Why Are There Ads On NBA Jerseys?
The NBA put ads on NBA jerseys because they want the extra revenue from advertisers and want the NBA to be promoted more. The NBA gets promoted because advertisers use their media or platform to talk about the NBA since they’re also investing money.
The ads are about 2.5-by-2.5-inch. Soccer is well known for putting ads on their jerseys but the NBA is now the first American sports leagues to do this.
The decision to place ads on NBA jerseys was expected to generate between 120-180 million dollars in revenue. Owners is expected to keep 50 percent of the sponsorship money from the jersey ads and the other 50 percent will be added to the revenue-sharing pool for all teams. (Source: ESPN)
Heres what the NBA commissioner Adam Silver had to say about ads on jerseys:
“It’s manifest destiny,” Silver told ESPN’s Rachel Nichols in an interview last month. “So let’s begin by saying this isn’t going to affect the competition. What we’re talking about is a patch on the jersey. And one of the reasons we want to do it is that it creates an additional investment in those companies in the league … the amplification we get from those sponsors, those marketing partners of the league, who want to attach to our teams and our players.
“But once they put their name on the jerseys, they’ll then use their media to promote the NBA extensively. That’s probably the greatest reason for us to do it.”
When Did the NBA Start Placing Ads on Jerseys?
The NBA started placing ads on jerseys during the 2017-18 season.
The league has been moving to this point for at least five years, and it has been a project that commissioner Adam Silver has been in charge of.
The NBA signed a national television and an apparel deal with Nike where the ads were part of the negotiations. Click HERE to read on how Nike secured the apparel deal and became the official endorsement partner of the NBA.
How Much Does It Cost to Advertise On NBA Jerseys?
The cost to adverstise on NBA jerseys varies but it can range between $5 million and $20 million.
For example, the Golden State Warriors agreed to a $20 million jersey sponsorship deal with Rakuten (Source: Bleacher Report). Rakuten is an e-commerce company that was founded in Japan in 1997, but it has a North American headquarters in San Francisco, which gives it a strong link to the Warriors and the Bay Area. It is the largest online e-commerce site in Japan and among the world’s largest by sales.
Will the NBA Stop Putting Ads on Jersey?
The NBA most likely will not stop putting ads on the jerseys.
Putting ads on the jersey generated more than $150 million for the NBA. Many sponsors and advertisers who have never done business for the NBA want to advertise their business with the NBA. Team, league and brand executives agree that puttting ads on the jerseys has been an overwhelming success, with exposure numbers easily exceeding projections.
According to Amy Brooks, president of the league’s team marketing and business operations division and chief innovation officer for the NBA, “The revenue has exceeded expectations and we think the success of the program to date will help drive value in the future. “It has proven to be a unique asset that draws brands for different reasons.”
As the NBA looks to extend the program, league and team officials say there is no demand to increase the size of the 2.5-by-2.5-inch patches. “There has been zero negative reaction to the size of the patch,” said Alex Martins, CEO of the Orlando Magic. “Consumers have become accustomed to it.” (Source: Sports Business Daily)
Currently, NBA jerseys with the ads are only sold at team-controlled stores and websites. However, there are discussions on making the NBA jersey’s the only jerseys available at retail.
Conclusion
NBA ads are ultimately good for the league because it means more teams, especially the small market teams, have money to spend on their players. It also doesn’t ruin the game for the fans.
The NBA is making alot of money from sponsors and advertisers and they most likely wont stop putting ads on the jerseys.
For more posts, check out:
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