The competition for top sponsorship resources by sports brands is always in the alternation of you singing and me taking the stage. As Adidas shifted its marketing focus to individual players, high school and college teams, and football and baseball other than football, Nike did not give its opponents a chance to bid, and directly bought the NBA at a price more than three times the previous average annual price of Adidas (the previous Adidas contract totaled $400 million for 11 years, or about $36 million per year; Nike 1 billion 8 years, $125 million per year).

Such a move reflects the determination of the sportswear industry boss, and it also means that Nike wants to gain more rights and interests from this contract.

Paul George wears a Thunder-themed jersey.

Beginning in the 2017-18 season, the Nike logo will appear on the right chest on every official NBA jersey. This is the first time in the history of NBA jerseys.

"It's a big step for the NBA to find the right partner to put the brand on their jerseys." Edwards told Lazy Bear Sports, "It's an opportunity for us to showcase our brand on a global scale and to get to know our brand better from people in different regions. ”

The reason why Nike was able to have its logo on NBA jerseys was agreed by Matt Poell, an analyst at NPD Group, and Mark Francis, a professor of sports marketing at the University of California, Los Angeles (UCLA), who agreed that it was because Nike gave enough money.

Francis even said: "Whoever helped Adidas negotiate a jersey contract with the NBA, and finally didn't let the Adidas logo appear on the jersey, this person should be fired." ”

He also said that the NBA is currently actively developing the commercial value of the league, and Nike is catching up with the good times. "Previously, the NBA, MLB, and BA broke this convention this year." Francis said.

Also starting with the 2017-18 season, NBA teams will open up jersey advertising slots, and each team can accept sponsorship from other brands, and the brand's logo will appear on the left chest of the jersey. So far, 14 NBA teams have received jersey advertising sponsorships, with the Warriors and Japanese e-commerce giant Rakuten spending the most in the league at $20 million.

"Spectators and fans in North America are actually more opposed to this because they are afraid that it will damage the team's image," Francis said, "and the team will definitely like it because it makes money." And in professional sports in the United States, it's all about money. ”

At present, the NBA is in a period of skyrocketing commercial value, both from the league to the team. In 2014, the alliance reached a new TV deal with ESPN and TNT for $24 billion over nine years; The recently completed sale of the Rockets set a record for a single team in the NBA - $2.2 billion.

In terms of jersey advertising, the NBA is also at the forefront of the four major sports leagues in North America, keeping up with European football clubs and developing commercial value on jerseys with every inch of land.

However, if you compare the jersey sponsorship between NBA teams and European football giants, whether it is a jersey sponsor or a corporate sponsor, the NBA is slightly inferior in price.

Recently, it was reported that Adidas will renew the contract of the La Liga team Real Madrid at a price of more than 1.5 billion euros for 10 years, with an annual sponsorship amount of more than 150 million euros, while Nike's annual sponsorship of 30 NBA teams is 125 million US dollars; if you compare with corporate sponsors, Rakuten, who sponsored the NBA Golden State Warriors for 3 years and 60 million US dollars, also signed a 4-year sponsorship contract with La Liga's Barcelona Club in 2016, and the annual basic sponsorship fee reached 55 million euros. Therefore, there is still a long way to go in the value enhancement and development of the NBA.

Of course, this contrast doesn't stop Nike from choosing the NBA as a partner. After all, when it comes to doing business in basketball, the NBA, the highest level of professional basketball league, is something that all brands are competing for.

Turn fans into consumers

Edwards has repeatedly mentioned in interviews that basketball has become a way of life beyond a sport.

Indeed, in the world's two largest economies, the United States and China, the influence of basketball, especially the NBA, is unquestionable. The charm of the sport itself and the blessing of media and technology not only stimulate the enthusiasm of fans to participate, but also induce their purchasing power.

Combined with the NBA, Nike will not only be able to add a heavyweight certification to its sponsorship resume, add more products to the retail market, and make a frequent presence on TV broadcasts and feature stories, but it will also be more likely to convert the NBA's already cultivated and still expanding fan base into its own consumer base.

Therefore, in the design of the NBA's new jersey, Nike should not only adhere to the principle of "obeying the athletes" and design lighter, more environmentally friendly, and better sweat-wicking products, but also launch five jerseys, including the league version, the classic color version, the theme version, the city version and the retro version, but also need to listen to the ideas of fans, so that fans can one day become Nike "fans".

"Through our conversations with the fans, we've developed a philosophy of making a jersey more than just a jersey," Edwards said, "and we're going to bring fans closer to NBA games and the players they love." So we came up with the concept of NikeConnect, where we can give fans more content, information, and videos that they can engage with players like never before.

