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NBPA’s hire of first CMO raises group licensing question

The NBA hasn’t controlled the marketing of its players since basketballs had laces, but it certainly seems that way. Long before the NBA’s popularity exploded with the ascension of players like Larry Bird and Magic Johnson in the 1980s through to today’s NBA royalty like LeBron James and Kevin Durant, the National Basketball Players Association sold group licensing rights for players and they have been administered by the NBA, which also controls the most valuable intellectual property — the NBA and its teams.

Combined, it’s been quite a cartel, so effectively serving the market that the union saw no need to do anything but serve as a conduit.

The league, not the union, holds group marketing rights for NBA players.
Photo by: NBAE / GETTY IMAGES
After all these years of taking a check and letting the NBA function as its licensing department, the NBPA under new leadership in Executive Director Michele Roberts recently hired its first chief marketing officer, former NBA marketer Jordan Schlachter. Two leading questions emerged:

What did the union have to market, since under the most recent collective-bargaining agreement, which ends in 2021, the league still has group licensing rights?

And, more intriguing and a question directed to us by a half-dozen licensing types within a day of Schlachter being named the NBPA’s CMO in mid-January: When will the PA take back its group licensing rights? An immutable law of licensing — seemingly violated by the union for years — is that the better job an outside agency does with a program, the closer those IP rights are to being taken in-house by their owner.

In his first interview since taking his new gig two weeks earlier, Schlachter said, “Taking our rights back is not at the top of our agenda. It just hasn’t been part of the conversation. We’re just looking forward to being as collaborative and understanding their strategy for the next uniform deal and next video game deal. We want to take advantage of the fact that this is a partnership. … We’re taking advantage of that for the first time.”

SCHLACHTER
Schlachter said his charter is “to make sure we understand all the opportunities available for our athletes, both individually and as a group.”

So what opportunities might the NBA’s team of consumer product licensers have overlooked? It’s only been a few weeks, but Schlachter sees opportunities in the content world and other possible digital extensions. With aficionados decrying the lack of basketball fundamentals displayed by Americans, especially relative to their European counterparts, he’s wondering if the union could play a role there.

Even under the current CBA, there are things the players association can do on its own but never has. One of those things is staging an offseason basketball competition. Interesting. We also note that while the CBA (and thus the assignment of group licensing rights to the NBA) lasts until 2021, there is an opt-out clause requiring notification not so far in the future, in December 2016. That’s nearly as attention-grabbing as a property previously with few marketing assets hiring a CMO.

There’s the basics of marketing to build for the PA. Toward those ends, there’s a contest to design a new logo, a need to be a licensing and marketing resource to its members, and a desire to build its own IP.

“It’s not a $100 million T-shirt business now, that’s not what we are trying to do,” said Schlachter, whose sports-marketing chops include stints as vice president of marketing for the New York Knicks and managing director and head of new business development and athlete marketing for the U.S. Olympic Committee. “We’re just trying to make ourselves a professional organization that represents some of the best athletes on the planet. … We have a very well-known organization that doesn’t really have a brand. We want to make sure NBA Players is a brand, too.”
So you don’t believe that the NBPA is on a path to getting the same licensing autonomy that its fellow pro sports unions enjoy?

Then you probably didn’t know that basketballs once had laces.

Terry Lefton can be reached at tlefton@sportsbusinessjournal.com.

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