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Diamond Card Talk Member
Picture of Raven
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This thread has fallen into limbo, I think because no one on the collector level really has any accurate information about what Fanatics has been doing since consuming Topps.

I don't either, but I had a short conversation recently with someone who knows a lot more about buying in the wholesale card market than I do. The rumors are pretty interesting.

The two main ones are that 1. Fanatics overestimated, paid too much for Topps and is regretting it now and 2. that their original plan was to distribute direct and lose the whole dealer network eventually.

This is the beginning of Spring Training and prime time for the new 2023 baseball cards from Fanatics. It will be a sign of things to come to see how well that goes, who gets the best products and how they get them.

I have no idea what is happening with their non-sport/entertainment card wing of "zerocool". Or if it is even still the brand they will use for all their non-sport cards? So far the titles they have put out are junk to me. I can't say if they have been successful or not for Fanatics because I barely hear about them since the hype has died down from that first insane Vee Friends.

If anybody knows how Fanatics is really doing a year in and what their plans are today, I'd like to read about it.
 
Posts: 10499 | Location: New York | Registered: November 20, 2007Reply With QuoteReport This Post
Platinum Card Talk Member
Picture of Scifi Cards
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I have some knowledge, most I can share...

I think Fanatics underestimated the complexity of of the trading card business.
Whether they regret their purchase is pure guesswork.

I do know they told the largest wholesaler of cards in the country that their services were no longer needed "effective immediately" at the National last year.

So far, they are the only wholesaler who's been dropped as far as I know, but there is some speculation that they are just waiting for contracts to expire.

They made an initial outreach to dealers for information on how they buy cards, but there has been no further contact as far as I know.

I think the fact that ZeroCool has not done another auction style offering says they were disappointed in how Jacka** performed in that format. Rumor is that ZeroCool is being rolled back into the Topps umbrella and will be used as a side-brand for unconventional sets, but not everything nonsport will be ZeroCool.

It's also strange that this is not a single Topps non-sport product out for sale right now. No Star Wars, Wacky, or GPK that is new has been solicited. Right now, the Topps website and Topps Now seem to be the real outlet for new product. Maybe that direct sale is making them enough money to continue that way for the time being.

So, when the next Topps non-sport is announced, it will be interesting to see what it is and who is actually wholesaling these products. I know my ability to purchase was restricted when they cut GTS off.

So, that's one small dealer's perspective. Sports guys might have a different take.

Ed

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Collecting Sketches of the Character Crystal

 
Posts: 5097 | Location: Phoenix, AZ | Registered: March 09, 2003Reply With QuoteReport This Post
Diamond Card Talk Member
Picture of Raven
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Thanks Ed, pretty consistent with what I heard, and the sports card guys don't know what they are doing yet either. Some had Topps accounts and they are unsure if they will sign up with Fanatics, if or when they ever get the opportunity. Maybe everybody will be heading for the secondary market instead.

One thing seems certain. Fanatics arrived with a business structure and sales model that has been spurting along so far and nobody's been impressed. If there are problems with the MLB rollout, I think even we will hear about it over here, and that won't bode well for their smaller stuff.
 
Posts: 10499 | Location: New York | Registered: November 20, 2007Reply With QuoteReport This Post
Platinum Card Talk Member
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Kinda funny that Zerocool was not impressed with the J@cka$$ auction. . . I thought those boxes sold for WAY more than they should have. . .

I'd still bet that there are is a ton of unopened product.
 
Posts: 5429 | Location: Parts Unknown. | Registered: January 25, 2001Reply With QuoteReport This Post
Silver Card Talk Member
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quote:
Originally posted by webjon:
Kinda funny that Zerocool was not impressed with the J@cka$$ auction. . . I thought those boxes sold for WAY more than they should have. . .

I'd still bet that there are is a ton of unopened product.

Dave & Adam's seems to have an endless supply. I wouldn't be surprised to see these for $50 on Black Friday, which is realistically what they should've been priced at anyway.

Fanatics seems to have no idea (zeroclue?) what they're doing. With the Topps purchase did they fire everybody in the company that knows how to operate a card business?

Ditching GTS feels really premature. They should've had some footing under them before even considering cutting distributors.
 
Posts: 1576 | Location: NJ | Registered: August 28, 2007Reply With QuoteReport This Post
Diamond Card Talk Member
Picture of Raven
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quote:
Originally posted by Ted Dastick Jr.:
Ditching GTS feels really premature. They should've had some footing under them before even considering cutting distributors.


