January 1, 2023
New Era is building on the post-Covid success of its cap business and intends to accelerate. The American brand, founded in 1920 and which made a name for itself creating caps for baseball, basketball and American football sports teams in the United States, is enjoying a positive moment.
“We have almost doubled our sales since before the crisis,” said Laurence Joslin, London-based director of marketing, brand and product for Europe.
“Since 2015 we have been growing every year, and in the last two years we have seen growth of 45%. The momentum is in caps, but also in accessories, which represent a small percentage of our business, and in clothing. , which is close to reaching 20% of our sales”.
Without giving details of the company’s sales, which according to the US specialized press reached 750 million dollars before the Covid-19 crisis, the brand’s managers hope to achieve their best year to date in 2022. And 2023 could, after a good spring/summer campaign, be even better.
It must be said that the company, which was one of the few unlisted companies of that size in the sector still run by its founding family, is moving in a different direction.
For years, New Era was the go-to brand for a fine New York Yankees cap, whether in the classic colors of the American baseball franchise or its signature red version created thirty years ago at the request of director Spike Lee. All fans of sports teams can find well-made products, carefully constructed and embroidered, in accordance with the twenty-two production steps that have made the brand so successful. This continues to be a major part of their business in the United States, where fans wear the brand’s caps both inside and outside of sports arenas.
The company’s lifestyle culture has spread internationally, particularly in Europe. The company’s main market in Europe is Germany, due to its sizeable sports fan base in the US, followed by France and Great Britain, while its Spanish and Italian subsidiaries are showing strong growth, according to New management. It was.
US sports leagues and Acon Investments fund acquire an equity stake
The company’s history, deeply tied to American sports, will continue to be a central pillar of the brand. Especially since last summer, the MLB (baseball league), the NBA (basketball league) and the NFL (American football) have taken a stake in the company founded by the Koch family. With the Covid-19 period, the company’s current CEO, Christopher Koch, raised the capital of the New York-based company for the first time in history, with the Acon Investments fund acquiring a 15% stake at twenty%.
Last summer, the company conducted a new round of financing, reportedly for $700 million, again with Acon, as well as other players, including American sports leagues. Koch will remain Chairman and will retain control of the family business. Meanwhile, he handed over management roles, making Jim Grundtisch global president of the brand and Jim Patterson president of operations.
With this injection, the brand will be able to build on its global momentum by strengthening its store network in North and South America, where it recently opened new stores in Mexico and its first store in Argentina, as well as in Asia. In Europe, the company has tested flagships in the past, especially in Paris, but now prefers to focus on working with major sports, streetwear and lifestyle retailers.
A specific strategy for Europe
In addition to American sports, New Era bets on European sports.
“We are taking a reverse approach,” said Yves Pham, who manages the brand’s French operations. “Clubs and federations used to have their own fan merchandise and were quite reluctant to diversify their equipment suppliers by product category, as is the case in the United States. In rugby, we are currently developing with Stade Toulousain and the Federation of Rugby, with initiatives for the World Cup and efforts to promote distribution in stadiums and sports outlets. For the French team, we have proposed more sophisticated caps, with a more subtle logo, and we have seen a quick response in the sales of these products. Motorsports, we’ve been working for a long time with Renault and now Alpine, and we do a lot of work in sports and lifestyle.”
New Era currently works with Manchester United, Tottenham and Chelsea football clubs in England, with whom the brand develops specific products. In addition, the brand supplies most of the clubs in the German first division and has recently signed with a club in the top Italian league. But New Era has also scored recently in motorsports. It has already designed Alpine and McLaren drivers and has just announced a deal with reigning world champion Red Bull team and its Dutch star Max Verstappen for next spring.
But New Era is more than a supplier of caps, it offers a range of styles starting at €25 (Trucker, 9Fifty, 9Forty 39Thirty and the iconic 59Fifty) that appeal to a wide variety of customers and wants to establish itself as a brand in its own right. .
“We are transitioning from a New Era-branded US sports franchise cap to a New Era club cap. We know that consumers identify a product as authentic when it bears our New Era logo,” he said. Joslin. “The interest in the brand is strong, so we need to cultivate that. We need to build on that to grow the brand.”
That was the idea behind the brand’s latest poster campaign, ‘Always On Side,’ which launched in fall 2022 and will continue through spring. Displayed in Paris at metro exits, as well as in other major cities, the campaign opted for New Age full-silhouetted lifestyle images. The brand makes a strong statement with hoodies, tracksuits, and varsity jackets, all synonymous with American sports culture.
This is enough to satisfy streetwear-loving consumers and start offering complete looks to fashion retailers such as Citadium and the many independent streetwear stores in and around Paris, as well as sports retailers such as Blackstore (Intersport). or WAS. (Sport 2000). In Europe, the brand is clearly aiming to build on its momentum to gain market share.
“We have benefited from a favorable headwear market since 2020, as retailers have decided to focus their purchases on one or two brands in each product category, since the introduction of our apparel offering on several major accounts and the impact of our collaborations”. Joslin analyzed. “This year, our collaboration with Bisous Skateboards gave us great local visibility in the French market. And, without a doubt, our collaboration with Saint Laurent gave us international visibility and allowed us to reach new consumers”.
Therefore, in 2023, New Era will continue this strategy of rolling out collaborations. A dozen launches are expected for the year, with very local activations and projects with global resonance. Pham, who initiated the partnership with Saint Laurent, is convinced of the company’s potential. Eager to present the second collaboration with the French luxury house, she already plans other projects to bring New Era to the runways of fashion week in 2023.
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