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The Cavaliers will receive more than $10 million annually through a new partnership in which Goodyear Tire and Rubber Company will place its Wingfoot logo on new, Nike-designed team jerseys for the next three seasons. The arrangement between the Cavs, Goodyear, and Turner Sports may be among the most lucrative in the NBA, according to sources with knowledge of the deal that was announced in a joint press conference Monday at Quicken Loans Arena.
The Cleveland Cavaliers reached a deal with Goodyear and will wear a patch with the tire maker’s wingfoot logo on their jerseys starting in 2017-18, it was announced today. The deal is worth $10 million per season, a person with knowledge of the situation told USA TODAY Sports’ Jeff Zillgitt.
Patch deals with other NBA teams have ranged from just under $5 million per season to $8 million per season. The $10 million per year deal is the highest in the NBA, in part because the Cavs are one of the league’s best teams and are on national TV more than most teams.
As part of the agreement, Turner, which includes TNT, the cable network that will carry the Cavaliers’ playoff games in the Eastern Conference finals, will air free commercials featuring the Cavs and Goodyear and promote the partnership on various traditional and digital mediums.
Jeff Zillgitt: Here’s how that Goodyear logo might look on the Cavs’ jerseys next season: pic.twitter.com/AnskxaUvWb
Albert Nahmad: Jersey deals ($/yr est): CLE: Goodyear (TBD) BRK: Infor ($8M) BOS: GE ($7M+) SAC: Blue Diamond ($5M) PHI: StubHub ($5M) UTA: Qualtrics ($4M) The 24 teams that haven’t yet announced a jersey sponsorship deal yet now have a decent swath of deals from which to triangulate value.
The Cavaliers will carry another big piece of Akron with them starting next season when the Goodyear Tire and Rubber Company’s Wingfoot logo appears on game jerseys.
The Cavs and Goodyear will formally announce the partnership Monday as part of the NBA’s three-year pilot program to sell ads on uniforms, starting next season. The pairing makes sense, as Cleveland’s star player, LeBron James, is Akron’s favorite son, and Goodyear is the city’s cornerstone company. It was founded there in 1898.
While Nike is set to take over the NBA apparel deal for the 2017-18 season, not all of the jerseys coming to the league next year will solely feature the Swoosh. The Charlotte Hornets confirmed this week that players on the team will wear Jordan Brand uniforms once Nike inherits the contract. In a press release posted on Monday, the team confirmed that it would be the only one in the league wearing Jordan jerseys. Michael Jordan is an owner of the Hornets and his Jordan Brand is owned by Nike, hence the connection here.
The new uniforms will be available first at the re-opening of the Hornets Fan Shop in Charlotte, North Carolina. Per the Hornets, the Fan Shop will play host to more Jordan Brand merch than it has in years past upon its fall reopening.
Goodyear Tire & Rubber Co. will place its logo on the uniform of the Cleveland Cavaliers, whose superstar player shares a hometown with the tiremaker, according to people familiar with the deal.
The agreement — part of a first-time effort by NBA teams to sell corporate sponsorship of jersey patches — was described by people who asked not to be identified because the partnership hasn’t been publicly disclosed. While no financial terms were given for the Cleveland pact, people familiar with four previously announced deals had pegged their value at about $5 million to $10 million a year.
Instead of the Qualtrics logo on the jersey, a 5 For The Fight logo will be on the jerseys for at least the first season of the three-year deal between the two sides. 5 For The Fight is a charitable organization trying to eliminate cancer with $5 donations at a time with the goal of raising at least $50 million
While other NBA teams — the Boston Celtics (General Electric), Brooklyn Nets (Infor), Philadelphia 76ers (StubHub) and Sacramento Kings (Blue Diamond Almonds) — have reached patch deals, the Jazz are the first to forsake a corporate logo for a charitable one. “This is the right thing to do,” Qualtrics CEO Ryan Smith said. “As much as I would love to put Qualtrics on it, this idea of raising $50 million for cancer research was something we couldn’t stop thinking about it. The Jazz were open to our ideas and how we wanted to use the patch.”
Qualtrics has been interested in a relationship with the NBA and had a brief discussion with the Jazz on arena naming rights. There is a business component to the relationships. Qualtrics is investing money in the Jazz and will provide the franchise with valuable information on the fan experience.
