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Corporate sponsors spent an estimated $1.12 billion on the NBA this season, fueled by the new sponsorship patches on team jerseys. That figure comes from IEG/ESP, a division of ad agency WPP that tracks sponsor spending and ROI on the major US sports leagues.
This is the first time NBA sponsor spend has topped $1 billion. For comparison, it puts the NBA between MLB ($892 million) and the NFL ($1.25 billion) in sponsorship spend.
The $1.12 billion is 31% higher than the $861 million in NBA sponsor spend last season, a much bigger increase than was projected. Sponsorship spend in the big four pro leagues typically gets bigger every year, but the NBA spend grew by far more than expected.
The huge jump in spend was driven by the new jersey patches.
This is the first season that the NBA has experimented with letting teams sell real estate on their jerseys: small patches (2.5 inches by 2.5 inches) on the upper left side. So far, 21 of the 30 teams have done it. These nine teams haven’t yet: Chicago Bulls; Houston Rockets; Indiana Pacers; Memphis Grizzlies; Oklahoma City Thunder; Phoenix Suns; Portland Trailblazers; San Antonio Spurs; and Washington Wizards.
The brands that have jumped in range from big, publicly traded American corporations (General Electric, Goodyear, Disney, Harley-Davidson, Western Union, eBay-owned StubHub) to private tech startups (dating app Bumble, Utah software “unicorn” Qualtrics) to one foreign company: Japanese e-commerce giant Rakuten (sponsor of the Golden State Warriors, of course: Silicon Valley’s sports team.)
Some of the patch deals were made long before the current season started (StubHub and the 76ers were first, announcing their deal way back in May 2016) while the latest ones happened as recently as March (Bumble and the LA Clippers, and 5Miles and the Mavericks).
The jersey patches only account for $137 million of this year’s total, IEG/ESP says. That’s a small chunk of the $1.12 billion, but it’s $137 million that is entirely new this season, since the patches are new. The average patch deal pays a team $6.5 million per year, and most are two-year deals.
The lion’s share of the $1.12 billion comes from league-level sponsors: big blue-chip consumer brands like Anheuser-Busch InBev, American Express, Frito-Lay and Gatorade (both part of PepsiCo), Nike, and State Farm, which IEG/ESP says is the No. 1 most active NBA sponsor.
“Our partners continue to activate with us at extraordinary levels and integrate into our platforms year-round,” says the NBA’s SVP of global partnerships Kerry Tatlock.