Championship season seen for sports logo goods

By Reuters
Posted Nov. 11, 2010 at 1:48 p.m.

Demand for jerseys, caps, video games, toasters and other items with sports logos has been a winner this year, and teams and leagues expect that streak to continue into the holiday season even with unemployment still high.

“If your team is winning and you’re excited about it, you want to be a part of it,” said Stu Crystal, vice president of consumer products for Major League Soccer. “It makes them forget about worrying if they’re going to lose their job or their houses went down in value and how they’re going to pay the mortgage.”

In addition to MLS, executives with the NFL, Major League Baseball, NBA, NHL and various retailers were optimistic demand will be strong this month and next; in some cases sales this year are running more than 20 percent ahead of 2009.

Their optimism tops expectations for the retail market. Last month, the National Retail Federation forecast a 2.3 percent rise in sales in the two holiday months.

Sales of licensed sports products in the United States totaled $11.5 billion last year, down from $13.4 billion in 2007, before the financial markets meltdown, and demand this year is off 11 percent, according to research firm SportsOneSource.

However, the decline is misleading because SportsOneSource’s figures do not include most video-game sales or products sold by the leagues themselves. For instance, licensed sports video games account for more than $1 billion annually, according to research firm EEDAR.

Sales at MLS, with core licensee Adidas, are up almost 20 percent this year and Crystal sees possibly the strongest sales year since 2007 thanks to the “empty closet syndrome,” where fans buy gear they lack.

GSI Commerce, which runs the online stores for all the major sports leagues and such chains as Dick’s Sporting Goods, expects sales in its licensed sports products business to rise by at least low double-digits on a percentage basis this holiday season.

Blackhawk Network, the gift card unit of Safeway Inc. that works with all the major leagues, expects double-digit percentage increases in the sales of gift cards, and sports cards should mirror that gain.

At Dreams Inc., which sells licensed sports products and memorabilia through 20 of its stores and 65 e-commerce sites it operates, sales have been “flippin’ amazing,” according to Kevin Bates, president of the company’s retail division.

He credits the double-digit sales percentage gains to more fashionable apparel and new products such asĀ  toasters that burn team logos from all the major leagues into bread slices.

The National Basketball Association came off a record year for retail sales last season and is up more than 20 percent this season.

The NBA has a new type of uniform to hawk this year, has launched a holiday advertising campaign in the New York area, plans for top players to appear in NBA shops at select Champs Sports stores throughout the holiday season, and boosted the page count in its product catalog by 50 percent, to 24.

Like many leagues, MLB has added more customized products, including the silhouettes of ballparks on apparel.

“Retailers are breathing a lot easier these days,” said Howard Smith, MLB’s head of licensing. “We’ll probably have one of the best years we’ve ever had in licensed sales.”

NHL officials see holiday sales rising about 10 percent this year, and cited strong demand for video games.

The NFL has focused more heavily this year on women’s apparel, offering new products in such locations as Old Navy, Victoria’s Secret and Destination Maternity. It also has increased its presence on Amazon and widened its holiday catalog distribution.

“We are, knock on wood, having a nice season — high single-digit growth, maybe even looking at with some breaks getting into more than that,” said Leo Kane, NFL’s vice president of consumer products.

Not everyone is so bullish, however, as attendance has suffered at track operators like International Speedway Corp., which hosts NASCAR races.

“(Consumers) are buying, but the ticket item has definitely gone down some,” said Blake Davidson, managing director of NASCAR’s licensed products. “If they bought five die-cast cars a year, maybe now they’re only buying one or two.”

At World Wrestling Entertainment Inc., sales in the consumer products business are off 2 percent through the first nine months of the year, with the best performer being a new toy line launched in January by Mattel. WWE is counting on the launch of a video game by THQ and a movie by WWE’s studio unit to boost fourth-quarter results.

“There is a general sense that we have begun to turn the corner and are in a recovery period, but any real enthusiasm is tempered with the acknowledgment that unemployment is still very high,” said Jim Connelly, WWE’s senior vice president of consumer products.

Read more about the topics in this post: , , , ,

Companies in this article

Comments are closed.