Kickin' It with the Sponsors: The NBA and Sneaker Endorsements

Showing off your brand new pair of sneakers on the court wasn't always very easy. The story behind the Air Jordans, as told in the 2023 film Air, involved a bit of activism on the part of Nike to change strict regulations by the NBA that governed what shoes athletes could wear. No doubt, it's a legendary story that sells the idea of a shoe representing the essence of whoever's wearing it.

So, what's the story behind sneaker deals today?

As I've mentioned in previous articles, the NBA Collective Bargaining Agreement (CBA) spells out the rules for all NBA athletes and teams to follow. Salary caps is one of the many ways teams are prevented from being "pay-to-win" and funneling all of their funds into a handful of players. It's great for the league! For the athletes that would love an extra check in the mail, not so much. 

Sponsorships are some of the ways athletes can have extra freedom over how much they get paid. This is partially subjected to limitations in Article XIII of the CBA, which prevents teams from circumventing salary caps through brand deals. Ultimately, these deals serve as supplemental income to their salary.

In this article, I will break down what a sneaker deal looks like, from the signing of the contract, to the on-court plays, to the check on their doorstep. 

Source: Karsten Winegeart

Types of Deals

No one deal fits all. As sports journalist Alex Kennedy writes, there's three types of deals:

• Signature Shoes. For some of the best players in the league, a signature deal is offered to them. These aren't decided by the company, but rather a negotiation between the player and the company to design the shoe to their preference. After this line of sneakers is released, the athlete will receive a cut of the profit through royalties. These shoes are immensely popular choices for NBA athletes to wear, even if they aren't the benefactor of a signature deal.

• Cash Deals. Although some star players like Bradley Beal do receive player-exclusive shoes (these are not signature shoes, but rather customized versions of existing models), many athletes receive cash deals. In this contract, a player is expected to participate in commercials, appearances, etc. in exchange for a yearly sum of money. You're paid to wear their brand.

• Merch Deals. The most common. Athletes aren't paid to wear the brand's shoes, but they do receive a product allowance. They'll get a free pair of shoes to wear during games and a large amount of in-store credit that must be spent by a certain date.

These deals can vary whether you're a rookie or a veteran. Top pick rookies can earn a lot of money from a sneaker deal across 4-5 years. However, veterans - or, if a rookie decides to not take a deal - can decide to take on free agency and wear whatever they want.

Going Rogue

So, you want a riskier method of earning extra cash? Try free agency on for size.

When a player decides not to sign a brand deal after their current contract ends, they're in a free agent state. They can wear whatever they want and possibly get an even better deal if they play well that season. That's what happened when Kobe Bryant opted out of continuing his deal with Adidas, sprinting into his famous 2002-2003 season as a sneaker free agent. Wearing everything from Reebok to Nike, his sneaker collection was just as impressive as his on-court plays. Eventually, he would sign a five-year contract with Nike for $40 million in 2003.

Since brands want to be conservative with their contract values in case an athlete doesn't perform as expected, this route puts results first so your brand deals can improve. Kobe Bryant would help kickstart this free agency phenomenon, but not everyone can pull off what he did.

The Negotiations

There are some common points that needs to be addressed in all sneaker deals.

The value of the contract versus the amount they actually receive is subject to change. Performance incentives are littered throughout the contract as conditions to meet in order to receive the full value of the deal. Some of these conditions include receiving an end-of-year award, making an All-Star team, winning X number of games, and more. This adds an extra layer of protection for the brand in case the player doesn't perform their best; they will lose out on less.

However, contracts can actually have conditions for docking pay. Kennedy further explains that contracts may include a provision for playing a certain number of games or reaching a certain point average in order to keep their current bonuses. Sometimes, if the player is in a market that's small, they will receive a reduction in pay.

At the end of the day, the player is the face of a shoe brand's product. That means if the player doesn't relate to the audience or doesn't draw enough attention, they're going to inherently earn less than another player.

There's an old adage related to this: "Big men can't sell shoes."

It stems from the idea that players such as Shaq and Embiid don't relate as much to average consumer as guards do, like Stephen Curry or Damien Lillard. This doesn't always prove true when looking at Embiid in particular, who got a signature shoe with Under Armour's Embiid One and could receive another through his signing with Skechers. Yet, modern centers like Nikola Jokić from the Denver Nuggets have been largely ignored by some of the biggest shoe brands out there.

To brands like Nike, your value to them is not just how well you hoop, but where you're from and the story they can spin from your likeness.

More Offers, More Possibilities

There's more to the sneaker world than Adidas and Nike.

What Air made it look like was a war between two major forces - Adidas and Converse - with Nike as the underdog who would eventually come out on top as the sneaker brand to rue them all. There's a lot more out there. While social media will hype up the releases from these brands, agents are very happy to consider offers from AND1, Under Armour, Skechers, New Balance or even going international with foreign brands. Some players, like Shaq, defied circumstances and started his own line of shoes, rejecting a $40 million offer from Reebok to provide affordable shoes at your local Walmart. 

Dealing with NIL contracts related to endorsements is messy. Putting a price tag on marketability sounds far beyond what an athlete wants to hear. Are you playing for your team, or for your endorsements? An agent's job is to play for the athlete at the negotiating table so these concerns don't follow them to the court. Future MVP or average NBA player, big or small - if you're going to play ball, get an agent.