If your business is a success, chances are good that, at some point, the sports community is going to notice-really notice. Maria Erickson, is president and CEO of Fantasi International, a company known for Bette & Court, a clothing line for women golfers. She has 35 employees as well as a couple dozen independent sales representatives working for her. Erickson has had pro golfers approach her to be paid spokespeople for the Bette & Court division--which brings in $8 million to $10 million annually.
Not a bad take, especially considering that her initial investment was only about $13,000 from her savings, although Erickson, 43, says she ultimately had to take out loans to keep the business running in the lean years. "We were definitely operating on a shoestring budget," says Erickson, who's fallen into a few sand traps and made a shank or two over the years.
One such year was around 1996, when she thought "Oh, boy, the market's going great with the ladies--let's get into men's clothing." What she didn't realize at the time was that the "barriers for entry [were] much greater," she says. "The rules of business, the way the business game is played, is much different than the one I had come from. I thought we could take the exact formula and replicate it with the men's [clothing]." We'll resist the urge to make a pun about a clothing company losing its shirt, but Fantasi, based in Hialeah, Florida, did lose "a significant amount of money" because Erickson had plunged into an area of business that she hadn't fully researched.
Add to that the sagging economy of recent years, which hammered away at Erickson's business. "When the economy is tough, golf is a luxury. And when there are corporate layoffs, and you're worried about your job and working twice as hard because you've lost half your staff, the last thing you want to do is spend frivolously on golf."
This is one reason why Erickson's business is still going after new golfers, expanding its female clothing by marketing to senior citizens and even girls. "I think the future is very bright, but you always have to be cautious," says Erickson, which is why she's not likely to join forces with an athlete to promote her clothes, even though her experience with having a spokesperson was largely a positive one. Erickson brought aboard Michelle McGann--who was and still is a force on the Ladies Professional Golf Association Tour--as a paid spokeswoman. That was about four years ago, and McGann represented the company for approximately three years.
For those who are interested in having a celebrity athlete as a spokesperson, Erickson says you can realistically expect to pay an athlete anywhere from $15,000 to $100,000 per year to market a brand. And, of course, you're talking about a scenario of "how much money have you got?" if you want a Michael Jordan type of player hawking your wares. But Erickson cautions, "You really have to look at the big picture and ask yourself 'I've got $40,000--if I spend it here, what are the pros and cons?' Having a celebrity spokesperson could potentially bring you nothing--and if you do lose that 40 grand, then that's 40 grand less that you could have spent on something else." That's an expensive lesson.
But perhaps the most important tutorial is imparted by Munro, who observes, "Just because somebody loves a sport doesn't mean they can necessarily market a business." The subtext here is that you have to love and understand the inner workings of the business world as well.
Mannix, who often meets young entrepreneurs with basketball on their brains, seconds that. "I think the most common mistake entrepreneurs make is thinking 'I love sports, so I want to work with [it].' What does that mean, anyway?" wonders Mannix. "I love cheesecake, but that doesn't mean I should start making it for a living."
Dan Mannix is CEO of LeadDog Marketing Group in New York City and adjunct professor at New York University, where he teaches classes in sports entrepreneurship and sports events tourism. We asked him for some ideas on where to turn if you're interested in learning more about starting a sports-related business.
- Street & Smith's SportsBusiness Journal: "A publication everybody seems to get," says Mannix.
- The Licensing Letter: A newsletter, published by EPM Communications, providing news and statistics on the licensing industry. "A great resource for someone who wants to do something in sports licensing," says Mannix.
- SportsBusinessDaily.com: Essential reading if you want to stay on top of the sports-business industry. It also has a daily newsletter, The Sports Business Daily, and this, says Mannix, is a venture that's only a few years old-"a perfect example that there's always room for something new in the sports-business industry."
Curiously enough, the two books Mannix considers essential reading for his students are not specifically sports-related books, but they're written by the founder of International Management Group (IMG), considered the leader in sports marketing worldwide:
- What They Don't Teach You at Harvard Business School: Notes From a Street-Smart Executive (Bantam) by Mark H. McCormack
- Never Wrestle With a Pig: And Ninety Other Ideas to Build Your Business and Career (Penguin) by Mark H. McCormack
Geoff Williams is a writer in Loveland, Ohio. Contact him at email@example.com.
Geoff Williams has written for numerous publications, including Entrepreneur, Consumer Reports, LIFE and Entertainment Weekly. He also is the author of Living Well with Bad Credit.