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The FIFA World Cup is Nike’s to lose versus Adidas
Nike and Adidas are set for a fierce battle on and off the pitch during the upcoming FIFA World Cup in North America. With the tournament hosted in its home market, Nike, led by CEO Elliot Hill, aims to leverage its strong North American presence and star athlete roster.
When the FIFA World Cup kicks off in North America in June, the trophy won't be the only prize up for grabs. Nike Inc. and Adidas AG will be battling on and off the pitch to win sales and to raise the profile of their brands in the US and around the world. With the games hosted in its home markets, and with Elliot Hill in place as chief executive officer for long enough to make a difference, the tournament is Nike's to lose.
But Hill must see off the challenge from Adidas, led by Bjoern Gulden, who'll be looking to cement the German firm's position as a leader in sports-inspired fashion and using the brand's buzz to capture a bigger slice of the market for products that help footballers kick more powerfully.
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With the World Cup spread across the US, Canada and Mexico, Nike has the natural advantage. North America is its biggest market, contributing more than 40% of sales in its most recent fiscal year. While the company is still struggling in China, helpfully Nike sales in North America are growing again. The company also sponsors the US and Canada teams. But it's not just the sporting nations that matter these days.
Nike Sponsors More Teams in the FIFA Top 10 Than Adidas | The ranking means CEO Elliott Hill has all to play for
Sport has undergone a “Kardashianization,” where individual star power outshines club or national loyalties, and Nike has a strong roster here too.
Hill became Nike CEO in October 2024. It takes about 18 months for new products to go from design room to store. So the timing is perfect for a suite of new cleats and kits. For example, Nike's teams will be wearing its Aero-Fit cooling fabric for the first time, which Hill likened to “air conditioning for the body,” to help its athletes cope with what experts fear may be extreme temperatures. It has also launched the latest version of its Tiempo football boots, worn by Brazil's Estevao Willian.
And in a shot across Gulden's three-striped bow, Nike is stepping up its efforts when it comes to football gear that can be worn off the pitch. It recently unveiled Hollywood Keepers, a streetwear collection based on the bold styles of 1990s and early 2000s goalkeepers. Versions to be worn by on-pitch goalkeepers will be unveiled closer to the World Cup, giving a strong hint of what Nike's team uniforms will look like.
The CEO isn't a whiz with product like Adidas's Gulden, but the Nike veteran, who's described by people who know him as living and breathing the brand, is inspiring staff, including its sneaker designers. Retailers seem to be warming to its World Cup selection, committing to 40% more football products by volume than for the 2022 World Cup, Hill said when he announced second-quarter results earlier this month. The tournament could be worth $1.3 billion in extra revenue to Nike, according to analysts at RBC Capital Markets.
The fresh kicks and kits will be backed by Nike's muscular marketing budget, estimated at about $5 billion annually by RBC. Given the home crowd and such a high-profile opportunity to win with sport, as Hill describes his strategy, we can expect the full force of the Nike machine to be applied in June. It's warmed up with a youth-led street football tournament called Toma el Juego, which means Take the Game, that's taken place in Los Angeles and most recently Miami, and will arrive in another 20 cities around the world in 2026.
But Nike won't have things all its own way. Adidas typically outperforms in football, given its rich heritage with the game. It is also providing the official ball for the tournament.
Gulden's strategy is to take its success in shoes and clothing worn every day into performance wear, where Hill is also majoring. For example, the Adidas chief is expanding its Originals line, which is typically more associated with leisure wear, into sport. Expect its trefoil logo and retro three stripes to be in evidence at the World Cup.
But Gulden isn't neglecting Adidas's style credentials. While some fans will want replica jerseys, others may prefer a pair of sneakers in team colors. Jamaica, which Adidas sponsors, lends itself well to just that kind of collection. Gulden has talked in the past about making the clothes that sportsmen and women wear more stylish. Rather than than fashion being a distraction, he wants the teams Adidas sponsors, including host nation Mexico, to be excited about wearing its gear.
He estimates that the event could generate €1 billion ($1.2 billion) in sales. And he has an incentive beyond cash through the checkout: He wants to build the Adidas brand in the US and is thinking beyond soccer, to baseball, basketball and American football.
Competition from challenger brands can't be ruled out either. Puma SE sponsors Portugal, and new CEO Arthur Hoeld wants to establish the company as one of the world's top three sports brands, with football one of his focus areas. Skechers USA Inc. has moved into the sport, sponsoring Bayern Munich forward Harry Kane. Privately held New Balance, which is aiming to reach $10 billion in annual sales over the next few years, from $7.8 billion in 2024, also has a big football business, sponsoring England winger Bukayo Saka. Reebok, meanwhile, is making a comeback under the ownership of Authentic Brands Group Inc.
So far, running brands such as On AG haven't ventured into football, but the World Cup will be a platform to promote wider sport and fitness. So wild cards can't be ruled out. Case in point: Athleisure brand Vuori luring tennis star Jack Draper away from Nike.
Hill must see off both Adidas and upstarts to make the most of the World Cup opportunity. Crucially, he must also avoid any self-inflicted wounds, such as Nike being criticized for making the women's track-and-field kit too revealing ahead of the 2024 Olympics. And the Kardashianization of sport poses its own risks, as individual players can be unpredictable. Remember Cristiano Ronaldo rejecting Coca-Cola at the delayed UEFA Euro 2020 games in 2021?
But if Hill can deliver some killer kicks without any own goals, there is all to play for in the summer tournament.
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Source: EconomicTimes
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