Why Nike's $500 Million Lifetime Contract With LeBron James Is a Brilliant Move
Why Nike's $500 Million Lifetime Contract With LeBron James Is a Brilliant Move
LeBron James's brand platform is proven, diversified, and still growing.
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"Now that you have graduated, the goal should not be to seek a job, or even a career, but to seek a calling."
That's the advice Nike founder Phil Knight gave
last year at the Stanford Graduate School of Business's diploma
ceremony. LeBron James, who earlier this week agreed to a lifetime
contract with Nike worth significantly more than $500 million, according
to USA Today, must have been listening.
It's now clear that James views his calling as something more than
the profession of playing basketball. The best way to describe James's
calling would be to compare him to someone like Martha Stewart: a brand
platform.
James is only 30 years old, but a short list of his credentials shows
just how diversified beyond basketball his brand platform already is.
He is, as my colleague Zoe Henry noted not long ago,
a major investor in Blaze Pizza, a growing chain that hopes to do to
Domino's what Uber did to cabs. His latest media project, Uninterrupted,
launched late last year and is off to a superb start. It's a simple
concept: A web site where star athletes share short video diaries from
their smartphones, saying whatever they please. The site has a prominent
web address as a subsection of the Bleacher Report sports site, and it has already received a $15.8 million investment from Warner Bros. and Turner Sports.
It's also a safe bet to say James will be making a comedic turn in a
major motion picture every now and then, for the foreseeable future.
He's not afraid to poke fun at himself, or the public perception of
himself, as he showed this summer in the film Trainwreck:
So with its investment in James's career, Nike is getting way more
than a basketball player. They're getting a partnership with an
exceptionally integrated and diversified brand, someone who can
represent Nike and potentially give it visibility in places it has not
yet treaded: major motion picture comedies and healthy fast-order
delivery pizza.
Of course, James also will be a massive marketing force in basketball
for the next several seasons. At age 30, he has plenty of seasons left.
And as Nike has already shown in its partnership with Oklahoma City
Thunder star Russell Westbrook,
Nike does not view the basketball stars in its stable as mere celebrity
endorsers. Westbrook is more like the co-creator and fashion consultant
of his own brand.
Which means that even when their playing days are over, both
Westbrook and James could have roles in the ever-intersecting worlds of
athletic gear and high fashion.
What's more, James could very easily follow Michael Jordan's
footsteps and one day become the owner of a pro basketball team one day.
In this way, too, he would have value to Nike when his playing days are
over. Which makes it easy to see why a lifetime contract made sense for
both sides--and both brands.
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