Italian Company Panini To Be NBA's Sole Trading Card Licensee
Wednesday January 28, 2009
By Terry Lefton, Editor-at-Large
The NBA has trimmed its trading-card roster to a single licensee, and it's a name not very familiar to stateside collectors: Panini. The Italian sports collectibles company has signed a four-year deal giving it exclusive global trading card, collectible stickers, and sticker-album rights. With the deal, the league ends long relationships with Upper Deck, a 17-year NBA licensee; and Topps, which produced its first NBA cards in '57. Officially, the Panini contract takes effect October 1. However, NBA Senior VP/Global Merchandising Sal LaRocca said the league is working with its other licensees to help Panini get rookie cards to market sometime late this summer. Sources said Panini beat the best offers from the incumbent licensees by 25%. LaRocca said that the NBA, Topps, Upper Deck, and Panini were in agreement that a single license was the right arrangement for the shrinking trading-card market. While Panini will not have the brand equity or relationship held by Upper Deck or Topps, marketing investment in the category will double because of the single-licensee arrangement. "The flow of product into the market will be more organized, there won't be a rush to get new cards out, and that should make a better consumer experience," LaRocca said. The deal does not include WNBA trading-card rights, which are held by Rittenhouse, nor a D-League license, as that circuit has yet to attract a trading-card partner.
LESS IS MORE: Reducing the NBA's trading-card licensee roster to one replicates a move made by the NHL in '06, which has helped that league boost a trading-card market wracked by oversupply and shrinking interest by an audience of kids that have abandoned trading cards for videogames. "The card market has been diluted and this is a way to clean it up," said Ian Jones, the former Global Sales Manager of Premiums and Promotions for Upper Deck, now a consultant. "The NHL deal controlled supply and kept prices stable, so now hockey is probably half of Upper Deck's card business. The Panini brand is not known here, so that's something they'll have to invest in." Aside from stimulating marketing investment in trading cards, the move will cut down on supply. LaRocca said the league's two current licensees have around 20 different sets. In its initial season, Panini is expected to issue 10-15 different trading card sets, LaRocca said. "An exclusive makes it easier to get channel investment and rebuild the category," said Bill Jemas, an NBA licensing exec from '85-92 and current CEO of New Jersey-based licensing/merchandising firm 360ep. "Sampling and other marketing and promotion are the key to jumpstarting this category, but they have almost disappeared. Panini understands how to market, promote and how to tie in other sponsors to help with that."
KNOWN AS ENTERTAINMENT LICENSEE: Panini held an NBA license to produce stickers in the late '90s. In the U.S., Panini has enjoyed success as an entertainment licensee, producing cards and stickers with large entertainment licenses like "Hannah Montana" and "High School Musical." Panini in Europe produces and distributes comic books and holds many soccer licenses, most notably the rights to the most recent FIFA World Cup. The NBA is Panini's first U.S. sports license of note, so there is some speculation it will use this license as a stepping stone to pursue other American sports properties as they become available. While the overseas market represents only about 5% of the overall NBA trading-card sales, LaRocca said it is a category "that is lagging there [overseas] and clearly we are trying to do something about that." LaRocca: "Panini has been able to re-energize kids time and again as new [entertainment] properties came and went with stickers and sticker albums. Their understanding of how to reach kids worldwide is clearly something we're interested in."