Fanatics Acquires Global E-Commerce Rights to Olympic Games Merchandise

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The International Olympic Committee closed its first global e-commerce deal on Thursday, in partnership with Florida-based sports company Fanatics.

The revenue-sharing agreement gives Fanatics a percentage of Olympic merchandise sales and extends through the 2028 Summer Games in Los Angeles. However, the agreement does not include a sale of the 2022 Winter Olympics in Beijing, as China has a separate e-commerce deal with Alibaba.

Fanatics will be making items related to past and future Olympics and it has already started producing items around the 2024 Summer Games in Paris. The company will also receive manufacturing rights to make and sell Olympic rings.

Financial terms of the pact were not disclosed and Fanatics gave no estimates on how much it could benefit from the IOC agreement.

“This is an exciting launch for us as fans from an increasing number of territories will be able to purchase official Olympic merchandising and get in touch with the magic of the Olympics for each edition,” said IOC television and marketing director Timo Lumme in a statement. pronunciation. “We look forward to working with the organizing committees of Paris 2024, Milano Cortina 2026 and LA28 on this new store,” he added.

Fanatics already owned Team USA’s e-commerce rights through a deal with the United States Olympic Committee. The IOC deal should align it with more revenue, especially around the 2028 Summer Games in the US

It’s unclear what the IOC generated from merchandise sales for the pandemic-hit Tokyo Games last summer.

But to paint a picture of the revenue that could be available to Fanatics, organizers forecast $100 million for sales of licensed products around the 2020 Olympics. For the 2016 Games in Brazil, officials initially estimated more than $400 million in sales. And the 2002 Winter Games — the last Olympics to be held in the states — generated $500 million in gross retail sales for licensed products, according to the Salt Lake Organizing Committee.

Fanatics plans to leverage a heritage line that will offer clothing, souvenirs and other merchandise related to past Olympics, including the 1996 Atlanta Olympics. And the company’s “Olympic Collection” will target younger consumers with toys and sporting goods. The collections are available domestically, in Mexico and in European countries, including the United Kingdom and Switzerland.

The IOC Pact also helps strengthen Fanatics’ economic moat. The company is valued at $18 billion after chairman Michael Rubin lured investors, including Japan-based SoftBank, to pump money into the e-commerce giant.

In 2021, Fanatics started a $1.5 billion non-fungible token (NFT) company. Fanatics also said its trading card business is worth $10 billion. It took over just about all of the e-commerce rights from Major League Baseball and joined the American team with the e-commerce rights of the Dallas Cowboys.

Fanatics also has operations in China, the world’s second largest economy. That division is a joint venture with investment firm Hillhouse Capital, an Asian-focused private equity fund with companies in the Asian e-commerce and retail sectors.

Fanatics estimates it will reach more than $3 billion in revenue this year and plans to leverage more than 80 million user base to grow future digital offerings, including sports betting.

Disclosure: CNBC parent NBCUniversal owns NBC Sports and NBC Olympics. NBC Olympics holds the U.S. broadcasting rights to all summer and winter games through 2032.

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