By Mick Duncan
In a recent interview, Nike boss Phil Knight revealed the obscene degree to which this massive company is built around enormous payments for celebrity-sportstar endorsements.
In 1998 Nike paid £11 million in an annual deal with the Brazilian football team. Two years later Nike signed a £300 million deal with Manchester United giving it rights to all of United’s merchandise. Knight cannot be too happy that David Beckham has defected to a rival—Real Madrid wears Adidas. If Beckham had to move, a better bet would have been Barcelona, which is also linked to Nike.
Nike expanded from its roots in athletics (Carl Lewis) to tennis (Jimmy Connors and John McEnroe), golf (Tiger Woods) and basketball (Michael Jordan). In 1992 Nike paid Jordan more money for his endorsement than it paid its entire Indonesian workforce.
Nike has bought into the “bad boy” images of Ian Wright, Eric Cantona and Ilie Nastase. It is a strategy—similar to the marketing of some Black music and images—that has appropriated and sold “attitude”.
Most recently, LeBron James, an 18-year-old high-school basketball star, was signed on a seven-year $90m deal.
Knight described celebrity athlete endorsement as one part of the “three-legged stool” that lies behind Nike’s growth since the early 1980s, with the other two being good product design and advertising.
Their famous ads have starred Pete Sampras and André Agassi playing tennis in the streets of Manhattan, and Brazil’s football team playing soccer at the airport terminal. And Nike spent $3 million on one Terry Gilliam-directed TV advert, shot in cages on a ship, for the 2002 World Cup.
Nike’s quarterly results state sales are up 6% to £1.4 billion, with profits at £75 million. Annual sales are forecast to be worth well over £6 billion.
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