The StubHub patch on NBA Philadelphia 76ers jerseys debuts in the 2017 season.
In a league that isn't known for surprise moves, the announcement last week that the National Basketball Association will allow ticket reselling leader StubHub to have a promotional patch on the Philadelphia 76ers jersey in the 2017-18 season was the sports world equivalent of a surprise Beyoncé album.
And while it may have seemed like a sneak attack, the deal was actually years in the making, even if the final details came together very quickly just before the announcement. StubHub and the 76ers have been partners since 2012 and had begun talks to extend their partnership in 2014, according to StubHub's head of partnership and business development Geoff Lester. "We kept asking, 'what can we do differently?' given that they were our only NBA partner," Lester said. "It wasn't discussed then, but we thought if there was an opportunity to put our brand on their jersey… fast forward a few years and they came to us and said the NBA was thinking about this and were we still interested? Absolutely."
From that point, the negotiations unfolded over a few weeks as StubHub – which has 200 team partnerships globally — saw a unique opportunity to extend their relationship beyond the transactional, making it about more than just coming to StubHub to buy or resell a ticket.
"Now, with us handling all the Sixers' ticketing needs starting this season, it made even more sense," he said. "You will be coming to StubHub to buy and sell tickets and extend that." One way that new connection might manifest is providing immersive experiences for the beleaguered team's fans. "Maybe not more signs [in the venue] but adding backstage experiences offered by some of our other partners." As an example, Lester pointed to a perk StubHub users can get with the USC Trojans football team, which allows a customer to run out through the tunnel and onto the field with the team and its coaches.
Though Lester would not talk terms of the deal, Bloomberg News reported that StubHub will pay $5 million annually as part of a three-year deal. And, with first-mover advantage, Apex Marketing Group predicted that StubHub could get as much as $4.8 million in annual exposure on TV, retail, social media and in video games. If the nearly $4 million in reported earned ad value in the first 12 hours after the announcement is even in the ballpark, then Lester said the announcement was a smash success.
The combination of the announcement just as StubHub is taking over the team's ticketing operations, blending primary and secondary ticketing on one site, made the timing perfect, according to 76ers chief revenue officer Chris Heck. "It's a huge undertaking and a huge shift in the business morphing your box office with a partner like StubHub," he said. The team never talked to any other prospective partners when considering the patch deal and in his 24 years in the business Heck said he's never seen a better fit for the team's brand or StubHub's.
"Who is more engaged with our brand than our ticketing partner?" he said. "We're literally batting them to the fabric of our uniform." Though the announcement admittedly raised a lot of eyebrows for a team that has been way down on the court for several years, Heck said the timing – the 76ers landed the #1 pick in the draft less than 24 hours after the patch deal was revealed – could not have been better.
"I believe our fans feel it and the partners feel it and the industry feels that the team is turning for the better and that eases any uncertainty on the business side," he said. The aggressive business moves and the good news about the draft pick might have tamped down any potential backlash to the patch dea,l and Heck said that other teams are "ecstatic" about the news.
"They love that we have put a flag in the ground and now everyone can start chasing it," he said, declining to speak on behalf of the team's players, but noting that they "understand their brands extremely well" and are well aware that for every dollar that NBA teams make 50% goes to their players.
For now, Lester said StubHub isn't looking to replicate this deal with any other teams, but he did note that his office got a lot of calls the following day from other teams wanting to talk sponsorship.
"I'm not sure we'd enter into a similar relationship at the moment," he said. "We're open to sponsorship and partnering with the industry, but we weren't looking to launch the Sixers jersey deal to land other sponsorships." And while similar jersey deals might not be in the offing, Lester said he's open to talking to anyone about ticketing services and other ticket-related deals.
With growing involvement in Major League Baseball stadiums and a secondary market deal with baseball and naming rights on the StubHub Center in Carson, Calif., for the unit of Ebay Inc., Lester said partnerships continue to be the best way to deliver the best fan experience. For now, there is no further formal relationship with the NBA, but he said he hopes the Sixers deal can lead to a larger one with the league. "We want to be thought of as the place to go when you're trying to find something to do and the place that gets you in the door,” he said.
Though cagey about specifics, Lester said you can definitely expect to see "a number" of announcements about other major new deals soon. "It's highly unlikely we'd sponsor more than one club. With more than 200 partnerships and sponsorships we have to be pretty judicious.”
Lester said he was not at liberty to say how much extra revenue StubHub could see from its investment in the 2.5 by 2.5 inch patch, but he pegged it as "significant" and "absolutely" worth the price. "It's in as good a place as any partnership with a major platform could be," he said.
Both men said they're not going to be shy about sharing the details of their deal at the upcoming annual NBA league meetings. "We're believers in sharing best practices and we would love for other teams in the league to follow suit and we'll help if we can," said Heck.
Interviewed for this story: Geoff Lester, (415) 222-8495; Chris Heck, (215) 339-7676