Jeff Zillgitt: Qualtrics will sponsor Jazz jersey, but patch will be logo for Five For The Fight, a charity for cancer research: 5forthefight.org pic.twitter.com/BC3LJVASxF
Jeff Zillgitt: Here’s a better look at Jazz jersey patch for cancer research: pic.twitter.com/frx5gqn2qA
Scott Soshnick: BREAKING: @cavs have jersey patch deal w/ @goodyear, sources say. Company based in Akron. @KingJames, of course, from Akron #sportsbiz #nba
The Brooklyn Nets have sold a jersey patch sponsorship to Infor, a closely held software company backed by Koch Industries Inc. The company will pay $8 million annually for the deal under the league’s three-year pilot program, according to a person familiar with the terms who asked for anonymity because the information is not public. As part of the tie-up, Infor will also provide data analytics and technology to support the team’s business operations, fan experience initiatives and player performance.
“Our alliance with Infor is a transformative partnership for both business and basketball operations and is indicative of the cutting edge and gritty culture we are building,” said Brett Yormark, CEO of Brooklyn Sports & Entertainment. “The patch on the jersey represents our deep engagement with Infor and the software company’s role in taking our performance to the highest level in basketball operations and the business side. We are looking forward to joining some of the world’s most innovative brands, like Ferrari, for the unique opportunity of instilling Infor’s proven business applications into our company.”
The 76ers signed a three-year, $15 million contract for jersey ads. The Kings will get the same amount, according to John Lombardo and Terry Lefton of Sports Business Journal.
We know it’s not a lack of interest. Plenty of companies are salivating to get their logos on the jerseys of NBA players. So what is going on? The answer is complex. The biggest factor is market value. Teams’ top marketing executives are under pressure to create value for something that doesn’t have an established market — at least not in the U.S. Their nightmare scenario would include rushing to make a deal before other teams sign more lucrative ones. In other words, no team wants to be sold short. So what happens? Teams are waiting and hoping the early deals develop a lucrative market. They’re tentative even though it’s understood the revenues will vary wildly.
At least one team, we’re told, has spoken to player representatives and is seeking to offer the top players in a package that includes their endorsement with the patch deal. Another wants to make sure the patch isn’t just a way to avoid advertising on local TV and is asking the uniform ad company to also buy ads on other media.
What’s your opinion about the advertising patches that are going to be added to the uniforms next year? Paul Allen: “I’m a member of the committee that reviewed those things for the league. I think that additional revenue makes the league healthier. So the challenge for us, depending on the size of the market, is to sell those patches to somebody that’s going to also well represent the team and those sorts of things. So I think you’ll see that evolve over the next few years. You already see it in other sports, whether it’s soccer or basketball in other places. So I think we’ll all get very used to it quickly.” You don’t think it’ll be weird to see an ad on a Blazers jersey? Paul Allen: “Well it’s definitely going to be a change. But, again, I think additional revenues help teams and so we’ll all get used to it in the end.”
Yormark, the CEO of Brooklyn Sports and Entertainment, the Nets parent company, didn’t identify the brands nor give a timeline for when a deal could be done. According to Sports Business Journal, the Nets are seeking “high seven figures” from advertisers. The patch, which the NBA describes as Post-It note sized, won’t be worn until the 2017-18 season. There has been only one deal since April. between StubHub and the 76ers. And SBJ notes, the market for the patches is much smaller than the league and teams had projected.
The Emirates Group is in preliminary talks to sponsor jersey patches for a number of National Basketball Association teams, according to two people with knowledge of the discussions. Allowing advertising on uniforms is a new initiative for the NBA. People familiar with the league and team operations say the sponsorships are expected to generate $150 million in total revenue a year. The three-year pilot program starts in the 2017-18 season.
A deal with the NBA would allow Emirates to put its name on a 2.5-inch square patch on the left shoulder of the jerseys. It’s not clear how many of the league’s 30 teams the company is looking to sponsor. The Dubai-based aviation company flies to the following NBA cities: Boston, Dallas, Chicago, Houston, Los Angeles, New York, Orlando, San Francisco, Washington D.C. and Toronto. The NBA declined to comment. Emirates didn’t immediately respond to a request for comment.
The Emirates bundle won’t include LeBron James’s Cleveland Cavaliers, according to people familiar with the discussions. The people asked to remain anonymous because the talks are not public.
Calvin Watkins: Rockets voted against this because teams have to share the money gained with each other. – RT: NBA on ESPN: Warriors asking $15-20 million a year for rights to advertise on jersey, most of any team. (via @darrenrovell)
It is believed that the Warriors, who won the title in 2015 but lost in the Finals to the Cleveland Cavaliers in seven games this year, are asking for more money than any other team. The NBA recently approved a three-year pilot program to allow teams to sell 2½-inch by 2½-inch patches on the upper left of the jersey opposite what will be a swoosh from Nike, which will begin its deal as the official apparel maker after the 2016-17 season.
