponsor on the DEDs at a time, which is referred to as a “full takeover.” Ad Age observed the Ottawa Senators feature up to five advertisers on the DEDs at a time. For now, the virtual ads are only visible from the main camera angle used for broadcasts; when other camera angles are employed, such as during replays, fans watching from home will see the standard dasherboards. (Wachtel said the NHL would not replace the arena dasherboards with digital signage because it would be too much of a distraction to the players.)
“We thought it looked less cluttered on broadcasts,” Panthers Chief Revenue Officer Shawn Thornton said of the Panthers’ “full takeover” approach. “I love the flexibility the league has given us with how we’re able to go to market with it,” added Thornton, who played 705 NHL games before transitioning to the business side.