Recently, the NHL rejected the proposed sale of advertising on jerseys, which the league estimated could net $120 million and approximately $4 million per team. The NHL declined the proposal because they didn’t want to be the first of the North American big four leagues (NFL, NBA, NHL, MLB) to feature sponsors on their jerseys. The league is also notorious for sticking with traditions — they do not want to trailblaze.
Public opinion doesn’t help the advertising cause either; no one wants to see ads plastered all over jerseys. Most people take comfort in the fact that sponsors on jerseys are limited to mainly European sports, such as soccer and cycling. Fans cringe at the idea of seeing a hideous Rogers logo on their beloved Canucks jerseys.
The truth is, the big four all already benefit from advertising revenue, so it’s not a question of purity. Take the NFL for instance, they have so many timeouts and breaks, advertisers are able to cram over a 100 commercials into three hours.
Baseball, with its breaks in between innings, has room for tons of commercials. In most instances, when there is a timeout in a basketball game they cut straight to commercial. Heck, even the NHL has TV timeouts to cater to the advertisers, and now even has digital advertisements added to the glass for the viewing audiences at home.
The thing is, ads on jerseys would provide the NHL with so much more money. The league already sells advertising, but due to some strange principle, they are denying themselves over $100 million, which is a hefty profit for the owners. These revenues could be used to help some of the struggling teams in the south such as the Arizona (formerly the Phoenix) Coyotes and the Florida Panthers.
Let’s take a look at one of the biggest current beneficiaries of advertising: Manchester United. They are about to enter a new 10-year, one billion dollar deal with Nike to make their jerseys. That is in combination with the over $70 million they will get per year from Chevrolet who sponsors their shirt — over $170 million in guaranteed revenue every year. That’s more than most teams anywhere in any sport make in a year. This is an extreme example, but it goes to show you how teams can take advantage of their brand to make a little — or a lot of — extra cash.
Passing up a new revenue stream because it will upset a few people makes no sense. If someone came up to me and said they would pay me $10,000 a week to wear an ad for their company to work, I’d take the deal in a heartbeat. Can you imagine how much revenue a team like the New York Yankees or Dallas Cowboys could potentially receive for a jersey sponsor? They would just be stupid to pass it up.
Advertising on jerseys in North American sports is inevitable; it’s just a question of when. With teams in the NHL like the Tampa Bay Lightning, who are losing $5.4 million per year according to Forbes, it’s a no-brainer, and the NHL might as well be first.
Fans might complain, but really, look at soccer teams — they still manage to sell tons of jerseys, even with those ugly ads plastered all over them. Right or wrong, at the end of the day, the money is all that matters.
$120M is miniscule compared to the NHL’s revenue, and furthermore adding such an eyesore to jerseys will surely affect jersey sales and revenue from that. It’s not as one sided.