When David Beckham was 15 years old, he was viewed as a talented kid with a bright future in football. After being spotted by an Adidas rep, they signed him up to a 2 year deal then fundamentally forgot about him. Two years later when Beckham started to break into the Manchester United first team and into the headlines, Adidas biggest rivals Nike started to chase Beckham, keen to sign him. Adidas, desperate not to lose their new star persuaded the young United midfielder to meet with them with a view to discussing a new contract. Beckham agreed and arrived in a brand new BMW, bought that week after an improved deal by Manchester United. At the meeting, the Adidas team were quick to offer him an improved 2 year deal to prevent Nike from stealing him, but Beckham was hesitant based on his past experience with the company. Sensing his reluctance, one sharp eyed Adidas representative spotted Beckham’s new car and engaged him in conversation about it. He quickly realised that Beckham couldn’t afford the insurance on his new car and was disappointedly going to have to sell the car based on this. Looking at this kid the rep saw his potential and offered to pay his insurance as well. This act showed Beckham more about Adidas than he had seen in the past two years and he agreed to sign a new improved five year contract. This contract sealed his loyalty to the brand for life and when Beckham went on to become a superstar over the next decade; he repaid Adidas back by being their main brand icon.
Brand association is key to Adidas and no more so than at the World Cup. Despite being an official FIFA sponsor, Adidas still faces a daily battle with its key rival, Nike who are keen to capitalize on the world’s most watched tournament. Adidas have spent around £50m on advertising around the tournament but it’s the branding seen on players shirts, boots and the official tournament ball that benefits them the most. Stars like Lionel Messi, James Rodriguez and Arjen Robben have lit up the tournament dressed in Adidas branded kits which in turn helps sales as kids across the globe rush out to buy the strips of their heroes. Nike has had a somewhat disappointing Word Cup with England and Portugal crashing out early but rallied behind home nation Brazil and the USA for addition shirt sales. It’s a competitive battle but Adidas are slightly edging during this World Cup with more sponsors remaining in the tournament than their rivals. Out of the last eight teams in the tournament, Adidas had kit sponsorships with four teams (Argentina, Colombia, Belgium and Germany) whilst Nike only had three (Brazil, France and Holland). This year’s surprise team Costa Rica’s shirts are made by Italian sports brand Lotto. With Brazil’s shock 7-1 defeat by Germany and Argentina’s penalty shoot out win over Holland, it will be an all Adidas final for the first time since 1990 (ironically between Germany and Argentina as well), much to Nike’s disappointment.
As far as organizations go, there are few bigger than Adidas and Nike. Between them they control the sports apparel and footwear market and have a majority of the world sport stars signed up on their books. Competition between the two is fierce and a variety of tactics have been employed by both companies over the years to gain the upper hand. The story of Adidas is a fascinating one and is brilliantly captured in the book Sneaker Wars by Barbara Smit. It tells the tale of two brothers, Adi and Rudi Dassler who started a shoe business in rural Germany shortly after World War 1 with almost instant success. Troubles soon surfaced as the pair disagreed on how the company should be run, which created a divide that would eventually lead them to follow separate paths. Those paths created history with the brothers establishing rival companies, Adidas and Puma. The astonishing story is of their long running feud and how the sports market evolved over the next sixty years, with branding association becoming more prevalent with the creation of global sports stars. The introduction of Nike in 1971 added an extra competition to the market and over time Nike grew to become the biggest rival to Adidas Empire. After basketball success in the 80s and 90’s, Nike turned its focus to Adidas core business, Football. Ever since that moment, the pair have been embroiled in a battle for dominance. Sunday’s all Adidas final will hand the German company this battle but their war with Nike to see who controls the sports market continues.
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