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Under Armour : Ultimate beneficiaries

08/30/2015 | 01:43am US/Eastern

The Larry O'Brien trophy, symbolic of the NBA championship, will make its way to Manila when Golden State Warriors guard Steph Curry comes to town for a one-day visit on Sept. 5.

The trophy is now in Asia, brought in from New York by an NBA staffer, and doing the rounds with touring Warriors. First, it was with Finals MVP Andre Iguodala during a two-day tour of Tokyo. Then, Warriors frontliner Marreese (Mo Buckets) Speights took his turn with the trophy to grace the Jr. NBA National Training Camp in Jakarta. The trophy goes back to Tokyo where Curry opens his Asian roadshow on Sept. 4. Then, Curry and the trophy move to Manila the next day, Beijing on Sept. 6, Chongqing on Sept. 7 and Shanghai on Sept. 8.

Curry, the reigning NBA MVP, is in for a grueling grind as he visits five cities and three countries in five days. Under Armour is taking Curry around Asia to promote his new Curry Two shoe. Curry's father Dell, a former NBA player, saw action for the US team that battled the Philippines, coached by Ron Jacobs, at the FIBA World Clubs Championships in Spain in 1985. Dell Curry's teammates included David Robinson and future PBA import Keith Morrison. The Philippine team was made up of Hector Calma, Allan Caidic, Samboy Lim, Elmer Reyes, Franz Pumaren, Tonichi Yturri, Alfie Almario, Jun Tan, Yves Dignadice, Jeff Moore, Dennis Still and Chip Engelland. The US finished sixth and the Philippines seventh in the 10-team tournament.

Under Armour has overtaken Adidas in the battle for supremacy in the US sports apparel market where Nike is on top of the ladder. In the US basketball shoe business, Nike controls 90 percent market share with Adidas way below at less than five percent. To get back on track, Adidas recently signed Houston Rockets star James Harden to a mammoth $200 Million 13-year endorsement deal. Nike's global revenues are in excess of $30 Billion. It's the world's largest supplier and manufacturer of athletic shoes, apparel and sports equipment.

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Adidas is trying to enhance market share by enticing stars to the three-stripe fold. Adidas will end its exclusive $400 Million uniform contract with the NBA at the close of the 2016-17 season after a run of 11 years and with free money to invest, is zeroing in on high-profile stars. Nike is taking over Adidas' uniform contract starting the 2017-18 season for eight years in a $1 Billion deal.

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Even while Adidas had its jersey contract with the NBA, the league kept business relations with Nike and Under Armour. For instance, Nike has been the NBA's partner in the Basketball Without Borders program while Under Armour sponsors the Draft Combine. In the past, shoe companies toured their NBA endorsers without NBA coordination around the world. Now they're in constant communication and there is more awareness of creating synergies with a closer relationship.

No doubt, the big winner in the so-called sneaker war is the NBA with the players as the ultimate beneficiaries. Former commissioner David Stern started to put money in the bank for the NBA when he succeeded O'Brien in 1984, the same year Nike began to make strides as a serious market contender at the Los Angeles Olympics. Stern's vision reached out beyond the US and he saw the potential of a vast global business. Stern's successor Adam Silver is cut in the same mold. With his exposure to international TV early in his NBA career, Silver pushed the envelope further. This summer, the NBA held its first-ever exhibition game in the African continent, a clear signal of where the league is headed as a global sporting entity.

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NBA Philippines managing director and associate vice president Carlo Singson said the other day these are exciting times in the league's history. Singson has witnessed the NBA's growth spurt in the region from his Hong Kong base over the last 17 years and said he expects no letup in expansion efforts with partners because of enormous business opportunities. Today, the NBA has offices in London, Madrid, Johannesburg, Toronto, Mumbai, Rio de Janeiro, Mexico City, Hong Kong, Taipei, Seoul, Beijing and Shanghai aside from New York and New Jersey.

The 1984 Olympics turned things around for Nike. Barbara Smit, in her book "Pitch Invasion," wrote: "In the early 80s, Nike decided to spend more money on advertising and on endorsement deals with a restricted number of athletes and players with whom they could build the Nike brand. When the medals were counted at the end of the Olympics, the first ever to return a profit in the modern era, Adidas claimed a predictable victory (with) 259 medals against 53 for Nike. Yet the marketing people of Adidas knew that Nike was on to something. No matter how many more athletes Adidas outfitted, Nike had hijacked the Games in Los Angeles. All but three of the men's gold medals in track and field had been won by Nike athletes. It suddenly became clear that Adidas was under serious attack."

Before the L. A. Olympics, Adidas offered Michael Jordan a $100,000 contract just like Kareem Abdul-Jabbar. Nike put up $2.5 Million with royalties on sales of shoes and garments that bore his name to win Jordan over. In its first year, Air Jordans generated sales of over $100 Million. "Basketball would come to represent about 60 percent of sales in the American market and it was Nike territory," wrote Smit.

Under Armour is now coming on strong as Nike's challenger in the same way that Nike was once Adidas' challenger. Adidas may be third in the totem pole at the moment but it's rebuilding and retooling. With the ferocity that the sneaker war is being waged, the athletes couldn't be happier.

© Pakistan Press International, source Asianet-Pakistan

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