Why Nike Will Beat Adidas at the World Cup
The real action at the World Cup won’t be between by the national teams from Brazil and The Netherlands, nor from Germany and Spain, or from any other soccer team. The biggest competition just might be between Nike and Adidas.
Each company is looking to the World Cup to catapult its soccer revenue and share of the overall sportswear market. And each is spending heavily to do so – team sponsorships are estimated to total almost $400 million alone and Adidas’s official sponsorship of the FIFA cost that company almost $70 million.
Even though Adidas has sponsored FIFA since 1970 while Nike didn’t even have a soccer offering until 1994, even though Adidas was started by a cobbler making soccer cleats (Adolf “Adi” Dassler) while Nike’s roots are as a running company, even though it’s estimated that Adidas makes 25% more on soccer than does Nike, and even though the ball on the field will be Adidas’s, my bets are on Nike winning the contest between the two brands.
A recent Bloomberg Businessweek article makes the case for me. The insightful piece by Brendan Greeley explains Nike’s advantage:
Nike is so good at advertising and event promotion that it sometimes seems as if no other company is even playing the same game. Adidas maintains an overwhelming advantage at the only global tournament, and it still makes more money in the sport. But Nike is drawing its only real rival into an old and expensive game: Sponsor as many of the best teams and players as possible.
Not only is Nike spending more on sponsorships, but also the way it approaches its sponsorships challenges Adidas. Peter Rohlmann, a sports marketing consultant, explains the difference in the two companies’ celebrity sponsorships. “The players from Nike have a lot of entertainment character. Cristiano Ronaldo, he’s much more a star in a broader sense than a football kicker. … Lionel Messi, sponsored by Adidas, he’s more a football kicker.” Greeley adds, “Adidas backs athletes. Nike backs athletic celebrities.”
Greeley observes,
Adidas sponsors athletes and teams, supplies them with innovative shoes, and hopes they win. Nike does all that, too, but relies less on reality… Nike has realized that while what actually happens on the pitch matters, it can also use its players to tell elegant fiction. What you, the consumer, remember matters just as much as what actually happened.
And Phil McCartney, head of sports footwear for Nike, further explains how Nike approaches marketing:
“The game is defined by key moments,” he says, “and I think when we can link product innovation to key athletes, to key moments, that’s when the magic happens.”
Even Markus Baumann, head of soccer at Adidas, seems to understand Nike’s advantage. Nike is, “More marketing-driven, I would say,” Baumann remarks as he reminds Greeley that Adi Dassler was a cobbler. The comment, which might have been meant as a criticism, actually sums up Nike’s prowess.
Those of you who know my new book, What Great Brands Do, probably find that the contrast between Nike and Adidas sounds somewhat familiar. One of the brand-building principles I discuss in the book is Great Brands Avoid Selling Products. I show how great brands, instead of pushing products, ingredients, and prices on people, engage customers on an emotional level. That’s because they know people make decisions based on how products make them feel and the identities they enable them to express and experience. And, I use the story behind the campaign that introduced Nike’s famed Just Do It tagline, as an example of the power of emotion over product.
Nike’s continued brand success can be attributed to its consistent ability to inspire people. So, it doesn’t matter if Adidas has the company heritage, the European integrity, or even perhaps the superior cleats. Nike understands that making powerful, transcendent connections with people is not about the product. Nike avoids selling products – and that’s why Nike will be the real winner at the World Cup.