Rather than embrace the global appeal of the NBA for the sport’s benefit, those governing world basketball – FIBA – and those running basketball in China seem to spend most of their time and resources preventing the NBA from taking a leading role
Michele Serri
Michele Serri joined Oliver & Ohlbaum Associates as Senior Associate in September 2018, focusing on sports and entertainment. Before joining O&O, Michele worked for PwC within the Strategy & Innovation team.
Basketball: closing the gap with soccer
13th December 2018, 11:41

Basketball is the world’s second most popular team sport. with annual commercial revenues of $6 billion, but if it is to close the very large gap with the top team sport – soccer – it’s probably going to have to consider some radical changes to its organisation and structure. These include giving serious consideration to uniting franchise-based club basketball globally under the powerful NBA brand.

While basketball is USA’s third most popular sport behind American football and baseball, it has a younger demographic than both, and evidence suggests its popularity is growing faster.

The NBA – a powerful, growing and youthful brand

The NBA – the major franchise-based league – accounts for a significant proportion of USA’s most valuable sports franchises, with 107 million social media followers versus just 59 million for the NFL. Its top stars, such as LeBron James, seem to make the transition to leading US entertainment celebrities more easily than those in either the MLB or the NFL, while the NBA 2K League has led the procession of established sporting brands into the world of eSports.

The NBA’s powerful brand, growing popularity and youthful demographics under its commissioner Adam Silver have helped increase sponsorship revenues by 30 per cent in 2017-18 to $1.12 billion, with top team the Golden State Warriors earning an amazing $20 million a year from global e-commerce company Rakuten for just one square inch on the team’s shirts.

Strength in Asia and Europe

Unlike both American football and baseball, basketball enjoys high popularity across the globe. It is still China’s top team sport, despite the efforts of soccer to increase its presence in the world’s second largest economy and new global super power. In Asia as a whole, 18 per cent of athletes play basketball and the NBA’s Kobe Bryant – retired in 2016 – is still China’s most recognised sports star. In Europe it is the second most popular team sport across most of southern Europe and enjoys a solid top 10 all-sport placing in the rest of the continent.

A globally divided sport living in fear of the NBA

But while basketball enjoys significant global reach it is organisationally divided. Europe has two rival continental team competitions – the IMG-backed EuroLeague and the FIBA-led Basketball Champions League – while the Chinese Basketball Association, while very popular in China, has very little appeal or reach outside its home market.

Only the NBA resonates across the globe, thanks to its international roster of players and recent brand-building initiatives. Since the successful exploitation of the first true non-American NBA star, Yao Ming, the league has moved away from its domestically-focused perspective, relying increasingly on foreign talent. In the last season, all 30 franchises had at least one of 108 international players from 42 different countries.


Only the NBA resonates across the globe, thanks to its international roster of players and recent brand-building initiatives  

 

The NBA has also introduced pre-season and regular season games in Europe and Asia (NBA London and China games), created specific internal business functions to move closer to the most dynamic markets (such as NBA China, India and Latin America) and has initiated the worldwide launch of the NBA’s OTT service – NBA League Pass.

But rather than embrace the global appeal of the NBA for the sport’s benefit, those governing world basketball – FIBA – and those running basketball in China seem to spend most of their time and resources preventing the NBA from taking a leading role. They are more concerned about the NBA taking their best players than helping to build a global sport to rival soccer.

London seems to be the latest battleground between the NBA and European basketball bodies, with the EuroLeague exploring the creation of a London franchise to help build the sport’s following in the UK, where the domestic league has struggled in recent years. Meanwhile, the NBA is trying to host pre-season tour matches in the city to help build the NBA’s brand and build the sport’s following – in direct competition to the NFL and MLB who are doing the same thing.

Time to come together and form a global Conference under the NBA brand?

If basketball is to start to close the gap with soccer then this infighting needs to stop. Consideration should be given to ending the European civil war and to uniting the NBA with the top leagues in Europe and China into a global franchise-based Conference – all under the powerful NBA brand.

The top teams in each of the NBA, the Chinese League and a unified European League could participate in annual post-season play-offs with real global appeal, with franchises from London, Milan, Barcelona and Shanghai going to head to head. That way, the top teams outside USA might keep the best players and basketball could finally emerge as the true pretender to soccer’s global throne.

Sportcal