Apparently they went into the card business with the plan of eventually not needing distributors, hobby stores or card dealers. No middlemen to cut in wholesale. Sell direct to the customers online and/or perhaps open stores or use the existing outlets they already had for Fanatics merchandise. If card sellers want to get in on the profits from their products, they can buy in at the same price as all those other customers and try their luck on the secondary market.

Now Fanatics may well be revising their operational methods, or at least their timeline for change, now that they are rumored to be dissatisfied, but that's just speculation. What is true is that there is a lot of uncertainty and distrust going on about how accounts are going to be handled in the short term and the baseball cards are coming.

As far as the old Topps card people go, I don't know who stayed or went, but I'm sure it's like any other business that gets taken over by another company. I've been in a couple of those myself. The new Boss has his own ideas and, even if you know better, you go along with it or you get out. The new Boss rarely waits to study things before changing them and doesn't ask for your opinion. After all, he is the Winner. Big Grin
 
Posts: 10499 | Location: New York | Registered: November 20, 2007Reply With QuoteReport This Post
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The most impressive thing to me about Zerocool is how quickly they realized they had zero clue. I figured they would have driven Topps much further into the ground than they did before realizing how bad things where.

I think a direct to consumer model could work, but they'd still need to have quantity pricing or incentives to push product and to encourage a dealer network.

I was very surprised to see that they dropped the auction format after just 2 releases, and are now pushing what to me looks like a terrible Stranger Things product that is only for sale through Netflix!?!?

Their biggest blunder seems to be absolutely ignoring non-sport card collectors. That never made sense to me -- why would you turn your back on the people who want to buy your product and instead try to build a new customer base from ground zero -- I'm guessing the answer to that is that the Zerocool team didn't even realize they were different customer bases.
 
Posts: 5429 | Location: Parts Unknown. | Registered: January 25, 2001Reply With QuoteReport This Post
Diamond Card Talk Member
Picture of Raven
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There are at least two schools of thought about direct consumer card sales, probably three.

Yes, the model can work and work well. However, there is an important caveat. It has to be done on hot products with a ready customer base that will buy it up. By not using a dealer network, the card maker is assuming all responsibility that it will sell out at the price he wants.

Otherwise the maker either gets stuck holding unto the unsold inventory or he has to sell at less profit than expected. If it gets really bad, he might have to sell close to or below cost. Then it becomes an actual loss.

The beauty of having distributors, authorized dealers and an established food chain is that the maker can bundle the dogs with the gems. It may take a bit of wholesale discounting and maybe some incentives for large accounts, but ALL product will sell out. The risk then becomes shared by the whole network that has the inventory on their shelves and make a bigger profit if and when it moves. Hot product will hopefully make up for those occasional dogs.

The third school of thought would be to try to combine the two, but that's a lot harder to accurately call on products. And shared risk means sharing more profits anyway. You can't unload your mistakes on people without cutting them in on the good stuff too. Smile
 
Posts: 10499 | Location: New York | Registered: November 20, 2007Reply With QuoteReport This Post
Gold Card Talk Member
Picture of mykdude
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quote:
Originally posted by Raven:
The beauty of having distributors, authorized dealers and an established food chain is that the maker can bundle the dogs with the gems.


From my understanding this is how Upper Deck gets rid of their Hockey product combined with MARVEL.

I can't remember the last time I saw a Fanatics commercial. Maybe they are figuring out that fandom in general is fickle, especially when the choice is between a new Jersey and a carton of eggs.

Recently I purchased a couple of re-imagined comic cards featuring Mike Tyson and Hulk Hogan which were direct sales from Leaf. They were made to order so Leaf could negotiate a per card rate at a preset sale price. Upside for the collector is you slice around all of the potential product you don't want and get exactly what you are looking for. In most cases this is where my collection currently sits, given a typical release I am hunting less than 5% of the total checklist anyway. The results of overly redundant title releases. I guess the downside would be potential less product hitting the secondary market for a higher/lower price.

quote:
Originally posted by webjon:
Their biggest blunder seems to be absolutely ignoring non-sport card collectors. That never made sense to me -- why would you turn your back on the people who want to buy your product and instead try to build a new customer base from ground zero -- I'm guessing the answer to that is that the Zerocool team didn't even realize they were different customer bases.


I don't know, I sort of appreciate any attempt to get non-sports collectors out of the title rut we have been in for a really long time. We just don't want to have anything to do with it.

