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Babolat On The Rise

The brands of tennis are well known to the American consumer: Head, Penn, Prince, Wilson. But over the past 15 years, one company — Babolat — has virtually come out of nowhere to achieve a huge share of the tennis racket business.

Tennis rackets at Babolat's 2010 US Open kick off event at CityView Racquet Club in New York City.
Brian Hider | Getty Images
Tennis rackets at Babolat's 2010 US Open kick off event at CityView Racquet Club in New York City.

It's not that Babolat is a new company. In fact, they actually invented natural gut tennis strings in 1875. It's just that they weren't especially well known in the United States until they started making tennis rackets 15 years ago.

How they went about getting to the top can serve as a lesson to any company looking to break into a niche part of a business: Work the behind the scenes.

Instead of spending big money to get veteran players to use their sticks, they decided to spend the money on grassroots marketing and get the rackets in the hands of the best young players.

It has long been done in the basketball shoe business.

The difference is players believe they can wear any shoe. Tennis players don't believe they can change their rackets at will.

So what happened?

Babolat rackets got into the hands of Rafael Nadal and Andy Roddick before they turned pro and the two and a slew of others insisted that Babolat would be their racket of choice. Sure endorsement money for top players was needed, but the fact that the players were already playing with their product made the sell easier. Babolat realized that if they seed the youth market and make good rackets, they will eventually get the big names that will help them achieve market share.

"I remember I saw them for the first time in 1998," said Roddick, who lost his second round match in a four-setter last night. "I was playing junior tournaments in Europe. They were getting into rackets and there was a good buzz about them. I tried one of the rackets for the first time in 1999. I haven't used anything else for my entire career now and they're selling great here."

Without any real buy-in from the mass sporting goods retailers, Babolat has made a significant dent in the business. The most serious consumers who go to tennis specialty stores now consider Babolat first.

"Instead of spending big money to get veteran players to use their sticks, they decided to spend the money on grassroots marketing and get the rackets in the hands of the best young players." -CNBC, Darren Rovell

Babolat rackets have a 34.3 percent market share in pro specialty stores, measured in dollars, for the quarter ending in June, according to the Tennis Industry Association.

Sure, Babolat rackets cost more than most, but they managed to grow share in a challenging 2009. As of the quarter ending in March, Babolat had eight of the top 20 best selling rackets, according to the TIA.

Even though the rackets are on the higher end in terms of price, Eric Babolat, the company's fifth generation CEO, said consumers decided it was still a value to go with his brand.

"I think when you are a tennis lover and you want to invest in your material...then you are ready to pay the money," Babolat said. "That was where our success was. A lot of players switched and decided to switch to us because they thought it was worth the money."

Other racket companies have had problems keeping its pro players, even while paying them, because they want to come out with new products every couple of years to sell consumers. Players don't want to change that often.

Babolat freely admits they don't make many changes.

"Our rackets are usually staying three to four years out in the field and then we have some slight change," Babolat said. "Andy's racket has been the same base for more than 10 years."

Babolat said that the next step for the brand is to move from the specialty stores to the sporting goods retailers like The Sports Authority and Dick's, who are no longer asking Baba-who?

Since Babolat executives don't believe their relationship with the customer closes with the sale, Babolat doesn't intend to ever be sold in a self-service type store like Costco , Walmart or Target . Expanding the brand is great, but it's not only about the racket and the string, it's about what's the right racket and string for the customer. Getting that wrong at the point of sale might mean that they don't have a customer for life.

Questions? Comments? SportsBiz@cnbc.com