Tips for retailers

World Cup? What World Cup?!

Next month two South African teams, each with a huge following, will be competing in World Cups. For retailers, World Cups usually mean good sales of teamwear replica, mascots and all kinds of memorabilia to remind the fans of the good times they had in the host country.

Yet, maybe because we had the main Cricket World Cup earlier this year in the West Indies, or maybe because of what seems to be rather poor marketing, many people don’t even know that there is a Twenty20 World Cup taking place in September.

Even though the Twenty20 World Cup will be played on home soil, it seems unlikely that more stock than usual will be created for the tournament.

Home tournaments normally result in increased sales of merchandise and replica, but South Africa playing host to the cricket tournament will not be on a par at all with major tournaments held in other countries, such as the last Soccer World Cup held in Germany.

"The last Soccer World Cup had maybe 10 teams’ replica shirts available from different brands, a whole bunch of caps and adidas made four or five different quality soccer ball replicas available," Mike Hermanson of Cricket Horizons explains.

"Taking into account that we, as the official licensed merchandisers of the Cricket World Cup held in SA in 2003, began the design, sampling and manufacturing programme in June 2002 of twelve different cricket products including mini bats, sets, cabinets, key rings, poly-soft balls, sponge balls etc. for the event beginning nine months later. The process to produce memorabilia on a major scale for the Twenty20 World Cup would have had to begin at least in January this year.

"To be frank, merchandise for the Twenty20 have not yet been offered to any of the major players in this market. We will obviously continue to support Hummel as the official suppliers of the Proteas and Nike as the official suppliers of the Indian team shirts.

"But there will only be an increase in sales if SA wins the tournament," says Hermanson. "Like all things South African, we hang on to things we achieve in and forget immediately the things we don’t achieve in. Who remembers, or who has ever watched, a replay of us embarrassing ourselves against Australia in the 2007 CWC semi-final?"

Another factor is that cricket memorabilia is just not as popular as rugby memorabilia. "For cricket, it’s just about one shirt," says Arnold de Villiers of Sportsmans Warehouse. "We don’t even stock merchandise for many of the provincial cricket teams. There is simply no demand. Even the national cricket shirt is not as popular as the rugby jersey."

As has been the case in other major cricket tournaments, Hermanson expects the cricket shirts to be the main sellers in the forthcoming September tournament.

This sentiment is shared by Jaap Engelbrecht of Somerset Sport who believes that the playing shirt will be a big seller for both the Twenty20 Cricket and Rugby World Cups, as they have been in previous sporting tournaments.

Rugby World Cup

In rugby generally, all memorabilia can result in big sales.

"The fact that the Rugby World Cup is not being played in SA will obviously result in less sales than what would have been the case if we hosted the tournament," says De Villiers. "Not much can be done from here to ensure more sales other than having the tournament locally! People aren’t going to buy jerseys just to wear while sitting in front of the TV!"

Sportsmans Warehouse is still going ahead and getting more stock for the tournament anyway. The recently launched players’ jersey by Canterbury is expected to be a best seller.

Martin Ferreira, commercial director of Xco Sport, agrees. While the top seller will be the replica Springbok or RWC jerseys, he expects that smaller memorabilia like scarves, caps, flags and rugby balls will also do well. "There will definitely be an increase in Springbok and RWC replica’s and memorabilia sales as of August, when every avid supporter starts to gear up for the RWC in September," says Ferreira. "Some will buy their supporters memorabilia in South Africa and those fortunate few going to France will have a choice to buy locally at the various airport stores or at the specific RWC venues."

According to Adrian Tuohy of Tri Merchandise SA, official supplier of RWC merchandise in SA, "huge consideration has been placed on pricing in order to make the supporter range accessible to all South Africans."

He predicts that sales of this year’s RWC merchandise — especially jerseys and caps — will be much higher than for the 2003 World Cup in Australia. "Since we are in the same time zone, many more people will be watching the games in pubs or as part of organized events, where they will want to wear jerseys, caps and scarves. There is also a real belief that SA will reach the semi-final stages and possibly even win the tournament — and this self-belief generates sales."

Paul Zacks of Canterbury International SA agrees with him. "Event driven products coupled with a spirit of belief in the country will always ensure a nice uptake in sales of replica merchandise," he says. Canterbury is expecting a big demand and have ordered a substantial number of jerseys over and above the normal inventory that they would carry during this period. In order to increase sales, Zacks believes it is vital that the product needs to be marketed effectively.

According to Tuohy, unique event merchandise — like jerseys and caps featuring all 20 logos of the teams participating in the RWC — will become sought after items as they are only available for a short period and in limited numbers. "What will obviously ad to the collectable value and uniqueness is if SA were to go on and win the tournament," he says.

Retailers and suppliers agree that team performance is highly correlated with replica merchandise sales. So, the ultimate fate of merchandise sales lies in the hands of the players themselves!

Counterfeit challenge

Zacks maintains that there also needs to be effective and adequate policing and control of counterfeit products if sales are to be successful.

Indeed, sports goods has become a key growth area for black market goods, especially when sold in connection with major sporting events like last year’s Soccer World Cup, the Olympics and the upcoming Rugby World Cup.

"If we can keep the fakes off the street corners and out of the game totally, then this will go a long way to help retailers sell more products," says Engelbrecht. "There are so many fly-by-nights getting involved in selling products which aren’t licensed. This needs to be more controlled from a suppliers point of view."

The problem of fake goods needs to be addressed urgently, not only in light of the World Cups taking place this year, but also in light of major tournaments over the next few years, and more particularly, the hosting of the Soccer World Cup on home soil in 2010.

"As we head towards 2010, the counterfeit goods situation needs to be regulated immediately," says De Villiers. "More counterfeit goods are currently being sold than the real stuff."

According to the World Customs Organisation (WCO), which groups 170 customs administrations who collectively administer 98% of international trade, counterfeiting and piracy account for about 7% of global commerce.

Counterfeit and pirated goods are now produced on an industrial scale. According to research by the European Commission, the trade in some counterfeit goods is more profitable than drug trafficking.

In 2004, the WCO reported more than 4 000 seizures involving about 166-m goods that were either counterfeit or pirated. More than 2 500 seizures were made during the 2006 soccer World Cup alone.

In 2006, SA Revenue Service (Sars) customs seized counterfeit goods bearing the 2010 Soccer World Cup logo, four years before the tournament gets under way!

Ferreira agrees that counterfeit goods remain the biggest challenge. "Commitment from the consumer, suppliers, license holders and retailers is needed to fight this," he says. "It would not just have a direct influence on sales but would elevate and do justice to the brand. The Rugby World Cup is a wonderful and rare occasion that only comes round every four years and I would like to see a wave of green supporters at all the stadiums where the Boks will be playing, RWC memorabilia is special — let’s be REAL Bok supporters — wear authentic stuff!"

So as we get in the grips of sporting fever that will make its way around the world in the next few months, we can definitely expect an increase in the sale of certain replicas and merchandise, but if SA emerge victorious in both the Twenty20 and Rugby World Cups, then sales could potentially soar.