At the end of July, the National Football League owners, players, and fans breathed a collective sigh of relief when the NFL and NFLPA finally reached a deal that ensured labor peace for the next decade. For Leo Kane, the NFL’s senior vice president of consumer products, the agreement meant the league could return its focus to meeting fan expectations.
“Our fans want our product to continue to improve, and there wasn’t an employee at the NFL who wasn’t concerned about the trust that our fans have with us to bring them their professional football year in and year out,” he says. “Fortunately, our partners stood by us, and we knew it was asking a lot of licensees and retailers to make goods and place orders without knowing for sure if there was going to be a football season.”
The National Football League traces its roots to the 1920 creation of the American Professional Football Conference, which ultimately became the National Football League in 1922. Some of its modern teams trace their existence to the earliest days of the league.
The Chicago Cardinals and Decatur Staleys were two of the NFL's charter members, and are now known as the Arizona Cardinals and Chicago Bears, respectively. Other long-lived franchises include the Green Bay Packers (founded in 1919 and began league play in 1921), the New York Giants (joined the league in 1925) and the Detroit Lions (founded in 1930 as the Portsmouth Spartans before relocating in 1934).
The league arguably became a major national professional sport in the 1950s thanks to seminal moments like 1958's "The Greatest Game Ever Played." The game featured the Baltimore Colts beating the New York Giants by a score of 23-17 and was the first NFL playoff game to go into sudden death overtime. The drama of the game, along with its national broadcast on NBC, helped drive the NFL's popularity forward.
In 1959, the American Football League was founded and had its inaugural season in 1960. The AFL eventually began to compete on par with the NFL, highlighted by the historic New York Jets victory over the Baltimore Colts in Super Bowl III. In 1970, the two leagues merged and helped the NFL move into an era where it became the dominant professional spectator sport in the United States.
Although several other leagues have tried to chip away at the NFL’s dominance, no post-merger football league has come close to achieving parity with the dominant NFL.
The league’s signature event is the Super Bowl, held every year since the NFL and AFL first agreed to merge. The first Super Bowl saw the Green Bay Packers defeat the Kansas City Chiefs 35-10 on January 15th, 1967. The Super Bowl name didn’t become official until the third annual game, and Super Bowl Sunday is now almost a de facto holiday in the United States. Eleven franchises have won the Super Bowl more than once, with the Pittsburgh Steelers having won the most with six Super Bowl wins. In 2011, Super Bowl XLV became the most viewed television broadcast of any kind in U.S. history with an average audience of 111 million viewers.
Today, the NFL has 32 teams and boasts one of the most widely watched annual events in the world with the Super Bowl. The league is the world's most attended domestic sports league, with an average per game attendance of nearly 67,000 fans. The league continues to grow its presence outside the United States and has hosted regular season games in London, Toronto and Mexico City.
The strength of its partners is of primary concern to the league. One of the NFL’s goals in recent years has been to reduce the number of licensees it does business with, preferring to work with a select group of the best licensees possible. Such is the case with the NFL’s relationship with EA Sports, one of the leading forces in the video game industry. Several years ago, the league and EA reached an agreement that gave exclusive licensing rights to the company, which produces the popular Madden NFL franchise.
Key segments for the NFL’s consumer products strategy have long included performance apparel and lifestyle products such as games, toys and DVDs. In addition, the league has actively explored methods to enhance penetration in women’s, children’s and international markets. Kane says the NFL is fortunate to have many long-standing partnerships as well as an infusion of new partners on the NFL’s big stage.
“For us, consumer products represent the relationships with licensees and retailers. We link in closely with our marketing group, and we try to determine what products make sense for the game, the fans and our brand. We have many licensees who have been with us for many years, but our process focuses on having bigger relationships with fewer partners,” Kane explains.
“The NFL demands innovation from our partners, but more from an evolutionary standpoint. We don’t want our brand to appear to fans to drastically change, so we rely on partners who have been with us for a long time as well fresh, new partner who can help us innovate and bring fans new, exciting products.”
Recent examples of new partnerships include agreements with New Era Cap Company and Nike. New Era, a global headwear and apparel brand, will become the official on-field cap licensee of the league beginning in April 2012. As part of the agreement, New Era will be the exclusive distributor for on-field, sideline and locker room caps while also having co-exclusivity for fan gear.
