Tuesday, December 14, 2010

Exclusive Licenses - Helped or Hurt Sports Trading Cards?

The use of the term 'Exclusive License' is used loosely here, however the fact that sports card releases have been trimmed down in relation to years past is something worth taking a look at.

Collectors & Hobby Store Owners/Sellers often urged companies to release less products throughout the calendar year because it was just too many cards for the market of collectors to handle. It took several years for the higher ups in the licensing departments to listen - but they honestly did. They often mentioned reducing confusion and the number of cards released in a season was a deciding factor in giving licensees to less companies (and constraining them to the number of releases unlike years past).

Baseball (or the MLB) seems to have a pretty tight grip on its exclusive license. For the most part, Topps is the only game in town - despite some nice efforts from Panini (Donruss EEE) and others trying to make an impact. You get the feeling that getting the MLB license is like getting the government contract to print money.

For the most part, baseball card collecting defines the hobby. Just recently I was having a conversation with a very well educated man who didn't even know there were cards other than Baseball Cards (seems like the other sports could do some marketing too). Its a sport that is rich with rookies and prospects who are brewing in the Minor Leagues. The fact that people from around the country can often catch a Minor League baseball game for less than $10 and watch the prospects of their favorite team up close and personal is a big reason why baseball cards are highly collected. A few years ago I saw Madison Bumgarner and Buster Posey play baseball 3 miles from my house - I can't often say that about Football or Basketball.

The number of releases in terms of sets (ie: Bowman, Bowman Chrome, Topps Heritage, Finest) has been cut back because Upper Deck and others can't have 15+ releases. Topps really only eliminated a handful - off the top of my head Turkey Red, Heritage High Numbers, and some others. Seems like the printer was on full blast after a non-autograph Stephen Strasburg Superfractor "RC" (2 years after he's had Upper Deck USA cards) sold for $16,000+.

Even after Stephen Strasburg got hurt, non-chrome 2010 Bowman Boxes still sell at incredible prices and the coming of Bryce Harper will help put a new face on 2011 products. Also, the fact that Topps has Mickey Mantle, Babe Ruth and a portfolio of card designs to always go back and re-print - seems like a pretty simple business. However, quality control issues (dusty Bowman Chrome Cards, Miss-Cut/Damage Cards) and product errors (Stephen Strasburg Allen & Ginter Mini, Bryce Harper Redemption not inserted into Bowman Chrome) have tainted what overall was a remarkable year for baseball cards. Not to mention the printer seems to be stuck 'on' for sets like Topps Chrome, Bowman Chrome and the Target/Wal-Mart money making non-premium sets.

Overall, I think the exclusive license helped increase prices for product across the board - and there is room for improvement and growth. What a 'rookie card' is still really cloudy and no one (Topps, MLB or the Pricing Guides) really wants to clarify the mess that they tried to clean up years ago.


We are about a year and some change when the NBA went with Panini to make the only licensed basketball cards. The challenges to win over collectors and make NBA cards more collectible/popular are still present. Michael Jordan and LeBron James are in the top 5 most collected (and highest value) basketball players of all time, and neither can have autographs in Panini (LeBron has Jersey Cards). If/when one of those two players can 'sign' with Panini - Upper Deck will still have a major presence in the basketball card market, despite only having a limited number of releases planned for the 2010/11 season. Panini relies mostly on Kobe Bryant and a handful of NBA players that sign for them. The product rely heavily on the rookies that come into the NBA as well. Unfortunately Blake Griffin was hurt in 2009/10 and that really hurt the sales of the product despite the strong play from Tyreke Evans, Brandon Jennings and many others. On top of that, the NBA is a tough league to break into and make a huge impact in the hobby ie: Stephen Strasburg or even a Tim Tebow.

That's the bad news.

Good news is that Blake is back and its giving a boost to the inventory of 09/10 product (which really helps sellers who have been sitting on it for a while). You also have a guy named Wes (Wesley) Matthews who could make some noise this season with autographs in several 09/10 Panini sets. The rookie cards in general will help sell the products even a few years after the release - as it usually takes some time for NBA talent to truly develop. Panini also seemed to listen to collectors and provided a few more on-card autographs (less stickers) in 2010/11 products.

