The market for sportswear and outdoor apparel keeps growing on a global scale and Nike has so far taken the center stage of the apparel business worldwide with a brand value close to $32 billion as depicted in tables 1 and 2 below.
Tables 1 & 2: Brand value of the leading 10 apparel brands worldwide in 2017 and retail sales of the sportswear and outdoor apparel market worldwide from 2012-2021 (Statista, 2018).
Blending business intelligence, innovation and marketability with revenue generation
Significant revenue and net income growth over the years are factors that reflect the brand equity enhancement of Nike’s brand over the years, cf. tables 3 and 4 below. Nike has really distanced their main competitor Adidas in terms of revenue generation over the past 10 years.
Tables 3 & 4: Development of revenue generation and net income from 2005-2017 (Statista, 2018).
Nike is a fast-rolling marketing machine in which the company’s dynamism and ‘speed-to-market’ approach serve as reinforcing branding cornerstones and Nike spends a considerable amount on promotional activities, cf. table 5 below. Nike understands to focus on the core and strive for more, which should be understood in the sense that Nike stays true to its brand promise in delivering its core products while striving to continuously innovate to speak to the needs of younger generations and to stay relevant concerning emerging trends. Consequently, Nike mirrors a pioneering mindset concerning its balance between business intelligence, innovation and marketability, which is a good indicator of success in today’s fast-paced consumer markets.
Table 5: Nike’s advertising and promotion costs from 2014 to 2017 (Statista, 2018).
Nike and the Michael Jordan relationship
However, what really got Nike ahead of its competition in the long run is the company’s amazing ability to seal profitable deals with super star athletes in various sports who have later become cultural icons in a ‘tribal’ and ‘hybrid’ branding relationship with Nike. Michael Jordan is one example of this development. Jordan’s brand took a high jump when he engaged in a partnership with Nike in the 1980s and it is still very much alive today through his best-selling ‘Air Jordan’ brand even though he retired from the playing field many years ago. Adidas made the mistake of passing on the opportunity to sign Michael Jordan, which had meant a difference in its basketball division and the brand-transfer to other divisions. On the other hand, Nike saw good ROI rates from the fact Michael Jordan became a commercial super star as seen in the video below (Super Bowl commercial from 1992).
The powerful commercial milestone of Bo Jackson’s multi-sport talent
During part of the Jordan era, Nike also launched the ‘Bo Knows’ campaign in the late 1980s and early 1990s to celebrate the extremely good athletic skills of multi-talented Bo Jackson, who became the subject for the epitome of athleticism across different sports. This was a powerful narrative in perfect alignment with the meaning of a ‘true American hero’ as Bo Jackson was an All-Star in two professional sports (baseball and American football) for what reason the ‘Bo Knows’ campaign portrayed the script that Bo Jackson knew all sports. Jackson excelled in two major sports until a serious hip injury slowed his career down before he decided to retire.
In ESPN’s ’30 for 30′ series episode ‘You Don’t Know Bo’, Curt Nelson, Director for Kansas City Royals Hall of Fame speaks about the authentication of Bo Jackson’s sporting magnitude in the 1989 MLB All-Star Game in which the former US President Ronald Reagan was in the booth with legendary commentator Vin Scully to call the first inning of the game in which Bo Jackson hit a leadoff home run, cf. video below. In the booth, Scully and Reagan talk about Jackson having an interesting hobby given the fact that he plays NFL football when the baseball season ends and suddenly Reagan says “oh” as Jackson hits the home run to which Scully responds “and Bo Jackson says hello”.
