“This partnership with the NBA is the perfect alignment for Beats. It feels like coming home.” -Luke Wood, President of Beats By Dr. Dre
In my previous article, I wrote about Apple’s position and advancements in the sports realm. Included was, how a deal with the NBA would be the most fitting of any other sport. As well as, besides the deals to distribute iPads to the MLB and NHL sidelines, that Apple’s biggest strength in sports comes from the athletes being seen wearing their headphones. Several days later, it was announced that Beats would become the official headphone, home speaker, and audio partner of the National Basketball Association. This is a partnership of 2 brands that evolved into forces which emanate style and influence culture.
Adam Silver, who took the position of the NBA’s commissioner in 2014, has been helpful to the advancement of the league. He has been known to be very open-minded and innovative as to the potential growth of the NBA as a game, as well as a brand. Adam Silver stated that “Beats revolutionized the music industry and has become one of the most innovative and culturally influential brands in the world. Through our partnership, we have an exciting opportunity to merge sports, pop culture and technology to deliver unparalleled experiences and premium products to our fans.” Now, the NBA will become another source of water for Beats and Apple’s popularity to grow even more.
Fans have been seeing their favorite superstars wearing these products on their own accord. Without a doubt, this partnership will lead to only more success for Apple’s audio brand. This also means marketing on one of the biggest stages and platforms in the world, the National Basketball Association. With their viewership at a 4-year high, it is a big opportunity for Beats to expand the wildly popular brand even more.
The Superstars Align
Lebron James, like many other players athletes, has been a long time supporter of the product. James starred in a television advertisement, shortly after the deal was announced. Most of the time players on the other hand are not being paid to wear the headphones. This Apple product is cemented as the favorite of athletes, all around the world. Notably, this trend is gaining heavy popularity in the European soccer world, which is a global force of its own. The second most popular accessory being worn by the players is none other than Apple’s own AirPods.
Beats signed an extensive roster of some of the leagues very best to their own team. This includes the likes of Lebron James, Draymond Green and last years MVP, James Harden. It also has signed several very young players who show boundless potential, the likes of Ben Simmons, Jason Tatum, and Karl Anthony-Towns. This points to the fact, this relationship will be a lasting one. “I always want to be the best and work with the best. That’s why I joined the Beats fam. They have the best headphones and they made them a style icon when no one else thought of electronics that way.” said MVP and 6-time All-Star, James Harden.
Beats’ comprehensive merchandising and marketing deal has more to it. Besides replacing Harman as the NBA’s official sound partner, they will establish separate deals with each NBA team. This means all types of custom audio equipment with each of the 30 different NBA team logos on them, on a global scale. This will reach even more users, including loyal and passionate fans. As we know when a fan loves his team, he will let you know it. Be that a jersey, hat or now a headphone, and a superior one at that.
Beats by Dr. Dre (Beats), the headphones created by the highly acclaimed and successful artist and producer Dr. Dre, along with the famed Co-Founder of Interscope Records, Jimmy Iovine. The purpose of the headphone was to give the user the experience of having studio quality sound on the street or in their home. In 2014, Apple acquired Beats for an astounding $3 Billion. They quickly grew to be very popular, and have became an integrated part of music culture worldwide.
This partnership is a good sign to take into consideration that the company that hit a $3 billion valuation has not hit it’s ceiling. With developments such as this deal, the release of the new iPhone Xr (with the new in-house built A12 chip), the upcoming iPad (with the very popular Adobe Photoshop) and more, Apple’s (AAPL) stock is on the rise. The new iPhone chip integrates AI technology into the phone to give it a better understanding of it’s surroundings. The new iPhone also rids itself of the headphone jack. This could mean a boost of sales for none other than Beats, as well as other wireless Apple audio products.
This deal is a perfect match, that promises to elevate both sides. This a merging of two global forces, which stand for expression, style, and the will to improve. Apple now in the matter of a year, has closed deals with the NBA, MLB, and NHL. I Know First’s algorithm forecasts another bullish year for AAPL stock, as it has successfully done in previous years. The Beats/NBA partnership will kick off in October, which is when the 2018-2019 NBA season will begin. Once again, unlike the game being played, this deal leaves with two winners.
-This article was written by Ryan Hematian, a Financial Analyst at I Know First.