The $90 U.S. women’s home jersey has now become the top-selling soccer jersey in a single season in Nike’s history—both men and women. Overall, the company’s jersey sales have surged 200% compared with the last Women’s World Cup (WWC) four years earlier, and 150% for all apparel related to the tournament. This success piggybacks on already rising sales for Nike in the women’s segment: up 11% YoY through May 31, according to Markets Insider.
Nike’s WWC success underscores the multi-billion dollar opportunity as soccer rises in America. For decades, evangelists have dubbed the right team, the right event, the right player the breakthrough soccer in America needs, from the New York Cosmos to the 1994 World Cup to MLS’ 1996 launch, and even American prodigy Freddy Adu. But the narrative of soccer’s failed promise now appears outdated.
According to a Gallup poll released last year, 7% of Americans count soccer as their favorite sport to watch, which is up three percentage points from 2013 (chart below). All three “major” U.S. sports—baseball, basketball, and football—declined in popularity over that same time period. Soccer now trails baseball by only two percentage points. According to CNBC, the average attendance of MLS games now exceeds that of the NBA and NHL and ranks 8th compared to all soccer leagues in the world.
No doubt investing in soccer’s growth in the U.S. will prove complicated. As Goldman Sachs recommended last year, buying into an MLS franchise is a good pure-play opportunity, though one with likely prohibitive barriers to entry for most. Some international giants like Manchester United and Juventus are publicly traded and could benefit from greater competition for U.S. rights—the Stoxx Europe Football Index, which tracks these teams, is up more than 13% YTD.
As for the broader beneficiaries: Soccer appears likely to prove a growth avenue for apparel behemoths like Nike and Adidas, though their businesses are diverse. The same can be said for media companies, with some likely to benefit while others see American football-related losses outweighing soccer expansion. Companies that enter into key sponsorship deals will also see increasing upside, with Visa and Coca-Cola prominently positioned.
Soccer’s growth appears certain to accelerate in the years to come. First and foremost, demographics are on the sport’s side. In the U.S., the fan base is defined by four key factors with outsized appeal for advertisers: it’s young, it’s wealthy, and it’s disproportionately female and hispanic relative to other sports. At 40 years of age, the MLS boasts the youngest fan base among the major U.S. sports leagues, according to a Magna Global study released last year. A Nielsen survey last year found 41% of medium income earners and 40% of high income earners were “very interested” in soccer, which compares to 24% of low income earners. The survey also found that 31% of women globally and 26% of American women were “very interested” or “interested” in soccer, the highest of any major sport.
Finally, the U.S. Hispanic population is projected by the Census Bureau to grow by more than one million people per year for decades to come, exceeding 20% of the total U.S. population by 2020. And as Telemundo’s EVP of sports content told the Miami New Times last month: “80% of Hispanic viewers are consuming soccer.” Just in 2018, Telemundo competitor Univision saw 14% growth in total viewers for its MLS broadcasts.
Coupled with the demographics, soccer will benefit from several key tailwinds. The Men’s World Cup is coming to North America is 2026, with the U.S., Canada, and Mexico co-hosting. The U.S. has its first shot at a homegrown international star—Christian Pulisic who was transferred to English superclub Chelsea for $73 million this year. Meanwhile, stateside television exposure continues to rapidly increase—in 2018, 2,791 soccer matches were broadcast across 40 channels in the U.S. Finally, EA’s FIFA video game—an important driver of soccer interest—continues to increase in popularity, with roughly 4.5 million copies of the 2018 version of the game sold in the U.S., up from 2.6 million for 2012’s version.
The fall of American football will also contribute to the rise of soccer. As we explored in WILTW September 28, 2017, the long-term decline of football has begun. The more the game’s effect on player brains is studied, the clearer it becomes that participation at any age risks life-altering cognitive damage. In much of the U.S., soccer is played at the same time of year as football. As parents push kids away from football, they’ll likely be pushed towards soccer, which will create life-long fans of the less-violent game.
This could help generate interest in soccer in areas of the country that have long been American football-obsessed. We may already be seeing the beginnings of this with the breakout success of Atlanta United. The team began play in 2017 and averaged over 51,000 fans per game in 2018, the most of any MLS team and 10th most of any team in the world, according to a study conducted by the CIES Football Observatory. As the Guardian wrote in a profile of the team last year:
That an upstart soccer team is attracting upwards of 50,000 fans to games in a city notorious for professional sports apathy—and in a corner of the country where the other football is less pastime than cultural vanguard—is without precedent.
With political headlines swirling around the WWC—from captain Megan Rapinoe feuding with President Trump to the team’s fight for equal pay—one thing was clear: soccer now has cultural primacy in the U.S. Continued growth is all but inevitable. Now is the time to find ways to invest in that growth. In the months to come, we will continue to identify compelling ways to tap into soccer’s rise in the U.S.