By Kian Arakelian
The Impact of Jordan Brand
Michael Jordan’s deal with Nike began in October 1998, when he signed a 5-year $2.5 million contract ($500k a year). Before signing Jordan, in February 1984, Nike reported its first-ever quarterly loss, after around a decade of growth. They needed a change and decided Michael Jordan was the way to go. Nike's co-founder, Phil Knight, said that signing Jordan was "the best decision I've ever made in my life".
This was also the biggest deal in all of the NBA at the time and the start of “Jordan Brand”. The first shoes released were the Air Jordan 1’s, and they were being sold for $65. But by the end of the first year with the Air Jordan 1’s Nike made around $126 million, and they started trending up. Nike came out with a black and red colorway for Michael Jordan to wear in his games.
At the time the NBA did not allow shoes that were colored less than 51% white. Nike was fined $5,000 a game for Jordan wearing the shoes, but they continued having him wear them and took the fines as a marketing strategy. This ended up working since they sold $70 million worth of Air Jordans within the first 2 months after the release. Michael Jordans performance on the court wearing the shoes and the unique and new sneaker design caused a lot of publicity and hype among basketball fans, and sneaker lovers, and demand for Nike Air Jordans skyrocketed and sparked a new era of sports players endorsements and sponsorships. Jordan Brand became the biggest Nike shoe and brought in a large portion of their revenue.
In 2012, 9 years after Jordan played his final game, Air Jordan sneakers made up 58% of all basketball shoes in the U.S. and 77% of all kids’ basketball shoes. In the current year, 2023, Jordan Brand reported $6.6 billion in annual revenue which was a 27% increase from the previous year 2022 which was $5.9 billion. Jordans make up 16% of Nikes' revenue with wholesale now. Air Jordans stand as one of the most popular shoes in the world and they are trending up year after year.
Sources:
Kunkel, Thilo. “How Michael Jordan Revolutionized the Sneaker Industry-and Our Relationship to Shoes.”
Temple Now | News.Temple.Edu, 4 Aug. 2023, news.temple.edu/news/2023-04-03/how-michael-jordan- revolutionized-sneaker-industry-and-our-relationship- shoes#:~:text=Released%20on%20April%201%2C%201985,the%20end%20of%20the%20year.
Mccann, Michael. “Inside the Rise of Michael Jordan’s Unrivaled Marketability.” Sports Illustrated, 16 May
Ramamurthy, Srikanth. “How Michael Jordan and Nike Redefined Athlete Endorsements.” Medium, 21 May
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