If you are an adventurer, a good pair of sneakers is a must for you in your life. The best part is it can be worn with any kind of clothes that you decide to deck up with. You can never go wrong with sneakers as it is comfortable and stylish enough to rock your style quotient. Sneakers can be worn with almost anything, they are extremely versatile and the comfort that it provides is just another great feature of them.
When we utter the word sneakers, two brand names come together with it in our minds as well. Nike and Adidas, these two renowned brands have always been hot favourites in the category of sneakers. Almost everyone has an idea about these two brands and these two have been unofficial rivals forever. Both the brands focus on sportswear and shoes and are the best in what they do.
Every household has at some point had an argument over which shoe apparel company is the best and which dominates the other. However, over the years, both the US and German sports labels have maintained two recognizable brands around the world. Yes, financially Nike is known to be much larger than Adidas, but the latter’s performance has been better over recent years. The article below will explain to you what has been different between the two companies so far, what is in store for them in the future and will help you choose your pick.
A Brief History of Nike and Adidas
Growth of Nike and Adidas
The Technology of Nike and Adidas
Marketing Strategies of Nike and Adidas
Revenue of Nike and Adidas
Production and Suppliers of Nike and Adidas
Cool Factor of Nike and Adidas
Sports Sponsorship
Future Plans of Nike and Adidas
Nike Vs Adidas: The Real Battle
FAQ
A Brief History of Nike and Adidas
Adidas
Adidas is the largest sportswear manufacturer in Europe and the second-largest in the world after Nike. Formerly known as “The Dassler Brothers Shoe Factory”, the company was founded by Adolf Dassler and Rudolf Dassler in 1924. The founders being sports enthusiasts began to make sport-oriented shoes that could improve the performance of the athletes in any sport.
Later in 1949, the two brothers broke their relationship which led to the creation of Adidas by Adolf Dassler and Puma by Rudolf making them the biggest business rival at that time. Adidas was named after the initials of Adolf Dassler's while the logo of three stripes was taken on as a shoe design on the company’s shoes for better comfort. With their logo “Impossible is nothing.”
Nike
Nike is an American multinational company that is the world’s largest athletic shoes and apparel manufacturer and supplier. Originally known as “Blue Ribbon Sports” it was founded by Bill Bowerman and Phill Knight who was a track athlete in 1964 before becoming Nike in 1971. The name was taken from Nike, the Greek goddess of victory. The company was first made as a distributor for a Japanese shoemaker Onitsuka Tiger. Bowerman then made his first shoe for Otis Davis who later went on to win two Olympic gold medals in 1960.
Blue Ribbons Sports sold 1300 pairs of Japanese running shoes with a gross of $8000. While its first advertisement gave its tag name as “There is no finish line” which was changed to “Just do it” in 1988. Today in 2020, Nike was valued at $30 billion and thus became the number one brand in the sports business.
Growth of Nike and Adidas
Adidas
In 2017, Adidas made an annual revenue of 21 billion euros and has a brand value of 7 billion US dollars. In the same year, Adidas employed 5,888 people worldwide and generated 50% of its sales in the footwear category. Adidas is much smaller than Nike in the terms of what its customers are looking for and trying to find a bigger audience in North America.
Nike
When it comes to Nike is the most valuable sports brand in the world and especially in North America. Unlike Adidas, Nike's first target audience is the people of North America and they also have strong marketing and sponsorship agreements to back it. Making it the reason behind Nike getting 30.57 billion euros in revenue in 2017. In 2006, however, Nike was still the leading with 13.44 billion euros while Adidas made 10.08 billion euros. In 2015, Nike also won the bet against Adidas and became the next exclusive provider of uniforms to the NBA.
The Technology of Nike and Adidas
Nike
Nike uses lighter materials to make its shoe lightweight and is made of polyester, rubber, and cotton. With that, it uses ZoomX technology, so that consumers can experience good speed during running. Nike shoes have holes in their toe cap which makes them breathable and is hygienic for feet as well. Nike shoes provide amazing designs.
