NBA Commissioner David Stern is featured on the cover of
BRANDWEEK in a piece by Terry Lefton. Stern, in his "over 12
years as commissioner, turned an unprofitable business with a
reputation for drug abuse into the league with the least labor
strife, the most global exposure and some of the highest-
visibility athletes." But the "challenge for Stern and his peers
in other top sports properties is wringing out additional
revenues at a time when the major sports may be past their prime
in terms of incremental revenue growth." IMG CEO Mark McCormack:
"I'm not going to say the NBA has peaked, but it certainly isn't
Microsoft anymore" (BRANDWEEK, 10/28).
BUNDLE OF GOODIES: Under Stern, the NBA has been the "most
active league" in defending digital property rights, including
pending litigation against Stats, Inc. over providing real-time
scores. Stern: "I just want to be standing with this big bundle
of carefully protected rights and be ready to go." Besides for
TV rights fees, there are those "wondering how much higher
sponsorship fees can go," and although Stern "vows to continue
the NBA's less-is-more philosophy," some sports marketers feel
fees "may have peaked." Some even speculate that large sponsors
will start owning clubs, venues or leagues. Stern: "I'd be naive
if I thought that someone like Coke or McDonald's hadn't at least
thought about this." Tony Ponturo, VP/Anheuser-Busch: "There is
a tendency to take the old money for granted in this business
while chasing new sponsors. But the old money can go elsewhere.
Once sports crossed into entertainment, you brought in a lot more
categories and it's created a cluttered environment" (BRANDWEEK,
10/28).
CLEAR OF CLUTTER? But Lefton notes that the NBA remains the
"most uncluttered of the top four leagues." Nike is close to a
uniform deal, but Stern kept the swoosh off game unis as it will
appear only on warmups. The league's licensing approval process
is the most "stringent in sports," and one licensing exec said,
"Some people say that NBA stands for Nothing But Attorneys. But
they've done the best job in sports of protecting their brand."
Another initiative facing Stern is extending property rights to
retail, restaurants and theme parks. The NBA "is negotiating"
for a retail location in Manhattan, which "will serve more as a
brand statement than a profit center." Stern: "If there's a
theory behind all of this, it's increasing our distribution.
We've had interest, but I don't see us doing an NBA Land.
Rather, we'll partner with someone like Disney to build branded
attraction in an existing facility." Stern concludes "every new
extension we put out there has our brand name on it. So we'll
have to put even more marketing oomph behind the brand, because
when you open up new businesses every one relates back to the
core brand" (BRANDWEEK, 10/28).
