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It’s Gotta Be The Shoes: How Nike bet on Jordan, Jordan bet on Nike and both won. Big.

Feb 15, 2013, 9:10 AM EDT

michael-jordan nike Getty Images

It seems like another world now — like discussing Pompeii or prohibition — but there was a time when Nike was just another struggling shoe company. In 1983, Nike had revenues of less than $1 million.

In 1984, Nike signed Michael Jordan.

Today, Nike owns the basketball shoe market. Owns it. When you factor in all the Nike brands — Nike, Jordan, Converse — you are talking nearly 95 percent of the basketball shoe market. And the Jordan Brand remains the biggest seller by far.

Michael Jordan turns 50 this weekend and yet his legacy and his shoes are such that when you talk to players coming out of college about their goals in the NBA, becoming part of the Jordan Brand family still comes up a lot. I mean with most of them. Players who were in kindergarten the last time Jordan won a ring.

It’s doesn’t gotta be the shoes. It is much more than that.

All this because of a big gamble back in the 1980s where a company that needed a star bet on the guy who would go on to become the general consensus greatest player ever, and that player bet on the company’s marketing skills.

Roland Lazenby, the author of “Blood On The Horns, The Long Strange Ride of Michael Jordan’s Chicago Bulls” (which is being re-released right now by Diversion Books as an ebook edition in honor of Jordan’s birthday) and also the author of a new Jordan biography due out in the spring of 2014 (by Little, Brown), said that even MJ admits it was all fortuitous.

“As Michael told me in discussing his career, ‘Timing is everything.’” Lazenby said. “He came along at a time when Nike, a struggling company, was suddenly willing to gamble millions, far more than had ever been gambled, on an untested NBA player, giving him an unprecedented deal before he had even played an NBA game.

“Nike turned its full efforts to marketing Jordan. Then suddenly he emerged as this amazingly athletic figure, wearing a shoe that was banned by the NBA.”

People sometimes forget that part of the story. David Stern and the NBA banned the first pair of Air Jordan’s in 1985, just weeks before the start of the season, because they were completely Bulls red and black with no white on them.

There is no better marketing endorsement than having the man say, “you can’t have it.” That shoe and that moment spawned today’s sneakerhead culture.

“Nike took that circumstance and pushed it, which would have meant nothing if Jordan hadn’t played the way he played,” Lazenby said. “It was a departure from the past that showed it was also immune to the future.”

Jordan’s play was the key. It started because of his athleticism, his “jumpman” dunks that went on to become the Jordan Brand logo. He could fly, and Spike Lee was yelling “It’s gotta be the shoes.” But everything grew exponentially as Jordan started to win and win big. He became the best player in the game and owned his generation, booming the popularity of the NBA.

And booming the sales of Nike and his shoes. Because everyone wanted to “Be Like Mike.”

“As I say in my book, he became the godhead of a global sports marketing machine,” Lazenby said. “Godheads aren’t flashes in the pan. They paid Jordan so much, and his shoes sold so well that he essentially became a partner in Nike long before they officially recognized it.

“He became enmeshed in culture like no athlete before or after.”

And with him, so did Nike.

Now they are a key part of the lucrative running shoe market (they maintain more than half the market) and Nike is a global apparel brand with it’s swoosh on pretty much everything but refrigerators.

But none of that would have been possible without a big gamble on Jordan that paid off better than anyone expected.

  1. zuiyo - Feb 15, 2013 at 9:17 AM

    “It’s doesn’t gotta be the shoes.”

    Can we get someone who speaks English to review the posts before they’re published?

    • zuiyo - Feb 15, 2013 at 12:20 PM

      These mistakes (which aren’t a one time thing as all readers of this blog know) really get in the way of appreciating the writing and the points made in it.

    • shenlee2013 - Feb 15, 2013 at 1:20 PM

      This was an intentional grammatical error. It was done for emphasis!

    • lawrinson20 - Feb 15, 2013 at 1:39 PM

      You may be (painfully) unaware that the Spike Lee Nike commercials were famous for the line, “It’s gotta be the shoes, money.”

      The writer of this article was making a proper reference.

      • lawrinson20 - Feb 15, 2013 at 1:40 PM

        Nevermind. Didn’t notice the “It’s.” Duh on me. Apologies.

  2. greej1938l - Feb 15, 2013 at 9:36 AM

    95% seems high…….adidas only has 5%…hmmm….

    • pudgalvin - Feb 15, 2013 at 10:25 AM

      Right now Jordan’s branch of Nike accounts for 58% of the basketball shoe market and Nike (non Jordan) accounts for 34% of basketball shoes. So only 92% of the basketball market.

