This note is written by Scott Sillcox in fall 2023 in response to a lot of readers asking me two questions:
A. You wrote and posted this 12 part blog in 2012-ish, is it still relevant today? Short answer - absolutely! The basics of sports licensing change very little over the years, so I strongly suggest that if you are trying to learn about sports licensing, read away! I have also tried to update certain areas where there have been significant changes, so I feel comfortable in telling you that this information is still highly relevant.
B. You mention that you are a consultant and might be able to help me, do you still do consulting? Short answer - absolutely. I work in the licensing field virtually every day of my life, so if you have questions or would like my help, contact me! The two primary ways I work are hourly telephone consulting ($175US/hour) and face-to-face meetings where I come right to your office for a full day ($1500US/day + $650 travel expenses).
Many thanks and happy reading -
Scott Sillcox
Please also note: This 12 part series initially appeared on my "Heritage Uniforms and Jerseys" blog, but I moved it in March 2012 to this blog which has a more single-focus on the world of licensed sports products.
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Greetings!
This is Part 10 of a 12 Part Series of blogs Scott Sillcox wrote called “An Insider’s Guide to the World of Licensed Sports Products in 12 Parts: Practical Lessons from the Trenches”. For a backgrounder on Scott Sillcox and his company, Maple Leaf Productions, please see the introductory blog and/or watch his 11 minute introductory video. Scott is available to consult with anyone interested in pursuing a sports license.
The 12 Parts of this Licensed Sports Products blog are:
Part 1: How Licensing Works - Follow The Money or How $5,000,000,000 can be less than you think
Part 2: What’s Involved in Getting a License – You need them far more than they need you
Part 3: The Landscape and some of the players
Part 4: Quality Control – Where The Real Power in Licensed Sports Lies
Part 5: Royalty Reporting and Audits
Part 6: Selling Licensed Goods - Why it’s not as easy as it looks
Part 7: Players Associations and Current vs. Retired Players
Part 8: Royalty Rates – Is 12% the norm and when 12% isn’t enough
Part 9: Local Licenses – myth or reality?
Part 10: Packaging
Part 11: Ten Things (Actually 12 Things) I Learned Along The Way
Part 12: Ten More Things (Actually 14 Things) I Learned Along The Way
Greetings!
To tell you the truth, I have been somewhat dreading telling the story of “Packaging”. There’s no getting around the fact that Packaging is not a very sexy topic. So I will admit at the outset: Packaging - a bit dull? For sure. But Packaging - important? To licensees, hugely!
In the big picture, most leagues have established fairly elaborate standards when it comes to packaging of licensed sports products. In its most basic form the packaging standard will govern the use and placement of the league’s licensed products hologram. But for most leagues packaging is far more than the use of a hologram.
If you don’t mind, I’m going to use the NFL as my primary packaging example, although I could have just as easily chosen MLB or the NBA or the NHL.
The NFL has a fairly rigid, and lengthy, set of packaging guidelines that licensees have to follow if they want their product to be approved for sale by the NFL’s Quality Control Department (see Part #4 for more on the hugely important role of the QC Department).
The packaging guidelines have two elements:
1. Licensed Product Authentication Products
aka sewn-in labels, hangtags and holograms
2. Actual product packaging
1. Soft Goods
For Soft Goods licensees, the packaging guidelines deal with the Licensed Product Authentication Products, namely:
A. Labeling affixed to /sewn onto the product (sewn-in label)
B. The NFL hangtag that is attached to the product (NFL hangtag)
C. The hologram that is usually built right into the hangtag (hologram)
D. The licensee hangtag that is attached to the product (licensee hangtag)
There are many rules related to these items, but the good news for Soft Goods Licensees is that in most cases the licensee can (and must) buy the NFL hangtag and hologram from the league’s exclusive supplier of officially licensed hangtags and holograms (OpSec Security Inc., Parkton MD), and therefore you have two less things to worry about. Keep in mind that you have to buy these hangtags/holograms from OpSec – they aren’t free – and prices range from a few cents each for holograms to upwards of $0.15 each for some combination hangtag/holograms.
2. Hardlines
For Hardlines licensees, the NFL has assumed that almost every hardlines product needs some sort of packaging and they have designed a set of guidelines, what they call a “Package Goods Program”, with the goal of creating a consistency across all NFL licensed packaged goods.
For the better part of 2000-2007, the look that the NFL wanted for packaged goods featured a red band on the entire left side of the package. Beginning in 2008, the NFL switched to an all-black/predominantly black background package design. If you walk into an NFL team store at a stadium near you, you will see what the NFL desires – a consistent look for most of the “packaged” or “hardlines” goods – a “black” look. Good or bad (and I skew towards the latter), they have achieved their goal.
