Audio giant Harman today is announcing a four-year NBA league sponsorship deal at its flagship store in Midtown Manhattan. Under the deal, Harman becomes the official headphone, speaker, and audio partner of the NBA. The deal includes rights for the NBA, WNBA, D-League and USA Basketball, which will provide Harman with some Olympic equity going into the '16 Rio Games. Talks began late last year and the deal was completed in late July. Harman CMO Ralph Santana said the company will advertise with NBA media partners. Harman is also looking at team sponsorships and player deals, to support its new NBA rights. There’s also a licensing component to the deal, under which Harman will market team-colored and player identified headphones and other portable products, including its popular Flip and Shock portable speakers. Those licensed products are not expected at retail until '15. What’s easily Harman’s biggest sponsorship deal is an attempt to combine consumer affinities for music and sports and achieve a powerful marketing mix. Recently, consumers have been migrating from more traditional audio specialist nameplates to brands with more "cool" cachet like Beats and Apple, especially for portable products. “Audio and music are endemic to sports, so it’s the right place for us to be," said Santana, the former Pepsi and Samsung marketer, who has been Harman CMO for the past 18 months. On the entertainment side, Harman has marketing agreements with acts including Maroon 5, Quincy Jones and Linkin Park. “Athletes use music to train and it brings the game to life on site. The NBA is at the center of music, fashion and sports and will give our brand more visibility and awareness. We also think there’s a lot to be done in terms of leveraging the NBA with our business partners."
DEEP SOUNDS: Harman acquired sports headphone brand Yurbuds in June, so NBA rights should help there, both in marketing and product development. However, the deal should go well beyond headphones, with extensions in car audio, where Harman’s Infinity brand is featured in the cars sold by fellow NBA corporate sponsor KIA. Around half of NBA arenas use professional audio systems from Harman and JBL. Leveraging of the sponsorship will begin at the NBA Global Games in Rio next month, where Harman will entertain customers, host musical performances and a viewing party. At the NBA All-Star game next year, Harman will sponsor musical performances during the All-Star Saturday Night. Marketing wars in the $2.3B personal headphone headphone category have been heating up recently as price points escalated well into the hundreds of dollars, with margins and marketing support rising in accordance. Bose headphones are now on NFL sidelines via a recent league sponsorship deal team sources was worth over $30M a year. Meanwhile, Beats’ portfolio of celebrity endorsers includes Cavaliers F LeBron James and Nets F Kevin Garnett, as well as Lady Gaga and Justin Bieber.
