By Mason Deel
Sports and sponsorships go together like bread and butter. Why wouldn’t they? Events like the Super Bowl have become famous for their advertisements and their effectiveness as a brand. Brand names, logos, and messaging are littered throughout any sporting event, from the names of the stadiums to the playing surface of the sport itself. However, one sponsorship avenue has only recently begun expanding across the modern sports market: the jerseys the players wear.
The History
Jersey sponsorship is not a new idea in sports. Professional soccer teams have had sponsors on their chests since the 1950s when the first recorded instance of jersey sponsorship came from the Uruguayan soccer club Peñarol.
The English Premier League began the practice two decades later, allowing clubs to place sponsor logos on their jerseys. Liverpool FC was the first club to adopt this, and today, every club has a primary sponsor front and center for every kit. However, this proved much more difficult than anticipated for the club.
The BBC, who broadcasted Premier League matches, had a strict policy against advertising that it did not approve, per Dave Moor, who runs the jersey history website historicalkits.co.uk, in an article for Vice. “For several years, teams had to have shirts without sponsorship if the television cameras were turning up.” Eventually, the league was permitted to accept sponsorship, so long as the maximum size did not exceed that permitted.
So, what makes these different from the modern trend across American professional sports? To find this answer, we have to examine where and why it started.
Of the major professional leagues in the US, Major League Soccer was the first to allow jersey sponsorship in 2007, following the trend created across other professional soccer leagues. Ten years later, the National Basketball Association would do the same. Following Nike’s takeover of jersey manufacturing, the NBA permitted teams to promote sponsors on the left sleeve of their jerseys, opposite the Nike logo on the right sleeve.
As the first of the “big four” American leagues (the NBA, National Football League, National Hockey League, and Major League Baseball), it saw the results the quickest. Five years after its introduction, the league’s jersey patch program was worth nearly a quarter of a billion dollars.
For both the league and the brands that wanted to sponsor, it was a huge win. Amy Brooks, the NBA’s President of Team Marketing & Business Operations and Chief Innovation Officer, noted the variety that a sponsorship provides for a brand.
“We found that partners wanted to really use this asset for different reasons,” Brooks said. “Some partners wanted to use it for brand awareness, other partners wanted to use it to sell more products. We’ve seen other partners want to use it to become more relevant in new markets globally.”
Following The Footsteps
After the NBA, the NHL was the next league to permit jersey sponsor patches. During the COVID-19-plagued seasons of 2020-2021 and 2021-2022, the league implemented sponsors on player helmets to offset some of the losses from the instability the pandemic caused. The following year, the league allowed sponsors for the jerseys to be added opposite the captain’s crest on the right collarbone.
This was horrible news for some of the league’s more storied franchises like the Toronto Maple Leafs, which the Dairy Farmers of Ontario were sponsoring. Fans online quickly took to sharing their displeasure with these ads. One commenter said, “One of the most hallowed sweaters in league history, and it just casually says ‘milk’ on the chest now. Great job.”
Despite the initial negative reaction, fans’ opinions soon mellowed, and the sponsorship has proven to be greatly effective for the Dairy Farmers of Ontario. According to a survey conducted by Statista in September 2022, 20% of fans strongly supported sponsor patches, compared to only 10% of fans strongly against them.
For the Dairy Farmers of Ontario, the sponsorship has worked greatly towards their goal of increasing milk and dairy’s relevance. According to the DFO’s annual report for the 2023 year, “The Toronto Maple Leafs continue to gain traction through the sweater patch with 11.1 billion impressions netting out in a media value of $11 million for the 2022-2023 season and many moments of consumption in-venue took place.” Although the sponsorship cost has not been revealed publicly, it is known that the deal was for multiple years, and it can be assumed that the media value gained from impressions will continue to increase as the team sees success.
Not only does this partnership benefit the brands that sponsor the jerseys, but it also benefits the league tremendously. According to a report by the Sports Business Journal, the NHL’s team sponsorship revenue grew 21% from 2021-2022 to 2022-2023, totaling an estimated $1.28 billion.
Per the report, the league’s helmet deals are estimated at $91.2 million annually, while jersey patch deals are at $32.2 million. While not every sponsor has readily available reports on the netted media value, it can be assumed that the costs per impression for these sponsorships are extremely slim.
Late Adopters
The MLB is the latest league to permit jersey sponsorship, with the league permitting sponsors in the latest Collective Bargaining Agreement with the player’s association last summer. Unfortunately, there is not much data similar to the NBA or NHL on its benefits for the league and brands because of this recency. However, it can be noted that many of the teams that currently have a jersey sponsorship are using this to promote regional businesses to national or even global audiences.
According to Sponsor United, 82% of the MLB teams with jersey patches have partnered with brands hailing from the same market as the teams, highlighting the “unique connection with their local fan bases, showcasing the importance of community, and giving many brands both national and global visibility.”
However, one question remains: where is the NFL in all this? The premier American Football League is a media giant, generating over $19.5 billion in revenue each year. Yet, the NFL currently has no jersey sponsorship patches and likely won’t for the next few seasons.
As seen in data from the other leagues, this lack of involvement with jersey sponsors means revenue lost for each year they don’t enter. So, how much revenue exactly are they losing?
Turnstile, a company dedicated to sponsorship valuations, analyzed the NFL at the beginning of the 2023-2024 season. According to them, the league is missing out on an estimated $673 million each season in revenue due to needing a sponsorship patch program. This is broken into the benefits value, the exposure value, and the intellectual property (IP) value that the program would provide, as shown in the graph above.
However, this analysis fails to consider that the league actually does have sponsorships already, just not for jerseys. An article on the 2023 season’s revenue analyzed by SponsorsUnited outlines that the league’s data “shows team sponsorship revenue increased by 15%, from $2.05 billion last season to $2.35 billion this season. The combined NFL spending of the top 10 categories surpassed the total sponsorship revenues of the MLB, NHL, MLS, and NBA, respectively.” Thus, it can be argued that although the league could benefit from jersey sponsors, they are quite well off as is.
What’s next for sponsorship in sports? Could we see more leagues adopting similar programs in the United States and internationally? Could these sponsorships expand into fan merchandise like the Detroit Red Wings have adopted? Although the answers are unclear, time will tell. In the meantime, we can continue to pay and watch our favorite teams, in person and over streaming, along with the companies that paid to be there, too.
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