Nike does make more business than Adidas but the customer reviews have deteriorated and there has been no innovation that has been as big as Yeezy's which is under Adidas.
Adidas
Adidas always believes in putting quality over quantity and gives more importance to customer satisfaction. Adidas talks to many athletes about their preference and comfort to then implement it into their design. This was the reason for them to innovate Boost technology which is an innovative cushion technology that includes a TPU (Thermoplastic Polyurethane) that compresses under pressure.
Adidas Ultra Boost shoes weighed a little more than Nike shoes. The shoes consist of a full-length midsole and made it feel like a cushion-type material is present while wearing it. It focuses more on comfort and gives out more energy on every single stride. It also provides run toe padding for its shoe models for comfort. This instantly bounces back to its original form and in shock prevention which helps the athlete in a more consistent run. Some of the famous shoes made by Adidas are the Y-3 collection, Ultra boost, Gazelle, Supernova, etc.
In 2013, Kanye left Nike and joined Adidas to then go on to create the Yeezy's which despite being expensive sold out as soon as it hit the markets. This makes us think of whether Nike is going to up with something new or if tables will turn in favour of Adidas.
Marketing Strategies of Nike and Adidas
These brands not only sell their products but also give people inspiration for a higher standard of living and a lifestyle, appealing to diverse market segments through products such as the Nike Pro Hijab or the Adidas Ocean Plastic sneakers. Adidas now has more funds that are used for advertising and introducing new brand ambassadors from around the world, securing the brand’s cultural impact.
Nike on the other hand was known to put out advertisements that propagate the message of fighting against yourself in order to achieve constant growth. Now, however, the brand has shifted its attention to promoting Muslim athletes and the LGBTQ community through projects such as the Nike Pro Hijab, and the equality campaign.
Pooja Uniyal
Revenue of Nike and Adidas
Nike
Some reports stated that the net revenue of Nike as of the year 2021 is 5.73 billion dollars. Thus, it still remains in the top and the leading athletic footwear brand. Nike has recruited and has over 73,300 employees working for them as of 2021. It is clear that Nike is quite big and is a really strong competitor of brands that deal with sportswear.
Adidas
Adidas reached a milestone last year by pushing its gross margin over 50% threshold while Nike has had a harder time dealing with margins as of late. As per reports, in the second quarter of 2021, the revenue of Adidas has increased by 55%. The company’s revenue is 5.8 billion euros. Adidas has employees of over 62285 people. Although is smaller than Nike, it focuses on quality over quantity. 50% of its revenue is derived from the sales of footwear.
When it comes to the revenue, Nike has a bigger business overall and is the market leader in the sports brands with the revenue from their footwear reaching $24.2 billion in 2018, which compared to Adidas footwear revenue which is $15 billion in the same year.
| Brand (2017) | Revenue | Net Result | Gross Profit Margin | Employees |
|---|---|---|---|---|
| Nike | US$37.40 billion | 1,468 million | 44.8% | 73,300 |
| Adidas | US$19 billion | 1,173 million | 49.7% | 62,285 |
These figures include not only Nike and Adidas branded footwear but also Converse which is owned by Nike and Reebok which was owned by Adidas. Adidas sold Reebok to Authentic Brands Group for $2.5 billion in 2021.
Production and Suppliers of Nike and Adidas
Nike
Although Nike is an American company just like its competitor, the shoes are not made in their own country. It has over 523 factories spread in over 40 countries and shoes and made in mostly China and Vietnam. Chinese manufacturers supply 23% of all Nikes production while Vietnam contributes 16% of Nikes total production which mostly constitutes creating apparel and footwear.
Adidas
All the shoes from the brand Adidas are specially made in China, India, Atlanta, Indonesia, Thailand, Vietnam, Turkey, Germany, and Atlanta US. Adidas has over 500 factories in over 55 countries. The majority of shoes are made in the countries situated in Asia, like Vietnam, Indonesia, and China. Vietnam produces 44% of all Adidas footwear, followed by Indonesia at 25% and China at 19%.