Meaning of authenticity, differentiation and constant visibility
That’s remarkably good timing for an athlete to perform like that in a highly mediated and exposed baseball game against top competition that all were positively amazed by his action. The articulation and the timing met once again as Nike rolled out the ‘Bo Knows’ campaign in one of the commercial breaks of the All-Star game. Yes, time and context matter in sports branding and it was very meaningful at this time and in this context that Nike strived to promote its new innovative investment in ‘cross-training’, in which athletes perform in various sports. Nike certainly hit a commercial home run in that regard. As a result of letting Bo Jackson endorse the cross-trainer edition, Nike’s sales grew exponentially. At the time, the competitive environment in the sports apparel industry was different with Reebok and Adidas playing a larger role so the Bo Jackson and Michael Jordan activities were important commercial milestones for Nike. It is so difficult to find success in this matter but it really speaks the language of the impact of innovation and betting on the right athletes in long-term strategic partnerships when aiming to win market shares and customers. The point of differentiation in applying Bo Jackson as a brand endorser was that he played two sports and dominated in these two sports; that is good timing when marketing a multi-purpose sports shoe and the associated apparel in that product line. It provided fruitful synergy in the business of sports in reflecting what Bo Jackson symbolized as a multi-sport star. Add to that the design on the shoes which fits well with Bo Jackson’s image of being faster and stronger than other athletes and larger than life as presented in the voluminous design of the shoe. All in all, this is aligned with my research in ‘hybrid sports branding’ in which Nike as well as Bo Jackson took advantage of their brand interactions in growing their respective brand equity and brand loyalty levels. In addition, Bo Jackson just as in the case of Michael Jordan helped Nike on its way to become a cultural icon that transcended the world of sports in the dynamic era of athlete branding and marketing in which Nike decided to build shoe and apparel lines around individual athletes. Nike’s strategic choice to honor great athletes won even more long-lasting merit due to the fact that some of their athletes became the best of their generation. Moreover, the greatest athletes in the world bring the notion to life that they can do anything and that certainly elevates Nike’s brand and that of the athlete(s) while adding meaning and authenticity to Nike’s slogan Just Do It. Bo Jackson’s campaign become such a trend that it translated into the production of counterfeit t-shirts with statements like ‘Bo Knows Your Mother’ and ‘Bo Knows Your Girlfriend’. Bo Jackson also became the focus of pop culture and was integrated in parodies, computer games and so on. The real power came in the fact that he was a multi-media super star before there was such as thing to the degree as we know it in the postmodern business of sports in 2018. In the peak years of Jackson’s career, the media coverage was massive and it definitely captured the brand awareness that build his brand image that eventually took his brand equity and brand loyalty to unseen heights at a time in which the business of sports was changing. Consider that he was playing when cable television first started to grow in the sports market and he was always present in the media portrayals because he played two sports.
Nike’s competent betting on sport stars reflects the greatest and most marketable athletes
Tiger Woods is another fine example of Nike’s ability to scout talent on the playing field that grows into champions and trendsetters of the sports that they represent. Two different and more recent examples include Nike’s long-term partnerships with current football/soccer players Cristiano Ronaldo and Neymar Jr., who are the most marketable super stars of the most popular sport worldwide. Football/soccer is also interesting since Nike decided to target the sport more as part of the 1994 World Cup on US soil.
We looked for the most followed player on each position and picked a social media dream 1⃣1⃣ – boasting a total following of over 1⃣ billion.⚽️#Dream11 #casillas #luiz #ramos #marcelo #alves #carrick #iniesta #messi #neymar #james #ronaldo pic.twitter.com/iqcpD0ioJ2
— Football Benchmark (@Football_BM) December 20, 2017
Which professional athletes own social media? https://t.co/KxFm3cD3FE #Ronaldo #Curry #Messi #Neymar #Bolt #Serena #Pogba #InvestinSports pic.twitter.com/nUugRDvxkF
— Global Sports (@globalsportfund) January 18, 2017
As illustrated in the tweets above, Nike’s selection of Ronaldo and Neymar Jr. are clever strategic moves because their impact on social media surpasses that of Messi – not only in numbers but primarily measured on the combination between personal accessibility, commercial flair, promotional activities and branded content. Nike’s long-term interactions with proven athletes materialize the value of these partnerships and turn them into monetizing rates of engagement with customers in international markets in a wide variety of sports.
Check the infographic below to learn more about Nike – click on it and zoom in to study it in the best manner.
The post How strategic sports marketing, continuous innovation and betting on the right athletes elevated Nike’s brand appeared first on Kenneth Cortsen.