Short of the Goal : Manufacturers Shy Away From World Cup Products
When the chance to market World Cup merchandise came rolling toward Mickey Novak, his reaction was swift.
He ducked.
His company, Innovative Time Corp., makes all sorts of time pieces--from Flintstone clocks to National Hockey League watches. But after asking his retail clients for their opinions on the World Cup, he decided not to give the soccer tournament the time of day.
“What do you do with World Cup Soccer merchandise the day after the World Cup?” posed Novak, president of the Carlsbad, Calif., company. “There is no value to something that no one wants.”
While it is too early to make any definitive judgment about sales of World Cup merchandise--the monthlong tournament doesn’t begin until June 17--some manufacturers say that initial product sales in the United States are slower than they had hoped. Others say they turned down overtures to make World Cup products specifically for that reason. And one Los Angeles licensee noted that even before the games have begun, he knows of retailers in three major cities that have already marked down prices on some World Cup items.
“In some cities, it just hasn’t caught on,” said Bob Davidson, vice president of sales at Los Angeles-based JH Design, which is making $1,500 World Cup leather jackets. Although his jackets and hats have so far sold extremely well, he said, in Detroit, Dallas and Boston--three of the nine cities that will host the tournament--sales of World Cup souvenirs by some smaller vendors have generally been “cold.”
One Woodland Hills licensee said sales of his World Cup products so far have not matched his early hopes.
“I am disappointed--particularly based upon my expectations of what could have been,” said Bob Solomon, president of Dakin Inc., which is making plush figures, key chains and coffee mugs. “My initial anticipation was that it would be bigger than the Olympics.”
Now, Solomon said, he expects to post only one-fifth of the $25 million in sales his company racked up during the 1984 Olympic Games in Los Angeles.
Some suggest the real problem is the game itself: Americans have hardly embraced the sport, so why would they buy the merchandise? Others say the one-month duration of the tournament--far less than a football or baseball season--is not enough time to mount a massive merchandising campaign. And though all of the World Cup games will be televised, the sport has received little previous TV exposure in the United States, a fact that could hurt product sales.
Still, a number of the estimated 300 product licensees worldwide--100 of them American companies--insist there is gold to be mined from the merchandising of the World Cup. Perhaps the biggest market is the 3.5 million visitors expected to come to the United States to watch the games. World Cup officials project that worldwide merchandise sales could top $1 billion.
“The World Cup is the single largest sporting event in the world,” said Ralph O. Irizarry, vice president at Time Warner Sports Merchandising, which is overseeing the global licensing of World Cup products. “Every year since 1984, participation in the sport of soccer has grown in this country.”
Much of the merchandise looks nifty enough. Some of the World Cup T-shirts and tank tops made by Magic Johnson T’s have an ultra-hip, urban look.
Although he declined to be specific, Irizarry said that after a slow start, World Cup merchandise sales have recently been snowballing in the United States. But two-thirds of the overall product sales will probably take place outside of America, he said.
“As far as the basic shopper at the Mall of America is concerned, well, I doubt they will have much interest in it,” said Karen Raugust, editor of the Licensing Letter, a Brooklyn, N.Y., newsletter. “There are still many Americans who have no idea it’s even taking place.”
That’s one reason Mike Dickerson, president of College Concepts, passed up World Cup overtures from Time Warner. His company makes boxer shorts with team logos, from the National Football League to the National Basketball Assn. But he turned thumbs-down to the World Cup.
“The risk factor is too great for us,” Dickerson said. “As a merchandiser, we need the kind of year-round TV exposure that the NFL and NBA give us that soccer cannot.”
Other licensees who signed on are keeping their fingers crossed. “It hasn’t been like the kind of sales you see during a Michael Jordan championship, but no one expected that,” said Jay Jacoby, executive vice president at American Marketing Works, which is making 30 different T-shirts with World Cup designs for Magic Johnson T’s.
At many airport shops--particularly those in international terminals--sales of World Cup souvenirs appear to be brisk.
“We already look upon World Cup as a success story,” said Richard Hunter, North American president of DFS Group, which operates gift shops at airports across the country. But Hunter declined to be specific about product sales.
Meanwhile, Davidson of JH Design said retailers are snapping up his World Cup leather jackets to sell at $1,500 apiece.
“The wealthiest 2% of the people on the planet will come to this event,” Davidson said. “For our customers, paying $2,000 for a jacket is similar to how most people feel spending $20 for a T-shirt.”
Briefly . . .
Venice-based Chiat/Day has lost the estimated $6-million ad business for Carlsbad, Calif.-based Upper Deck, which moved the account in-house. . . . LA Ads Advertising & Marketing has been tapped by Mt. Sinai Memorial Park & Mortuary in Los Angeles to handle its ad business. . . . No Excuses Jeans, which once featured Marla Maples and Donna Rice in its ads, is about to break a new campaign featuring socially conscious ads, including one with the headline: “There Are No Excuses for Violence.”