More than anything, my issue has to do with the fact it seems to me that packaging has the potential to be a very important tool in a licensee's sales arsenal, but if licensee's hands are almost completely tied as we conform to a predetermined standard chosen primarily for consistency, then sales will suffer. I simply believe that in trying to achieve consistency, sales are being lost, not gained. I could carry on about how much money must have been spent creating these guidelines, and how much time and effort must be wasted (I mean spent) policing and enforcing these guidelines through an overworked and underpaid Quality Control staff, but I won’t…
Now off my soapbox and back to the topic at hand…
The NFL packaging guidelines cover a range of packaging types, including:
- clamshells
- boxes
- boxes with windows
- one-sided header cards
- two-sided header cards
- belly bands
The packaging guidelines cover such things as the size and placement of all logos printed on the package, how and where the holograms can be placed on the package, and many more rules about the actual packaging design itself. I don’t mean to belabor the point, but for boxes alone there are rules for the:
1. Front of box background
2. Actual product front
3. Product “callout” / product description + the NFL shield logo
4. Hologram on front
5. NFLPA logo (if applicable)
6. Back of box background
7. Barcode
8. Sides of box
If you would like to see the NFL's 2008 packaging design guidelines, which I would suggest couldn't be more complicated if you tried, please contact me. Please note that when it comes to NFL hangtags, Soft Goods licensees will order these directly from OpSec so you don’t have to worry about designing hangtags yourself.
In the grand scheme of things the point of this blog is simply this: You cannot take the packaging of licensed products lightly or you will not pass the final stage of the Quality Control Approval process and you will not get your product to market.
Here are a few other packaging bits and pieces, partly demonstrating what a minefield packaging can be:
A. Post-season programs
Most leagues, especially MLB, have a special post-season licensed product hologram program (if you have a World Series license, you have to use World Series holograms, not regular holograms). It doesn’t end with correctly ordering post-season holograms from OpSec (yes, MLB uses OpSec as well – ditto the NHL and NBA), it only begins there because MLB specifies that you must account “for every single hologram you purchase, and all unused holograms must be returned to OpSec.” Holograms typically come 1000 to a roll, and “each sticker on used rolls must be counted and noted by licensees before being returned to OpSec. And Major League Baseball Properties reserves the right to audit licensees to verify their sales of postseason products and the use of hologram stickers.” You can’t make this stuff up folks… Yikes!!!
B. What licensees are (and are not) allowed to order from OpSec
In the case of the NHL (and ditto the other leagues), “There are a number of different NHLE authentication products available to NHLE licensees depending on the types of products you are licensed to market (i.e. apparel, novelties, etc.). NHL Enterprises has made the determination of which products you are required to use and has [told] OpSec which type of authentication product you are authorized to receive and required to order. If NHLE has identified you to OpSec as a licensee authorized to receive more than one product because you are distributing products in more than one classification, you must specify to OpSec at the time of your order which products you need.” Once again, you can’t make this stuff up.
C. Authentication Prices
I thought it might be interesting to see OpSec’s NHL Authentication Products price list (from 2008). No editorial comment – I just thought it would be somewhat interesting to show a price list:
In retrospect, I find it somewhat telling that I gave every blog in this 12 part series a subtitle – every one except Part 10:Packaging. My subconscious must have been at work, knowing how potentially dull (but necessary) a topic this would be. That being said, if I was to do it over, I should have subtitled this blog “Packaging: Not for the faint of heart” because like it or not, in the world of licensed sports products, Packaging is time consuming, complicated and cannot be ignored.
Thanks for reading and as always, all comments are welcome!
Scott
PS Way back in 1992 an organization called The Coalition to Advance the Protection of Sports logos (CAPS) was formed as an alliance between The Collegiate Licensing Company (CLC), Major League Baseball Properties, Inc., NBA Properties, Inc., NFL Properties LLC, and NHL Enterprises, L.P. to address common trademark protection and enforcement matters of its members and to help consumers identify counterfeits. After a period of relative quiet, it would appear that CAPS has become quite active in policing all sorts of product "violations", or what they at least feel are product violations. I have shown some of the info below as examples of sewn-in labels, hangtags and holograms, images of which are hard to find on the internet. Their website says for more information to call 1-800-TEL-CAPS (835-2277) and some of these have been updated on the CAPS site so best to visit it directly.
PPS from fall 2023: In case you weren't aware, I created and constantly maintain a searchable Online Directory of 2500+ North American Licensed Sports Products Companies – it can be found at www.LicensedSports.net and only costs $59 to use for three full months. This is a highly searchable directory of licensed sports products companies in North America, companies that have been licensed by various sports leagues (NFL, MLB, NBA, NHL, NCAA, NASCAR, MLS, etc.) as well as the various players’ associations (NFLPA, MLBPA, NBAP, NHLPA). There is nothing like it anywhere on the internet, and I update the database weekly, oftentimes daily.
Virtually all 2500+ company records have a contact name with title, phone number and email address. In many cases, I list up to six contacts within the company. What's more, many of the records have a Linkedin url so you can learn much more about that contact including if you know people in common.
So if you’re looking for all the licensed sports products companies based in Connecticut, or all of the NFL licensees which sell housewares, or all companies licensed by the NBA and the NHL and MLB for soft goods, check out this terrific and highly searchable resource at www. LicensedSports.net .
PPPS from fall 2023: I am a very active consultant to people looking to learn more about the licensed sports product industry - you can find the full detail here. I spend almost every day in the licensed sports product field and I work with between 300 and 500 clients each year. There are three primary ways I work with people:
1. Hourly telephone consulting
2. Full day face-to-face meetings where I will go almost anywhere in North America to spend a full day with you and giving you a fire hose amount of information that is directly applicable to your circumstances.
3. I have a bundled package of services for those people who know that they want to work with an existing licensee.
So visit here for more detailed info and let me know how I can help you move your idea forward.
