There's nothing quite as motivating as a good rivalry. Think about Bill Gates and Steve Jobs, Coke and Pepsi, Ford and Chrysler.
Nike and Adidas are two of the biggest sports brands in the world, yet there is one area where Adidas is a decided underdog: basketball.
Scanning a public court in Manhattan, it’s clear Nikes are the preferred shoe at a weekend pickup game.
“I collect basketball shoes,” says accountant Lester Narcisse, after finishing a game in Nikes. “I still have my Jordans, the first ones. I still have a brand new pair, in the box.”
“I haven’t worn anything but Nike’s in 10 or 15 years,” says Thomas Smith, an online retailer. “I like Adidas, too, though.”
That’s a spark of good news for Adidas, but Nike has a very high share of the basketball shoe market – well over 90 percent, according to data from SportsScanInfo.
But in recent years, Adidas has been making a push to try to take on Nike on the hardwood. They made basketball a priority a few years ago by becoming an official sponsor of the NBA, says Chris Grancio, general manager for Adidas’ global basketball division.
“But I would say as a brand that has aspirations to be the leading basketball brand in the world, we haven’t grown fast enough,” he says.
To get that growth, the company wants to build shoes around some of the league’s biggest players, though choosing the right players can be as uncertain a process as picking stocks is for investors. Adidas signed megastar Derrick Rose back in 2012, but he’s been plagued by injuries.
So this summer, Adidas got particularly aggressive, signing four of the top six picks in an especially strong draft class: Andrew Wiggins, Joel Embiid, Dante Exum and Marcus Smart.
“Knowing that we’ve got half the starting point guards in the NBA now wearing Adidas, and the fact that we’ve got five or six or eight guys that we think could be not only All Stars but could be really special players – that has to be part of our approach,” says Grancio. “There is no silver bullet for us. We have to be continuously looking for the next great player.”
“What that actually reminds me of is exactly what Nike did about 20 years ago,” says Victor Matheson, a sports economist at the College of the Holy Cross. “Nike wasn’t a player at all in the soccer markets around the world, and they started to make a concerted effort in about the mid-1990s to become a big player worldwide in soccer. And they started to try to sign the top stars and the top teams around the world.”
The roles were reversed back then, Matheson says. Adidas was dominant in soccer, and Nike was the underdog. This World Cup? They were neck and neck.
Going back even further, signing a megaplayer worked for Nike in basketball, too.
“The biggest piece that threw Nike into basically national prominence was the Air Jordan,” says Matheson of Nike’s deal with Michael Jordan.
Everyone wanted to be like Mike – and they still do. Air Jordans are owned by Nike, but on their own they still account for nearly half of the basketball shoe market.
“You want your brand associated with top players,” says Jack Plunkett, CEO of Plunkett Research. “You want your logo seen on those top players.”
Rocket science, it is not. But Plunkett says endorsements work, so Adidas is making the right moves.
“I think Nike’s so far ahead, though, in some ways that they’re presenting a huge challenge to the industry,” he says. “I mean I would hate to be in a position of taking Nike on head on.”
But he’s not saying Adidas shouldn't try.
“I know they’re a global brand with great financial power, and they’re smart people," Plunkett says. "I just think it’s a big challenge for them.”
“I think the best compliment I can give is not to say how much your programs have taught me (a ton), but how much Marketplace has motivated me to go out and teach myself.” – Michael in Arlington, VABEFORE YOU GO