I am sure Zerocool came in with grand ideas to flood our hobby with new and interesting products to spark sales and the collector base. They just didn't count on how difficult it would be to find one new thing of common interest to most collectors. That answer is already established in sports products. When you really think about it, from a business plan we are not an easy bunch to figure out. Smokin'

This message has been edited. Last edited by: mykdude,

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Posts: 4922 | Location: Tennessee | Registered: March 09, 2002Reply With QuoteReport This Post
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There is another option for the manufacturer and that is limiting the amount of product which they already do to some extent. Other collecting genre already do it e.g. the model car world and the model train world. Both genre have had major manufacturers go from dealer sales to direct sales, companies like Corgi, Hornby, Matchbox, Airfix. Some dealers do get stocks but usually it is because they are also collectors.

regards

John

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Posts: 2132 | Location: United Kingdom | Registered: October 14, 2001Reply With QuoteReport This Post
Gold Card Talk Member
Picture of mykdude
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quote:
Originally posted by JOHN LEVITT:
There is another option for the manufacturer and that is limiting the amount of product which they already do to some extent.


I kinda figured that was the response to the 90's bubble bust at the turn of the millennium. Seems like production runs have been getting smaller and smaller.

I am still amazed that Umbrella Academy was only 3000 boxes and Lost in Space was just 2000. How much lower can you go and still afford the license? Or how much will you have to charge?

Either way the collector base doesn't look very healthy.

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Posts: 4922 | Location: Tennessee | Registered: March 09, 2002Reply With QuoteReport This Post



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quote:
Originally posted by mykdude:

I don't know, I sort of appreciate any attempt to get non-sports collectors out of the title rut we have been in for a really long time. We just don't want to have anything to do with it.


I agree fresh titles is a good thing.

When I said that they ignored non-sport card collectors I was referring to the fact that their entire advertising campaign seemed to be meeting with sports card influencers, and their product design was only based on parallels.
 
Posts: 5429 | Location: Parts Unknown. | Registered: January 25, 2001Reply With QuoteReport This Post
Diamond Card Talk Member
Picture of Raven
posted Hide Post
quote:
Originally posted by mykdude:
quote:
Originally posted by Raven:
The beauty of having distributors, authorized dealers and an established food chain is that the maker can bundle the dogs with the gems.


From my understanding this is how Upper Deck gets rid of their Hockey product combined with MARVEL.


It is exactly how Upper Deck established itself as the #1 card brand in the early 90's. If you wanted to get their hot cases, they told you what else to buy and how much. Strong arm stuff, but it worked for a while, until the sports cards market tanked.

Your comment about small production runs is dead on. It also applies to the idea of direct-to-consumer custom made cards. The customer gets what he wants, but how does the maker get enough money to do it when the project is so limited? If there is a license, how cheap can it be to make the effort affordable?

With Kickstarters they are raising the money first and, if they don't get enough, they can always cancel. Bigger makers with bigger titles can't do that and keep to a production schedule. They also don't seem to know how to reach the customer base to promote it.

As Ed mentioned, Topps Now is distributing and recently I saw some Star Wars autograph cards that I didn't even know were released because I don't look at their website. Selling cards through Netflix is another thing that just happened. It's downright foolish to think you can make money from custom card products that card collectors don't know about.
 
Posts: 10499 | Location: New York | Registered: November 20, 2007Reply With QuoteReport This Post
Gold Card Talk Member
Picture of mykdude
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Wow! How do you screw up Stranger Things? With no grasp of simple insert collation and balanced box packing Zerocool may not be the wave we were expecting.

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Posts: 4922 | Location: Tennessee | Registered: March 09, 2002Reply With QuoteReport This Post
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Picture of Raven
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So this is a new one and I don't know enough to make much of a comment, besides the obvious.

Panini wants to make an anti-trust case against Fanatics. Now this has heated up because the time is coming for Fanatics to claim their sports cards licenses, which is probably more important to Panini than non-sport. It's also pretty funny because, when it comes to monopolies, Panini didn't mind when they were the one cornering the market, did they?

Anyway, things are shaking up because they all want the money. We, as the buyers, are merely pawns in the game. Big Grin

The link to one of the articles is below.
https://www.sportsbusinessjour...awsuit-fanatics.aspx
 
Posts: 10499 | Location: New York | Registered: November 20, 2007Reply With QuoteReport This Post
Gold Card Talk Member
Picture of mykdude
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I think I agree that a 20 year deal is too long. I would assume there are provisions to break it if Fanatics begins to shed a bad light on the teams or the fans.

Panini has a long history of ignoring collectors with legitimate redemption, autograph and production problems. Personally I like watching them sweat and hope they lose big. Question is, will Fanatics be any better?

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Posts: 4922 | Location: Tennessee | Registered: March 09, 2002Reply With QuoteReport This Post
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