Predicting Endorsement earnings

We know that athlete endorsers can generate substantial additional revenue from their corporate partnerships, but what determines the magnitude? Most people can name several elite performers in their sport who are also key brand endorsers, but what about others? Is there an increase for playing a certain sport, having more followers or being more popular? In order to determine this, a regression analysis was conducted on the top 100 athlete endorsers of 2019 as named by Opendorse. This website listed 2019 endorsement earnings, sport and number of Twitter followers. Next, athlete popularity was collected from ESPN who ranks the top 100 athletes by popularity. Finally, a model was run looking at earnings as determined by the sport played (with basketball as the reference sport), number of Twitter followers (in Millions) and ESPN rank (1 most popular).








The results indicate that compared to basketball, tennis athlete endorsers receive an additional $11 million, golf receives about $14 million more, while crticket and soccer each receive about $21 million less  and fighters receive $11 million less than basketball, with football, baseball and driving showing no difference in endorsement income. For every 1 million increase in Twitter followers, an athlete can expect to receive an $480,000 and as popularity drops, so does the amount they receive, about $200,000 per drop in rank.

Overall, these results provide some evidence that not all sports are equal in terms of attracting endorsement dollars. Some sports command a premium over others. Athletes who are interested in generating additional income should be encouraged to cultivate their social media following as they are rewarded for a larger audience, which makes sense for endorsing companies trying to increase their reach. While this model predicts about 64% of endorsement dollars, there are several other features that are potentially contributing to endorsement dollars that isn’t captured. The more that athletes, their agents, and endorsing companies, understand what impacts endorsement earnings, the better able each is to represent their interests to greatest advantage.

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