Nordstrom is partnering with Fanatics to offer licensed sports merchandise for the first time in the luxury department store’s 120-year history.
The multi-year partnership will allow Nordstrom (NYSE: JWN) to list thousands of products from the NFL, NBA, MLB and NCAA on its website, starting immediately. Nordstrom will control the pricing, marketing and point of sale, but the orders will be fulfilled and shipped by Fanatics, the world’s largest seller of licensed sports apparel.
It’s a lesser-known part of the Fanatics business—in addition to its own shop and the ecommerce sites for major leagues, teams and colleges, Michael Rubin’s company also sells product through a handful of major retailers. The company has similar online partnerships with Walmart, Kohl’s, Macy’s and JCPenney.
Those retailers don’t get access to the full line of Fanatics products; each partner has a different mix. Financial specifics of the Nordstrom deal weren’t provided.
The announcement is the latest in a business pivot for Nordstrom, which was founded in Seattle in 1901 and now has more than 350 locations in North America. In an Investor Day presentation earlier this year, the company announced its plan to reduce traditional wholesale to 50%, from 85% of overall sales. In its place, the company plans to prioritize both private labels and what the industry calls “drop shipping,” in which product is mailed directly from a brand to the buyer, despite the point of sale being Nordstrom’s website.
Drop shipping will allow the company to offer a much wider assortment of products, from 300,000 current customer choices to more than 1.5 million, according to the presentation. The Fanatics deal, which includes licensed product from athletic companies like Nike and Adidas, plus fashion brands like Vineyard Vines and Peter Millar, is part of that diversification.
“Through this innovative partnership model and new product category, we can now meet the needs of sports enthusiasts and the people who shop for them,” Nordstrom chief merchandising officer Teri Bariquit said in a statement. “Fanatics is the industry leader in this category and a digital-first company with strong investments in technology. They made the perfect fit for us to differentiate our offer and give customers increased selection to discover.”
Fanatics recently raised money at an $18 billion valuation, a three-fold increase from the prior year. The company is also expanding rapidly outside of its core merchandise business, including a new trading card company (valued separately at $10.4 billion) and an NFT company (valued at $1.5 billion). The company is also looking at sports betting and media, and IPO is expected at some point in the near future.
