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The Cooper Report: NBA Jersey Sponsorships to begin in 2017

in Sports Business/Sports Media/Sports TV by

-DigitalSportsDaily.com takes a look at some of the most notable sports business and media stories of the past week.

One of the biggest stories to come from the professional sports world this week is that the NBA Board of Governors approved the sale of jersey sponsorships, beginning with the 2017-18 season, as part of a 3-year pilot program. NBA commissioner Adam Silver stated that “Jersey sponsorships provide deeper engagement with partners looking to build a unique association with our teams and the additional investment will help grow the game in exciting ways.”

    • Each NBA team will be responsible for selling and maintaining its own sponsorships.
    • Unlike sports such as soccer, where the sponsor name dominates the front of the jersey, the NBA’s jersey sponsorships will be much smaller – measuring approximately 2.5 inches by 2.5 inches and be adjusted to fit the dimensions of each sponsor’s logo.
    • The logos will appear on the front left of the game jerseys opposite the Nike logo.

Last week, the NCAA and its media partners, CBS and Turner, announced an eight-year extension to their original 14-year, $10.8 billion deal, which went through the 2024 men’s basketball tournament. The new agreement extends to 2032, and allows the NCAA to have early access to roughly $400 million of the revenue from the extension.

    • Reason: The NCAA’s current deal has substantial built-in increases, going from $740 million this year to $761 million in 2017, $782 million in 2018, $804 million in 2019 and $827 million in 2020. Those increases do flatten to zero from 2021 through 2024.
    • The NCAA negotiated for more money from both CBS and Turner to build up the annual increases during those years, and will have the flexibility to take the upfront money as early as 2021 and spread it out from 2021 through 2024. These increases are important to schools, especially those outside the power five conferences. They rely heavily on that annual revenue from the NCAA to grow their individual budgets.
    • More than 90 percent of the revenue from the Turner/CBS contract goes back to NCAA member schools.

Speaking of the NCAA, UPS, a March Madness sponsor, has decided to exit its NCAA partnership after six years. The global shipping powerhouse confirmed that its current contract with the NCAA expires in August and will not be renewed. A company spokesman said that UPS is going through a review of sponsor relationships – a regular activity – and that the NCAA deal didn’t fit with an upcoming shift in marketing and communications strategy. UPS originally signed its NCAA partnership in 2010 and renewed it two years ago. The company exercised an option in the most recent contract to exit the deal.

It remains to be seen whether UPS will continue with its heavy ad buy around March Madness on Turner and CBS in the future. 

“We are hopeful that they will continue to advertise in the tournament,” said Mark Lewis, the NCAA’s executive vice president for championships and alliances.

“We certainly are disappointed to have them leave. It is a great company, and they did a lot of very good activation with their sponsorship.”

UPS has been a heavy investor in collegiate sports over the past decade, and used the NCAA tournament for years as a platform to highlight its logistics expertise. They worked with creative agency Ogilvy to create the “We love logistics” campaign, and that message became central to the company’s march madness advertising.

Other Sports Media tidbits to note:

  • ABC’s and ESPN’s Viewership and Ratings went up for the NBA Regular-Season. (Thanks Golden State)
  • NBC announced the 2016 “Sunday Night Football” & “Thursday Night Football” schedules. Oh yes, it’s almost that time of the year again. 
  • The Golden State Warriors broke the NBA record for wins in a season with 73 last week, on the same night that the great Kobe Bryant played his last game. Those two games were the two most-watched NBA regular-season finales ever on ESPN.
  • The Buffalo Sabres ended the Pittsburgh Penguins’ run atop the NHL’s local TV ratings chart, despite a sub-.500 record.
  • NRG Stadium is undergoing a complete overhaul of its food service operation with a big piece occurring before the 2017 Super Bowl in Houston. The project is estimated to cost around $20 million.
  • NFL agreed to a $10 million deal to stream “Thursday Night Football” on Twitter.