Hot Market Madness
What do you call 65 teams playing in 64 games in less than 20 days where winners move on, losers go home, and companies can have less than 36 hours notice to get product with the correct championship teams in the marketplace? You call it hot market madness! A “hot market” is defined as a short-term sales window for collegiate product, usually capitalizing on athletic success or a milestone /achievement of a collegiate institution.
One of the biggest hot market events in collegiate athletics is the NCAA Men’s Basketball Tournament, also known as NCAA March Madness. It’s no secret the “madness factor” also can be attributed to the time constraints levied on the licensees, licensors, and universities to meet the hot market demands of excited fans.
During this hot market, teamwork is just as important off the court as it is on the court, as time is of the essence to get products approved, manufactured, and on shelves for consumers to purchase.
To bring some method to the madness and to answer common questions surrounding the NCAA basketball tournament hot market is Cory Moss. Moss is Senior Vice President of Operations for The Collegiate Licensing Company (CLC) and has been at the helm of several hot markets during his tenure at CLC.
How many companies are licensed to produce product for the NCAA Men’s Basketball Tournament hot market?
“The NCAA currently has 25 company’s licensed to produce product for the men’s basketball tournament. These companies hold exclusive licenses for this particular hot market and include companies such as Nike, Addias, Russell and Top of the World to name a few. These companies are cleared to use the NCAA and Final Four marks on product they’ve been licensed to manufacture throughout the tournament.”
Are exclusive licensees producing product before the brackets are filled? Is that risky?
“It’s possible some produce product in advance, but a more common practice for a licensee is to have all the products designed and approved in advance for the institutions they are tracking in the tournament. I think they’ve eliminated the majority of the risk in the early rounds of the tournament, since they have a good inclination of teams that will make it into the tournament. It’s the bubble and Cinderella teams that might cause them to back pedal a little.”
“It can cause headaches for some. However, this is where licensees might take a gamble on having artwork designed and approved for low seeded teams on the front-end. If the gamble pays off, then it’s a homerun for the licensee and the retailer.”
What’s the best way for retailers to prepare for a hot market opportunity?
“CLC tries to bridge the gap between the licensee and the retailer and is a great resource for retailers preparing for the tournament. CLC can produce “Officially Licensed Merchandise” and “NCAA bracket” signage to promote product. CLC can also provide retailers with a list of manufactures producing tournament product because the licensees selling tournament product may be different than retail buyers typically purchase from.”
The issue of selling unlicensed product is always a topic at any big sporting event? What steps are taken during the NCAA basketball tournament hot market to deter counterfeiters from selling bootleg merchandise?
“First off, it’s unfortunate this problem exists. With that being said, we have nearly 20 representatives dedicated to our counterfeit enforcement teams throughout the tournament. We have law enforcement officers paired with each representative on the ground, as well as three on-call attorneys to field questions and assist the needs of those handling counterfeit enforcement.”
What is the counterfeiter’s product of choice during the tournament? Why?
“T-shirts are the items we seize the most. Bootleggers are pretty high-tech and have the capability of turning this type of product around pretty quick and it usually shows in the quality.”
What was your most memorable enforcement seizure at the tournament?
“It was probably the Final Four in San Antonio in the late 1990s. It was memorable because we didn’t seize anything of significance. A couple of month’s prior we were in San Antonio doing enforcement at the Big 12 Championship and really hit the counterfeiters hard. In Texas, if you’re caught selling counterfeit product, law enforcement seizes everything. They seized the product, money, the cars they were using to store the product in and all the counterfeiters were arrested. So when the tournament came to town in March there was no counterfeit product anywhere. We sent a strong message to the counterfeiters that weekend at the Big 12 Championship and it showed on the streets of San Antonio during the Final Four.”
The team that wins the National Championship has a hat and T-shirt with their team logo and the Final Four mark immediately following the game. From a layman’s perspective that’s pretty amazing. What’s the secret to producing that product so fast?
“Locker Room product is produced for all teams that earn a spot in the Final Four in advance. Due to the quick turnaround this hot market demands, manufactures have factories or authorized manufactures domestically that produce the product and ship it to the venue. When the product arrives at the stadium, it’s checked for accuracy then placed in a secure location. About 120 pieces (hat and T-shirt) of Locker Room is produced for each school.”
What happens to the product from the losing teams?
“All losing team Final Four Locker Room product is returned to the NCAA. The NCAA donates the product to World Vision, who distributes the product oversees to those in need.”
After a champion has been crowned, do the exclusive NCAA licensees have the option to produce product for that team?
“Yes. The exclusive NCAA tournament licensees are also National Champions licensees, but the exclusivity is no longer in effect. The hot market for producing National Champions product is a non-exclusive category. In most cases, the winning school will bring in their own set of licensees.”
What’s the life span of the NCAA Tournament hot market?
“It encompasses the entire month of March. The National Champion usually experiences an additional month of hot market sales. There are some rare cases where a team, other than the National Champion, will experience big sales. For example, George Mason University made a big run in last year’s tournament, but came short of winning the title, yet their hot market was lengthy due their tournament success."
What is the coolest part of a hot market?
“Definitely watching the hot market come together. Seeing fans buying and wearing the product, receiving positive feedback from retailers and licensees, and knowing everybody worked as a team to make the program successful. Distributing the Locker Room product to the players, coaches and staff at the conclusion of the National Championship game has been a really neat experience over the years. The electricity on the court at the end the game is indescribable.”
What’s your hot market pet peeve?
“Licensees not following the guidelines put forth for the hot market. For example, licensees manufacturing and selling unauthorized products, using unapproved designs on product, and entering channels of distribution they are not permitted to sell in. Also, licensees that refuse to meet the demands of fans of small market institutions that make it into the tournament or have a successful tournament run is also very frustrating, because the fans have no source for purchasing product during their tournament frenzy.”
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Editor’s Note: CLC represents 38 teams that were invited to participate in the NCAA Men’s Basketball Tournament this year, as well as the NCAA itself. Congratulations to all those teams that are battling for the championship!