Group Created with Sketch.
Volume 22 No. 35
  • Created with Sketch.
  • Created with Sketch.
  • Created with Sketch.

Mavericks end patch deal early as teams evaluate metrics for success

Last week the Dallas Mavericks announced that they were ending their agreement with patch sponsor 5miles with one season remaining on their three-year pact. A source familiar with the Mavericks’ thoughts indicated that their decision to part ways with 5Miles, a local marketplace app, was driven by the desire to “put a blue-chip name on their jersey. There were also concerns surrounding the cryptocurrency element of 5miles’ business.”

The Mavericks are the first NBA team to announce an end to their initial patch sponsorship. The upcoming NBA season will be the third and final year of the patch sponsorship program’s trial period and turnover is anticipated.

Dallas had a deal with 5miles, a local marketplace app, but a source said the team hopes to get a blue-chip company going forward.
Photo: getty images

The average value of NBA jersey patch deals is between $12 million and $20 million in media and digital assets, according to Michael Neuman, managing partner of Scout Sports and Entertainment. It is believed that figure will rise, perhaps by as much as 50% for teams on the low end of the scale, by the 2020-21 season.

Sources reiterated that data is likely to suggest that the most valuable patch deals will be for companies that are national or global, digital-first and business-to-consumer focused. Teams now have access to advanced analytics that enable them to better understand the sponsorship’s value proposition.

Jersey patch sponsorship can be an effective marketing vehicle for regional brands looking to relaunch or introduce themselves to a local market for the first time. However, the reach a patch partnership provides far exceeds a regional business’ sphere of influence and those companies don’t want to pay for exposure they can’t capitalize on. Neuman said 75% of all patch media value originates from social channels with global reach.

Other teams are likely to soon be in the market for new patch deals. Multiple sources said the Boston Celtics are looking to replace the General Electric logo on their jersey, perhaps as soon as this season. One source pointed out that GE’s initial purpose behind signing on was a planned corporate headquarters in Boston, so “it made good corporate sense to put their logo on the team’s uniform with the company returning home.” But with GE having since scrapped those plans, it appears as if the goodwill gesture is no longer necessary.

Ted Dalton, Celtics senior vice president of corporate partnerships and business development, said in a statement, “GE has been an excellent partner during our relationship, helping advance our data analytics and deepening our impact in the community with our mobile STEM labs. We couldn’t be happier with the overall impact, exposure and value of the jersey sponsorship, which has outperformed our expectations significantly. We look forward to another great season of this partnership.”

Corey Leff is a writer in New York.