MLB on-field headwear rights holder New Era has gone deep with the league’s top-selling team, quietly signing an eight-year marketing agreement with the New York Yankees.
One well-placed MLB source pegged the deal’s value at $20 million over the term and said it includes a host of marketing rights, enhancement of its two company-branded stores in Yankee Stadium, and an extension of New Era’s sponsorship of the Pinstripe Bowl, a non-BCS bowl game that the company has title sponsored since it began in 2010.
“We live and breathe in the headwear space, where obviously the Yankees have a unique position where they are their own story,” said New Era President Pete Augustine, without commenting specifically on the deal terms.
“You look at the iconic nature of the Yankees logo, and how people have embraced it, not only in the U.S. but more importantly around the world. It’s a great story, a great heritage, and we want to be part of that for a long time.”
While this is the capmaker’s longest MLB deal, Augustine emphasized that New Era has other long-term MLB team relationships, notably with the Mets, host of this week’s All-Star Game.
The value of the Yankees headwear deal is likely attributable to a number of reasons. The Yankees are regularly — and historically — a top-selling team. The NY logo’s perpetual dominance among MLB licensed-product sales is eclipsed only by its absolute dominance in overseas MLB licensed products sales; some estimates have Yankees-logoed products accounting for well more than half of MLB licensed sales overseas. And the Yankees’ dominance in MLB licensing is even greater in headwear, licensing sources said.
There are also political reasons motivating the deal. Aligning for eight years with a perennial top seller and a team that is arguably MLB’s most influential makes a switch to any rival capmaker highly unlikely when New Era’s current exclusive leaguewide on-field agreement expires in a few years.
“In some ways, it’s an insurance policy, considering how powerful the Yankees logo is in this business,” said one baseball source. “You also have to appreciate that after the [broadcast] rights holders, New Era is probably MLB’s largest single business partner.’’
It was unclear whether the deal gets New Era any degree of product exclusivity within Yankee Stadium. Augustine said, “You’ll see a small amount of competitive headwear, but we’ll have the lion’s share there, from value caps through premium product.”
