SBJ/October 1 - 7, 2001/This Weeks Issue

Timing, budgets cut marketing interest

While Michael Jordan's second renaissance is sure to boost NBA ticket sales and TV ratings, marketers, at least in the short term, aren't rushing to the athlete who is as renowned for his pitching ability as his basketball skills.

There are two sound reasons: Marketing budgets were already slashed even before the Sept. 11 terrorist attacks, and nobody leverages the NBA for marketing purposes before the December holidays except, well, the NBA itself.

Thus, most of the marketing you'll see is from clubs rushing to push the Wizards as part of season-ticket packages (many already had, in anticipation of Jordan's return) and from Turner networks TBS and TNT, which need to hype an NBA schedule that left advertisers disappointed last year.

Retailers say that Jordan's retro sneakers have been moving at the register, much more so than the latest models, which usually carry a price tag some $50 higher than the retro sneakers. Nonetheless, the basketball category has been depressed at retail for almost five years, as running and walking shoes gained in popularity along with brown shoes and boots. Even before Jordan announced his return, retailers were looking for a double-digit bounceback this year in basketball.

"We were already booking bigger in anticipation of a basketball revival, but Jordan's return gives a real buzz to the category that's been missing," said Bruce Blanke, partner in a chain of 21 Athlete's Foot stores in New York, New Jersey and Connecticut.

Nike, which rode Jordan's coattails to its current position of owning 42 percent of the $7.5 billion (wholesale) branded athletic footwear market in the United States, has the most to gain. The Jordan brand, which now encompasses sneakers and cleated footwear, athletic togs and a line of Two3 clothing (designed to compete with the like of Ralph Lauren and Calvin Klein) is already a $200 million enterprise.

"Obviously, we'll get a lift," said Greg Johnson, Nike's marketing director for Brand Jordan, "but it wasn't like we were sitting around waiting for him to come back."

Sneaker analyst Faye Landes of Sanford Bernstein estimates that if Jordan's return doubles sales of Nike's Jordan line, it could add 18 cents to Nike's earnings on a per-share basis. Like the networks now negotiating new NBA TV deals, however, she cautions that Jordan's impact will not be lasting.

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