Crypto Deals Drove NBA Sponsorship Revenue to Record High

UTC by Kofi Ansah · 3 min read
Crypto Deals Drove NBA Sponsorship Revenue to Record High
Photo: Unsplash

The said figure represents a 13% increase from the $1.4 billion the league recorded in the 2020-21 season.

Crypto deals with several cryptocurrency companies helped push the NBA’s sponsorship revenue to a record $1.6 billion in the 2021-22 season, according to data released by IEG, a sports partnerships consultancy.

The said figure represents a 13% increase from the $1.4 billion the league recorded in the 2020-21 season. The National Basketball Association earned $1.2 billion in sponsorship money during the 2018-19 season with sponsorship deals ranging from arena naming rights and for firms to place their names or emblems on players’ jerseys,  examples of sponsorship agreements.

The NBA’s sponsorship revenue is now up 90% from five years ago. The NBA racked in an additional $180 million in revenue from a slew of new arena naming rights and jersey patch deals, with crypto deals accounting for roughly 70% of the new money.

“The NBA has always been a test-and-learn thinkers,” Peter Laatz, IEG’s global managing director, stated in a phone interview. “They have a younger audience than the NFL, a more diverse audience, and a more global audience.” If you look at the crypto spending in the NBA, it makes perfect sense.”

The NBA ranks third in sponsorship revenue among the top four sports leagues, according to IEG, coming behind the NFL, which came first with approximately $2 billion in sponsorship arrangements for the 2021 season. The MLB came in second with $1.7 billion in endorsements last season, while the NHL has acquired $676 million in sponsorship money for the 2020-21 season.

Cryptocurrency firms spent over $130 million on NBA sponsorships last season, compared to less than $2 million in the 2020–21 season. Crypto deals are now the second most lucrative partnership in the NBA, climbing from 43rd place to second place in terms of NBA sponsorship spending, trailing only technology.

A league agreement with crypto trading site Coinbase was one of the NBA’s largest crypto deals this season, which was a $192 million deal over four years. According to IEG, other categories that paid the NBA over $100 million annually included banking,  telecommunications, and commerce. Anheuser-Busch, Pepsi, and AT&T are among the companies that have spent at least $50 million.

According to IEG, 92% of the spending was accounted for by five businesses (Crypto.com, Webull, Coinbase, FTX, and Socios). They included naming rights deals, including the Staples Center rebranding to Crypto.com Arena ($700 million, 20 years), and FTX Arena ($135 million, 19 years), which replaced American Airlines Arena.

The last time the NBA saw a sponsorship boost this substantial was during the 2017-18 season, when the jersey logo patch was introduced, resulting in a 30 percent increase in inventory.

While cryptocurrency has accelerated sponsorship development, traditional sponsorship categories have remained consistent in their investment in the league so far.  Technology businesses spent at least $170 million, while banks, telecommunications, and footwear/apparel industries also spent $100 million or more. Over $70 million was pledged by the beer, insurance, gaming, automotive, and retail industries.

Business News, Cryptocurrency news, News
Kofi Ansah
Author Kofi Ansah

Crypto fanatic, writer and researcher. Thinks that Blockchain is second to a digital camera on the list of greatest inventions.

WhaleMaker
Related Articles
WhaleMaker