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NBA sponsorship revenue to grow by 159% over the last 10 years

Justinas Baltrusaitis
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NBA sponsorship revenue to grow by 159% over the last 10 years

Over the last decade, the National Basketball Association has been focusing on new revenue streams to supplement returns from television viewing. Strategies adopted by the association are paying off thanks to the increasing sponsorship revenue.

Data gathered by Safe Betting Sites shows that the NBA sponsorship revenue is projected to grow by 159.33% between 2010 and 2020. The revenue will be highest during the current 2019/20 season at $1.39 billion while during the 2009/10 season the revenue stood at $536 million. From this period, the revenue has been rising steadily. The figure surpassed the one billion mark during the 2017/18 season when the sponsorship revenue was $1.12 billion and later grew by 15.89% to 1.29 billion in the 2018/19 season. From the data, the biggest growth was between the 2016/17 and 2017/18 season with a percentage increase of 30.08%. Over the past decade, the revenue amounted to $9.24 billion.

Our research also overviewed sports sponsorship spending in the United States from 2014 to 2024. By 2024, the spending will grow to $19.8 billion, an increase of 27.74% from the estimated 2020’s figure of $15.5 billion. By next year, the spending will stand at about $16.4 billion, which will later increase by  6.09% to $17.4 billion by 2022. In 2023, the spending is projected to stand at $18.5 billion.  Between 2014 and this year, the sponsorship has grown by 28.09%. From the data, the lowest spending was registered six years ago at $12.1 billion.

NBA’s new revenue streams paying off

It is important to note that NBA’s unprecedented move to suspend its season early this year due to the coronavirus had an immense cost as the league’s clubs collectively lost millions in game-day revenue for games canceled. This move might significantly impact the 2020 figures. However, the league is expected to resume later this month.

Over the past decade, the NBA revenue has been growing thanks to the introduction of new revenue streams like jersey patch agreements that have proved a success. When the sponsorship revenue surpassed the one billion mark, it was highly credited to these new streams like the partnership with YouTube TV. Under this deal, the association sold presenting sponsorship of the NBA finals for the first time, as well as signing league partners Rakuten and Heroic Sport. The YouTube deal was part of the NBA’s revamped new sales strategy around the playoffs and finals which paid dividends for the league and its broadcast partners.

In general, the NBA has also expanded its deals leading to unprecedented sponsorship growth with traditional players like the insurance industry alongside fast-food chains.

More audiences spur sports sponsorship spending growth

However, despite sponsorship revenue increasing, the NBA needs to smoothen its revenue-sharing system. In this case, all teams pool their eligible revenue together to redistribute it from teams with higher revenues to those with lower returns. Additionally, there is a continuing trend away from television viewing as other technologies like live-streaming are taking center stage.  Notably, the NBA might be losing revenue to illegal streaming services.

Overall sports sponsorship spending is projected to soar thanks to sports marketing by brands. The interest in sports marketing can be attributed to the ability of popular live broadcast events to reach huge audiences. At the same time, the emerging streaming service is fragmenting the viewing audience making it a challenge to find widely appealing programming.

To keep a grip on more sponsorship spending, sports entities need to deliver better returns for their partners while at the same creating digitally appealing packages that attract brands.

Justinas Baltrusaitis
Justinas Baltrusaitis

Justin is an editor, writer, and a downhill fan. He spent many years writing about banking, finances, sports, blockchain, and digital assets-related news. He strives to serve the untold stories for the readers.

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