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Leagues and Governing Bodies

Warriors target decisions on PSLs, patches

Sitting inside a private lounge at Oracle Arena 90 minutes before Game 1 of the NBA Finals, Golden State Warriors President and COO Rick Welts addressed two highly anticipated business decisions facing the franchise this summer.

One is whether the Warriors will go the NFL route and sell personal seat licenses inside the 18,000-seat Chase Center, set to open in San Francisco in 2019. The other major effort for the team is to sign a jersey patch deal in time for next season.

Selling PSLs is a rare move in the NBA, but given the crush of demand surrounding the Warriors and the burden of privately financing the $1 billion arena development, they could be a viable option.

Welts said the team is close to a decision on a potential PSL strategy.

“We have not yet decided,” Welts said. “We are sensitive to how fans perceive it. We will make it by the end of the summer.”

The team is also in discussions with potential partners for a jersey patch deal. Finals challenger the Cleveland Cavaliers recently sold a three-year jersey patch deal with Goodyear that is worth $10 million annually.

The Warriors are selling the patch with other teams in mind. “There is a sense of responsibility to help set the market,” Welts said. “Every deal that gets done affects the value of other teams.”

The Warriors are not using an agency to sell the patch.

“Our expectation is to get it done by next season,” Welts said. “We have some talks that are ongoing. We are in different stages of conversations with different partners.”

The Warriors are also looking to add founding partners for the Chase Center, which would build on deals made with United Airlines and Accenture.

“It’s an interesting time in the franchise’s life,” Welts said as the team prepares to spend another season in Oakland at Oracle Arena while working on moving to the Chase Center afterward. “We have parallel tracks. The big prize is two seasons down the road.”

Golden State is considering fan reaction as it weighs whether to sell PSLs at Chase Center.
Photo by: NBAE / GETTY IMAGES

CAVS FOOTBALL-READY: Like the Warriors, the Cleveland Cavaliers made their third consecutive trip to the Finals, but the franchise also has football in its sights. The organization is selling sponsorships for the NFL Hall of Fame Village in nearby Canton, adding to the team’s business reach.

“It’s a great opportunity for a great brand and a great natural extension,” said Brad Sims, executive vice president and chief revenue officer for the Cavs.

The team’s agreement with the NFL Hall of Fame Village and with developer IRG comes after the NFL Hall of Fame Village signed an 18-year naming-rights deal with Johnson Controls for the $700 million sports and entertainment project.

“They are bringing their expertise as we build the village,” said Pat Lindesmith, vice president of sponsorship and gold jacket relations for the Pro Football Hall of Fame. “We are working with them to bring in new partners.”

For the Cavs the project adds to its portfolio, which, in addition to the basketball team, includes the AFL Cleveland Gladiators, the D-League’s Canton Charge and the AHL’s Cleveland Monsters.

Initially, the Cavs are approaching their own sponsors about adding a deal with the Hall of Fame Village.

“There are a lot of opportunities throughout the village and there is a lot of inventory,” Sims said.

E-LEAGUE UPDATE: The NBA is putting some big resources behind developing its NBA 2K esports league, which will debut next year with 17 teams.

The league’s team marketing and business operations division will assign account managers to each esports team to help drive the nascent league’s business. In addition to the 30 NBA teams, TMBO works with the 12 WNBA teams and the D-League, which next season will have 25 teams.

“It’s a huge priority,” said Amy Brooks, executive vice president of team marketing and business operations for the NBA. “We intend to treat it as any of our leagues. We will have a set of account managers helping teams grow.”

The esports league is run by former TMBO senior vice president Brendan Donohue, who recently was named its managing director. Aaron Ryan, another former TMBO executive, was named senior vice president of business operations.

STRONG TICKET SALES: In other TMBO-related news, Brooks said the NBA is on pace to set a record for new full-season ticket sales, surpassing the 300,000 new full sales made during the 2015-16 season.

The five teams, in no specific order, driving new full-season ticket sales are the Houston Rockets, Milwaukee Bucks, Philadelphia 76ers, Utah Jazz and Detroit Pistons, a team that will move into the new Little Caesars Arena in downtown Detroit next season.

The NBA’s season-ticket renewal rate is tracking in the mid-80s, the eighth consecutive season that the league has posted a renewal rate of more than 80 percent.

SPONSORSHIP SUMMER: The NBA’s sponsorship business flourishes in June as league partners activate around the Finals and the NBA draft, set for June 22, but this summer will be particularly busy. The league will put the finishing touches on two major rollouts as Nike prepares to take over from Adidas as the league’s uniform supplier and the D-League is rebranded as the G-League, thanks to Gatorade beginning its title sponsorship of the NBA-owned minor league.

Kerry Tatlock, senior vice president of global partnerships for the NBA, said the league will see after the Finals how it will bring the G-League partnership to life. “There will be a true unveiling this summer. We are working with them and their sports science institute. While it is the Gatorade League, it is about working on innovation and science.”

Tatlock added that Nike soon will begin unveiling its uniforms for the league’s 30 teams.

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