London Olympic Games Offer Golden Opportunity to Sportswear Manufacturers
Summer 2012 brings the Olympic Games to London and with it an opportunity for global sporting apparel manufacturers to strike gold. Athletes from 205 countries will be participating during the 19 days of Olympic competition. The combination of so many countries taking part, global improvements in satellite communications and the events taking place over a prolonged period mean viewing figures for the event will be extremely high – the eyes of the world will be watching, and for a significant period of time. For any brand involved with the Olympic Games, this type of global exposure is the stuff of dreams, but for sportswear manufacturers in particular the stakes are even higher.
For the world’s top three sports apparel and footwear manufacturers, Nike, adidas and Puma – which will all be represented at the Games to varying degrees – the Olympics offers an incredible opportunity to boost their market presence around the globe. With around five months to go until the opening ceremony on 27 July, sportswear manufacturers are lining up to make the most of the event, and key to gaining an edge over their rivals will be the companies’ various marketing activities.
Adidas shells out to be an official sponsor
Adidas, the world’s second largest sportswear manufacturer, has given itself an early advantage, signing up as an official Olympic partner in a deal that reportedly cost £100 million. As part of the deal adidas will be kitting out Team GB athletes – official tracksuits are to be designed by Stella McCartney – as well as dressing the 70,000 Olympic volunteers. As well as supplying clothing to those participating and helping out at the Games, as its official clothing licensee it will sell Olympic-themed and branded clothes through its own stores and third-party retailers. In addition, Stella McCartney has also designed a premium capsule range, which hit stores in May 2011.
Adidas has stated its intention to use the Games as a springboard to overtake its arch-rival Nike as the biggest sportswear company in the UK. Nike currently accounts for 0.9% of the total UK apparel market, compared to adidas’ 0.5%. In terms of footwear alone, Nike accounts for a 4% share and adidas 2%.
Nike makes its campaign count
Of course, the world’s leading sportswear manufacturer, Nike, is not going to let adidas steal its share that easily, or let the Games go by without also bidding for gold. While not an official sponsor of the Olympics, Nike is kitting out the Russian, Chinese, US and German squads. It also has individual deals with many athletes who are expected to be medal winners. Most recently, in February 2012, Nike unveiled its Nike Pro TurboSpeed suit. The high-tech second skin will be worn by Nike-sponsored sprinters at the Games, and is sure to make headlines because of its futuristic look.
In January 2012, Nike launched its ‘Make it Count’ campaign. Perhaps in a bid to steal adidas’ thunder as Team GB sponsor, the campaign features a number of British athletes, all Nike-sponsored, such as cyclist Mark Cavendish. While no mention of the Olympics is made in the advertisements, the theme of the campaign and the decision to use UK athletes only means consumers do not need to make too much of a leap of thought to link the campaign and the Games. In addition, Nike has opened a large store in London’s Westfield shopping centre just next to the Olympic site, a shopping centre through which many ticket holders to the main stadium will pass.
First Games row centres on footwear
Of course, Nike is just one of many sportswear manufacturers to sponsor individual athletes, a practice which is well-established. However, it is this that has brought about the first conflict between sportswear sponsors of the Games so far – and reflects the fierce corporate rivalry that runs through most sporting events. While athletes are allowed to wear whichever footwear they prefer while competing, as it is deemed technical equipment, potential podium footwear is proving a bone of contention. UK newspaper The Daily Telegraph recently reported that athletes sponsored by Nike will be in breach of contract if they are forced to wear Team GB’s official adidas footwear out and about or, most importantly, on the podium.
There are a host of potential medal-winning athletes – not limited to just Team GB – that both adidas and Nike believe should be wearing their footwear on the podium. A spot on the podium is, of course, the ultimate validation of a company’s credentials in sportswear. There is speculation that should the row remain unresolved medal winners might take to the podium barefoot to avoid contractual troubles with either sponsor – which would certainly make headlines and would not cast either Nike or adidas in a particularly sportsman-like light.
Puma quick off the mark to sign Bolt
Outside the footwear row engulfing Nike and adidas, Puma, the world’s third largest sportswear manufacturer, has put itself in a prime position for at least one spot on the podium. Although, like Nike, it is not an official sponsor of the Olympics, it may well wind up in the spotlight through its sponsorship of the world’s fastest man and 100m gold medal favourite Usain Bolt, and his Jamaican teammates. Bolt famously highlighted his Puma shoes after breaking world records at the Beijing Olympics.
Puma signed Bolt when he was 16 in 2003, and has reaped the benefits of his performances and popularity, particularly over the past few years since he won three gold medals at the Beijing Olympics and took the 100m world record at the World Championships in Berlin in 2009. In 2010, Puma renewed Bolt’s sponsorship to last until 2013 and launched the Bolt Collection, a range of clothing, footwear and accessories that the sprinter helped develop. Puma says Bolt’s most recent contract is by far the largest ever given to a track and field athlete, positioning him as a top earner in the world of sport.
For the 2012 Olympics, as well as holding on to one of the current Games’ most famous faces, Puma has also recruited Cedella Marley, Bob Marley’s eldest daughter, to design the Jamaican team’s uniform. This is a savvy move for the brand as her association opens the brand up to a wider audience than just sports enthusiasts, and the Olympics is an ideal platform for this kind of brand expansion.
Vast potential for expanding consumer base
Despite the fact that, unlike large football tournaments, the Olympics do not as a rule inspire fans to buy replica shirts, there is no doubt that the potential gains for sports brands linked to the Olympics are vast. Perhaps more so than any other sporting event the world over, the sense of occasion as well as the vast scope of disciplines at the Olympics serve to bring in a much wider cross section of society as an audience.
While sportswear manufacturers of course want the attention of actual athletes, fitness enthusiasts and year-round sports fans, the Olympics is the sort of event that attracts many viewers for whom watching sport is not normally a pastime, and even less so playing it, opening the brands associated with it up to a much larger consumer group than they might ordinarily reach.
Couple this with the growing trend of wearing branded sportswear in everyday life as casual wear and the potential to drive sales through the exposure provided by the Olympics is vast. In an ideal world for Nike, adidas or Puma, consumers watching the Games at home from the comfort of their sofa will be wearing the same brand as the athletes competing.
Sportswear’s big three have already put in the legwork in terms of how they are approaching their Olympic campaign. Only time will tell which will take gold, silver and bronze.