Fanatics (sports retailer)

Fanatics, Inc. is an American online retailer of licensed sportswear, sports equipment, and merchandise, formed in 1995 and headquartered in Jacksonville, Florida. Fanatics offers product via its Fanatics and FansEdge brands, as well as sports collectibles and memorabilia through Fanatics Authentic and SportsMemorabilia.com. Fanatics also currently operates the e-commerce websites of major professional sports leagues (MLB, NASCAR, NBA, NFL, NHL, PGA, MLS, and UFC), major media brands (CBS Sports, FOX Sports, and NBC Sports), and over 150 collegiate and professional team properties. They are also the exclusive online distributor for the United States Olympic Team and Paris Saint-Germain.

Fanatics,Inc.
Private
IndustryTextile Ecommerce
FoundedJacksonville, Florida, 1995 (1995)
FounderAlan Trager
Headquarters
Jacksonville, Florida
,
U.S.
Area served
United States
Key people
Michael Rubin, Chairman
Doug Mack, CEO
Michener Chandlee, CFO
ProductsLicensed sports apparel, sportswears, hats, collectibles
BrandsFanatics
FansEdge
OwnerMichael Rubin
Number of employees
1,800
SubsidiariesMajestic Athletic [1]
Websitefanatics.com

Fanatics has relationships with over 1,080 product vendors, including such companies as Empire Warehouse, Freeworld, Front Row Couture, ‘47 Brand, Adidas, Majestic, Mitchell & Ness, New Era, Nike, Reebok, Rock 'Em Apparel, Under Armour, and over 1,000 others. Fanatics, Inc. also owns Fanatics Apparel, which produces licensed sports apparel exclusively for the Fanatics umbrella of sites. Additional offices are located in Boulder, Colorado; Conshohocken, Pennsylvania; Rockwall, Texas; Roanoke, Texas; Deerfield, Illinois; Arlington, Texas; Fort Lauderdale, Florida; Irving, Texas; San Mateo, California and Memphis, Tennessee.[2].

History

Formed in 1995, Fanatics, Inc. was originally started when brothers Alan and Mitch Trager opened Football Fanatics, a brick-and-mortar storefront in the Orange Park Mall, focused on the Jacksonville Jaguars and local collegiate team merchandise. By 1997, a second store had opened in the Avenues Mall. Brent Trager focused on achieving an online presence for the retail company, hiring its first dedicated e-commerce focused employee in early 2000.

Fanatics' early success resulted from a business strategy which targeted and partnered with websites with quality content and domain names. The company began as a customer-centric organization with its mission of "To consider the customer first in everything we do."

Fanatics further grew through affiliate marketing, repeat customer business, and acquisitions. The first acquisition (2006) was Richard Perel's Marketsville, Inc. sports websites which included the top college e-commerce property CollegeFootballStore.com. At the time, Marketsville, Inc. accounted for close to 25% of Fanatics' online sales as an affiliate. Richard Perel stayed on board as a marketing executive at Fanatics until 2014, helping the company secure funding at a $3.1 billion valuation in 2013. Subsequent acquisitions were RuppShirts, based out of Tallahassee, Florida, and Demand Made.

In 2011, Fanatics, Inc. was purchased by GSI Commerce, led by chairman Michael G. Rubin, for $171 million in cash and $106 million in GSI common stock.[3]

In 2012, Rubin purchased Fanatics outright from eBay, along with a 70% stake in Rue La La and ShopRunner, and formed the umbrella company Kynetic as a parent company.[4] Later that year, Fanatics acquired its Florida-based rival Dreams, Inc. for $158 million in cash and $25 million in debt.

Michael Rubin owns 72% of Fanatics,[5] after the last round of venture capital funding. As of June 2014, Fanatics was valued at $3.1 billion.[6] As of April 2014, Doug Mack is the CEO of the company, which currently has about 1,800 employees.[7] Fanatics was ranked #42 in the Internet Retailer Top 500 in 2014.[8]

In April, 2017, Fanatics bought sportswear and merchandise manufacturer Majestic Athletic to VF Corp.[1] Majestic was the exclusive on-field uniform provider of the MLB since 2005. The deal was a move to replace Majestic as the MLB provider since the 2020 season, after Fanatics had signed an agreement with Under Armour.[9]

In September 2017, Fanatics closed a $1 billion round of fundraising led by Softbank, with participation from the NFL and MLB. As of that year, Fanatics was expected to produce $2.2 billion in annual revenue.[10]

On January 29, 2019, it was announced that Fanatics and Walmart have reached a deal to start selling its apparel on Walmart's website.[11]

Recent forecast released on CNBC suggest the company is nearing $2.5 billion in sales. [12]

Sports leagues

NBA

In 2015, the NBA announced a multi-year partnership with Fanatics to operate its 25,000 sq ft flagship store in New York City.[13] Since Fanatics also operates the online NBAStore.com, customers of the New York City store are able to browse and purchase from the entire online inventory through in-store handheld devices.

NFL

In March 2016, the NFL and Fanatics agreed to a new long-term extension to operate NFLShop.com.[14] The NFLPA also granted Fanatics the rights for player merchandise. Fanatics will replace Nike as the largest maker and seller of player merchandise starting in March 2017.[15]

NASCAR

In 2015, Fanatics obtained a licence from NASCAR to sell the merchandise trackside at all 36 Monster Energy NASCAR Cup Series races and select NASCAR Xfinity Series races. This contract eliminated car owner and sponsor-owned merchandising haulers, which had previously sold mixed merchandise and limited edition items in favor of a singular "superstore" shopping area with one checkout zone for all merchandise, generally located outside one track entrance. It was initiated in August 2015 at the Pocono Raceway.[16] By 2017 however, the plan was considered a failure due to limited merchandise and poor foot traffic, and it led to a decline in overall at-track merchandise sales.[17] Larger tracks such as Daytona International Speedway utilized the first turn for merchandising, however, the majority of fans did not enter through this area as well as the many fans camping infield. Sponsors were unable to find places for drivers to initiate fan contact as they had previously in merchandise haulers for events such as autograph signings.

Fanatics currently employs a "hybrid" system with a blend of haulers and smaller Fanatics tents (size/space varies per track). This allows Fanatics to reach more fans, especially once inside the gates and has reopened the door for NASCAR and driver sponsor interaction. Fanatics President Ross Tannenbaum indicated, "We've got all this money and all this product invested [in the tent] and it's sitting outside the gates where there is nobody coming [while the race is happening]. All those people are inside and at some point walking around or doing something and there's a very poor product offering. To have the best shopping experience, our goal would be to have a really strong offering of product out front like we have today but do a better job of having destination shopping inside the track."[18] In July 2017, it was revealed that the drivers only get as little as 1 to 3 percent of the profits that Fanatics make while Fanatics make 75 percent of the profit. This has led drivers such as Kyle Larson and Ricky Stenhouse Jr. to be vocal and seek changes. On November 2, 2018, Fanatics announced they would no longer provide the trailers for the series as the series continues its decline, though Fanatics would continue with online sales until 2024.[19]

NHL

In 2017, the National Hockey League partnered with adidas and unveiled a new hockey jersey with Fanatics making the jerseys themselves as the new standard jersey for fans while adidas manufactures the on-ice jerseys.

MLB

In December 2015, MLB announced a merchandise deal that split the rights between Fanatics and Nike.

MLS

MLS and Fanatics began their partnership in 2017.

Other ventures

In January 2015, Fanatics began selling a collection of casual womenswear designed by Robert Kraft's ex-girlfriend Ricki Noel Lander called Let Loose By RNL.[20] In October 2019, Fanatics teamed up with sports broadcaster Erin Andrews on a line of clothing.[21]

Fanatics announced a multi-year partnership with the Overwatch League to sell team and League clothing and other merchandise; this represents Fanatics' first venture into esports merchandising.[22]

In June 2020, Fanatics announced a ten-year licensing, manufacturing and e-commerce partnership with French soccer club Paris Saint-Germain.[23]


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References
  1. Fanatics buys Majestic by Dan O'Shea on Retail Dive, 4 Apr 2017
  2. "Why the world's largest licensed sports merchandise retailer is moving hundreds of jobs to San Mateo". Silicon Valley Business Journal. May 4, 2016. Retrieved May 13, 2016.
  3. "Jacksonville-based Football Fanatics scores with $277 million sale". The Florida Times-Union. Archived from the original on 2014-02-13. Retrieved 2014-09-25.
  4. "Newly-Minted Billionaire Is Spinning eBay Scraps Into Gold". Forbes. December 11, 2001.
  5. "Profile: Michael Rubin".
  6. "Score! Web Sports Retailer Fanatics Inc.Tops $3 Billion Valuation". Wall Street Journal.
  7. "Sports Apparel Purveyor Fanatics Swipes One Kings Lane Chief". Blogs.wsj.com.
  8. "Sports apparel e-retailer Fanatics hires a Williams-Sonoma exec". InternetRetailer.com.
  9. Jacksonville’s Fanatics Inc. to acquire Majestic sports apparel company by Drew Dixon on Jacksonville.com, 5 Apr 2017
  10. "Given an assist, sports e-commerce giant Fanatics closes that $1 billion round led by SoftBank". TechCrunch. September 6, 2017. Retrieved 2019-10-24.
  11. "Walmart Scores Big Against Amazon With Fanatics Sports Gear Deal". Fortune.
  12. "Fanatics Names Nike Exec CFO". CNBC.
  13. "Conshohocken Company to Run NBA Flagship Store in NYC". More Than The Curve. Retrieved 13 May 2016.
  14. "Fanatics Signs Long-Term Extension Of NFL Deal, Expanding Rights". Retrieved 13 May 2016.
  15. "E-commerce giant Fanatics scores a new deal with the NFL". B2B E-Commerce World. Archived from the original on 14 May 2016. Retrieved 13 May 2016.
  16. "FANATICS LAUNCHES NEW 'TRACKSIDE SUPERSTORE'". NASCAR. Archived from the original on 2015-08-06. Retrieved 2019-10-24.
  17. "Souvenir haulers may return to some NASCAR races as merchandise program evolves". NBCSports.com. Retrieved July 6, 2017.
  18. "Revamped merchandise model will see more souvenir trailers at tracks". ESPN. May 9, 2017. Retrieved 2019-10-24.
  19. "Fanatics to bring early end to its deal selling NASCAR merchandise". motorsport.com. Nov 2, 2018. Retrieved 2019-10-24.
  20. Fanatics website: "Let Loose by RNL is a Contemporary Women's Fanwear Line Designed by American Actress, Model and Designer Ricki Noel Lander" retrieved August 8, 2016
  21. "Erin Andrews Designs Clothes for Fanatics". WWD. October 2, 2019.
  22. Holt, Kris (December 3, 2018). "Overwatch League lands major merchandise deal with Fanatics". Engadget. Retrieved December 3, 2018.
  23. Kochkodin, Brandon (June 30, 2020). "Paris Saint-Germain Signs 10-Year Merchandise Deal With Fanatics". Bloomberg. Retrieved June 30, 2020.
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