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The Nike vs. Adidas Sneaker War

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The Nike vs. Adidas Sneaker War

The Nike vs. Adidas Sneaker War

Nike and Adidas have been the biggest names in the sneaker game for as long as anyone can remember. Sure, Reebok and Sketchers had their moments in the sun, and Under Armour is making a strong play with its new line with Dwayne “The Rock” Johnson. But without a doubt, no two athletic footwear brands have endured like Nike and Adidas.

Not surprisingly, the two sneaker giants are highly competitive, and not always in a friendly manner—we’re talking lawsuits, poached endorsement deals and other sketchy business practices. Needless to say, things between the stripes and the swoosh can get a bit ugly.

Over the past few years, this sneaker war has ramped up. While Adidas has long been a streetwear staple, the brand has finally begun to gain ground on Nike, which had long dominated the space with its Air Jordans and other high-profile partnerships.

What’s the current state of the so-called sneaker war? Here’s a quick snapshot to bring you up to speed on the decades-old rivalry between Adidas and Nike.

Adidas’ recent rise to prominence

Despite its name recognition and decades-long streetwear presence, Adidas spent years being popular mostly with soccer players and Europeans, not the larger public. But the rise of athleisure and some choice endorsement deals have recently brought the brand to new heights.

Adidas stocks have been on the rise over the past couple of years. And due to its market diversity, the German shoe brand may be a more stable investment than the swoosh. Nike’s shares, by contrast, have not been performing so well.

The reason for the sudden sprint to the front line? Global growth. Blame Instagram, nostalgia or the sudden acceptance of athletic wear for all seasons. But whatever the reason, the most popular sneaker in 2016 wasn’t the Jordan or even the Nike Flyknit; it was the Adidas Superstar. Yes, you heard right: the most popular sneaker of 2016 was the shell-capped white shoe with three-colored stripes, which has been around since 1969.

Right around 2015, Adidas started to step up its game. The brand partnered with superstars like Kanye West, whose limited-run Yeezys were an instant hit. Around the same time, Adidas locked down bearded NBA star James Harden in a 13-year, $200 million deal.

In 2017, Adidas’ stock rose by 200%, while Nike’s only grew by 32%. That said, Nike isn’t tanking by any stretch of the imagination. The brand is simply sharing some of the spotlight after years of domination. And keep in mind that the rest of the 2016 “top sneakers” list was rounded out by Nike. Adidas received top billing, but Nike continues to hold the bulk of the market share.

What’s the real deal with the sneaker war?

Nike generates the bulk of its revenue from the Nike brand, as well as profits from Converse. It’s a similar story with Adidas, which generates most of its revenue from its namesake brand and a smaller amount from Reebok shoes. The main difference between Nike and Adidas is the split between footwear and apparel.

Last year, more than 60% of Nike’s revenue came from shoe sales. The rest was a combination of clothing, accessories and licensed brands. On the other hand, just over 50% of Adidas revenue came from shoe sales, with the rest from sporting goods and apparel. Nike continues to sell more shoes because it focuses more on the footwear industry.

Are we suffering from Air Jordan fatigue?

But some observers with a close eye on the sneaker market believe that Adidas’ rise can be attributed to something else: a growing sense of boredom with the Air Jordan brand.

Michael Jordan’s namesake sneakers have been a big deal since they came on the scene in 1986, and they continue to be a huge piece of Nike’s business. Over the past few years, Nike has been releasing countless versions of retro Air Jordan sneakers, flooding the market with a style consumers have seen for years. It could be consumers are on the hunt for something new, according to many sneaker spectators.

Things are looking up for Nike in 2018

After a less-than-amazing 2017, Nike is now developing the first line of female Air Jordans with Serena Williams. It also holds lifetime deals with LeBron James, Cristiano Ronaldo and MJ himself. Nike is also partnered with both the NFL and the NBA, and has put its signature stamp on the sustainability landscape with its eco-friendly Flyknit line. In January, Nike stocks began to climb once again after a bit of a slump.

What does that mean for the sneaker war? Chances are, we won’t see a victor emerge for a long time, with the rivalry expected to continue pushing both brands to step up their game.

And that’s a good thing for Adidas and Nike fanatics alike.

 

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