Sports Illustrated's new owners think there are big dollars to be had in branded supplements and swimsuits — but not so much in magazines

  • Authentic Brands Group, a brand management company that owns the rights to 50 brands, most of which are retailers, purchased the magazine Sports Illustrated in 2019.
  • Since then, ABG has licensed Sports Illustrated's name and intellectual property to create various merchandise lines, including nutritional supplements, CBD cream, and apparel collaborations.
  • ABG told Business Insider that the company weighs the risk of upsetting traditionalist fans while pushing into new categories.
  • ABG gave publishing rights of the magazine over to media company Maven shortly after buying it in 2019, so its not directly involved in editorial operations, but handles licensing.
  • Visit Business Insider's homepage for more stories.

What do Elvis Preseley, Juicy Couture, and Sports Illustrated have in common?

They're all owned by Authentic Brands Group. Next question: What is Authentic Brands Group? It's a self-described "brand management company" that owns 50 brands, most of which are retail companies ABG bought out of bankruptcy. 

Among its portfolio of once-bankrupt retailers like Brooks Brothers, Juicy Couture, Forever 21, and Aeropostale, is a puzzling inclusion — Sports Illustrated magazine. As the only media entity in ABG's portfolio, it appears to be an outlier. But ABG didn't buy Sports Illustrated because it wanted to run a magazine, it bought it because it's a good brand.

"Our vision is, how do we take arguably the most famous sports brand that's meant a lot to a lot of people, and create a 21st-century media brand," Marc Rosen, the executive vice president for ABG's business unit, told Business Insider in an interview. "It's about being in a lot of places and being a lot of things to your customers."

Since ABG acquired Sports Illustrated from media company Meredith in May 2019, it has indeed been a lot of things.

This year, the company launched a line of nutrition supplements and CBD "recovery" cream, both of which carry the Sports Illustrated logo. It also launched a series of apparel collaborations with retail brands including German streetwear company Beastin, and a new collection with sports nostalgia company Mitchell & Ness. The Mitchell & Ness collection features both the SI logo, as well as iconic covers from famous moments in sports history. ABG has capitalized on owning the covers to Sports Illustrated; beyond repurposing them for apparel, ABG also relaunched an e-commerce store for its covers in April, where consumers can purchase prints of covers as commemorative wall art.

Then, there's the swimsuit business. In 2018, based on the popularity of the annual swimsuit issue, SI launched a women's swimsuit collection. In July 2020, ABG relaunched the swim collection with Venus Fashion. "We're very bullish on the swim brand," Rosen said.

In an October interview with Digiday, Rosen said that since its May 2019 acquisition, Sports Illustrated has become profitable and more than doubled its earnings, though the company declined to share specific revenue figures with Business Insider.

All of these new ventures are separate from the magazine, which ABG doesn't operate. Two weeks after ABG acquired the company from Meredith, it sold the publishing rights to Maven, a Seattle-based media company.

"We're not operators," Rosen said. "We look for best-in-class partners in every category, and find who the best person is in that category to help us achieve our goals and objectives."

Typically, ABG acts as a licensing company, meaning it focuses on acquiring intellectual property it sees as valuable but is not as interested in operating those companies. Sometimes, ABG will shut down the stores of the companies it acquires; other times, it will farm out the operation to other companies who specialize in operating, as is the case with Sports Illustrated. ABG made headlines this summer for teaming up with mall operator Simon to purchase the bankrupt menswear brand Brooks Brothers.

In the case of Sports Illustrated, not operating the magazine has posed some potential risks to the value of the brand.

Shortly after Maven acquired the company in October 2019, the operator was criticized by media workers for laying off 25% of the Sports Illustrated staff with the plan to replace full-time staff with contract workers. In March 2020, Maven cut 9% of the remaining staff, or approximately 30 employees, because of pandemic-related economic stresses, and the sports shutdown.

Expanding the Sports Illustrated brand into new categories, like supplements and apparel is another move that could upset purist fans. ABG acknowledged that there will always be traditionalists who could be upset if they do anything beyond the magazine, and that the team weighs those concerns and says 'no' a lot more than they say 'yes' to licensing partnerships.

"We want to be seen as holding true to the tradition of the brand,"  Rosen said. "But you also need to challenge yourself and challenge your consumers to push into new areas and be seen in new ways."

Fans of the magazine, as well as the magazine staff, might argue that by focusing on merchandising and making cuts to the newsroom staff, ABG and Maven are not prioritizing the quality journalism that gave Sports Illustrated its marketplace value in the first place. But to Rosen, the journalism and the merchandising aren't competing avenues.

"I would argue the lines between merch and content are not as distinct," Rosen said. "Content is a way of reaching fans with a story or with an emotional connection."

That emotional connection can also be replicated through associated merch. When a historical sports moment is captured on SI's cover and in an accompanying work of journalism, it turns into an object that can be reprinted in different contexts — on a hoodie or a canvas. To Rosen, both the original feature story and the reprinted cover are simply ways of reaching consumers. And the articles aren't just articles, they're ways to drive the creation of merchandise.

"We're looking to create sort of a virtuous cycle where content drives commerce, and commerce leads to more content," Rosen said.

An example of the "virtuous cycle" that Rosen mentioned is illustrated with what the company has done with ownership over Elvis Presley's intellectual property. ABG owns Graceland Mansion, Presley's home in Memphis, Tennessee, a tourist destination that Rosen said is the "second most-visited house in the world after the White House." Drawing on the staying power of Presley and the success of Graceland, last year, ABG closed a deal with Netflix for an adult animated show about the King of Rock 'n' Roll, on which Rosen will serve as a co-executive producer. Content (in this case Presley's music), begets commerce (Graceland), begets more content (Netflix show).

ABG is working on replicating a similar route with Sports Illustrated with the launch of Sports Illustrated Studios, which will adapt the magazine's work into scripted and unscripted TV shows, films, and podcasts. The first project in the works is Covers, which will look at the stories behind SI's most iconic covers through history. Like the apparel collaborations, Covers capitalizes on the history and legacy of the company, versus its present or future.

During the print era, Sports Illustrated was arguably the most famous sports magazine in circulation. But in the digital age, Sports Illustrated has had to compete with digitally-native and nimble publications like The Ringer, The Athletic, and Defector, to name a few. The Sports Illustrated cover represents a clout level from a bygone era, in which there were fewer players. Still, Rosen hopes the cover can retain its power.

"The SI cover has been, and hopefully will be the gold standard, the ultimate real estate, for sports," Rosen said.

But that gold standard is a moving target. As sports media changes, so too do the sports themselves. Rosen said Esports and sports betting are top of mind as growing categories for SI to be involved in. He mentioned ABG is working on tech products for sports betting. These new avenues might make some fans or writers wary, but Rosen said that's the nature of the game.

"SI is very much alive and it's evolving and it's transcending into a better version of itself, and that's not scary."

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