In this photo illustration a Coinbase logo is displayed on a smartphone with an NBA logo in the background.
Thiago Prudencio | Sopa Images | Light rocket | Getty Images
Cryptocurrency firms helped fuel NBA sponsorship revenue to a record $ 1.6 billion in the 2021-22 season, according to estimates from IEG, a sports partnership consulting firm.
That’s 13% higher than the $ 1.4 billion in the 2020-21 season. In the 2018-19 season, the National Basketball Association raised $ 1.2 billion in sponsorships. Sponsorship agreements may include agreements for arena naming rights and for companies to place their names or logos on players’ shirts.
“Sending sponsorships from the cryptocurrency category has nothing to do before,” said Peter Laatz, IEG’s global CEO.
Crypto partnerships are now the second most profitable sponsorship category for the NBA, behind only the tech category. Among the NBA’s cryptocurrency deals this season was a league deal with the cryptocurrency trading platform Coinbase. CNBC reported the deal was worth $ 192 million over four years.
Other categories that are estimated to pay the NBA over $ 100 million annually include banking, telecommunications, and freight, according to IEG. Companies that spend at least $ 50 million include anheuser-busch, PepsiAnd AT&T.
Among the big four sports leagues, the NBA ranks third in sponsorship revenue. the The NFL is the No. 1 with nearly $ 2 billion in sponsorship deals for its 2021 season, according to IEG. And in March, CNBC reported MLB earned $ 1.7 billion in sponsorships last season. The NHL has made sure $ 676 million in sponsorship cash for the 2020-21 season.
IEG screenings come when the NBA Finals kick off Thursday, when the Golden State Warriors host the Boston Celtics in Game 1 at the Chase Center.
On the team front, the Los Angeles Lakers have agreed on a 20-year contract for the arena naming rights 700 million dollars with Crypto.com platform. And the Warriors have signed a $ 10 Million Global Rights Agreement with FTX, a crypto derivatives exchange. The company also secured the arena naming rights for the Miami Heat.
Jayson Tatum b. 0 of the Boston Celtics goes to the basket during their game against the Golden State Warriors on March 16, 2022 at Chase Center in San Francisco, California.
Jed Jacobsohn | National Basketball Association | Getty Images
Another category that helps the NBA’s profits: announcements on player jerseys.
The NBA is expected to gross more than $ 200 million this season from jersey patch deals. They include the protection of the Brooklyn Nets $ 30 million per season from the Webull brokerage trading platform in September 2021. The deal was leading the NBA at the time, but the Warriors topped the top spot earlier this month when they renewed the deal with the Japanese e-commerce firm Rakuten.
The terms of this agreement have not been publicly disclosed. But league sources told CNBC that Rakuten will pay the Warriors north $ 40 million a year. This is up from $ 20 million for the previous deal.
People spoke to CNBC on the condition that they remain anonymous because they couldn’t publicly discuss the team deals.
Sponsorship of the jersey has expanded into pro leagues over the past year. The NHL, for example, added patches to uniforms and helmets during the pandemic. And the MLB approved team uniform patches in his new employment contract with players in March this year. The NFL does not allow patches on uniforms.
The growing revenue from uniforms announcements and other sponsorship deals could help the NBA catch up $ 10 billion is expected in total revenue this season. NBA commissioner Adam Silver said total revenue in the 2020-21 season was down about 35% from the previous year after the pandemic reduced the season to just 72 games. Revenue in the 2019-20 season, also partially affected by the pandemic, was $ 8.3 billion, down from $ 8.8 billion in 2018-19.
The league’s sponsorship revenue is expected to continue to grow.
The data rights agreement of the Swiss-based league sports radar – reportedly worth $ 1 billion – starts in season 2023-24. The NBA’s televised deal also expires after the 2024-25 season, and sports executives expect it to eclipse its current $ 24 billion worth, or about $ 2 billion per season. The NBA also has a merchandising deal with e-commerce powerhouse Fanatics and a deal with Dapper Labs, the creator of NBA Top Shot NFTs.
In league agreements, the companies also agree to purchase advertising for the NBA’s national games.
For 2021-22 regular season games, national advertising spend for NBA games reached $ 470.7 million, according to media monitoring company iSpot.