On the heels of last week’s announcement that the Boston Celtics had reached a deal with General Electric to place their logo on the team’s jersey for an annual price of $7 million, the Hollywood Reporter reports that the NBA is looking to reach $150 million in revenue by way of jersey ad sales.
The $150 million benchmark would average out to $5 million per team, and falls in line with agreements already in place for the Sacramento Kings ($5 million annually with Blue Diamond) and the Philadelphia 76ers ($5 million annually with StubHub).
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Boston’s ability to garner more than the $5 million plateau should not come as a surprise due to their market and status as a championship franchise. Teams such as the Los Angeles Lakers, Golden State Warriors, and Chicago Bulls, touting similar geographical advantages and historical clout, figure to follow suit. But the question that remains is how much teams without market leverage or years of playoff glory will be able to negotiate for themselves.
Is there a suitor out there willing to fork over $5 million annually to attach their brand on the front end of the star-ridden and struggling Brooklyn Nets? That remains to be seen.
An initial inference would be that some teams will fall below the $5 million average (but no lower than $2 million), while the Cavaliers, Warriors, and other stalwarts will make up for the subpar returns.
An extra emphasis should be placed on Golden State given the popularity of their brand, the fact that they have two players slotted in the top three of jersey sales, and the deep pockets of Silicon Valley.
There is a world where the Warriors garner $10 million annually for a jersey sponsorship.
The NBA is going to get to $150 million before it’s all said and done, even if the path to that mark (in terms of specific dollar amounts per team) may be unclear for the time being.