(Photo credit: Brooklyn Nets)
Editor’s Note: We apologize to our readers for the week-long layoff. Your humble correspondent at Sports Biz USA was knocked off online by Hurricane Sandy. But we’re back in action starting today. Our thanks to the great Patrick Gartner for taking the reins on the technology side. Thanks for your patience. Now on to the sports biz news at hand…
The NBA’s Board of Governors has backed off its plan to place ads on its jerseys for the 2013-2014 season. But we haven’t heard the last of the four major U.S. pro sports leagues looking to slap corporate logos on team unis to raise advertising revenue. Even if there’s a backlash from fans, media and sports purists.
Here’s why. It’s no big secret pro sports and Corporate America would rather have seen Governor Mitt Romney win the election than President Barack Obama. The president’s more likely to raise taxes, increase regulation, etc. Tuesday’s election makes it more likely pro sports leagues and teams will seek non-traditional ways to raise ad bucks. Slapping corporate logos on uniforms, ala NASCAR, is a natural option
Second, the lingering U.S. recession has changed the rules in sports and media. The WNBA has added corporate logos to its uniforms. NFL teams are selling corporate logos on practice uniforms. Sports broadcasters are now accepting ads from spirits marketers and other advertisers they would have rejected before the current economic recession.
Third, pro soccer is becoming a big TV sports play. ESPN, Fox Sports and the new NBC Sports Network all televise either U.S. or European pro soccer. Soccer uniforms have corporate logos. The sky hasn’t fallen. There hasn’t been a hue and cry from U.S. TV viewers who are far more concerned about finding or keeping a job.
“We think this is coming. It’s kind of the next obvious step,” says Jim Andrews of IEG Consulting. “It’s not something that everybody will be happy about. But it’s going to happen eventually in most leagues.”
How much money are we talking? Enough to make leagues, teams and sponsors stand up and pay attention. The NBA’s Adam Silver, who’ll succeed David Stern as commissioner in 2014, estimated league teams could have raised an extra $100 million by putting a 2.5-by-2.5 inch logo space up for sale on the front of player jerseys.
The media exposure value for sponsors could be even greater. Image Track, a new service launched by the WPP Group’s IEG and Kantar Media, estimates an equivalent advertising value of $165 million from TV alone if the ad patches had been worn by NBA clubs during the 2011-2012 season
Says KantarSports chief Richard Brinkman in a statement: “The ad equivalent value from all TV—including local—would range from around $5 million for a team not reaching the playoffs to about $34 million for a finalist. Our experience from other sports leagues, such as the English Premier League, shows that value derived from pictures in the press and online is likely to double the TV value generated by each team.”
Once the dominoes start falling, here’s how I predict it will go. The NBA and NHL will try it first. Major League Baseball will go No. 3. (Majestic has provided major league uniforms since 2005 and a small company logo can be seen on the jersey sleeve.) The deep-pocketed NFL would be the last pro league to try it — if they ever do it at all.
“This is the way that sports in general is going. I think there is a marketplace for sponsors who will want something like this,” IEG’s Andrews says. “In some way shape or form, the NBA will probably be selling a logo on its jersey. The NHL is the most likely next suspect.”