Will LeBron’s Jersey Be Open for Bidding?

Selling space on game uniforms could net owners millions | “I’ve got about six companies that would buy it right now”

Ira Boudway

ILLUSTRATION BY MARCOS CHIN

When NBA owners gather on April 12 for their first board of governors meeting since the bitter labor dispute last fall, an old idea may get a new hearing: selling ad space on game jerseys. According to Sports Business Journal, the idea is expected to be debated at the meeting. NBA spokesman Michael Bass says the agenda is not yet set but that “sponsor logos on NBA uniforms is a subject of on going conversation.” Marketing experts say it’s only a matter of time. “When you look at the revenue streams left available, jersey branding is the most significant that hasn’t been exploited,” says David Abrutyn, head of global consulting at sports marketing firm IMG Worldwide. Frank Vuono, co-founder of 16W Marketing, agrees: “It’s inevitable.”

What’s not so certain is what a jersey deal is really worth. Front Row Marketing Services, whose parent company, Comcast-Spectacor, owned the Philadelphia-76ers until last fall, figures the annual cost to place company logos on uniforms would range from $1.2 million to $7.5 million per year, depending mainly on the market where the team plays. The calculations are complicated, says Front Row President Chris Lencheski. His analysts have scoured game footage to tabulate which parts of a jersey appear at various points during a game’s telecast. “There is a marked difference on the return depending on where a patch might be,” he says. “And is it a three-inch-by-three-inch patch? Or is it a three-inch-by-three-inch square and your logo can fit inside that area? It sounds silly, but this is what you do.”

A study by Horizon Media last year estimated the annual value of the television exposure of the space across an NBA jersey’s chest at from $4.1 million for the Los Angeles Lakers to $300,000 for the Minnesota Timberwolves. Abrutyn, whose IMG arranged the NBA’s deal with its official automotive partner Kia Motors, says those numbers are probably low. He figures that the Lakers, which Forbes estimates to be the most valuable NBA franchise, could fetch $10 million to $15 million per year. Abrutyn and Vuono point to European soccer, where marquee clubs such as Manchester United get more than $30 million a year for uniform deals.

Whatever the cost, there will be no shortage of bidders, says Lencheski. “I’ve got about six companies that would buy it right now,” he says. Abrutyn says companies that already hold naming rights to NBA venues, such as Staples in Los Angeles or TD Bank in Boston, are likely to be “the ones on speed dial once this gets approved.”

While dealmakers are understandably gung-ho, fans may not be thrilled to have advertisers invade one of the few commerce-free corners of the game. None of the four major U.S. sports sell space on game jerseys. And the NBA, unlike the other leagues, doesn’t even give space to its uniform maker, Adidas.

But the purists have long been in retreat. In 1979, Liverpool Football Club became England’s first professional soccer team to put a sponsor, Hitachi, on its uniform. At first the BBC refused to air the club’s games. Now, every team in the Barclays Premier League sells space on players’ chests. “Commercialization in sports has long been accepted in society,” says IMG’s Abrutyn.

The players are not likely to complain because they would be entitled to a share of the extra revenue. And fans may be happy to have someone else chipping in. “The initial outrage of people putting names on stadiums ended pretty quickly when people realized that otherwise they’re going to have to pay a lot more for their tickets,” says Vuono.

The league will still have to sort out ground rules to keep from upsetting its current sponsors and TV partners. Could a team with Southwest Airlines on its jersey play at American Airlines Arena in Miami? Does Kia’s status as the league’s official auto partner keep Chrysler Group from buying space on the Detroit Pistons uniform? Bass says the NBA, which already does jersey deals in its development league and in the WNBA, is evaluating “the impact on key stakeholders.” One big consideration, he says, is whether jersey sponsorships would increase revenue or merely divert it from existing deals.

The largest stumbling block could be the owners themselves. Last fall’s lockout was in part a battle between big- and small-media market teams over revenue sharing. And the league’s have-nots are likely to cry foul over any plan that promises to be much more lucrative for the top franchises than it is for the rest.

The bottom line NBA owners may debate selling sponsorships on team jerseys in April. Such deals could fetch up to $15 million annually for top teams.

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