Signature Moves-With Its Access to Athletes and their Merchandise, a Small Marketing Company is Making Big Bucks

November 12, 2006

DURING a recent meeting at the New Rochelle, N.Y., offices of Steiner Sports, CEO Brandon Steiner and his staff were discussing the boom in searches on its website for free-agent third baseman Aaron Boone's autographed paraphernalia. As if on cue, the cellphone of executive vice president of sports marketing Matt Lalin began to vibrate. " Aaron Boone!" Lalin shouted. "How you doing today?"

"Stuff like that," says Steiner, "happens all the time here."

As the head of the world's largest sports-collectibles company, Steiner operates a $50 million corporation that has deals with some 5,000 athletes and holds exclusive rights to create memorabilia for the New York Yankees, New York Mets and most recently Syracuse and Notre Dame. More than $25 million in merchandise—such as Magic Johnson's warmup jacket and a dusty pair of cleats signed by David Ortiz—resides in his 25,000-square-foot office, where the walls are covered with photos of famous moments in sports history. The best-selling items for Steiner Sports, which has a customer base of more than 50,000 and does 20% of its sales through its website steinersports.com, are autographed photos of Yankees shortstop Derek Jeter's dive into the stands against the Red Sox in 2004 (the company receives several dozen orders a month for the $599.99 item) and collectibles signed by Yankees pitcher Chien-Ming Wang (more than 300 orders a month). "Steiner has taken sports to places no one else has," says Rocky Landsverk, editor of Tuff Stuff, a monthly sports-marketing magazine. "They have revolutionized the industry with their ability to get an athlete or an autograph at a moment's notice."

Steiner began to see the possibilities of marketing athletes in 1985, after teaming with Billy Rose, a limited partner with the Yankees, to open the Sporting Club, a Manhattan sports bar. The Sporting Club was a popular hangout for New York athletes such as Giants linebacker Lawrence Taylor, Giants running back Ottis Anderson and Mets first baseman Keith Hernandez, and, says Steiner, "friends would ask me if I could arrange an appearance for one of them. I started to think there might be something to this."

In 1987 Steiner founded Steiner Sports, and he was soon arranging hundreds of appearances. Six years later he expanded his business to include collectibles, a venture that in its first year required thousands of humbling cold calls and letters to athletes. One of the most difficult athletes to reach was New York Rangers captain Mark Messier. "I was calling his sister, his brother; I even called his accountant," says Steiner. His relentless effort paid off: Messier agreed to become a spokesperson for Steiner Sports. In 1998, after the Yankees won their second World Series in three years, Steiner spent $1.5 million to sign 13 Yankees players. Though he had to take out a second mortgage on his house to make ends meet, the investment helped him turn a $2 million profit by the end of '99. With the addition of Hall of Fame running back Walter Payton and soccer star Mia Hamm to the group of athletes from which he received merchandise, Steiner made $3 million in profits a year later. "We really started to lock in on capturing as many of these [big stars and items linked to important moments] as we could," says Steiner, who has a staff of about 100 people.

In September 2000 Steiner sold the company to Omnicom, a global advertising and marketing company, for an estimated $25 million, with the agreement that he stay on as CEO. "We had hit a lull with our marketing," says Steiner. "Omnicom gave us access to hundreds of new clients. I saw them as someone who could help me do what I'm doing better." Steiner used some of his newfound wealth to open Last Licks, a New York chain of ice cream parlors complete with bar stools, plasma TVs and—you guessed it—wall-to-wall memorabilia. The parlors, which he calls "sports bars for kids," are the perfect ventures for an entrepreneur who thinks of himself as a giant kid in a candy store.

A Naismith Trove

On Nov. 20 Heritage Auction Galleries in Dallas will start online bidding for about 300 items that once belonged to the inventor of basketball, Dr. James Naismith. Below are some of the artifacts that Naismith's granddaughter, Hellen Carpenter, is selling.




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