【Follow Me】A Title for LeBron May Mean $4 Billion For Nikein China

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A Title for LeBron May Mean $4 Billion For Nikein China


By Scott Soshnick
-
May 19, 2011 12:15 PM GMT+0800

LeBron James’s first National Basketball Association championship would help add $4 billion in revenue from China for Nike Inc. (NKE), according to the first sports marketing employee in the country for the world’s largest sporting goods maker. Adding a championship to abasketball resume that includes an Olympic gold medal in Beijing and two NBA Most Valuable Player awards is imperative for James, the 26-year-old Miami Heatforward, to achieve the marketing might of fellow Nike endorsers Michael Jordan, who won six titles with the Chicago Bulls, and Kobe Bryant, a five-time winner with the LosAngeles Lakers.
“LeBron is white-hot with the Chinese basketball-loving youth, but his popularity and influence outside of that circle is limited,” said Terry Rhoads, who left as Nike’s China sports marketing director in 2002 after eight years to form Shanghai-based Zou Marketing. “One reason is the lack of titles.”
Nike posted $1.96 billion insales from China,the world’s most populous nation, in the 12 months through January. Rhoads saida “solid part” of that stems from basketball, without being more specific. A championship for James would allow him to take over for the 32-year-old Bryantas the company’s face in China,where Rhoads said it’s “easy to see” Nike’s revenue reaching $6 billion by2020.
James earns about $30 million annually from endorsements with companies that include Nike, which counts China as its second-largest market behind the U.S.;
McDonald’s Corp. (MCD), the world’s largest restaurantchain; and Coca-Cola Co. (KO), the world’s largest soft-drinkmaker.

“If Kobeisn’t the king with Chinese consumers, LeBron could take over and continue topower Nike’s stronghold on China basketball,” Rhoads said in an e-mail.
James said a championship is his goal, no matter how it might help sponsorships. “It would do everything for me,as far as an individual standpoint,” James told reporters before last night’s Game 2 of the EasternConference finals against the Bulls in Chicago.“I don’t care what it does marketing-wise. My marketing statement was in placefor me as a professional.” The best-of-seven series moves to Miami May 22 after the Heat won 85-75 in Chicagolast night to tie the best-of-seven series at one game apiece. Beaverton, Oregon-based Nikesaid in March that revenue was $5.1 billion in the third quarter ended Feb. 28.The company missed analysts’ estimates for the first time in 19 quarters.

“LeBron inspires millions of young athletes and fans, and we’re excited to work with one of the premier players in the world to garner unrivaled insight and develop the most innovative products,” Nike said in an e-mailed statement May17. “His highly successful collection continues to be popular throughout the world, including China,where he won gold in 2008.” James last month became apart-owner with hedge-fund billionaire John Henryof the Fenway Sports Group, which owns Major League Baseball’s Boston Red Sox and England’s LiverpoolFootball Club.
Tom Werner, Fenway Sports Group’s chairman, said the deal, which gives James a stake in Liverpooland makes the sports group the basketball player’s exclusive marketing partner, joins two of the most popular brands in sports and provides international marketing opportunities, particularly in Asia. Asian Appeal Liverpool toured Asia in 2009 and is scheduled to play there again thisyear. The 18-time English champion has a jersey sponsorship agreement with Standard Chartered Plc, the U.K. bank that makes three-quarters of its profitin Asia. Henry in an interview declined to comment when asked about the potential marketing opportunities a championship would bring James. David Falk, agent for the 48-year-old Jordan,said James’s overall marketability hinges on securing more “groundbreaking” agreements like the one with Fenway Sports. Winning, he said, matters more outside of the U.S. “It gives you legitimacy andcredibility,” Falk said,noting that only eight franchises have won NBA championships since 1980.


The NBA said last month thatJames had the league’s best- selling jersey for the first time since 2004, topping Bryant, based on sales on NBAStore.com.
It isn’t unusual for popular players who change teams to see a surge in jersey sales. James is in his first year with the Heat after seven seasons with the
Cleveland Cavaliers. James said he chose the Heat, teaming with fellow All-Stars Dwyane Wadeand Chris Bosh, becauseit gave him the best chance at winning championships.
Last year, James had the second-best-selling NBA jersey in the U.S., Chinaand Europebehind Bryant. Coca-Cola uses James to promote brands including Sprite and Powerade. Beatriz Perez, chief marketing officerfor the Atlanta-based company’s North Americadivision, said sports marketers gauge championship athletes by revenue, not rings.
“We’re focused on LeBron and his relevancy on the consumer market we’re trying to reach, especially teens,” she said in a telephone interview. “Whether he wins or not we have a solid partnership.”

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