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NBA outlines revenue target for jersey sponsorship programme

National Basketball Association commissioner Adam Silver has said the North American league projects that its decision to implement jersey sponsorship for the 2017-18 season will be worth around $100m (€89.2m) per year.

The NBA on Friday confirmed that it would permit the sale of jersey sponsorships as part of a three-year pilot program running from 2017-18 to 2019-20. The move, which had been widely anticipated in recent months, was approved by the Board of Governors of the North American league.

The sponsorship patch will appear on the front left of the game jerseys, opposite Nike’s logo. In June 2015, the US sportswear giant secured an eight-year deal, from the start of the 2017-18 campaign to the end of the 2024-25 season, to become the official on-court apparel provider of the NBA. Nike will become the first NBA apparel partner to have its logo on the on-court uniforms, a significant break from the organisation’s deals with Adidas and Reebok. Nike’s logo is likely to be replaced by that of its subsidiary, Brand Jordan, for the Charlotte Hornets as that franchise is owned by NBA legend Michael Jordan.

Patches will measure approximately 2.5 inches by 2.5 inches and be adjusted to fit the dimensions of each sponsor's logo. The NBA’s 30 teams will be responsible for selling their own jersey sponsorships.

Silver said the league has calculated that the initiative will be worth around $100m per year, adding that the NBA’s overall revenues are expected to be in the range of $7bn for the 2017-18 season. ESPN.com said revenue from jersey sponsorship will be counted as basketball-related income and, therefore, split with the players.

“It's my hope, independent of whatever additional revenues are generated through this patch program, that the greatest impact will be in this amplifying effect of companies choosing to associate directly with a team jersey, then going out and promoting that relationship to the largest market,” Silver said.

The sponsor patch will not appear on the retail versions of the player jerseys but teams will have the option to sell the jerseys with sponsor patches in their own retail outlets. The NBA is the first North American major league to embrace jersey sponsorship and Silver said the three-year programme has been designed to gauge reaction to the project. “There's a reason this is a pilot program,” Silver said. “We listen very closely to our fans.”

Regarding the broader objectives of the initiative, he added: “The media landscape is changing. People are watching less live television outside of sports. People are watching fewer commercials. This will become an important opportunity for companies for connecting directly with their consumers.”