Good news is there is lots of room to improve too:
Going forward, basketball is a global game that is very popular in other countries, in particular China and many parts of Europe. If something could ever be done about importing/exporting to sellers in those countries (to keep prices down) they would buy more cards. The NBA Playoffs have been very competitive and enjoyable to watch (despite the Lakers/Celtics winning most of the titles). If the NBA could eliminate or modify the very lucrative guaranteed contracts that each player has - the play during the 82 game schedule will become better. That will also impact cards because it will give the teams/coaches the ability to give opportunities to more players ... giving the NBA the Football and Baseball 'prospecting' aspect that it lacks now.

The products lack autographs of key players that are worth lots of money, including Kevin Durant, LeBron James, and Michael Jordan - if that changes, basketball cards will become much more collectible going forward. In general I think the exclusive license has helped clarify the NBA card market. Releases are spread out over several weeks (for the most part) - so it does help with collecting. Panini is still a 'young' company in terms of making Basketball cards, so it will be interesting to see how they address the challenges going forward.


Football has the double license - so it doesn't really fall into our 'exclusive license' category. Upper Deck has had success using players in College Uniforms in only a handful of planned 2010 sets, so its almost like you have 3 choices to choose from.

Lets start with the bad:
Topps Football is pretty much Topps Baseball with Football players.
Panini football seems to never really blow anyone out of the water - so getting momentum set to set is still something they are working on.
Both seem to lack fresh players being added to checklists/player pools including Michael Vick, Arian Foster and Chris Ivory ... the current 'hot players' are rarely added to sets.

For the most part with both companies products, you get a 'player worn' material jersey card and an autograph from a rookie that was purchased at the same event. I can't believe that its that hard to get more veteran players like Tom Brady, Brett Favre, Peyton Manning, Chris Johnson, Drew Brees, Michael Vick, DeSean Jackson, Arian Foster + MANY more NFL stars. All you get in today's NFL product is a chance to get 1 of the 35 rookies that showed up at the photo shoot months ago. Collectors should be seeing more Joe Montana, Emmitt Smith, Troy Aikman, Jerry Rice, and Barry Sanders autographs than they do now. Why does it seem that Walter Payton & Vince Lombardi cut autographs seem way more rare these days than Babe Ruth and Mickey Mantle? Seems like every Topps Baseball set has something from someone dead - why not football? (no offense to the fallen legends) What ever happen to the super deep autograph checklists from Contenders or even Topps? The lack of variety actually encourages people to collect less cards - because they have all the guys from 2010 by the 3rd product that comes out.

The Good:
Football still has big draft classes every season, with someone(s) that drive card sales. They also have guys in later rounds like Chris Ivory, and guys that emerge as stars in years 2, 3 and beyond. Football will be fine, and football cards will be good. Just wish they utilized all the talent and possibilities like they seem to have done in the past.

In general, I think football cards have gotten worse in terms of years past. Not sure if its that much more money to get a retired legend that didn't make multiple millions to sign cards - guess it is. Really it comes down to it being easy to get 35 rookies in Los Angeles at an event coordinated by the NFL, instead of calling Tom Brady's agent and getting 500 cards signed - I understand that. Hopefully collectors make enough noise to let these companies know that getting a 1:35 chance at a top rookie in every box is cool - but you're icing out the current and former NFL players that fans have spent years following and developing a personal relationship with. Those are the players people 'collect' - just like baseball.

The industry asked for less product from companies and the leagues responded by giving out less licenses. Overall, I think its helped put less strain on the retailer that now has a clearer picture on what they should purchase during a giving year. The companies themselves seem open and willing to listen - but possibly the comfort of knowing you don't have competition knocking at your door each week with a new product has made them 'lazy' - throwing out sets that look the same from sport to sport - and checklists being the same group of players every time. Hopefully more time is spent developing sets and working in new configurations (24 Packs, 18 Packs, 10 Packs, 1 Pack) is all you see now at the Hobby Level. Keeping it 'fresh' is what Nike, Google, Apple and other top companies contently try to do - would be nice to see the sports card manufactures work on that now that they have exclusive licenses to make the cards we want to collect.

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