Rakuten Strikes Gold With Warriors Jersey Patch Deal


The Golden State Warriors have reportedly reached a $20 million per year jersey patch agreement with Rakuten. The Japanese tech company will be featured on the Warriors’ jersey for the next three seasons. The fact that the Warriors would sign the most lucrative jersey patch deal in the NBA is not surprising. The team has won two of the past three NBA Championships, has numerous international stars, and is situated in the Bay Area near Silicon Valley.

The fact that the team received nearly double the amount of the second highest team, the Cleveland Cavaliers, and the fact that the deal is with Rakuten, a company few people in the U.S. have likely heard of until now, is surprising. Why would Rakuten spend this amount of money for a jersey patch deal?

Rakuten is a well-known brand in Japan and owns cash-back site Ebates, messaging app Viber and e-book brand Kobo. The company, which generates $7 billion in revenue per year, does have a history of targeting expensive apparel rights deals. The company is paying almost $60 million per year to be featured on the jerseys of FC Barcelona.

However, it does appear that Rakuten is following best practices through its new relationship with the Warriors. In particular, Rakuten’s CEO Hiroshi Mikitani understands that his company lacks brand awareness in the U.S. even though its North American headquarters is based in San Francisco.  According to Mikitani, "We want to be a household name like Google and Facebook. Our partnership in Barcelona has helped us in Spain, and the Warriors will certainly be a pillar of getting us there in United States."

Jersey patch deals are an excellent fit for companies looking to maximize brand awareness because of the amount of exposure they will receive on television, digital, and social media channels. The new badge with the Warriors in particular (what the team is calling the jersey patch) will enable Rakuten to achieve significant brand exposure to a tech-savvy audience in Silicon Valley and throughout the United States (over 84% of NBA fans use online devices for sports-related purposes according to the research firm SBRnet). 

We examined the value generated by the Golden State Warriors in Twitter through the NBA playoffs using B6A’s Social Sentiment Analysis Platform.

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We found that the team generated $2.49 million dollars in value and over 201 million impressions during the playoffs alone. We also discovered that several of the most valuable posts featured photos with the team’s jersey’s prominently displayed in the image with earned media coming from coverage in ESPN and The New York Times. We would estimate that the team would generate $5 million in revenue from Twitter for the season and likely more from Facebook and Instagram given that NBA audiences are larger in these social media networks according to research firm SBRnet.  

In addition, Rakuten expanded its deal to include terms that can directly help its business generate revenue. According to ESPN’s Darren Rovell, “Rakuten will be the team's official e-commerce, video-on-demand and affiliate marketing partner. Ebates will become the team's official shopping rewards partner, Viber will be the official instant messaging and calling app, while Kobo will be the official e-reader partner.” As the sports industry pursues technology innovations including e-commerce platforms for its products including tickets and merchandise as well as on-demand content delivered to fans across multiple devices, Rakuten is well positioned to utilize its relationship with the Warriors to monetize its products directly through its relationships.

Our analysis indicates that this deal likely should generate significantly more than the “$32 million to $37 million in equivalent advertising” projected by the Apex Marketing Group. Rakuten should generate a substantial positive ROI with the Warriors because the partnership will generate high quantity, quality, and engagement with its target audience in ways that will enable the company to achieve its economic and branding goals.