Only one team has consummated a deal since the league allowed teams to start doing business in mid-May. The Philadelphia 76ers’ three-year deal with StubHub is worth $5 million a year, according to sources.
Indiana Pacers executives are discussing a new revenue opportunity that would have been seen as taboo just two decades ago: a corporate logo stitched onto the team’s uniforms. Rick Fuson, the Pacers’ chief operations officer, said the franchise is supportive of having an advertisement on the team’s white, blue and gold jerseys. In fact, Fuson said the Pacers are planning to have a corporate sponsorship deal in place for the start of the 2017-18 season, which is when NBA teams can debut sponsored patches on uniforms. “We are hopeful and look forward in talking to a number of folks who may have interest in that,” he said. “I’m confident that many teams, if not most, will have a great sponsor on the uniform.”
The NBA announced last month that it would be the first league among the four major sports to allow advertising on regular season uniforms as part of a three-year trial approved by owners. Teams will be allowed to sell advertising in the form of a patch, approximately 2 ½ inches x 2 ½ inches, beginning in the 2017-18 season, coinciding with Nike’s new deal with the league. “First off, hats off to Adam Silver,” Sixers CEO Scott O’Neil told USA TODAY Sports. “He’s a commissioner who will take opportunities and will make the right decision and sometimes the tough decision and he continues to lead through policy. He gives teams the opportunity to drive our business.”
The three-year deal is worth $5 million per season, according to a person with knowledge of the deal. The person spoke to USA TODAY Sports on the condition of anonymity because they are not authorized to speak publicly on the matter.
Scott Soshnick: BREAKING: @Sixers first @NBA team to sign jersey sponsor deal – get $5 million/year from @StubHub #sportsbiz #NBA
Q: What do you think about the NBA approving advertisements on jerseys for 2017-18? Mark Cuban: “I’m fine with them. Look, we put memorials on jerseys all the time that are just gonna be a little bit smaller than an ad would be and nobody says ‘oh that’s terrible, that distracts from the jersey’ when you’ve got someone who died or did something special. I don’t think it’s gonna change all that much.”
Sports Business Journal reports Monday that it’s unclear how much revenue the NBA will bring in from jersey ads — which it describes as “smaller than a standard Post-it note” — but Brett Yormark believes the Nets could rake in between $4 million and $6 million a year from what he calls “naming rights for your team.”
Teams will keep 50 percent of the revenue generated by their individual patch sales, with the remaining 50 percent being shared equally among the league’s 30 teams. The Knicks could get as much as $10 million, SBJ predicts.
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“I think sometimes teams make false assumptions of their team based on things like that. I think that our team is not that much different than a lot of our competition in the East. I think we had a good year in spite of some injuries, you know, with [Al] Horford going down early and Isaiah [Thomas] missing a short time and Avery [Bradley] missing 22 games there in a stretch. We had to overcome some injuries, and it was good because our depth got a chance to play. Everybody on our roster got a chance to prove their worth. “But I feel like it doesn’t really matter what we’ve accomplished. If we’d lost Game 7 against the Wizards, I don’t feel any different than if we’re where we are today. I know that we’re good. I know that we’re not great. I know that we still have more to do, and, you know, that next step is by far the hardest.”
“Just because you’re one piece away doesn’t mean you can get it. And if you force yourself to get it, and if you force a deal or force yourself to get the second best available or the third or fourth best available player at that position that you need, then it might not make you that much better or make you still not good enough, and you’re stuck. So, yeah, we’re not that far away, but we’re still a ways away. We still know we need to get better. Everybody in our organization knows we need to get better. We need to add.”
That competitive spirit is what led ESPN to outbidding Fox and others for top NBA rights. It’s what led ESPN to rebuilding its NBA coverage from the top down, bringing in Wildes and others to help bring life to the discourse. “Basketball is a cool sport,” Elhassan says, echoing Wildes. And in that sense, it’s at the front of the innovation curve as well. One question asked to every person interviewed for this story was whether these tone changes only made sense for the NBA’s younger, more diverse audience.
Expect more Sidecasts in the future, though probably not for the Finals because of differences between ABC and ESPN rights deals. The ESPN3 platform also features streaming pregame warmup video, as alternative viewing options are further explored. Second-screen viewership was an important factor in the decision to bring on Wojnarowski, too. The NBA’s foremost news-breaker was allowed to create The Vertical on Yahoo Sports in early 2016, with an emphasis on news, video analysis and podcasts. But the best asset for ESPN may end up being The Vertical’s live Web shows for the NBA draft and free agency that drew millions of viewers desperate for the best information fastest.