by Gerald Flores and Zac Dubasik
Nike may have recently offered up a rumored $1 billion to lock down the NBA uniform deal, but they reportedly aren't willing to match adidas’ $200 million contract offer for the services of James Harden. Hence, the Beard will likely be joining the lineup of ballers (in the NBA and in entertainment) at adidas including John Wall, Derrick Rose, Damian Lillard, Kanye West, and Pharrell by week's end.
Following a season that included a deep playoff run, and strong contention for MVP, Harden is currently enjoying his highest profile ever. He may be a known entity for NBA fans, but in the bigger picture of influence, things get murky. According to agency The Marketing Arm’s Celebrity DBI, an index for brand marketers that determines a celebrity's ability to influence consumers when endorsing a given brand, Harden ranks 825th among trendsetters, “putting him on par with Guy Fieri, Shaun White and Sarah Jessica Parker.”
So, is this a good move by adidas? We asked sports marketing experts to break down the deal and give us their thoughts on how it will play out.
Is James Harden worth a $200 million deal?
Rick Jennings, Executive Vice President of PR firm Step 3: In today’s market, yes. James Harden is a rising star with a unique look and a personality that transcends basketball. Adidas gets increased awareness for their brand, and another young talented player to add to their roster along with Derrick Rose and Dame Lillard. It’s a smart move by adidas.
Courtney Brunias, Associate Director, USC Sports Business Institute: It’s a high number. It’s at the upper regions of shoe contracts. He’s one of the top players in the NBA. When you’ve reached that level of notoriety, those are the numbers that get thrown around because you bring that impact with you once you reach that level. You’ve become more than a basketball player, but also a conversation piece. You’ve expanded just beyond the casual fan, and that adds a bit more dollar value.
Joe Favorito, Sports and Communications consultant, Professor at Columbia University: That's for adidas and the marketplace to decide down the road. They are trying to get back into the individual basketball star game and he is the biggest name out there. The positives are pretty vast; he has a distinctive look, appeals across many demos, will be heavily promoted by the league and the team. He has delivered on the court and has been edgy and fashion-conscious without being overtly controversial. Plus he will be key to market globally, especially in China, where the Rockets have continued to make a splash even after Yao retired. They are obviously banking on a huge upside for years to come.
Bob Dorfman, Executive Creative Director, Baker Street Advertising: Since it’s adidas putting it up, I think it’s worth the money. If Nike was putting that money up, I would say no. Nike already has the market share. They’ve already got the stable of successful champion athletes wearing their shoes. Adidas is working from behind and some of the other endorsers that they’ve shelled out ridiculous amounts for haven’t panned out.
With Harden, they’ve got an iconic player. He’s got the beard. He’s got the style. Adidas, if anything, is a style-conscious company. A lot of the things they’re doing with Pharrell and the music side of the business seem to be working very well. It makes sense to have a guy like Harden. He stands out. He’s one of the top players in the league. He’s spectacular on the court. Guards seem to do the best selling shoes on the street level.
Does losing Harden hurt Nike?
RJ: No. Nike is the market leader by far and still has LeBron, Kobe, and Kevin Durant, among others.
CB: Nike is doing a good job of rounding up talent. Whether it’s through the Nike brand or the other subsidiary, Jordan Brand. Nike has a stable of athletes that can recover from a loss like this more than any other company can. Even if it does hurt them, it’ll be more short term.
JF: Hard to say. Nike's new deal with the NBA, plus their scores of individual deals, doesn't make them hurt-proof, but this is a much bigger win for adidas than a loss for Nike.
BD: I think the guy they missed out on was Steph Curry. The company that’s kind of sitting pretty right now is Under Armour, that’s landed the right guys in every sport from Jordan Spieth to Tom Brady. They’re the company that Nike has to look over their shoulders for a little more than adidas.
Nike certainly has enough in the stable. They signed D’Angelo Russell and Karl Anthony Towns, the top two picks in this year’s NBA Draft. Russell could really be something on the Lakers - someone who could really be a superstar if possible. For that kind of money, I don’t think it’s a big sacrifice for them to miss out on Harden.
What can adidas get out of a player like James Harden?
RJ: Great street credibility, a star with untapped global appeal, and the ability to use this partnership with other elite athletes they represent in other sports to unify their brand to casual sports fans around the world.
CB: Adidas needs to look at what attracts consumers to James Harden. Obviously, he has a very unique style of play. His beard and his look are very unique as well. If they can build the marketing around the uniqueness of James Harden, that’ll help them differentiate whatever products that are already out there. Whether it’s on-the-court stuff or off-the-court stuff, adidas can capitalize on that.
JF: Opportunity and market share. My guess is they see James a breakout star, not just on the court, but with multiple demos, and they need to make a splash. They accomplish all those things with this signing, and now can use this to build for the future with a platform not built around a league partnership but around standout individuals.
I think his look, his potential global appeal, and the fact that the Rockets have worked hard to grow their brand outside of the U.S. makes it special. If this were a startup shoe company or a relic like AND1, there would be much more risk. But you are talking about adidas, so it becomes a bigger win for all involved.
BD: I think adidas would have to play up the style and fashion angle a bit more. The way that James Harden is a fashion icon seems to have a coolness factor that most other players don’t have as much. Maybe put him together with someone like Kanye or their other music folks and do something interesting to cross over a bit. There’s always been a huge crossover between hip-hop, the music world, and athletes. They can bring that even closer together.