StubHub will have its logo on the Philadelphia 76ers's jerseys starting in 2017, making the National Basketball Association team the first to take advantage of a recent rule change that allows advertising on uniforms.
The EBay Inc. unit agreed to pay $5 million a year for a 2.5-by-2.5-inch patch with StubHub's logo on it, according to a league official with knowledge of the deal. The official asked not to be cited by name because the terms of the deal aren't public. Neither 76ers CEO Scott O'Neil nor StubHub President Scott Cutler would disclose financial terms.
While ads on uniforms are common in soccer and the WNBA has corporate jersey sponsors, the biggest American sports had kept their outfits commercial-free until last month, when NBA owners agreed to a three-year test program for ads on uniform jerseys. It could grow into a lucrative revenue stream: The English Premier League's Chelsea, for example, gets around $60 million a year from jersey sponsor Yokohama.
"It's the best real estate in sports," Mr. O'Neil said in an interview. The patch with the 76ers, specifically, will give StubHub as much as $4.8 million in annual exposure, including broadcast TV, video games, retail and social media, according to Apex Marketing Group.
Teams that play more often on national TV -- and clubs with bigger international audiences -- can command higher rates for jersey ads. Teams will keep half of what the ads generate. The other half will be put into a revenue-sharing pool.
Earlier this year the 76ers and StubHub started a ticket marketplace that is unusual in that the team sells tickets alongside third-party sellers. "We want to be associated with the fan experience," said Mr. Cutler. "We wanted to be associated with an innovator. This was an absolute natural."
The patches will debut in the 2017-18 season, which coincides with Nike replacing Adidas as the NBA's uniform supplier.
The 76ers finished the 2015-16 season with a 10-72 record and attendance that ranked 28th out of 30 clubs. The team is owned by an investor group led by Apollo Global Management LLC co-founder Josh Harris and Blackstone's David Blitzer. They also control hockey's New Jersey Devils and their arena, the Prudential Center in Newark, New Jersey.
-Bloomberg News
