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Sports Business: College Apparel Sales Tied To Fashion, Success

Thursday, September 11, 2008 11:41am
By: Accsports Staff

By Chris Boucher, ACCSports.com
August 25, 2003 Blake Kelly is not a basketball fan from Chapel Hill. He's a 14-year-old from Connecticut who prefers lacrosse to any other athletic endeavor. So what in the world is he doing in that Carolina blue UNC hoops T-shirt? “I like the colors,” said Kelly, as he was out shopping for school necessities at the Enfield Square in Enfield, Conn. “North Carolina has cool shirts and shorts.” Kelly called UNC basketball “OK,” and there was an overwhelming sense that this teen was underwhelmed with Carolina's place in the annals of collegiate athletics history. He's only in it for the fashion. This mentality has led to a boom in the collegiate apparel industry, which is OK with Pete Gilman, head of the College Division at The M.J. Soffe Company, makers of athletic apparel (shorts, shirts, pants) emblazoned with university logos since 1946. From its headquarters in Fayetteville, N.C., the outfit made apparel with the logos of every current ACC school and several other high-profile universities in 2002. Soffe also is the inventor of the MO-37 Cheer Short, known on college campuses nationwide as “butt shorts” because of the school name printed on the garment's posterior. Having been in the business for 25 years, Gilman was around when seeing a Connecticut kid in King Dean's colors would have raised some eyebrows. Today it's unsurprising, and that exposure is sweet for universities, college licensing companies and apparel makers. “I think the big thing for the schools is they're getting advertising all around the country,” Gilman said. “You can go to New York and see a Carolina shirt, or to the West Coast and see a Miami shirt. It's like having a billboard out there representing your school.” If the billboard looks great with a new pair of Nikes and some baggy Levi's, all the better. Firms such as the Collegiate Licensing Company of Atlanta regulate the college apparel market. Formed in 1981, CLC assists collegiate licensors in protecting and controlling the use of their logos through trademark licensing. In other words, CLC makes sure your favorite university's mascot doesn't end up on a can of sardines. (Unless that's what the school's into, of course.) The company also provides its clients with an extensive list of contacts in the apparel and logo universe. “We're an agent for the university for managing logos and trademarks,” said CLC's Joe Hutchinson, calling from Tampa, where he was helping unveil the new logo for the University of South Florida. “The Nikes and Champions come through us to get licenses of different institutions. … We manage the process for the university and collect royalties … and we pay the institution.” Whereas there are many, many (many) apparel makers, CLC is the big dog in the licensing world. CLC's consortium consists of 180-plus universities, bowl games, conferences, the NCAA and the Heisman Trophy. CLC represents every current ACC school except Wake Forest, and incoming member Miami also is a client. Virginia Tech handles its own licensing, as do a handful of other major colleges. Universities can make a pretty penny off of licensing agreements, in addition to all of the free exposure they afford. Mollie Mayfield, as assistant athletic director at Georgia Tech, said the school receives approximately $300,000 annually in royalty payments from CLC. The athletic department keeps a third of it, while the rest aids general student scholarships and development. “As far as how this (revenue) compares to other universities,” Mayfield said, “it is probably smaller due to our smaller fan base than say, FSU or Clemson.” According to industry executives, Georgia Tech's lack of prominence in a major sport over the last two years could have hurt sales as well. So what makes a school a hot apparel seller? A variety of factors contribute, according to Hutchinson. “It all depends on the market,” he said. “It's based on size of institution, enrollment and other factors — such as marks, logos and the fashion element.” The fact that the Yellow Jackets haven't stung the rest of the ACC in football or basketball lately likely has shrunk its market for the time being. The better a university does in a major sport, according to Hutchinson, the better the apparel sales numbers. “Athletic success definitely affects and helps merchandise sales,” Hutchinson said. “It doesn't matter what the school size or location is, athletic success really helps. When I say athletic success, I mean the more predominant sports: men's basketball, football, women's basketball, baseball. Those are the sports that have huge fan followings.” FansEdge.com is a Chicago-based retail company that sells college and professional sports apparel, memorabilia and what fans like to call “tailgating gear.” When Maryland earned its first NCAA men's basketball title two years ago, it detonated an “explosion” of interest, said FansEdge.com merchandise manager J.T. Vanderkamp.

“Sales for (Maryland) increased nearly 200 percent over the regular season,” Vanderkamp said. “A majority of this increase can be tied to the sale of specific championship merchandise, but it also increased the sale of regular Maryland merchandise as well.” CLC's Hutchinson confirmed that the Terps have been major movers over the last half-decade. “Maryland's royalties in the last couple of years have definitely tripled,” Hutchinson said. “(Athletic success) opens up a lot more opportunity for retail. Until a few years ago, Maryland was a D.C.-area seller. Now there is demand on a higher level.” A similar spike has surfaced with Soffe's Maryland merchandise, but Duke and Florida State are the most solid sellers. Gilman said it is no coincidence that those schools boast nationally elite basketball and football programs, respectively.

“We do a lot with Carolina; Carolina is the big draw because of the colors. The powder blue is a big seller,” Gilman said. “But Duke and Florida State, those winning traditions bring sales. When you go 0-11, no one wants that shirt. When you're 10-0 or a national champion, everyone wants it.” Carolina's aforementioned aesthetic appeal, chic logo and storied athletic history make it a perennial best-seller. It was FansEdge.com's third-best seller in the last fiscal year, and it recently topped CLC's royalties rankings for the third consecutive year. Duke and FSU also are steady revenue producers, which gives the ACC three apparel giants. Clemson is steady and Maryland may be a monster in the making, but manufacturers and licensors also are excited about the potential of other league schools. “N.C. State (sales) are improving all the time, as they're getting more exposure,” Gilman said, “and Wake Forest is another school that is making progress.” Conference-wise, the SEC generally is regarded as the biggest earner, with the Big 12, Big Ten and the ACC all about even at No. 2. But in a few years, that could be history. The ACC's new entries for 2004 certainly won't hurt the conference's national profile. Virginia Tech always fills a huge football stadium despite a relatively small population base locally, and Miami already is a big seller thanks to its pigskin prominence. How much the new members will help the ACC's merchandising interests remains to be seen. The conference put the kibosh on any co-branded products (i.e. ACC logos on Miami or Tech apparel) until next summer. “They're coming to the ACC,” Hutchinson said, “but they're still in the Big East.” For now, yes. But Miami and Tech will be here soon, and they're bringing their expansive national fan bases with them. Can you hear the cash registers jingling? Brought to you by: