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PR Newswire - <B><FONT COLOR=BLUE>NIKE</FONT></B>: NO FUNDAMENTAL CHANGE IN SPORTS MARKETING STRATEGY
NIKE
: NO FUNDAMENTAL CHANGE IN SPORTS MARKETING STRATEGY
PR Newswire
:
Thursday,
October
1,
1998
BEAVERTON, Ore., Oct. 1 /PRNewswire/ --
Nike
, Inc. (NYSE: NKE) today again reiterated that, unlike some of its competitors, it is not shifting its sports marketing strategy in any fundamental way.
It also released a transcript of vice president of global brand management Andy Mooney's comments to Wall Street analysts in New York City on September 24:
"We are totally committed to continue to invest 10 percent of global revenues in demand creation. So that gives us about a $900 million global demand creation budget, which is roughly split between $500 million for sports marketing and $400 million for communication. Our sports marketing money is less flexible than communications money but not that much less flexible. Aside from Michael's [Jordan] contract most of these contracts with athletes or teams don't go much longer than three years. So we have a chance to completely re-look at every athlete, every team and every event we're involved with over the next three years. We believe that it is possible to move as much as $100 million from sports marketing to communication over the next three-year period to continue to excite the market.
"I want to make a couple of things, having said that, perfectly clear. We are totally committed to sports marketing athletes and teams endorsements as a fundamental pillar of success for this business and this industry. We believe we can make this transition without necessarily giving up much, if any, athletes or teams because, as Tom [Thomas E. Clarke,
Nike
president and chief operating officer] alluded to, it's really a two-horse race. There are only two companies that have any money to bet on any of these properties. And some of the competition will be fierce for some of the jewel properties. But I think as was evidenced by the passage from the NCAA to NBA drafts this year, just as a fundamental of supply and demand, the renewal costs of these deals we believe will be significantly lower than they currently are."
Nike
began working with athletes since its founding in 1972, starting with the great American middle distance runner, Steve Prefontaine.
SOURCE
Nike
, Inc.
©Copyright 1998 Comtex Inc. Published by OneSource Information Services, Inc., October, 1998.
