Fashion and comfort have started becoming synonymous in the past few years, and this transition is giving rise to a number of trends throughout the industry. Whether it is oversized clothing or sneakers for regular use, comfort is a big part of the overall fashion expectation for the new-age consumers.
Gone are the days when sneakers would be worn for casual outings like gymming, trekking or informal get-togethers, whereas Oxfords and similar shoes were designated for more formal gatherings. These days one can see sneakers in all kinds of settings – offices, restaurants and even board-rooms! With all the attention received by these tiny trend-setters, it is interesting to watch what’s happening in the sneaker market.
When there is a huge market to be captured and massive profits to be made, it is impossible to not have legendary business rivalries. The famous Cola wars have dominated the discussions in the management schools as much as the business circles. But there is another, equally captivating business rivalry story, that has been silently building over the years. With the rise in popularity of the sneakers, this silent story is now slowly coming to the forefront. Although the story is not new, the twists and turns have ensured, the whole fashion world is closely watching it unfold.
So who’s leading the sneaker war? The top names that come to mind when one thinks of sports shoes or sneakers, are Nike and Adidas. The popularity of Nike and Adidas is spurred by the fact that both have an iconic status and legions of strong followers. Even among those who are not a supporter of either camp, it is impossible to find someone who hasn’t heard of Nike’s “Swoosh” or the “Three Stripes” of Adidas. When brands with that kind of recognition get into a rivalry, it is obvious that every one is interested. So, here is an account of what has led to this rivalry and where is it headed!
It is interesting to note that while these two brands may be strong rivals today, they did not start as such. Instead, they started out of the strong love and interest of their respective founders, towards improving sports performances with the help of better footwear.
Adidas is the older of the two rivals and has a fascinating story associated with its beginning. The two Dassler brothers – Adolf and Rudolf – started manufacturing sports shoes in the year 1924. After facing challenges including World War II and a bitter feud between the brothers, both started their own shoe-making companies. Adolf registered “Adidas” in 1949 and his brother Rudolf started “Puma”. While the rivalry of these two companies is interesting in itself, the “Adidas” brand grew tremendously in Western Europe thanks to its being located in Germany.
Nike on the other hand was started by Bill Bowerman and Phil Knight in the year 1964, in The United States. The company started as a distributor of Japanese manufactured shoes and was initially known as Blue Ribbon Sports. Over the years, the company moved towards creating their own designs, making shoes and becoming the powerful brand that they are, by the year 1971, when their iconic logo was first placed on the shoes. By virtue of being located in The States, the company’s growth came primarily from the North America market.
With their distinct beginnings, both the brands grew at a steady pace, leading their own markets. However, as was expected, with the growth of both companies, there had to be a time when both would compete for a bigger share of the world market. This need to gain a higher market share is the genesis of the Nike Adidas rivalry.
While Adidas had and still has a huge presence in the European market, it is no secret that the sneaker market is dominated by North America. Thus, a natural path towards growth for the company has been to capture a higher share of the North American market. Nike, on the other hand, has started and owns nearly 60% of the North American sneaker market share. Thus, Nike became Adidas’ biggest rival.
Both the brands have a strong market presence, a loyal consumer base, some legendary shoe models and a lot riding on their position. Thus, no one wants to concede even an inch in this extremely crucial arena. Apart from making sports shoes, both the brands have diversified into different product categories. Since both are dealing in similar categories – footwear, sports apparel and sporting equipment – this constant rivalry becomes even more interesting. Here is a look at how these two compete with each other on different parameters.
If one were to look at the rivalry, purely from a financial lens, there is no doubt – Nike is the clear winner. With its strong base in the bigger market, their financial prowess is way more than Adidas. Also, the company doesn’t hold back in spending to maintain their position. Be it sponsorships, celebrity endorsements or marketing events – Nike is spending big bucks everywhere.
At the same time, Adidas is not to be left behind. While their revenue numbers may not be in league with Nike, Adidas are packing a punch with their aggressive marketing strategies. They have redefined their marketing efforts, especially under Mark King, their new North America President. If Nike is endorsed by names like Drake, Roger Federer, Christiano Ronaldo and Kobe Bryant, Adidas has an impressive list too including names like David Beckham, Pharell, Novak Djokovich and Beyoncé!
Both Nike and Adidas have nurtured a loyal fan base with their technological experiments and inventions, making the sports footwear a boon for the athletes. Whether it is breathable fabrics, performance-enhancing cushioning, perfecting the fit or innovative laces – both companies have evolved their products over a period of time. Their new lines reflect these enhancements and thus, are eagerly awaited by fans.
Nike has worked in collaboration with many legendary sportsmen to perfect their shoe design. The most iconic partnership of the company has been with the Basketball legend – Michael Jordan. Their Air Jordan line of shoes, which premiered in the 1980s, are still the biggest grosser for them. They have worked with a lot of designers, to create their independent lines.
The biggest twist in this rivalry, which brought it into the mainstream from the silent one so far, came when the rapper Kanye West, who had been associated with Nike moved on to Adidas in the year 2014. The rapper alleged that he was not allowed the creative freedom at the former company, which the latter allowed. His famed collection – Yeezy Boost 750 – launched with Adidas in 2014, sold out within minutes.
With this transition, the battlefield started heating up. Kanye was followed by three top designers from Nike, who also moved to Adidas, citing the stifling creative process at Nike. Adidas has signed a host of other celebrity influencers and designers over the years, building the perception that it is a more creative and free space for artists.
Over the years, both the brands have been consciously working on building their offerings around subjects that are relevant and help them create a positive image. While both are working towards a more sustainable manufacturing process, there are certain campaigns that have established their presence in a strong manner. Whether it is the Nike Pro Hijab or the Ocean Plastic Footwear series by Adidas, both were garnering positive feedback for the respective brands, before the pandemic struck.
In keeping with the times and the situation of the world, Nike came out with their face masks. Adidas stood up to the challenge with their own face shields. The silent rivalry between the strong contenders in the sneaker wars doesn’t seem to be abating anytime soon. If anything, it is just getting stronger by the day.
The Nike Adidas rivalry is closely watched by the fashion industry, not just in North America but throughout the world. With time, the companies are incorporating much-needed changes such as going digital and establishing a strong presence in emerging markets around the world.
Both giants outsource their manufacturing to cities in Asia including China, Vietnam, Bangladesh, Pakistan, as well as a small portion to places in Africa. As the two majors battle it out for market share and revenue share, only time will tell who takes a bigger bite from the sales pie.
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