Nike Losing in the Sports Brand War?

Welsh Rugby Player Jamie Roberts Wearing Under Armour

Nike, the giant American sports brand has issued a profits warning and the shares have shed 5%. This begs a question as to whether Nike is losing its position in the sports brand war. The company blames the rise in commodity prices. In my opinion Nike may well be losing some of its allure. Their sports icons such as golfer Tiger Woods and tennis player Roger Federer are losing their global standing. Meanwhile, new, more technical brands such as Under Armour are gaining ground in the more profitable sports accessories markets. Nike has focused its sponsorship activity on key personalities, such as Woods, with the inherent risks this brings. Meanwhile Under Armour has spent its money on teams such as football club Tottenham Hotspur and the Wales rugby team.

Nike's sports brand positioning has been unchallenged over the past two decades facing down Adidas, Puma and Reebok. The new environment is more challenging and I suspect that this latest downturn in the companies financial performance may be more than a blip.