Sport and Co: Nike vs Adidas: the Eternal Battle

° Nike company overview

Nowadays, rare are the people who have never seen the Swoosh of Nike. This upside down comma is one of the most known and recognizable logo in the world and was invented in 1971 to represent the famous American multinational specialized in sports equipment. As the main manufacturer of athletic clothing and footwear of the world, Nike is estimated at US$19 billion. This worldwide brand has been founded in 1964 by Bill Bowerman and Phil Knight under the name « Blue Ribbon Sports » before to become Nike in 1971. Since this day, the company has never stopped growing until it become the most profitable company of the sports market with its many brands: Air Jordan, Air Max, Converse, Air Force 1, Nike Pro, Nike Golf and others. As most major companies, Nike had to make use of many brilliant strategies to succeed, both in terms of sales strategies as well as ad campaigns. But what made Nike the most profitable and popular company on the market today? Why it main competitors, Adidas, is still not able to get ahead?

° Adidas company overview

Adidas, the second big sport brand. The company is a German multinational born as a result of a disagreement between two brothers: Adolf and Rudolf Dassler. In 1949, Adolfer Dassler created Adidas, which is became the second largest sport brand of the world, just behind Nike, while his olden brother was creating another sport brand, Puma. Also specialized in the manufacture of sports clothing, footwear, and equipment, the company owns several sport brands such as Reebok and Runtastic. When one sees the importance of the two companies, one American and the other European, it is legitimate to think that they are leaders of the market businesses. Thus, many people have looked at how these two companies have become the giants of the industry.

° Nike’s strategies

On one side we have Nike; an innovative brand focused on the technical characteristics of their product. If this company is leader in its category, it is thanks to its strategy of production which consists mainly of outsourcing approaches. But it is not only for that reason, their marketing strategy and the brand image they have created during their evolution are key factors regarding the company’s success. It all began a little before 2000s, when the famous brand signed a partnership with the world famous basketball player, Michael Jordan. This partnership engaged the athlete to be one of the spokesmen of Nike but also resulted in the creation of the brand Jordan, which are emblematic sneakers sold throughout the world. Meanwhile, the brand has also continued to sign sponsorship contracts with other sports stars like the greatest golfer of all time, Tiger Woods, or the famous American tennis woman, Serena Williams. In addition to this marketing strategy, Nike has also developed its brand portfolio by making major acquisitions such as Hurley in 2002, Converse in 2003 and Umbro in 2008. The last big hit of the brand being its collaboration with the most popular American rapper, Kanye West, who has been able to design a whole collection to its effigy: The Yeezy footwear collection. The Kanye West x Nike’s strategy is simple: a trendy and fashion celebrity designs limited edition shoes that will be sold through the Nike network at a reasonable price. As this exclusivity is the designed according to the star’s image, these shoes will quickly become must-have that will generate a fairly impressive resale phenomenon. Even if this technique is well known in order to create awareness, this collaboration has broken all records. Indeed, the original price of the Yeezy sneakers, sold through Nike official retail stores, is about US$ 200, but as the collection has been out of stock in few hours, especially because of e-commerce, these shoes have been resold on unofficial websites at senseless prices up to $ 4000.

° Adidas’ strategies

It is in a similar way that the German giant has beaten his sports empire. Indeed, both brands embrace innovation and quality as well as they use bold and expensive marketing strategies to build their brand image. From a global point of view, in 2009, the board of direction decided to change the company's internal structure from a vertical to a functional multi-brand approach. This strategy was put in place with the aim of gaining sustainability, but also for each brand of the company, such as Reebok bought in the same year, to focus on their own target market and therefore the group can have access to a broader market segmentation. In term of marketing, the brand recently put a lot of effort to restore its brand identity. In fact, Adidas has also many contracts of sponsors with famous athletic stars like David Beckham, who has a lifetime contract with the brand, Lionel Messi and Muhammed Ali. To differentiate itself from its main competitor (Nike) the company does not hesitate to go further with for example Pharell Williams, a famous singer of the pop music, as spokesman and representative of the brand. This call to music is not limited to Pharell Williams: in 2015, when the Kanye West X Nike collaboration ended following a pay disagreement, Adidas did not hesitate to jump on the opportunity and launch a new collaboration Kenye West X Adidas called Yeezy as well.

° Adidas and Nike: the eternal battle

Now that we have seen how the strategies of both brands were identical, the question is: Why does Nike always stay better than Adidas despite their similar efforts? We could believe that the difference is minimal and yet not, Nike is well the best in his field. Nevertheless, one can not neglect the fact that its German competitor, Adidas, never ceases winning battles in this market war:

- - Adidas had been the official sponsor of the football World Cup of 2010 and 2015.

- - In 2010, Adidas sponsored 12 football teams whereas Nike sponsored only 9 teams.

But the reality is so, Nike always has a step ahead, faithful to its core values: innovation and inspiration. Nike is a fairly innovative company for having first succeeded in linking technology to sport. But that's not all, they use the most influential stars of the moment to create brand loyalty and engage in current causes. Indeed, Nike’s directors want sustainable strategies that will allow the company to indefinitely grow. Thus, Nike is currently engaging in sustainable development by supporting ecological and equitable actions. Nike’s futuristic vision is probably its key factor for success.