As for the partnership formed with Nike, the company will become the league’s new official uniform provider. Previously, the league worked with Reebok, which will continue its rights to the NFL’s uniforms until 2012. When the new five-year deal with Nike commences, the company will produce jerseys and uniforms and provide all league teams with on-field team apparel such as base layers, as well as sideline personnel apparel and fan merchandise.
In the case of both the deals with Nike and New Era, the league hopes to expand the depth of merchandise available to fans by working with companies that are clear global category leaders.
These are not the sole apparel-related licensing agreements for the NFL. Under Armour is responsible for outfitting the scouting combine as its presenting sponsor; ‘47 Brand produces headgear for fans; Outerstuff provides youth apparel; and GIII and VF are fan gear outfitters. GIII focuses on lifestyle collections for men and women, while VF’s focus is t-shirts and fleece products.
Engaging all fans
Establishing relationships with niche apparel licensees has been a critical undertaking over the last few years, as well. The league has tried to expand into demographics that it felt weren’t being served well enough, and Kane pointed to the 44 percent of NFL fans who are female as an example. Two or three years ago, the league wouldn’t have had relationships with companies such as Victoria’s Secret or Destination Maternity.
Today the league does have those partnerships because it is actively attempting to match its fans’ desire for football in channels where they want to be served. “We’re still at the beginning stage of reaching out to our female fans. That is a group that we will continue to market to, both in the game and outside of the game,” Kane notes. “We will go where our fans are, because it isn’t just about a transaction for many fans. It has to be much more experiential.”
Game-day entertainment licensing is also an important part of the NFL’s licensing strategy given the tailgating culture that thrives among the league’s fans. In April, the league struck a deal with the entertainment equipment and outdoor lifestyle company Best of Times, which has licensing rights for the Best of Times Bar & Entertainment Center, a portable bar and entertainment system.
“The game day party atmosphere happens in parking lots and at home, what we refer to as home-gating,” Kane says. “We will have ways for fans to enhance their game-day experience — everything from licensed glasses and bowls and party ware. The breadth of product in that area is immense.”
Finding the seams
The league’s creativity with licensing and consumer products extends to its distribution and advertising channels. The NFL has even explored selling a range of items – everything from collectibles to t-shirts – in vending machines.
As for more interactive techniques on NFL.com and in its TV campaigns, the league attempts to make its strategies come alive whether they are targeted at core consumers or niche consumers.
Online, the league is exploring simulation gaming such as casual games on the youth-focused NFLRush.com site, and it is continuing to move the Madden franchise into the digital media world.
“As we’ve become more of a media company and a 365-day-a-year brand, we’ve spent a lot of time to make sure that anyone who tunes into NFL Network or shops at NFL.com has an experience that really reflects our brand,” Kane says.
“Over the next few years, we will bring our role-playing game — the NFL RZ — alive with products. That is our key strategy for kids.”
At the same time, international distribution of its products continues to increase due in large part to the league’s five-year tradition of holding a game at London’s Wembley Stadium.
Kane said international fans attach themselves to the game in a much different way than American fans. At any given NFL stadium in the United States, the majority of fans adorn themselves in the colors of the home team. At the London game, however, all 32 teams will be represented almost irrespective of the two teams playing in the game.
“It is a different world. Everything begins with the brand that we have, and we’ve gotten much better at understanding how international fans connect to that,” Kane says.
The right mix
Now that the league and its players are back at work on the gridiron, Kane is happy to turn his attention to new products like NFL Pillow Pets team-branded plush toys, just one new product that Kane is excited about.
With a full calendar of events around the year — everything from preseason, regular season and playoff games to the Super Bowl, Pro Bowl, NFL Draft and scouting combine — Kane is aware that there are more events than ever that appeal to the league’s fans and more ways than ever to connect fans with the brand.
Future success depends on finding the right product and distribution matrix with the right retailer and calendar initiative to extend the brand onto platforms that can be built on for many years.
“Labor peace allows us to have a long-term view and be that much more strategic,” Kane says. “All of our partners need the brand immersion that we want them to have. It isn’t about just make products that basically have the same logos of the other leagues. Our products must be NFL unique and NFL-specific. “We owe that to our fans because we have a game that people are passionate about,” he continues. “Every game takes on a life of its own, and that gives us an opportunity to bring out different products and elevate our brand so it is more engaging and gives fans the experience they deserve. Now we feel like we can invest in the future and have the superior presentation that people expect from the NFL.”