As the NBA enters the penultimate year of its $2.67 billion domestic media rights deal, a pivotal revenue source emerges through patch partnerships. Teams are set to generate $293.83 million during the 2023-24 season, with the LA Lakers and LeBron James maintaining their popularity, according to GlobalData, a leading data and analytics company.

Ahead of the 2017-18 season, the NBA first broke news that it would become the first American-based sports league to allow teams to add partner logos to its uniforms. Before this, these extra type of main sponsorship deals were more commonly seen and associated with European sport. Given the commercial landscape of the location of the NBA, it should have come as little surprise to see just how valuable the extra generated money has been to competing franchises. Teams are permitted to wear partner logo’s on the corner of their jerseys, 2.5 x 2.5 inches in size.

GlobalData’s latest report, “The Business of the National Basketball Association 2023-24,” reveals that reveals that patch partnership deals in the league have been shown to increase by nine new deals this season.

Jake Kemp, Sport Analyst at GlobalData, comments: “All but three NBA teams currently boast an active patch partner – the Los Angeles Clippers, Memphis Grizzlies and Portland Trail Blazers. This means that the average value of such a partnership across the remaining 27 teams in the league stands at $10.88 million this season. This money is also well spread across the league, thanks to the popularity of the league and value of all franchises involved. Given their respective locations in New York, it comes as little surprise to see the two New York-based teams, the Knicks and the Nets earning the most from these deals, at $30 million each respectively.”

Patch partners are typically worth more than a standard partnership in the NBA because of the added exposure to fans at each game.

Kemp continues: “Despite the added price tag associated with these deals, we are still continuing to see the financial services and technology sectors emerge as the most active in signing them. The former of these industries is the most prominent in the market, responsible for nine deals, with the tech sector down as the second-most prominent with six unique deals.”

Even at the lower end of the scale, patch partnerships in the 2023-24 season are worth $5 million a year, a value assigned to the likes of the Utah Jazz and Orlando Magic.

Kemp concludes: “The only other major type of deal like this permitted by the NBA for individual teams to sign surrounds branding on practice and warm up gear. This was seen as a direct response to the impact of the COVID-19 pandemic, with the league first breaking news of this permittance before the start of the 2020-21 season.”