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Adidas is defending its soccer business the way the Italians do their goalmouth--tenaciously. "I don't think it's a question of whether we have to win this battle," says Günter Weigl, Adidas' global soccer chief. "We can comfortably say that we are going to win this battle." Besides having home turf, the company is an official World Cup sponsor and will pay $350 million over the next eight years to extend that privilege to the 2010 and 2014 World Cups. Those billions of eyeballs will see only Adidas signage in the stadiums, and the company's black-and-gold Teamgeist (Team Spirit) match ball will be passed around the pitch. What kind of revenue can official sponsorship deliver? One example: the company says it has already sold 10 million World Cup balls, priced from $15 to $130, since December, and expects to ship an additional 5 million by year's end.
Should Adidas get a yellow-card warning for being cocky? Well, it's not as if Nike has ever finished second in arrogance. In July 2005, the American marketing machine sent a rosy letter to retailers worldwide that read, in part, "The new season for Spring 06 will serve as the platform for launching Nike into the number one soccer brand in the U.S. and the globe ... Prepare yourself and your business for a historic ride."
The scoreboard shows the Swoosh still trailing, though. Nike lost global soccer market share in 2005 and now has a 31% share, compared with 38% for Adidas, according to NPD Sports Tracking Europe. Historic hubris, maybe. "In 1998, they publicly said they wanted to be No. 1," Weigl says of Nike. "In 2002, 'We want to be No. 1.' I can tell you right now, they will again fail to achieve that goal." And you thought Argentina vs. England was a grudge match?
Nike simply touts its momentum. A dozen years ago, the company registered a paltry $40 million in annual soccer-related sales. That figure is approaching $1.5 billion, according to Nike. "We're very happy with our position," says Don Remlinger, Nike's global soccer chief. "If it's making others uncomfortable, that's not our issue." Some of that business came from Adidas; a lot came from Puma, once a dominant soccer brand (started by Dassler's brother) and now enjoying its own renaissance. Smaller brands were crushed under the weight of the marketing spending by the two big guys.
Nike's soccer standing is impressive because, for the company's first 27 years, it basically ignored the sport. Nike built itself into the world's top sports brand by capitalizing on the 1970s jogging boom and the growing global infatuation with basketball in the 1980s and 1990s, headlined by the most valuable endorser in corporate history, Michael Jordan. Adidas seemed invincible in soccer because the sport put the company on the map. For the 1954 World Cup in Bern, Switzerland, Dassler had designed the first soccer shoe with replaceable cleats, or screw-in studs, at the bottom. An hour before the final between heavily favored Hungary and Germany, Dassler surveyed the muddy field and figured his German team needed longer studs to improve traction. Germany upset Hungary 3-2 in the slop, and the "Miracle of Bern" established Adidas as the unquestioned soccer leader.