Attention, sports fans. Hollywood may be coming to a Foot Locker near you. Two media giants are jogging into the sneaker biz, and the results could redraw the boundaries between sports and entertainment.
Time Warner (the parent company of EW) is debuting WB Sport, a line of athletic apparel that includes $39.95 sneakers endorsed by Los Angeles Laker Shaquille O’Neal. (Licensed from Reebok, which will still sell Shaq’s high-end shoes, the Warner sneaks will sell at places like Target.) Why would a company known mostly for making Friends and Batman want to start making sports clothes? Look no further than Space Jam — it grossed $90 million but really scored at the Warner Bros. Studio Stores, which helped Michael Jordan-related merchandise slam-dunk more than $1 billion in total sales. Although O’Neal’s recent Warner movie, Steel, has earned a foul $1.8 million, the company believes it doesn’t need a tie-in to be in business with sports stars. The company has also signed endorsement deals with New York Knick Patrick Ewing and Chicago White Sox slugger Albert Belle. ”It’s an extension of what we do at retail,” says Dan Romanelli of Warner Consumer Products. ”The line between athletes and [entertainment] stars has blurred.” Time Warner has even trademarked the phrase ”Sports Is Entertainment.”
Fox also wants to play ball. On Sept. 5, studio owner Rupert Murdoch agreed to pay $350 million to acquire the L.A. Dodgers, who could one day take the field wearing Pumas. Also last month, Fox announced a 15-year pact (reportedly worth more than $200 million) with producer Arnon Milchan (Tin Cup), whose New Regency Productions is one of the largest Puma shareholders. While the Milchan-Fox deal is centered on movie production, watch for a cozy relationship to develop between Puma and Fox’s sports division, which will reportedly market the brand. There could also be plenty of Puma product placement in Fox films. Says Milchan, ”I have no problem giving Sharon Stone goodies from Puma.”
So far, Nike — with a commanding 40 percent share of the U.S. athletic-shoe market — isn’t sweating. ”We don’t consider those companies competitors,” sniffs Nike spokesman Lee Weinstein. But with designers like Tommy Hilfiger and Donna Karan joining the race and Disney (which owns the Mighty Ducks of Anaheim and the California Angels) already making sports clothes, Nike had better watch its heels. ”If these studio types can combine it with some Hollywood marketing, they have a shot,” says industry analyst Faye Landes of Smith Barney. ”There’s no business like shoe business.”