Cool Factor of Nike and Adidas
The cool factor here refers to the collaboration with music and celebrities or other influencers. Adidas seem to be winning in this category as its athleisure collaborations with Kanye West and Beyoncé as compared to Nike more sports-focused approach with sponsoring some of the biggest names in the sports category like Serena Williams, Roger Federer, Tiger Woods, Kobe Bryant, and Lebron James, it has created some noise.
With athleisure becoming a new trend Adidas is trying to win the market by this approach. Kanye West is the best example of this because with the help of Adidas he has now built a billion-dollar Fashion Empire through his sneaker brand Yeezy.
Whereas Nike main collaboration till now has been with the basketball veteran Michael Jordan whose Air Jordan line of trainers for it holds the top spot for celerity sneaker brands generating more than $3 billion in sales every year. But the first Jordans were launched in 1985 which is why it has lost its cool factor. The Celebrities that support Adidas are David Beckham, Pharell, Novak Djokovic while Nikes supporters are Drake, Roger Federer, Cristiano Ronaldo, etc.
Sports Sponsorship
Sports sponsorship has been the main activity of both the companies and have a history of being a part of numerous famous sports events. Nike is known to be the main provider of apparel, footwear and uniforms of the NBA league most of the time.
In 2018 however, Adidas sponsored way more than Nike in the Football world cup. Where 12 teams wore the brand Adidas, 10 teams signed up for Nike. Adidas boasts the current World Cup holders Germany, along with Argentina, Spain, Belgium, Colombia, Egypt, Iran, Japan, Mexico, Morocco, Russia, and Sweden.
Both Companies have always competed on who will get to sponsor more teams especially in events like the FIFA World Cup, Olympics and NBA basketball games.
Future Plans of Nike and Adidas
Both Adidas and Nike have performed exceptionally well in the past few years and have reached their highest financial record in the year 2017. Adidas and Nike are now looking forward to growing their companies, their revenues and earnings and spreading across the world in the coming years.
Nike in particular is focusing on higher growth in China while Adidas is looking to get a larger audience in North America. They also look forward to digitally transforming their businesses, Nike is looking for new materials for its products and Adidas is concentrating on its designs by opening up its brand to its customers and other designers.
Nike Vs Adidas: The Real Battle
To be specific there is this timeless battle going on between the best sneaker brands of the world. The battle started in 1976 when Nike hired John Brown and Partners as their advertising agency. Nike emerged itself into aggressive marketing and took 60% of the athletic shoe market in its grasp. When in 1988 Nike started the 'Just do it' campaign, it become one of the best ad slogans of the 20th century.
In recent times, more specifically in 2014, Adidas partnered with Ye formerly known as Kanye West, who claimed that his Yeezy Boost shoes are way better than Jordan Sneakers. This thing escalate the rivalry as people started leaning towards Yeezy's.
The sponsorship battle between the two is another issue. With Nike sponsoring some of the biggest names in the sports category like Serena Williams, Roger Federer, Tiger Woods, Kobe Bryant, and Lebron James, it has created some noise.
On the other hand, Adidas also showed that it is not less than anyone by sponsoring some of the biggest names from the sports and music industry. David Beckham, Novak Djokovic, Lionel Messi, Beyoncé and Ye. Reports claimed that Nike pays more to their sponsors than Adidas though.
The fight between the two sneaker giants didn't stop even in The Covid when Nike started creating face masks while Adidas created face shields.
Chayanika Goswami
FAQ
Why is Nike better than Adidas?
Adidas has always managed to keep its audience in consideration to design its products undoubtedly, but Nike has always had an upper hand in innovation and design when it comes to the sports market.
How is Nike different from Adidas?
Adidas because they tend to keep the customers on the top. Adidas creates products according to their customers need. Undoubtedly, Nike is comfortable but they design the product keeping innovation in mind.
Who makes more money Nike or Adidas?
Looking at the revenue as of 2020, Nike is leading. Adidas, Nike both go head to head and the former has given the latter a tough competition when it comes to fashion as well as the sports market.
Author: PV Vyshnavi
Source : https://startuptalky.com/adidas-vs-nike/
Date : 2021-12-03T10:57:00.000Z