A second National Basketball Association team has now sold advertising space on its jerseys, making it more likely that the NBA’s pilot program for the new revenue stream could turn into something more permanent.
Sacramento Kings Jersey Ad Deal Reached
The Sacramento Kings have reached a deal with nationally-recognized agricultural distributor Blue Diamond Growers, giving Blue Diamond not only a jersey patch but ads on the court aprons of the new home of the Kings.
The deal, as mandated by the league, is for three years. Fans will begin to see the jersey patches in the 2017-18 season, although the court aprons will bear the Blue Diamond logo in the upcoming 2016-17 season. The Kings are also currently offering Blue Diamond Almond Breeze beverages and new menu items featuring Blue Diamond almonds at concession stands in the Golden 1 Center.
While the Kings have not officially released the value of the deal, other sources place the annual worth at around $5 million. That figure is in keeping with what the Philadelphia 76ers got for their jersey real estate from Stubhub five months ago.
The NBA’s current legislation caps these deals at three years in length and dictates the size and placement of the jersey ads, but expectedly doesn’t cap the value of the contracts for its member franchises.
Philadelphia and Sacramento rank 28th and 18th in Forbes’ latest NBA team valuations, with values estimated at $700 million and $925 million respectively. If the 76ers and Kings can sell that space for three years at $5 million a year, then the top-ranked New York Knicks and runner-up Los Angeles Lakers should be able to ask for three to four times that annual price for a similar deal.
It could be argued that two out of 30 NBA franchises having secured deals may not be enough to keep the jersey ad pilot program going, but it’s unlikely that the league will legislate away an opportunity for even a small amount of its franchises to bring in additional revenue. Additionally, we aren’t aware of how many other teams may be in negotiations for sponsorships right now.
Like most other things in the world of professional sports, if it makes cents, it makes sense.
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