Michael Jordan’s billionaire deal with Nike

His Basketball Career

Michael Jordan claimed success and fame throughout his basketball career from college basketball to the NBA. He was drafted in to the Chicago Bulls and led them to 6 NBA Championships where he was named MVP 5 times.

His success continued until he retired in 2003 with a total of 32,292 points and a 30.12 points-per-game average which was the best in league history.

In 2006 Jordan became a minority owner and general manager of the NBA’s Charlotte Hornets before becoming the first player to become a majority owner of one of the league’s franchises in 2010.

His deal with Nike

Brands were fighting over the prime spot in basketball to be ‘the’ trainer, Adidas, Converse and the newly released Reebok were all leading the way above Nike in revenue and popularity at the time.

Using brand ambassadors was becoming popular at the time with brands recognising the influence that celebrities had over the public and how this could improve their sales and awareness.

It was Michael Jordan’s agent who coined the term ‘Air Jordan’ referencing the skilled jumps Jordan was known for who also convinced him to listen to the Nike pitch in 1984. From here Jordan signed a 5 year deal for $12.5m which was three times more than any other deal in the NBA.

The Air Jordan’s were released in 1985 making more than $100m in sales within the first 12 months.

The first release also drew attention from the NBA which fined Jordan for not meeting the league’s colour standards. Nike took this as an advantage and paid the fines whilst creating this into a marketing campaign drawing on the publicity sparked.

Other Basketball players went on to wear Nike trainers and Nike transformed to one of the largest consumer brands.

Forbes estimates Nike has paid Jordan over $1bn since the first signed deal as new trainers are released and new brand ambassadors sign on to promote the Jordan Brand.

This deal in 1984 not only transformed the Nike brand and allowed them the monopoly on basketball shoes over any other brands, it also created a billionaire out of Michael Jordan.