In North America, spectator sports represent a nearly $64 billion market. Some of that revenue comes from ticket sales to fans who cannot get close enough to the action. But the right to broadcast those sports accounts for an ever increasing portion of the market’s revenue, and as those interests grow, some key priorities are changing too. In particular, the National Basketball Association (NBA) is breaking away from some of its traditional peers, and taking a page from soccer and racing leagues, to consider new sponsorship agreements that place company logos right on the players’ uniforms.

Thus far, the new agreement applies only to the uniforms for the 2016 and 2017 All-Star Games, for which the NBA players’ uniforms will feature a small, 3.25” ´ 1.6” patch with the name and logo of the automotive brand Kia. Individual teams do not have the league’s permission to alter their jerseys similarly, and as of now, there are no plans to add advertising patches to regular season uniforms.

But even in this limited form, the move is still a dramatic change, considering that the NBA—along with its peers, the National Football League, Major League Baseball, and the National Hockey League—has never used them in the past. The uniforms in all these leagues feature logos for the clothing manufacturer, and they often sport commemorative patches to honor important people and personalities who have recently died.

But advertising for other brands has not existed, for several reasons. The uniform manufacturers have resisted it in particular, worried that other ads on the jerseys would compete for consumers’ attention. Another of the primary reasons is the difficulty of finding a external sponsor that is acceptable to all the teams in the league. In addition, leagues have struggled to define a profit sharing plan that would be fair. That is, how much of the revenue created by such advertising would go to the league, to the team, or to the players themselves?

For the NBA, Kia’s All-Star jersey sponsorship actually was the result of negotiations between the league and Turner Sports, which is the network that owns the broadcast rights for games. When the two parties entered into their most recent contract, Turner asked for the right to negotiate with sponsors and sell advertising space on the players’ uniforms. In turn, it entered into the two-year marketing agreement with Kia.

Although the NBA and other major sports leagues have little experience with this form of marketing communication, others are far more familiar with it. Both drivers and their cars are festooned with sponsorship logos in most car racing leagues. European soccer players also often display logos on their jerseys. One professional, and entrepreneurial, marathon runner sells space on his race kits and bibs to advertisers when he enters big races like the New York Marathon.

Moreover, it isn’t as if sponsorships are anything new in sports, on virtually all levels. Another car company, Nissan, recently announced that it had entered into “the widest-reaching sponsorship in the history of collegiate sports.” This agreement gives Nissan the rights to place its name and logos in the stadiums of 100 different universities throughout the United States, as well as to use those school’s names in its own advertising.

Discussion Questions:

1. What influences are marketing communications on players’ uniforms likely to have on consumers?
2. What kinds of brands would create the best fit with advertising on the uniforms of players from different sports leagues? Why?

Source: Sarah Germano, “NBA to Put Kia Logo on Front of All-Star Jerseys,” The Wall Street Journal, October 28, 2015. See also E.J. Schultz, “Nissan Goes Big with College Sports in New Sponsorship Deal,” Advertising Age, November 6, 2015