Sports and Sports-Themed Entertainment Licensing

June 16, 2008

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MOVE OVER, MAJOR LEAGUES. The field is opening up to new players.

            While the NFL, NBA, MLB and NHL still account for the majority of the approximately $825 million in sports licensing royalty revenues,* the growing popularity of non-traditional sports and entertainment-based sports has widened the playing field for licensed merchandise.

            Sure, men's basketball jerseys are still doing fine, but how about a line of soccer-themed apparel for women, or an X Games-branded bedding collection for boys? Those are just a couple of the newer items being introduced by this year's LIMA awards finalists in the sports and sports themed entertainment category-an eclectic group that includes Lucha Libre, World Poker Tour and Red Nose, a Brazilian brand that describes itself as serving the "radical sports segment" of fighting, surfing and skating.

            X Games, which helped create the contemporary notion of sports-themed entertainment, continues to expand its licensing program. While apparel and accessories remain its biggest growth areas (it recently launched a line of branded footwear, for example), X Games is finding a new home, as it were, with an upcoming collection of bedding and other accessories, such as wall clocks.

            "Sports participation among the youth is on the rise, and home décor is an opportunity to reach younger audiences," said Steve Cipolla, vp/gm of ESPN Consumer Products, which handles licensing programs for ESPN, X Games and Bass fishing. "Boys want to bring the sports lifestyle into their homes in the same way that girls might decorate their rooms with a hot entertainment property."

            That trend is beginning to show up in licensing sales data. As of 2006, apparel and accessories accounted for the greatest share of sports licensing revenues, at roughly a third, followed by software/video games at 16%. But home décor, which barely registered a few years ago, has crept up to 3% of the total, or about $25 million.

            Others are joining the fray. Warner Bros. Consumer Products, for example, is bringing soccer-themed home décor-and even pet products-to consumers in North America. Since 2005, WBCP has been creating licensed product as part of its marketing partnerships with football (soccer) teams, known as "clubs," in Barcelona, Manchester, Paris, Mexico and Brazil. "From pets to pillows, true [soccer] fans enjoy experiencing their teams in a variety of ways," said Jeffery Whalen, vp/gm at WBPC. The arrival of soccer superstar David Beckham on the U.S. scene, he added, has helped grow the market for licensed merchandise in this country. "Soccer enthusiasts across multiple demos are such big fans, they are enjoy having club merchandise as part of their home."

            Another relatively untapped demo for licensed soccer merchandise is women. According the sport's international governing body, FIFA, women comprise nearly half of the viewing audience for soccer across all marketing platforms worldwide. "Women are the largest underserved merchandise segment in global soccer," Whalen said. "Our women's apparel is selling as fast as anything we produce. We're talking about general merchandise Tshirts, not jerseys, that cost upwards of $80 and are going into boutiques and mass department stores."

            At World Poker Tour, meanwhile, the end game is not so much a particular demographic as it is a pyschographic.

            "Our brand is aspirational-everyone thinks they can play the game better-so we look at licensing as a way to extend that lifestyle brand," explained Rose Odeh, chief marketing officer at WPT, whose licensing program began in 2004 with accessories (cards, chip sets) and has expanded into other categories, such as apparel. One of WPT's most successful ventures has been a downloadable mobile poker game called Hands-On.

            "We do limited advertising; we try to leverage our show's distribution in promoting our licensing programs," Odeh said, adding that new licensing plans were in the works. "We're looking at affinity cards, branded credit cards-edgier things that people aspire to and that go back to that aspirational lifestyle."

For more LIMA coverage:
A note from Charles M. Riotto, LIMA President
2008 LIMA Finalists
Character Brand Licensing
Corporate Brand Licensing
Film, TV and Entertainment Brand Licensing
Sports and Sports-Themed Entertainment Licensing
Licensed Promotions
Art Brand Licensing
Retailer Licensing Programs