The Value Behind NBA Jersey Patches

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Estimated reading time: 3 minutes

via NBA

via NBA

 

The 2017-2018 season brought a new look to the NBA. Being the first of the four major U.S. sports leagues (NFL, NBA, MLB, NHL) to add sponsorship patches to their jerseys, the NBA welcomes the expansion of its legacy by adding a new revenue stream for its teams and players.

 

Currently, 19 of the 30 NBA teams have signed jersey patch deals. However, the sponsored jersey deals are not long-term for the NBA - they are a part of an initial three-year agreement in which the NBA will evaluate the ROI (return on investment) of the jersey patch agreements.

 

 

 

 

So what is the value of a jersey sponsor patch for not only the NBA but also for the sponsors?

 

Let's start with the largest jersey patch deals:

 

  • Golden State Warriors and eCommerce company Rakuten, valued at $20M (the largest jersey patch deal so far)

  • Los Angeles Lakers and eCommerce platform Wish, valued at $12-$14M

  • Cleveland Cavaliers and Goodyear, valued at $10M

  • Boston Celtics and General Electrics, valued at $8M

 

Two weeks into the 2017-2018 NBA season, the Warriors, Lakers, Cavaliers, and Celtics accounted for 87% of the total earned media for jersey patches where earned media value equaled $2,592,513.73, according to BlinkFire Analytics.

 

So what supplies the value surrounding sponsored jersey patches? The value comes directly from digital marketing across various media platforms, where social media takes the lead.

 

When analyzing sponsorship value for the Golden State Warriors across their social media channels, Blinkfire reported that Rakuten earned media value totaling $1,030,811.25 during the first two weeks of the 2017-2018 NBA season where they also made up 52% of the Warriors sponsorship value.

 

I know you are saying "enough with the big numbers. What does all of this mean"? Well, the significant value for NBA jersey sponsor patches is in the increased brand value for the sponsors and of course the increase in revenue for NBA teams and players. 

 

Think of how many times you have seen the new NBA Nike jerseys with the sponsor patches. Now, think of how many times you or others may have researched or inquired about the sponsor and why they chose to sponsor a particular team. Also, think about how many people may have liked, commented, or followed the jersey patch sponsors just because of their association with a specific NBA team. That creates an increase in brand awareness and recognition for the sponsors. 

 

With the rise of digital media consumption and the forward-thinking progress of the NBA, becoming a jersey patch sponsor of the NBA is a win-win for any company that takes advantage of this three-year patch deal.

 

Sponsored jersey patches not only bring in money for the NBA and recognition for the sponsors - it adds another layer of storytelling between brands and sports teams. The majority of brands that have sponsored patches have a lasting history in the cities of the NBA teams they are sponsoring, and some have been sponsors of the respective teams for years (i.e., Goodyear and the Cleveland Cavaliers or Infor and the Brooklyn Nets).

 

Coupled with the additional revenue and brand awareness, adding sponsored patches to jerseys puts the NBA in a global space that the NFL, MLB, and NHL are not in. When you watch global games, you see sponsors on jerseys. With its growing global presence, the addition of sponsored jersey patches solidifies the NBA as a global game. In return, more value for the NBA and its sponsors on a much larger (global) scale.