Professional and college players get their

Nike makes the most of its NFL gear with sales to fans

Nike pays a fortune for the privilege of making all of the gear worn in the National Football League, and most of it will be bought by almost nobody. Professional and college players get their equipmentfor free, and few fans have enough enthusiasm to buy the same $100 gloves worn by their favorite wide receiver. But grown men and women have proved eager inthe past decade topay as much as$300 for jerseys identical to those worn on the field. The same feats of fabric wizardry meant to enhance the performance of eliteathletes see more use by fans rushing the beer vendor at halftime and blitzing platters of chicken wings in front of the TV.

Last week, in the middle of its fourth yearas the league gearsupplier, Nike unveiled yet another futuristic football uniform. The shirts and pants players will wear next season, dubbed Vapor Untouchable, are almost athird lighter than the current uniform. “The feedback from the athletes is, got better range of motion, and I feel faster, said Todd Van Horne, Nike creative director for football. Fans probably aren concerned with how much their shirts weigh, but they will need to spend again to match the on field look andthat exactly what Nike was counting on when it bet heavily on football.

The Nike of old regularlypassed up official sponsorship opportunities for the FIFA World Cup, the Olympic Games, and the National Basketball Association,preferring instead to sign individual athletes to endorsement contracts. In an example of Nike classic strategy, a player like LeBron James is considered asport unto himself when it comes to selling gear, and therefore merits a lifetime sponsorship deal.

Nike five year deal to become pro football official gearmaker in 2012 pushedAdidas Reebok brand out of that role. 1 sport.

In the 2013 fiscal year, just after Nike introducedits first NFL uniforms in a publicity extravaganza, itsmen training line managed $2.5 billion in sales. All of the sudden, with itsvery first foray into the NFL, Nike committed almost one tenth of its marketing dollars to a sport that accounted for a far smaller share of its business.

Nike and the league declined to discuss revenue from NFL gear, but the few numbers that offera glimpse of jersey sales aren overly impressive. The NFL Players Association, which collects a royalty on league apparel, said jersey revenue reached$150 million in the first year of the Nike era. The business has been fairly flat since then, saidMatt Powell, vice president for industry analysis at NPD Group. The reported revenue in Nike entire men training category ticked up just 4.3 percent in 2014 and 2.2 percent in the most recent fiscal year.

Powell estimates thatNike is still losing money on its NFL deal from a product sales standpoint. That doesn make it a bad strategy there major value in displaying a Nike logo on every uniform and shredof sideline apparel during broadcasts that consistently draw more than 20 million viewers.”These deals are really about marketing as much as anything,” Powell said.

One thing Nike NFL contracthasn been about isamateur athletes, the backbone of the company far larger divisions selling running clothes, soccer cleats, and basketball sneakers. “The equipment part of the business is pretty small,” Powell said. “We see football connecting strongly today,” he said, “and we want to make sure we using that to connect to athletes.”

In one respect, however, Nike uniform deal is profiting from the punishing tollof football. As playing careers grow short, jerseys featuring the name and number of starsturn over frequently. A fan determined to dress like her favorite team new starting running back needs tomake a purchase every three or four years now.”When a player moves, or gets hurt, or retires, that always a sales opportunity,” Powell said.

Nike has responded by building a supply chain geared for speed. When a second or third string playertakes over for an injured star, the companycan getthe player jersey in stores in a matter of weeks. Oddballfans who have a thing for the backuppunter can custom order his jersey. This faster supply chain was a big part of Nike pitch to the NFL, and the company hustled to streamline its relationships with suppliers and dial in its shipping strategies. “It a hot player comes on, they very quick to respond,” said Leo Kane, the NFL senior vice president forconsumer products.

A speedy supply chain is less critical when it comes to other sports. Basketball, baseball, and hockey have far fewer athletes and injuries. Soccer jerseys, meanwhile, are less intricate; retail stores typically receive blank shirts and use their own machines to press players names on the back.

Nike has allowed the NFLto highlight more games with unique uniforms. This season, for instance, Nike sewed up eight so called Color Rush jerseys, garish uniforms that helped the league draw interest to Thursday night games. “And on the Web, we have unlimited shelf space.”

Adult fansdidn always get a thrill by dressing themselvesin the jerseys offootball stars. For decades, a guy in the stands would clothe himself more like Vince Lombardi than like Bart Starr. Gradually, the sea of wool overcoats and fedorasgave way to logo plastered sweatshirts and jackets.

The market for authentic football jerseys “exploded,” the NFL Kanesaidof the period after the Rebook deal. “All of a sudden, if you were going to a game, you were wearing a jersey,” he said. “It has really become the uniform of the fan.”

When Nike was bidding on the NFL gear business, it saw some gaps in the field that Reebok had largely left open. Female fans, for one, had never been offered a chance to buy an official jersey with a cut that wasn intended to flatter massive men with shoulder pads, or Cheesehead hats. Nike made better fitting women jerseys and helped the league move beyond what Kane describes as the “shrink it and pink it” approach.

## ## Nike also took control of the official jersey business just asthe fantasy football phenomenon was beginning to build. The traditional boundaries of fandom were shifting from geographies and teams to individual stars. In the 2012 season, for example, Saints quarterback Drew Brees made a lot of money for fans who couldn care less about New Orleans, and his jersey sold accordingly. Boyle, of Fanatics, saidNike expandedthe number of named players per team to five or six from two or three.

InMarch, after its third season of outfitting the NFL, Nike reached an agreementwith undisclosed terms to extend its contract three years. Morningstar analyst Paul Swinand described Nike original contract as “astronomical,” unless one factors in potential growth. “They wondering: How can we export American culture to the world?”he said. “How do we pull off another basketball?”

The NFL has steadily beenhosting more games in London and even talking about sparking up a British franchise. Jarryd Hayne, a professional rugby player from Australia, made the San Francisco 49ers squad as a running back earlier this season. His jersey immediately became the top seller at Fanatics and remained so for seven weeks; the majority of those purchases were shipped to the Southern Hemisphere, according to Fanatics.

The Players Association, meanwhile, is focused on helping each of its members cash in during what might proveto be a short career. Of the union royalties collected on a jersey sale, 75 percent goes directly to the player whose name is on the shirt, while the remainder is split among other players and the association itself. Hayne, for example, should be thankful for his early season jersey blitz, as he was quickly bumped to the 49ers practice squad.

In a moment, they make the transition from prospect to product. “To see the looks on their faces is great,” Scebelo said. “It like they made it.”Registration on or use of this site constitutes acceptance of our User Agreement, Privacy Policy and Cookie Statement, and Your California Privacy Rights (each updated 1/1/20).

2020 Advance Local Media LLC. The material on this site may not be reproduced, distributed, transmitted, cached or otherwise used, except with the prior written permission of Advance Local.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Create your website at WordPress.com
Get started
%d bloggers like this: