Harman, NBA Sign Marketing, Merchandising Deal

JBL, the powerhouse live-sound–speaker brand whose line arrays are in basketball arenas across the U.S., will have its brand connection to the NBA considerably extended. JBL parent Harman International has inked a four-year marketing and merchandising partnership to be the official headphone, speaker, and audio partner of the NBA and affiliate leagues WNBA, USA Basketball, and NBA Development League.

The agreement, announced Thursday at Harman’s Manhattan retail store, calls for the consumer-electronics manufacturer to make headphones and portable speakers adorned with NBA team logos and player likenesses. Headphones have become a massive growth category in consumer electronics in recent years. Apple’s $3 billion acquisition of Beats by Dr. Dre was the most prominent of several such plays in the category, including Harman’s own acquisition of sports earbuds supplier Yurbuds in June.

The terms of the agreement do not extend to any of Harman’s professional brands: JBL Pro (PA speakers), AKG (microphones and headphones), BSS (DSP), Crown (amplifiers). JBL speakers are currently used in dozens of NBA and collegiate arenas, including Madison Square Garden (New York Knicks), Staples Center (L.A. Kings), Pepsi Center (Denver Nuggets), MODA Center (Portland Trail Blazers), the University of Pennsylvania’s Palestra facility, and UCLA’s Pauley Pavilion. However, the arenas — which in many cases are used also by other leagues and entities — are not affected by this agreement, only the league and its teams.

Darrin Shewchuk, director, corporate communications, Harman International, notes, “Our partnership with the NBA will open up new relationships with team owners and local-level/team organizations that will facilitate discussions about the use of Harman professional products in these facilities.”

Harman’s press release on the agreement indicates that the new marketing and consumer-products partnership will “focus on Harman’s JBL brand and will provide fans with enhanced audio experiences both in the arena and at home.” Additionally, it states that the company’s products will also be “featured at NBA events worldwide and integrated into league operations. Harman will provide JBL and other Harman products to players and coaches.”

The Consumer Electronics Association puts headphones and Bluetooth speaker among its fastest-growing audio categories. According to the CEA, headphones in 2014 are expected to sell 75.9 million units, earning $1.4 billion in revenue, a 20% increase over 2013. Bluetooth wireless speakers are expected to generate $650 million in total revenue this year, a 69% increase year-over-year.

Harman’s revenue from its lifestyle division, which includes headphones, portable speakers, and other consumer-audio products, was nearly $1.7 billion last fiscal year, Forbes reports. Financial terms for this partnership were not disclosed.

Harman Chairman/President/CEO Dinesh Paliwal, in making the announcement with NBA Commissioner Adam Silver, stated, “Harman is extremely proud to become the first official audio partner of the NBA and excited to elevate the NBA basketball experience for fans around the world wherever they enjoy the sounds of the game — at the arena, in their homes, in their cars, or on the go. Recognizing the convergence of music, sports, technology, and entertainment, the NBA and Harman are ideal partners to develop powerful marketing programs and exciting co-branded audio products that will engage and inspire a new generation of fans.”