- NBA licenses clothing company MK Trend to create casual and lifestyle-focused clothing for South Koreans.
- Over 130 NBA stores are in operation across South Korea, positioning the league as a fashion brand.
- Partnership has helped the NBA engage with a new demographic as it targets young Asian consumers.
In 2011, the NBA penned a deal with Seoul-based fashion brand MK Trend that allowed the designer to create merchandise on behalf of the league and sell it in branded NBA Store locations. The level of freedom granted to MK Trend to play with and redesign NBA marques is exceptional; a bold move for a rights-holder which usually exercises tight control over its branding.
The NBA had seen an opportunity in the South Korean marketplace, where the fashion sector generates $13bn (€11bn) annually, the sixth most in the world – with a notably high proportion of spend from younger consumers. NBA team jerseys and other branded items were already popular in the country, but largely among basketball fans. The MK Trend partnership was an attempt to communicate with fashion-conscious young people first, and use it to convert them into NBA fans.
The league now operates over 130 NBA Stores across South Korea, which are a mixture of standalone shops and sections within larger department stores and outlets, selling not just the usual selection of officially-licensed merchandise, but a range of exclusive lifestyle products not available anywhere else in the world – some not even immediately recognisable as NBA wares.
Owning the youth
“We like to think that the NBA really owns youth around the world,” says Scott Levy, senior vice-president and managing director of NBA Asia, “but especially in Asia”. Much of the continent, he points out, is highly urbanised, with playing space for basketball easier to find than for other sports, while the median age across South-East Asia and India is in the low-to-mid twenties.
“That’s a significant demographic crossover with what we see as a typical NBA fan,” he adds. “There’s a whole continent of potential basketball consumers out there, but it’s not homogenous. We really have to tailor our strategy in each territory to make sure we’re speaking to fans in ways they understand and appreciate.”
In the Philippines, that has meant a strong push into social media and new technology. Across South-East Asia, where consumers are generally less affluent, the Junior NBA grassroots programme has aimed to engage young fans by getting them playing. In South Korea – which Levy calls “the most fashion-conscious nation in Asia” – it has meant using the NBA’s brand as a fashion marque.
“But everything is interconnected,” he says. “We don’t want to silo fans off into: ‘these are the ones buying merchandise, these are watching the games’. We want something like the NBA Stores to act as a gateway to the wider world of the NBA.”
A fashion-conscious teenager who goes to an NBA Store because she wants to buy an MK Trend-designed Knicks hoodie “is going to learn about all the other ways that she can engage with the NBA”, says Levy. Details of upcoming NBA fixtures, and how to watch them via the league’s OTT service, are posted in-store, along with social media information and advertisements for other ways to interact with the NBA, such as promotions for its video gaming partnerships with EA Sports, Take-Two Interactive and Gamevil.
“We want to point casual fans toward other ways they can get involved with the NBA,” says Levy. “The idea is to engage them across multiple assets, and in South Korea, one of the ways that can start to happen is in the NBA Store. The stores are really just part of a comprehensive approach to the market – it’s not an independent fashion strategy, it’s part of our broader approach.”
There is evidence, Levy says, of the strategy working. While the NBA does not disclose specific revenue or sales figures, Levy does confirm that the NBA Stores have experienced “double-digit year-on-year sales growth”, and the sector continues to expand, with new stores opening on a regular basis – more than 20 new locations since 2016. Meanwhile, uptake of the NBA’s League Pass OTT platform is experiencing similar growth in the country. While it is very hard to directly correlate the two, Levy says NBA Asia is confident that its “comprehensive approach” is working.
The genesis of the partnership with MK Trend was not, Levy says, “a case of us chasing them, or them chasing us”. Instead it evolved out of a few early, one-off collaborations and gradually developed into the relationship that exists today.
“There is such a strong affinity for brands in South Korea, but that was an area where we obviously lacked some expertise,” he says. “We saw an opportunity for them to take advantage of that and we wanted to bring them on board. Sometimes these relationships might seem obvious after the fact, but they don’t come together until you meet the right partner who is developing the right product. It was really a meeting of two minds to create something unique.”
Because of the franchise nature of the NBA, the central organisation controls the rights to each team’s trademarks, logos and colours. Typically, their merchandising partners create replica jerseys and other goods which maintain these elements.
In order to establish the NBA as a genuine fashion brand, however, and not just a retailer of licensed merchandise, MK Trend was given a significant amount of leeway to “use our logos in innovative ways, choose a colour scheme, take some of our secondary marques and create a very different, very unique product”, says Levy.
The result is a range of clothing and apparel that is style-focused, putting a twist on iconic NBA imagery, such as taking the Washington Wizards’ white and red colour scheme and creating a pastel-pink sweatshirt, complete with a floral logo. The NBA still receives a final review and sign-off on all merchandise, but MK Trend has “gained greater flexibility, as we’ve come to trust them more and understand what they’re doing with the products”, says Levy. “They’ve come up with so many unique products that now we’re always excited for what we’re going to see next. But we trust their instincts as to what is going to work in Korea.”
Products are designed for both men and women, and Levy says that there isn’t a huge disparity between the genders in terms of sales. Basketball, he notes, is a “gender-neutral” sport, and the NBA Stores and fashion lines have given the league the opportunity to “talk to different demographics to what you would usually target in Asia”.
“There is a whole demographic in Korea that probably sees us as a fashion brand rather than as a rights-holder, but in a way that gives us an even better platform to engage them,” he explains. “Korea has a unique element in the way they understand the value of our brand on the product, they really see the NBA as a sign of prestige. And that helps us to attract a wider audience, maybe a more casual NBA fan, that will purchase products.
“We have the bonus of our players being so authentic in so many things – fashion being one, but also music, and gaming, and technology. These are the same interests that our fanbase has, and particularly casual fans. So once we connect them to the game through one of our partnerships, we think it’s a natural pathway for them to become NBA fans and get more engaged.”
MK Trend now has a similar deal in place with the Ladies Professional Golf Association, signed in 2016, suggesting that other rights-holders have seen value in this approach.
The NBA itself is not ready to expand the idea, but it is experimenting with further official outlets which distribute regular merchandise, as part of their partnership with Fanatics. Stores in Doha and New York City are already operational, while another will open in Milan by the end of the year.
The NBA also already has a presence in 150 stores in Japan through sportswear outlet Xebio, and in Australia through fitness brand Rebel, but unlike the South Korean stores, these are not NBA-branded, and still lean toward the sporting side. Some MK Trend designs have been distributed through these partnerships – as well as through Japanese ecommerce giant Rakuten, which is a major sponsor of the NBA – but it has so far been on an ad-hoc basis rather than as a strategic roll-out.
“It comes down to what the things we think are going to have the greatest impact in each of our territories are,” Levy says. “It’s about the right partner in the right country, and we haven’t yet found it necessary to have the exact concept we have in Korea in other countries. We think we have the right structure with the partners that we have, but of course we’re reassessing that all the time.”