Nike playing catch up in World Cup stakes

Nike inc. is now recognised alongside adidas as the worlds leading supplier of sports equipment, boasting annual revenue of over $18billion (2008 accounts). However, comparatively to their rivals however Nike's rise to sporting stardom has been a much faster ride. 40 years the junior of rivals adidas, Nike has exploded on the sporting landscape in a flurry of cutting-edge design and marketing innovation which has become a benchmark for the industry. However, like its main rivals adidas Nike, or at this stage Blue Ribbon Sports, began life modestly in January 1964 Oregon, under track athlete Philip Knight and his coach Bill Bowerman, as a US distributor for Japanese footwear firm Onitsuka Tiger (now actually owned by Nike's main competitor in the running sector, Asics) selling the shoes at track meets across the region of Oregon.

Circumstances led to their agreement with their Japanese suppliers ending in 1971 and the pair, both keen on the technical innovation of running footwear began the design and production of their own range. It was with these early designs that the company found its legendary "swoosh" and amid experiments with a waffle iron and some rubber, Nike's infamous"Waffle design" was produced with great success. Consistent innovation saw the company quickly gain a near 50% share in the US athletic shoe market under its new name - Nike.

Nike quickly saw the potential around key sponsorship of elite athletes and invested heavily in acquiring a broad range of superstars which they felt best portrayed their personality. Superstars who gained Nike sponsorship were expected to do much more than just wear the clothing, but had a duty to represent the complete ethos of the brand in their lives, on and off the field. You are perhaps by now asking what relevance this has to the World Cup?

Although Nike have dominated sports marketing over the last few decades, investing millions in portraying its identity through carefully selected superstars and exciting advertising campaigns, they are falling well short in World Cup stakes. Nike has only sponsored one world cup winner since its inception (Brazil 1998), while its rivals adidas have five such associations to their name. The effect this has on their bottom line is arguable, I mean despite this Nike are one of the biggest and most successful brands, so surely this doesn't concern them right? For a brand which prides itself on being the best, and bringing out the best you can bet your bottom dollar Nike is keen to start clawing this figure back on adidas, perhaps reflected in their multi million pound deal with Brazil and the recent $500million deal to take over the rights for the French national team from adidas.

Nike doesn't like being beaten on promotion by anyone, and has already started to invest accordingly. In South Africa Nike will have to be reliant on their main protagonists of Brazil, Holland and Portugal to carry their swoosh to a second world cup commercial payday, preventing adidas sponsored Spain claiming their partners a sixth world title. It's a battle of the brands which is akin to the Roman emperors sending their gladiators into battle, with marketing ego's and multi-million pound consequences on the line. To the victor the spoils, and Nike mean business!

What does a small German town have to do with the World Cup?

What does the opening day fixture of Uruguay versus France have in common with a small cobblestoned medieval German town of just 22,000 people? Some of you will know the answer to this question immediately (clever clogs), but if so you know where this blog is going, and that it is worth sticking with for the next 700 or so words. Alternatively, if you don't know then prepare for a potted history into the business of football, literally!

In our quest to unlock the connection let us revisit 1920's Germany, and specifically the town of Herzogenaurach. In their mothers washroom a pair of brothers are busily struggling to get their new footwear business off the ground. The brothers (Rudolph and Adolf 'Adi' Dassler) are blissfully unaware that they are setting about shaping the commercial future of the sports world. Adi, the technician of the outfit, was obsessed with the shape and feel of the shoes, while Rudolph, the salesman, set about promoting the abilities of these shoes to the world - Gebrudar Dassler was born. Although on paper it seemed like the perfect combination, their relationship proved as combustible as Wayne Rooney on speed, and was ultimately doomed to failure. Disgruntled and angry, the brothers went their separate ways. Adi continued to manufacture in the existing factory that once held Gerbrdar Dassler, while Rudolph crossed over the river which split the town to set up a direct rival.

And that is the potted story of the birth of two of sports commercial Goliath's. I can imagine over the last paragraph the penny is starting to drop for most of you. 'Adi' dassler's craft and expertise pushed Adidas to the top of sport, while Rudolph's drive and passion helped Puma join them on that pedestal. Bitter and cynical the businesses have faced off for decades, splitting the Dassler family, and the entire town, in two.

Skip to Friday 11th June, 2010 and the most recent round of that rivalry will be played out in front of 64,100 people at Green Point, Cape Town. In the Puma corner, an abrasive Uruguayan outfit, in adidas' the flair and panache of the French. The battle will continue throughout "the biggest show on earth" as Puma and adidas indirectly battle for that million pound moment which could shape the short term success of the company. In 2006 Fabio Cannavaro lifted the famous trophy and with it ploughed millions onto the value of Puma, as he held aloft the Jules Rimet with the gold Puma adorning his chest - an image which went around the world (and came back again).

adidas will be hoping the likes of Iker Casillas (Spain), Javier Mascherano (Argentina) or Phillip Lahm (Germany) do their bit to take revenge, while Puma will once again be pinning their hopes on Mr Cannavaro (Italy) and his men, or even Didier Drogba (Ivory Coast) in what would be the World Cup's first African winner.

In a tournament designed to test national rivalry on the pitch, this is one rivalry which will shape the global commercial landscape of sport for the next four years!

And don't get me started on Nike...