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Volume 21 No. 34
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Apron ads proving a difficult sell for NBA teams in initial year

Terry Lefton
In any franchisor/franchisee relationship, be they quick-service restaurants, quick-lube centers or hotels, the franchisee always wants more inventory to sell. Such is the case in the continual push-pull between leagues and teams, as well. So, after the NBA’s attempt to add on-uniform advertising was tabled in a struggle between big- and small-market teams, the league gave teams permission earlier this year to sell ads in the proximity of player benches, a location previously reserved for the branding of team URLs and Twitter handles.

At a time when advertisers are insisting on more demonstrable ROI in their sports buys, you’d think any new camera-visible inventory would be a hot ticket. However, as of press time, only two teams had sold the “apron” ads: Indiana and Toronto.

The Pacers, one of two teams to sell the high-dollar inventory so far, sold their apron space to the Indiana Economic Development Corp.
We also note that JPMorgan Chase has the apron position at Madison Square Garden. However, considering what Chase paid for its “marquee” sponsorship across all things MSG, we’re told definitively that was not an incremental buy.

Make no mistake: This is one expensive apron. No club has priced it below $1 million per year. Many are packaging the on-court signage with broad club IP and media packages. We saw a proposal from one big-market team asking for more than $3 million annually.

Marketers familiar with the NBA said the newness of the apron signage combined with its premium price tag has made the initial year difficult.

“We hit the big three [Detroit automakers] pretty hard on this,” said Dennis Mannion, president and CEO of Palace Sports & Entertainment, which owns the Detroit Pistons. “With something new and with this kind of price, it needs a year to cycle through the budgets, and analysis of the big companies that would be the likely buyers.”

Officially, the apron signage is being called a one-year test by the league. There’s some question as to how easy it is to buy or sell any seven-figure piece of advertising inventory when its future is unclear. Its proximity to on-court branding from whatever company holds arena naming rights can also make an apron deal anywhere from tricky to impossible.

Other marketers noted the wide variety of camera-visible signage already available around NBA courts.

“The one-year term for this raises some eyebrows, and there is a bunch of other advertising opportunities nearby, including kick plates, chair backs, basket pads and rotational sideline signage, which can carry more complex ad messages,” said Randy Bernstein, president and CEO of Premier Partnerships, which has sold various NBA sponsorship inventory over the years. “It will take some time to find the proper supply/demand and price/value formulas.”

Other factors affecting perceived value: The signage is used only on locally televised games, and it must be monochromatic.

(Is there any other advertising inventory bought in one color anymore?)

“Certainly there’s value there,’’ said Tom McGovern, president of Optimum Sports, which administers State Farm’s ownership position of stanchion signage at most NBA arenas. “But any time you introduce new inventory, you have to be mindful of how it impacts existing signage, because you can be creating clutter.”

Cliff Kaplan, former NBA sponsorship senior vice president and now chairman of consultancy Equity Sports Partners in New York, said, “You only get a chance to introduce a platform like this once, and my sense is that the teams want to get it right. … These are large-scale sponsorship positions and investments and it takes some time in the marketplace to find the right partner who allows for the opportunity to be maximized for both the team and the sponsoring brand.”

In the meantime, the seven-figure price tag has been holding.

“I’m happy teams have decided not to do these on the cheap,” Mannion said. “It can be hard to stay away from that two or three hundred thousand dollar offer, when you are asking a million or more and it isn’t moving, but I still think it will be effective inventory for all of us.”

> COMINGS & GOINGS: Michael Pine has departed WWE less than seven months after he was named senior vice president of global sales and partnership marketing. The move continues the revolving door for the top sales spots at the wrestling circuit. Andrew Judelson, former WWE executive vice president of sales and partnership marketing, left in February after less than 14 months there. Ironically, Judelson took a spot that was very similar to Pine’s old spot at IMG. … Doug Smoyer, New York Giants vice president of business development, is leaving the team after six years to join the NFL league offices with the same title. Smoyer, who’s also worked in sales jobs with the Washington Redskins and Pittsburgh Penguins, will start at the league after Thanksgiving and report to Renie Anderson, senior vice president of sponsorship and partnership management. … Also at the NFL, Julie Perlish joins as vice president of consumer insights and research. She was with ESPN for the past six years, most recently as senior director of advertiser insights. She will report to NFL CMO Mark Waller. Perlish replaces former NFL research director Alicia Rankin, who left after six years with the league.

Terry Lefton can be reached at