Monday, June 10th, 2013

Cynopsis: Sports
06.10.13

Good morning. It’s Monday, June 10, 2013, and this is your first early morning Sports briefing. 

After raising $170 million last week from Singapore state-owned investment company Temasek Holdings, sports-apparel retailer Fanatics is looking to raise its game. According to the Wall Street Journal, the funding round more than doubles the company’s valuation to $3.1 billion for Fanatics and parent company Kynetic LLC. Fanatics already sells officially licensed jerseys, mugs, jackets and other merchandise and ranks as one of the world’s largest retailers in the category with virtually all sales coming from online channels such as fanatics.com, fansedge.com or e-commerce sites that the company operates for all the sports leagues, including the NFL, MLB, NBA, NHL, NASCAR, PGA and more than 200 professional and collegiate teams.

Cynopsis Sports asked Fanatics President (and former Versus President) Jamie Davis about the funding, the company’s plans for the future and the state of e-commerce.

Davis on the job: I love connecting with passionate sports fans via any medium  TV, digital or otherwise. The ability to combine this love with the dynamic growth of e-commerce is a dream come true and to be with a company that is singlehandedly expanding the entire licensed sports industry is more than I could have ever expected.

On company goals: As a private company, we’re always looking to build strategic, long-term growth rather than manage quarterly earnings and that will continue to grow value for the company. Some of the things we’ve done so far are: we’ve recruited the best people from all different sectors of the industry, including retail, media, tech and e-commerce; we purchased Dreams in 2012, that included FansEdge, which aligned perfectly with our business plan and created instant scale; we continue to be obsessed with our customer-first culture; and we continue to invest in our regional distribution network so we can deliver team gear to our customers faster. As a result of these efforts, no company is growing the overall licensed sports industry more than Fanatics.

On the new funding: It will be used for general operating purposes to expand our already enormous inventory, speed up our international expansion plans and accelerate the build-out of our regional distribution network. Our plan is to invest and grow the international business organically by acquiring rights directly from partners and building out our infrastructure on the ground there. As for distribution, we recently invested $35 million to open a 500,000-plus square foot facility in Ohio to serve the large demand coming from the Northeastern US. We will be looking to do the same on the West Coast soon to serve that area. The creation of this regional distribution network will allow us to deliver our merchandise to sports fans even faster than we do today. There are many other areas we are also focused on. One is building the Fanatics brand. We are significantly ramping up our marketing investment, including traditional marketing. Another is mobile. We see a big opportunity given how much sports content over-indexes on mobile.

On e-commerce trends: E-commerce has a natural tailwind as more and more consumers are flocking to this medium versus buying goods in traditional brick and mortar outlets. E-commerce affords companies, like Fanatics, to provide a much larger assortment of merchandise to its consumers anytime, no matter where they are. As a result, at least in the licensed sports industry, Fanatics has made products available to fans which they never could access before and thus the overall industry is growing. This is leading to greater demand from the consumer for our vendors’ products, increased purchasing by Fanatics from our vendors, and an overall growth in licensed sports merchandising.

On the Air

And so it begins. NBC Sports Group announced programming plans for its presentation of the 2013 Stanley Cup Final. The action starts Wednesday night with Game 1 between the Bruins and Blackhawks at 8p on NBC. For the series, NBC is set to broadcast Games 1 and 4, as well as potential Games 5-7, while NBC Sports Network will telecast Games 2-3. In addition, NBC Sports Network will offer pre-game and post-game. In addition, for the first time ever, the Stanley Cup Final will be streamed live through NBC Sports Live Extra (see below). Mike ‘Doc’ Emrick (play-by-play), Eddie Olczyk (analyst) and Pierre McGuire will call the action during each game.

Meanwhile, NBC’s NHL Conference Final game on Saturday delivered a 2.9 in the metered markets, marking NBC’s best delivery ever for a Conference Final game. On the local front, Chicago drew a 19.6, the market’s best rating ever for a non-Stanley Cup game on NBC, while Los Angeles scored a 3.8, also the market’s best rating ever for a non-Stanley Cup game on NBC.

Speaking of post-season play, Game 1 of the NBA Finals between the Spurs and Heat drew 14.2 million viewers, to easily take the night for ABC. The game averaged an 8.8 rating, according to Nielsen live + same-day data, dipping from last year’s Game 1 by 11%. Still, that marks the fourth-largest opening game in the Finals since the 2002-03 season.

With the NASCAR on FOX season all wrapped up, the company announced that racing action this year once again ranked as the highest-rated and most-watched sport in-season for the 13th straight year, according to Nielsen. The complete 2013 NASCAR on FOX Sprint Cup season averaged a 4.8/10 household rating/share for the third time in four years (2010, 2012 & 2013). The company noted that it marks the only major sport on a broadcast network not to post a year-to-year ratings decline this year.

