The Jazz are the fifth NBA team to announce a jersey-patch deal.
The other teams are the Philadelphia 76ers with StubHub; the
Sacramento Kings with Blue Diamond; the Boston Celtics with General
Electric.; and the Brooklyn Nets with software company Infor. Also,
the Cleveland Cavaliers have reached a logo deal with Goodyear Tire
& Rubber Co., Bloomberg reported last week, citing unnamed
sources because the pact has not been publicly disclosed. Late last
year Bloomberg reported that Emirates Group is
in preliminary talks to sponsor jersey patches for "a number of"
NBA teams.
The deals with the Celtics, Nets and Jazz have all come within
the past month, suggesting the dealmaking is heating up after a
slow start. In September, Sports Business Journal
reported that the ads had not been an easy sell. Some teams are
cautious about striking deals in a nascent market that has yet to
establish valuation benchmarks, the publication reported.
The Celtics deal with GE was worth more than $7 million a year,
Bloomberg reported, citing a person familiar with the deal. The
Nets deal, which was announced last week, fetched $8 million
annually, Bloomberg reported, according to a person familiar with
the terms.
Larry Mann, executive VP at sports marketing agency Revolution,
guessed that two-thirds of NBA teams would have deals in place by
the time the 2017-18 season starts.
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"In this day and age, any way you can cut through clutter and
put your logo in a place where it's a captured audience … I
think it's a good thing," he said in an interview with Ad Age. But
"the sales process on these things is long. And because of that it
makes it a little bit more challenging to pull off a deal." He said
the question is if teams can drive new revenue from patches or it
they end up using them to entice existing sponsors to sign
renewals.
Qualtrics is an existing vendor for the Jazz but the company did
not previously hold a sponsorship, according to a team spokesman.
The jersey patch deal is part of a larger arrangement that also
makes Qualtrics the team's "exclusive fan experience insights and
analytics partner." The team plans to use Qualtrics' tools to
collect and analyze fan data to improve the arena experience.
"It's among the biggest partnerships that we have ever done,"
said Jazz President Steve Starks. "It includes more than just the
jersey patch. Qualtrics really is all-in on the Jazz and so they
are buying other assets and hospitality with us."
Asked about interest from brands in the patch, he said: "The
demand was strong. We were able to have conversations with
essentially anybody that we wanted to. Some of those were just
exploratory and others were people wanted to really start
negotiating with us." He added: "We were able to be selective. We
didn't just want to go to just the highest bidder. We wanted to do
something that would be meaningful on several levels."
Qualtrics, he noted, is representative of the tech boom
occurring in Utah that earned the region the nickname of "Silicon
Slopes." Qualtrics markets software to "manage the entire customer
experience -- from surveys to insights to action," according to its
website. It says it does business with nearly 60% of the companies
comprising the Fortune 100.
Qualtrics has an interest in fighting cancer because co-founder
and CEO Ryan Smith's father is a cancer survivor. The company has
its roots in a tech project Mr. Smith engaged in when he moved home
to be with his dad. "That project eventually turned into Qualtrics.
We vowed that if the company ever made any money, we would make it
our mission to support cancer research," he said in a
statement.
The company's "5 For the Fight" campaign
launched one year ago in partnership with the Huntsman Cancer
Foundation. The model is to solicit $5 individual donations and
then have donors challenge five other people to do the same. The
goal is to raise $50 million.
Interested donors are asked to make donations via a website. Then they
are encouraged to write on their hand the name of someone who
has fought or is fighting cancer, take a photo of it and share on
social media using "#fiveforthefight."