How did Nike, the world's biggest sports brand, start losing its edge?

**Rahul Tandon** (0:00)
This week, we're talking about the global sports brand, Nike. For decades, it wasn't just any sports brand, it was the sports brand. A global symbol of winning with 26 pairs of shoes, still sold every single second. What a number that is. Athletes wore it to dominate their sport, kids wore it to dream to be athletes, but somewhere along the way, things have started to slip. A once market dominator slowly turned into a laggard. This year alone, its stock price has dropped by 35%. So this week, we're asking how did Nike, the company built on winning, become the one everyone thinks is losing?
Welcome back to Business Daily, I'm Rahul Tandon, here in the studio in the UK.

**Michelle Fleury** (0:45)
I'm Michelle Fleury in New York.

**Will Bain** (0:46)
And I'm Will Bain, in the UK as well alongside Rahul.

**Rahul Tandon** (0:49)
I know Will's very excited. We can see him there with his England football top on.

**Will Bain** (0:52)
Part prop, part ready, because we are recording right before the England DRC World Cup game. So by tomorrow, you might know whether I'm crying or cartwheeling through Piccadilly in Central London, all that kind of stuff.

**Michelle Fleury** (1:05)
And whether you have any fingernails left, or whether they're all bitten there.

**Will Bain** (1:07)
I think those are definitely gone one way or another, regardless of the results.

**Rahul Tandon** (1:10)
I can promise you all, if Will cartwheels anywhere in London, we will post it on some video everywhere. We're not going to discuss who's going to win the World Cup. I think we all know it's going to be France. Sorry about that, Will.

**Will Bain** (1:20)
It's looking likely.

**Rahul Tandon** (1:21)
But of course, when you think of a big sporting occasion, you do think of big sporting brands, and none bigger than Nike. Founded in 1964 by former athlete Phil Knight and his coach Bill Bowman, they started bringing in shoes from Japan and selling them out of the back of the car at Athletics meeting. They rebranded as Nike in 1971, which of course, named after the Greek goddess, and the rest is history. It's become the biggest sports clothing brand in the world. Here's a question to start off for both of you. You know the famous swoosh on the Nike shoes that Anna Will is wearing today? Other brands are available, of course. How much do you think they paid for that bit of iconic marketing?

**Will Bain** (2:00)
Oh my God, I'm terrible at quizzes. I'll start with $500,000.

**Michelle Fleury** (2:06)
Oh, I'm going under that. I think, you know, with inflation and everything else, $70,000.

**Rahul Tandon** (2:11)
Okay, let's hear the answer from the founder of Nike Filament.

**SPEAKER_4** (2:15)
There was a graphic arts student at Portland State that had done some work for us and she charged $2 an hour and we said, how about coming up with a logo for the shoe? She spent 17 and a half hours on it, so it cost us $35.

**Rahul Tandon** (2:28)
There we go.

**Will Bain** (2:28)
My future on TV game shows has also crossed off now as well as my cart wheeling.

**Rahul Tandon** (2:34)
Actually, Will, you weren't that far away. You weren't that far away because they gave her 500 chairs, which I think now are worth probably a lot more than the amount that both of you quoted there. That's the swoosh. But for those who haven't followed the history of the brand, this has changed the world that we live in, hasn't it, Michelle?

**Michelle Fleury** (2:52)
Yeah.
If you think back to every decade since the 70s, Nike has been associated with some of the biggest names in sports. So back when it was started, it was Steve Prefontaine in the US, the first athlete to sign with Nike. He was a runner. Then in the 80s, of course, that's when you got Nike going into basketball. So Michael Jordan, of course. Then the 80s, 90s, that's when you start to see figures like Tiger Woods, Serena Williams in tennis, all of the big names. Of course, now we were just talking about the football. Cristiano Ronaldo was one of their first big football signings back in the day.

**Rahul Tandon** (3:31)
So here we have a company that managed to dominate sportswear along with Adidas for many, many years. We across the world now, whenever I go to India, everybody's in a gym, everybody's trying to get fitter, everybody's running. So results out on Tuesday, I presume, with the fitness boom, this is a company that should be booming?

**Michelle Fleury** (3:52)
Well, look, you know, the reason you and I, what all three of us are talking about this today, is the company is in a bit of a funk to put it mildly, and they're trying to kind of turn things around. So that's the context here. And against that, no surprise, you know, the earnings were a bit of a stinker, not as bad as they could have been, but they were boosted by a huge tariff refund in the last three months. Still, they are struggling despite the fact that they are still the world's biggest sports shoemaker.