MLB’s Flagship Store Will Be Tested By Timid Sports Retail Sales Trends

    • Merchandise sales for MLB, NBA, and the NFL are all flat or down in the high single digits over the last 12 months, NPD says.
    • The new outpost, set to open in Manhattan in 2020, will be the only official MLB league store location made available in the U.S.

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Major League Baseball expects its flagship retail store, set to open next year, to be a sanctuary for baseball fans to nerd out while also driving revenue.

That’s according to MLB’s SVP of Consumer Products Denis Nolan, who said that after kicking around the idea of a flagship store in the U.S. internally for several years, the league found the right location and right partner in Legends Project Development to operate the 17,000-square-foot store that is now under construction. 

“We are providing a really elevated fan experience on the retail side and on fan engagement,” said Nolan. “Visitors to New York will know this is the premier place for MLB to promote merchandise and our offerings.”

Two factors traditionally drive merchandise sales across professional sports leagues: Players moving to a new team and new-found success by clubs, according to Matt Powell, senior sports industry advisor at the NPD Group. Out of the remaining teams in the 2019 MLB playoffs, the Washington Nationals winning the World Series would bring the biggest boost to league merchandise sales.

NPD Group tracks revenue for all licensed apparel sold by official league distributors, including Modell’s, Dick’s Sporting Goods, and Fanatics. Over the last 12 months, the sale of MLB merchandise is down in the high single digits, according to the company. The NBA is flat over the same period, while the NFL is down in the low single digits. 

“Sports apparel has never been stronger and licensed apparel should move in concert with it, but it has just not happened,” said Powell. “You’ll see fans wearing licensed apparel in a stadium, but not on the street.”  

Recent trends also show that league stores are usually not profitable in New York City, where commercial real estate is expensive, and a lot of space is required to showcase team memorabilia. Sports leagues instead are more apt to view retail openings in The Big Apple as a way to market themselves and connect with fans in the city with the most foot traffic in the U.S., said Powell.

“New York City stores are the same for all leagues, brands, and other large retailers. They are more about marketing and less about commerce,” he added. 

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The new flagship retail space will offer products from all 30 clubs, historical franchises in the Cooperstown Collection, and game-worn gear. An adjacent courtyard will additionally be used to host events and marketing activations. 

In opening the long-awaited flagship store, MLB also selected prime real estate. Located at 1271 Avenue of the Americas, across the street from Radio City Music Hall, the space is in close proximity to both the NBA and NHL stores. Each league has had a presence in New York City for more than a decade. In addition to the store, MLB is  also consolidating its two existing New York offices and moving into the same building.

“I don’t think those stores really compete with each other,” said Nolan, speaking to the threat of competition from the NHL and NBA outposts. “As a baseball fan, this will be on your checklist of things to do in New York.”

“Midtown has tourists walking up and down all day, and is a major shopping area,” Powell added.  “The same way you see a Burger King across the street from a McDonald’s; you want to get some of that traffic.”

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MLB will not open any other stores in the U.S. The league, however, does have multiple retail store locations open across Asia with operating partners. These stores, while still offering officially licensed MLB apparel, tend to cater more to lifestyle or fashion enthusiats than hardcore sports fans.

“The team logo does not mean as much,” Nolan said.