The Olympic Games is undeniably a major brand marketer moment. And lately, marketers have been eyeing everything from women’s sports to Formula One races as opportunities for growth, making sports marketing more competitive than ever.
Still, brands are throwing money at the games, including the likes of Powerade, Reese’s, Old El Paso and, of course, Nike. The athletic retailer in particular has already shelled out nearly $143 million in advertising dollars from January through May this year, even before the Olympic Games start, according to data from MediaRadar. That figure is up 10% year over year from the $130 million spent during the same period in 2023.
Nike, which didn’t respond to comment on this story, told Reuters that this year’s Olympics were its “biggest” spend yet. In 2021, Nike spent an estimated $39 million on advertising during the Summer Olympics in Tokyo, per MediaRadar’s data.
The Olympic moment comes at a time that is all too critical for a brand like Nike, which some industry experts say is pressured to improve its standing among consumers after seeing a dip in sales as of late.
The 60-year-old retailer faces challenges on more than one front. Full-year revenue (the fiscal year ended May 31 for the company) was up just 1% to $51.4 billion compared to $51.2 billion in 2023, per the company’s earnings report. Meanwhile, fourth-quarter revenues were $12.6 billion, down 2% on a reported basis and flat on a currency-neutral basis, per the report. Nike’s digital sales have also been lagging, dipping 3% year over year from the third quarter of fiscal 2023 to the third quarter of fiscal 2024, marking the retailer’s first digital decline in nine years. Nike is said to have invested too much, too quickly in its direct-to-consumer business, which has become a scapegoat for its poor performance, as ModernRetail reported. In the face of financial headwinds, the company has gone through a series of layoffs to cut costs.
This year, Nike seems to be aiming to make a big splash at the Olympics. Last week, Nike released its Olympic-themed spot “Winning Isn’t For Everyone” featuring big names like basketball forward LeBron James and U.S. sprinter Sha’Carri Richardson, with a voiceover by actor Willem Dafoe. The spot drummed up excitement on X, where users acknowledged a possible return to Nike’s iconic storytelling roots.
Stupendously interesting and mighty provocative new ad film by Nike, for Olympics, made by the agency, Wieden+Kennedy Portland.
Why is it stupendously interesting? Because the script cleverly lists all the quintessential qualities of a ‘bad person’ and places it in the context… pic.twitter.com/8tHPDM8Tof
— Karthik ?? (@beastoftraal) July 20, 2024
The retailer is also introducing a new footwear and apparel collection for breaking (formerly known as breakdancing) ahead of the Olympics, in addition to a slew of shoe prototypes developed with athletes, per Reuters. The sportswear giant is also hosting a sports-themed exhibition at Centre Pompidou, a Paris landmark, introducing programming and jerseys around its iconic Jordan Brand, as well as sponsoring hundreds of athletes who will compete in this year’s games, including big names like James and Richardson.
While Nike’s Olympics ad has received praise on social media, its message isn’t exactly aligned with the brand’s current positioning, having seen more competition from the likes of other athletic brands like Hoka and On Running and considering recent sales numbers. Marketers said the impact of the spot hinges on the performance of the featured Olympic athletes.
“If there’s one thing we can expect, it’s an ad from Nike that will excite people around their athletes or an event. Another constant is that an active element of Nike’s brand identity is its athletes,” said Gary J. Nix, founder and chief strategist at the brandarchist, a digital and experiential brand consultancy. “If their athletes meet (or somehow exceed) expectations, it will be a good look for the brand.”
Regardless of how much Nike is spending on advertising and activations at this year’s Olympics, marketers said it’s still unclear whether its build-up to the Paris games is enough to solidify its status with consumers.
“The Olympics will give them a boost, but I don’t think it’ll be anything lasting,” said one creative agency executive who spoke on the condition of anonymity. “They’ll probably use it as a launching pad for stuff that they’ve been keeping under wraps over the years.”
In other words, marketers haven’t been able to read the tea leaves just yet to tell whether Nike’s Olympic marketing strategy will translate to shopper favoritism.
Nike maintained its No. 1 position among apparel brands in Kantar’s “Most Valuable Global Brands Report” this year, still ranking ahead of its mainstream competitors including Adidas and Puma. However, the company’s valuation dipped in 2024, coming in at $71.6 billion, down 4% since 2023, per the Kantar report.
According to the three marketers Digiday spoke with for this story, the sportswear giant’s current status is due to a culmination of things: more brands getting into sports marketing, competition from the likes of Hoka, On Running and other similar brands, and economic headwinds that have caused consumer spending to slow. Plus, the marketers said, the legacy retailer is missing the innovative spark that made it stand out years ago, which has left room for competitors to gain a bigger share of the market.
“It feels as if the fact that a lot of negative things happened all at once either set them into short-term planning mode, or, more likely, set stockholders into short-term planning mode,” said Nix.
Nike, which is known for its athletic underpinnings, has ventured from its core of athletic performance toward more lifestyle-centered products, said the anonymous exec.
In the past, Wieden + Kennedy, Nike’s creative agency of record for more than 30 years, which did not respond to a request for comment in time for publication, was trying to make a name for itself, and Nike was willing to sign off on campaigns that pushed cultural boundaries, like its 1990s campaign with Lil’ Penny the puppet or the controversial “I am not a role model” commercial featuring Charles Barkley. At this point, the anonymous exec said that Nike is a “behemoth,” which has slowed its product innovation and kept the brand from truly participating in culturally defining moments.
“Once you become a behemoth, you start playing not to lose instead of playing to win. That’s essentially what has happened. They’re playing not to lose. They’re not playing to win anymore,” the exec said.
But, as the marketers pointed out, Nike’s Olympics marketing push could mark a relaunching point, especially when it comes to the next generation of shoppers.
“[Nike is] not going anywhere. But I do think that their top-of-the-mountain status might be moving down for a little bit if they don’t get back to their core proposition of what they stand for,” said Holly Willis, founder and CEO of creative agency and marketing consulting firm Magic Camp.
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