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Non-exclusivity the key to shoe and betting category NBA deals

A close up of the New Balance sneakers worn by Kawhi Leonard #2 of the LA Clippers during their game against the Golden State Warriors at Chase Center on March 10, 2020 in San Francisco, California. (Photo by Ezra Shaw/Getty Images)

The NBA’s strategy of non-exclusivity in the footwear and betting partner categories yielded both revenue and marketing value for the league before the NBA shutdown this month.

In February, the NBA added New Balance to a footwear roster that already includes Puma and Under Armour. The three non-exclusive shoe category deals are valued by industry experts between the high seven-figure and low eight-figure dollars per year.

The NBA provides for non-exclusivity in this category because it allows brands to showcase their shoe endorsers in their playing uniforms on a global scale, thereby promoting NBA players and driving fan engagement with the NBA. Nike, as the league’s official uniform and apparel partner, automatically holds these rights.

As part of its multi-year deal, New Balance will create new broadcast, digital, and retail content featuring New Balance-sponsored athletes in their respective NBA uniforms and team logos.

The Boston-based brand relaunched its basketball endorsement programme at the NBA All-Star Game in February 2019, where the then San Antonio Spurs forward Kawhi Leonard showcased a new model of New Balance shoes. Leonard moved to the LA Clippers as a free agent in July 2019 debuted a signature New Balance shoe at the 2020 All-Star Game.

The league deal aims to consolidate New Balance’s position as a leading basketball and athletics brand.

League deals in the shoe category tend to follow major player endorsement deals.

Rival brand Puma became an NBA official marketing and footwear partner of the league in February 2019, having re-entered the sport after a 20-year gap via player deals with the Phoenix Suns’ Deandre Ayton and Zhaire Smith, as well as the Sacramento Kings’ Marvin Bagley III.

Under Armour signed with the NBA in August 2015 in a deal to promote its NBA athletes, led by Golden State Warriors star Stephen Curry. The deal also made Under Armour the title partner of the NBA Draft Combine and presenting partner of the Jr. NBA, the league’s youth basketball programme.

Shoes worn by Stephen Curry #30 of the Golden State Warriors (Photo by Lachlan Cunningham/Getty Images)

The NBA’s non-exclusivity principle for the shoe category has latterly been extended to the sports betting category, which now has 11 NBA partners around the globe.

Experts believe that it is important for the NBA to have a proposition in the marketplace to authenticate and authorise sports betting operators, which also act as marketers for to the promotion of the NBA.

The sports betting operators benefit from a differentiated position relative to their rivals as an official sports betting partner and official data partner of the league.

The league’s first, and biggest, betting operator deal, struck with casino and resort brand MGM Resorts International in July 2018, was for the US market only and was worth about $24m (€22.1m) over three years, or $8m per year.

The league has also struck authorised NBA betting operator deals for the US market with daily fantasy league brands DraftKings and FanDuel, digital sportsbook operators William Hill and Unibet, online and mobile betting provider Stars Group and mobile sports betting app theScore Bet, as well as betting operators Tabcorp and BetEasy in Australia, Codere in Mexico and Supermatch in Latin America .

Experts believe that deals in the above group sell in the low-to-mid seven-figure dollars per year.