  3. akmgiants - Feb 15, 2013 at 9:40 AM

    3s,4s,5s,7s,11s,13s

    • fanofevilempire - Feb 15, 2013 at 11:21 AM

      Hey, don’t get my 18’s mad, I pull those out every now and then for the youngins.

  4. watermelon1 - Feb 15, 2013 at 9:44 AM

    Great, now I want a Nike refrigerator…

  5. davidly - Feb 15, 2013 at 10:05 AM

    This is all well-and-good, Kurt… (can you here a but coming?) …but the simple act of categorizing a company that has yet to corner the market as “struggling” is paradigmatic of all that is wrong with our current neo-turbo-crony-capitalistic pseudo-society.

    It represents the oxymoronic too-big-to-fail logic that gives precedence to huge corporations who outsource labor to children whose greatest chance of empowerment amounts to one day having grown so frustrated & angry that they might warrant enough attention to being taken out as remote targets (which–let’s face it–is what they already were when they got the job).

    I remember in ’79 when every kid in school with well-to-do parents (or parents who couldn’t say no) had Nikes. It wasn’t long before canvas wasn’t good enough, you had to have leather. Then, of course, hi-tops.

    If Nike was struggling (I won’t pretend to know whether they were in the red or not, but citing revenue don’t mean sh*t), the extent to which they were would be an indication of having greedily expanded the business before they should have.

    “Bet on Jordan” is perhaps the most apt terminology, but that makes them just as infamous as famous.

  6. zerole00 - Feb 15, 2013 at 10:07 AM

    All this because of a big gamble back in the 1980s where a company that needed a star bet on the guy who would go on to become the general consensus greatest player ever, and that player bet on the company’s marketing skills.

    They both also bett on sweatshops.

  7. zerole00 - Feb 15, 2013 at 10:07 AM

    All this because of a big gamble back in the 1980s where a company that needed a star bet on the guy who would go on to become the general consensus greatest player ever, and that player bet on the company’s marketing skills.

    They both also bet on sweatshops.

  8. wlubake - Feb 15, 2013 at 10:23 AM

    They bet on a number of athletes around the same time. They all seemed to work. I remember in grade school feeling like the coolest kid in school with my new Andre Agassi shoes. Jordan definitely was the big one, though.

  9. nolanwiffle - Feb 15, 2013 at 11:19 AM

    If Lenny Bias lives, neither Michael Jordan nor Nike would have been quite as successful. Reebok!!

    • fanofevilempire - Feb 15, 2013 at 11:22 AM

      he was good, but I don’t know about that.

    • metalhead65 - Feb 15, 2013 at 11:58 AM

      he just should have said no and maybe he would have been that good but we will never know because he didn’t.

  10. bux1022 - Feb 15, 2013 at 1:07 PM

    @ nolanwiffle

    Ummm..are u kidding me! You have to be 45 plus to make that comment. He was good but we are talking about ” your airness”..no comparison at all. And if he did live, rest his soul, he would have been in MJ’s shadow his entire career!

    • nolanwiffle - Feb 15, 2013 at 2:50 PM

      ….and you must be twentysomething to so easily dismiss one of the most dominant players the ACC ever produced. They went head-to-head while in college. Bias was every bit the athlete that Jordan was at that time.

      You clearly never saw the guy play. Perhaps you should google “Len Bias”.

      He was set to join a Celtics team that had just won an NBA championship. He would have been the sixth man in a Boston line-up that still had a front line of Bird, McHale, and Parrish. Bird had alreadey told Auerbach that he was coming to rookie camp to work with Bias.

      Your Airness? Maybe you’re not even 20.

  11. philtration - Feb 15, 2013 at 10:33 PM

    With all of the Bulls games being televised here in Chicago, we got to see him night after night.
    Not just highlights on ESPN but really watch him the whole game and it was incredible.
    It never got old and we never got jaded by seeing him.

    I thank my lucky stars that I got to see both Michael Jordan and Walter Payton play in person.

  12. jessesaglio - Feb 16, 2013 at 6:38 PM

    A little fact checking would show that the author is not so adept with math, or at least with understanding the concept of “units”. If you look at Nike’s 1983 annual report http://investors.nikeinc.com/files/doc_financials/1983%20annual%20report.pdf you will find that Nike had nearly $900 million of revenue in 1983, expressed as $867,212. If you look just above that, you see that figures are expressed “in in thousands, except per share data”. This means that Nike’s fiscal 1983 revenue was $867,212 “thousand”, or put more simply, $867 million.

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