Chime has his logo on the Dallas Mavericks jerseys. The name of LendingTree is carried by the Charlotte Hornets. And the Miami Heat sold their arena naming rights to crypto firm FTX.us.
Sponsorships from the National Basketball Association have long been dominated by banks, telecommunications companies, and other traditional advertisers. But fintech and crypto companies are increasingly making themselves known through professional basketball, according to a new report from data provider SponsorUnited.
This change is in part due to a slight decline in marketing spending by banks, some of which tightened their belts when the coronavirus pandemic hit and disrupted sporting events in person, according to Bob Lynch, founder and president of SponsorUnited. NBA teams had to “survive and develop new partnerships,” and they found willing partners in fintech and crypto companies looking to fill the void, he said.
The new crop of marketing deals shows no signs of stopping.
“Most of these brands that come into this space, they’re not doing just one transaction,” Lynch said. “A lot of times these teams look at this and say, ‘OK, they’ve planted their flag. They started working in the NBA. Let’s make sure to talk to them because there might be some opportunities with us as well.
A sign of change: NBA teams using the SponsorUnited platform to seek partnerships have sought out financial technology and crypto companies more than any other industry. Crypto.com and Coinbase were among the brands that NBA teams searched for the most.
Overall, the financial services industry has been the biggest consumer of NBA marketing this season, generating around $ 121.4 million in revenue, according to the report. Next are tech companies, healthcare providers, telecommunications companies, and automakers.
In the finance category, banks and credit unions are still the top spenders, accounting for 60% of the total. JPMorgan Chase, Capital One Financial, Wells Fargo, TD Bank, Barclays and Golden 1 Credit Union in Sacramento, Calif. Each own the naming rights in an NBA arena. The average NBA sponsorship deal involving a bank was $ 2.9 million, according to the report.
Still, the number of banks and credit unions with an NBA partnership has fallen to 64 this season from 78 the year before.
FinTechs accounted for 9% of all transactions this season, up from 5% the year before. Crypto companies accounted for less than 1% of marketing dollars spent, but that could rise to 10% next season, as this year’s totals do not include the bulk of revenue from two partnerships that have gone official there. Just a few weeks ago, Lynch said.
Those two partnerships are: the naming rights for the Miami Heat arena from FTX.us and the StormX patch on the Portland Trail Blazers jerseys.
In two other recent crypto deals, Socios.com, which provides blockchain services to the sports and entertainment industry, has signed partnerships with the Philadelphia 76ers and the Boston Celtics.
Chime’s deal with the Mavericks was announced in January 2020. At the time, Chime CEO Chris Britt said in an interview with CNBC that the neobank had been successful in advertising on sports programs. “And so it’s only natural for us to think about entering the NBA and the Mavericks in particular,” he added.
As with any emerging industry, fintech and crypto companies are looking to demonstrate that they are “here to stay” and make their brand synonymous with their respective industries, said Adam Grossman, CEO and Founder of Block Six Analytics, which works with sports teams, brands. and advertising agencies.
“They are certainly looking to say, ‘How can we increase brand awareness, how can we increase our market share, how can we become what people think of when they think of fintech and crypto “said Grossman, who is also a lecturer in Northwestern University’s athletic administration program.
Sponsorship programs, especially expensive ones like naming rights and shirt badges, are a good way to do this, Grossman said. The NBA fan base is younger, he noted, making NBA sponsorships an attractive investment for some companies.
“With fintech and crypto moving so quickly, now is a good time to really try to make sure you can grab as much market share as possible,” Grossman said.