One of Nike’s biggest recent business shifts will be on full display this week when March Madness kicks off in arenas around the country.
There will be six teams wearing Jordan Brand’s “Jumpman” logo in the men’s basketball tournament this year, up from just two in 2018. As Nike (NYSE: NKE) prioritizes getting the lifestyle brand into more corners of the market, the NCAA’s biggest event has become a high-profile display of that growth.
The Jumpman schools competing in the opening round are UCLA, Michigan, UNC, Marquette, San Diego State and Houston. They’re part of Jordan’s growing college stable that also includes Oklahoma and Florida.
Overall, as it has for at least the past decade, Nike has by far the most teams in the men’s field. Nike outfits 39 of the 68 teams (including the Jordan schools), with Under Armour next at 16, and Adidas with the other 13, according to data from Apex Sports Marketing. Those numbers have varied slightly for the past seven years, but the trends have largely held steady—this is Nike’s market, with two other smaller players and no one else.
Jordan Brand’s growth, however, is a relatively new change. Over the past five years Nike has pushed the brand, once mainly men’s sneakers and lifestyle clothing, into new areas. That included a landmark soccer partnership with Paris Saint-Germain in 2018—Jordan’s first with a European club—and extending into other sports like college football and baseball. The brand is also doubling down on women’s apparel and select international markets.
The changes have paid off on the balance sheet. Jordan had $4.7 billion in revenue in 2021, up 65% in just the past three years ($2.9 billion in 2018). Under Armour (NYSE: UAA), by comparison, had $5.7 billion in revenue in 2021.
While the breakdown of companies hasn’t changed much in the past seven years, the money apparel companies are willing to pay has shifted dramatically. That change was spurred by Under Armour, once a big spender, pivoting from pricey long-term marketing deals. It has left Nike and Adidas as the market’s only major players moving forward, giving them leverage at the negotiating table.
In 2015 and 2016, high-flying Under Armour committed to hundreds of millions of dollars in apparel deals across the NCAA, a spree that also induced Nike and Adidas to up their offers. Then the business contracted—Under Armour's stock price fell 85% from September 2015 to April 2020—and amid a multi-year restructuring the company has decided to focus its marketing efforts on individual athletes like Steph Curry, Tom Brady and Dwayne “The Rock” Johnson. In recent years Under Armour ended its on-field licensing deal with the NFL and has exited a number of its bigger college partnerships.
No school exemplifies this trend more than UCLA. In 2016, UCLA inked a 15-year, $280 million deal with Under Armour, one of the largest college apparel partnerships in history. Four years later, Under Armour sued to get out of the deal, and amid an ongoing legal fight, UCLA signed with Jordan Brand on a six-year contract that pays $46.45 million, less than half the UA partnership’s annual value.
There is only one school in the NCAA tournament that isn’t wearing the Nike swoosh or Jumpman, the three-stripes Adidas logo, or Under Armour’s interlocking UA. Davidson, which won the Atlantic 10 tournament, is an Under Armour school, but its jerseys have the Curry brand’s logo, perhaps the very early stages of trying to build Under Armour’s version of the Jordan Brand.
Sportico will be publishing short business highlights throughout the three-week NCAA tournament.
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