With Nike's new NikeConnect, fans can get up close and personal with their favorite players and teams.

In the future, consumers will be able to customize match information, pre-match videos, match highlights, and team playlists by purchasing a new version of the jersey using the "NikeConnect" technology, downloading the NikeConnect app, and identifying the players and teams that are the corresponding players and teams through the NFC chip. In the words of Adam Sussman, Nike's chief digital officer, the new technology brings "the arena into the pockets of consumers."

Sussman also told Lazy Bear Sports that through NikeConnect, users may even have the opportunity to buy Nike's latest basketball products one step ahead of the market, or get a corresponding product specially created for fans of a certain star. In addition, NikeConnect users also have the identity of Nike's other digital platforms and can experience Nike's other digital products and services.

And the content on NikeConnect is inseparable from the support of the NBA. "Nike gets a lot of content from the NBA, and we're unique in categorizing and editing content based on what users like," Sussman said. ”

Is the NBA a panacea for Nike basketball?

Winning the NBA's jersey sponsorship, sitting on two-thirds of the NBA's player resources, and Nike and Jordan brand sneakers covering almost the entire basketball footwear market, Nike's basketball business seems to be going through a good time.

However, the numbers speak for another fact.

Since fiscal 2016, Nike Group has reported the performance of Nike basketball and Jordan brands separately in its financial reports. From fiscal year 2015 to fiscal year 2017, Nike basketball's hole sale revenue increased by 19%, 2% and -5% (excluding foreign exchange factors), according to the annual report. As recently as September 20, Susquehanna Financial Group, a rating agency, downgraded Nike to neutral, largely due to the weak performance of Nike's basketball business.

According to a report released by NPD, a U.S. market research agency, Adidas' current market share in the U.S. market has soared to 11.3% from 6.6% in the same period last year, Jordan's brand share has risen slightly from 9.4% to 9.5%, and Nike has fallen from 39% to 37%.

Matt Powell, an analyst at NPD Group, said in an email to Lazy Bear Sports: "The fashion vane has shifted from basketball to other areas, such as retro trendy styles, and such a shift is threatening Nike's basketball business." In addition, he said, Nike is currently adopting more price reduction strategies in North America because of competition, but in order to boost revenue, the product has to return to normal price levels.

Retailers are most sensitive to this shift. Richard Johnson, CEO of Foot Locker, the largest sports retailer in the United States, said in a recent statement that the lack of innovative products from major sneaker brands was one of the reasons for Foot Locker's decline. Keep in mind that the Nike and Jordan brands account for 68% of the number of products sold by Foot Locker. The signature sneakers of several Nike stars, such as LeBron James and Kevin Durant, also seem to have lost their appeal to consumers.

Sports retailers seem to want to reduce their reliance on Nike, and Nike has to step out of the "unreliable" retailer circle of friends to find better ways to boost sales.

In conjunction with the new NBA jersey, Nike also introduced more stylish and other street gear.

In addition to the DTC (Direct To Customer) model that has been promoted in recent years, Nike also announced a business plan called Consumer Direct Offense in June this year, led by Nike Inc. President Edwards. In conjunction with this move, Nike established the Nike Direct division, and it was at that time that Sussman was appointed chief digital officer. As a result, Nike has brought together its official website, directly managed stores, and Nike's digital products. To put it simply, the purpose of this series of actions is to strengthen the direct connection between brands and consumers, understand their needs and preferences, and provide them with corresponding products and services.

Although the cooperation with the NBA began two years ago, Nike's latest business adjustment is also reflected in it.

Outside of the NBA, Nike's tentacles in basketball have gone further, out of North America, and into multi-level basketball competitions.

On February 27, 2017, Nike and the International Basketball Federation (FIBA) announced an 11-year (2017-2027) partnership agreement under which Nike will become FIBA's official product and marketing partner, sponsoring all FIBA men's, women's and youth basketball tournaments. When talking about the cooperation with FIBA, Edwards specifically emphasized the 2019 Basketball World Cup in China, when Nike will have a series of actions in eight host cities in China. "The basketball world of the future must be global," Edwards said.

In addition, Nike's sponsorship in college leagues and grassroots leagues is also increasing.

Edwards once confidently said at the end of 2016: "Basketball is back!" At the event on September 15, we asked him again: "Is basketball really back?" ”

He didn't answer directly: "You look at the whole world, so many basketball participants, people's enthusiasm is increasing, the number of spectators is increasing, maybe it will reach a billion level, which is one-seventh of the world's population!" So, we can definitely benefit from that enthusiasm. ”