ESPN announced that the company has added seven Big Ten Conference college football games during the first three weeks of the 2013 season. Combined with previously announced prime-time matchups, nine games will now be televised across ESPN, ABC, ESPN2 and ESPNU in the first three weeks. New games in the mix will include Buffalo/Ohio State and Syracuse/Penn State on Aug. 31. Other matchups include Cincinnati/Illinois and San Diego State/Ohio State on Sept. 7 and UCLA/Nebraska on Sept. 14.

ESPN also announced that its network will offer all 52 matches of the 2013 FIFA U-20 World Cup from Turkey, which takes place from June 21 – July 13. ESPNU will carry the bulk of the televised matches, with 21 games on deck, including the quarterfinals and semifinals. Meanwhile, the final will air live from Istanbul on ESPN. The tournament kicks off on Friday, June 21, with two matches beginning at 10:45a on ESPN3, while the U.S. National team begins its campaign on ESPN and WatchESPN at 1:45p against Spain.

Save the date! The annual Cynopsis: Sports Business Summit is set to take place on Aug. 14 in NY, and will feature some of the biggest names driving sports today. In addition, we are holding our Women of Action cocktail event celebrating and discussing the impact women are having in the sports industry on Aug. 13.


A CYNOPSIS MESSAGE


GO BIG, OR GO HOME!

Cynopsis: Digital BIG Monetization Summit

Your gateway to the must-have insights on next generation business models and strategies for developing and distributing quality digital programming.

8:30am-5:30pm | June 18 | NYC

www.cyndigitalmonetization.com
*Sponsored by: Yahoo!*


Sponsorship & Promotion

2K Sports revealed that 2013 NBA MVP, LeBron James, will make his video game cover debut on the next installment of the top-selling video game franchise, NBA 2K14. 2K Sports also announced the King James Bonus Pack that will offer exclusive content featuring James.

Adidas inked a six-year extension to its partnership with the University of Kansas. The new deal will run through 2019 and is valued at over $26 million and will allow Adidas to continue to provide footwear, uniforms, apparel and accessories to the Jayhawks’ 18 intercollegiate programs, including the men’s basketball team.

ESPN is tapping new generation Brazilian artist Roge’s music to serve as part of its presentation of the FIFA Confederations Cup Brazil 2013. His songs will “meld different genres of Brazilian music from samba and bossa nova to reggae,” and will be used in and out of breaks, as well as for highlights of the 16-match, two-week event from six cities in Brazil.

Digital & Production

With the Stanley Cup Final set to be streamed live for the first time ever, NBC Sports Live Extra will live stream all Stanley Cup Final games as well as offer bonus coverage by utilizing Star Cam and Spotlight Cam for each game of the Stanley Cup Final. Star Cams will be dedicated cameras that follow a star player from each team throughout the entire game. Spotlight Cam is a top-of-the-glass camera that is positioned at center ice. This also marks the first time this season that alternate cameras have been used for the live streaming of games that air on NBC Sports Network.

Game 1 of The Finals on ABC live through special simulcasts on ESPN3 marks the largest NBA game of the season to date with over 8.6 million total minutes and an average minute audience of 54,000 across computers, smartphones, tablets and Xbox, according to Adobe SiteCatalyst. In addition, NBA content across ESPN digital platforms generated over 58 million total minutes, half of which were consumed on mobile properties.

The Main Event, the featured game of the day sponsored by Thuuz, real-time sports discovery for mobile & connected TV platforms

Red Sox vs. Rays Tonight, 7:10pm ET. Thuuz rating:83
Pitcher’s duel of the day. Lackey (3-5, 2.79 ) Cobb (6-2, 2.39).On ESPN.


A CYNOPSIS MESSAGE


SAVE THE DATE: Cynopsis Sports Business Summit
Wednesday, August 14, 2013 | Grand Hyatt NY

It will examine how the industry is using content, context and digital connectivity to build audiences, engage fans and integrate sponsors locally, nationally and on a global stage.

For sponsor information, please contact Mike Farina at (203) 218-6480.

More information to follow…



ON THIS DAY in 1981: Pete Rose ties Stan Musial’s NL record of 3,630 hits.

In The Know: What musician anchored Nike’s Bo Jackson campaign in 1989/90? (Not counting the Sonny Bono cameo.) (Email Chris-Sports@cynopsis.com with your answer and be sure to include your name, company, city and time zone. Unofficial rules: Only the second four correct answers from each time zone will be mentioned; and once you’ve been mentioned in any of the Cynopsis editions, you can’t be mentioned again that calendar week.)

Answer to Our Last Sports Trivia Question: What would someone have to do to win the Harley J. Earl Trophy? Answer: Win the Daytona 500. Kudos: David Young-ABC/NY; Joe Guarnieri-ESPN Remote Operations/Bristol; Glenn Schineller-Time Warner Cable/Charlotte; Synda Kollman-Charter Marketing Group/Boca Raton; RT Harris- WideOrbit/Detroit; Chuck Gordon-Clear Channel Media/Mobile; Matt Sautter-OpenTV/Golden; Tom Moore-Kalt Productions/LA; David Westberg-SAG-AFTRA Los Angeles local/LA.

Later — Chris
Chris Pursell for Cynopsis | Sports
06.10.13

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