SBJ/December 20 - 26, 1999/No Topic Name

New Starter runs into stop signs from leagues

The four major pro leagues have all turned down the new Starter brand's request for licenses, but generic Starter-branded product will still hit the shelves of Kmart, Wal-Mart and Target next fall.

Sources say the leagues would not license Starter because, among other reasons, they did not want Starter products to be sold through mass-merchant retailers. Starter is still the most recognized brand name in team licensed products, and the leagues feared that if Starter merchandise were sold at discount prices through these stores, it would cut into sales of higher-priced goods at department stores and sporting goods shops.

The leagues are also trying to cut down their base of licensees and ease price competition in the struggling licensed market.

The Starter trademark was bought out of bankruptcy by a group led by Logo Athletic, several other apparel brands and an investment bank last summer. The brand is being managed by Group III and Elite Sports Properties, which are licensing the Starter name to various apparel suppliers, most of whom already do business with the mass merchants.

Elite Sports Properties CEO Michael Lewis said the Starter brand has already been licensed to more than 20 apparel makers. With Wal-Mart, Kmart and Target all "starving for real live brands," as Lewis said, he predicted that the new Starter will easily eclipse the $300 million to $400 million in annual sales generated by the old company, even without any licenses from the leagues. Lewis said discussions with the leagues will continue, and the brand will also pursue motorsports and collegiate licenses. But he boldly predicted that the branded line alone will become the "third- or fourth-largest sports brand in the world."

The initial list of licensees should be announced next month.

With Sara Lee Corp.'s Champion not returning as the WNBA's uniform supplier and lead licensee, NBA Properties Inc. plans market its own line of WNBA products next season, sources said, but will continue to order the raw goods from Champion.

The league offered the WNBA license to Nike Inc., but Nike is said to have turned it down because the company believed the costs of supplying the teams could not be offset by retail sales. Champion generated only about $3 million in annual business through the WNBA, despite exclusivity in key apparel categories, sources said.

NBA Properties has dabbled in marketing its own products ever since the NBA Store opened last year, contracting directly with manufacturers to produce some generic NBA-logoed product and, more recently, some team-specific goods. Distribution of those products has since been expanded to some overseas accounts and team shops. But the WNBA move represents the first time a major professional league will actually supply its own uniforms and then market those products at retail. WNBA sponsors Sears, Roebuck & Co. and Lady Foot Locker, along with arena souvenir stands, have sold the bulk of WNBA licensed products.

HotJobs.com has picked up promotional rights to the Super Bowl logo by signing a $500,000 deal to become an associate sponsor and banner advertiser on SuperBowl.com. One of two Internet companies, along with competitor Monster.com, to advertise on the Super Bowl broadcast last year, HotJobs.com spent another $1.9 million on a Super Bowl spot this year and will reportedly spend almost $20 million on a multimedia campaign built around that ad.

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Related Topics:

Champion, Kmart, NBA, Reebok, WNBA

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