Comment on Eric Eaton’s post “Some Thoughts on Athletic Endorsement Deals”

The original post is https://blogs.ubc.ca/eeaton/

In this post, Eaton talked about the player Andrew Wiggins is about to earn $180 Million dollar before he is even play any game outside of high school. I totally agree that this is a ridiculous high pay for such an young age player, but if we look at Andrew Wiggins’s profile, he is 6ft8in (2.03m), he was named 2013 Gatorade National Player of the Year, and Mr. Basketball USA, and he was ranked number one high school basketball player by SLAM Magaizine. This all make him seems like a player that has full of potentials, therefore, by endorsement him into Adidas, Adidas is purchasing an intangible asset for the next 20 years (Given Jordan retired at age of 40). Once Adidas has an ongoing relationship with Andrew, it would be easier to ask him for additional advertising than if Andrew got recruited by Nike. Therefore, it is very necessary to target those potential big stars early.

In addition, let’s look at the 180 Million.

With the 16% market share, times by half of the American Population of 300 Million

0.16 x 150M = 24M person. Times that by $100 per shoes is $2400 Million of revenue, which is greater than 180 Million paid. That is only one person buying one shoes from one country, and not counting the other products that got bumped up in price due to Andrew wearing Adidas, and the market share Adidas might steal from Nike.

Therefore, It has the with such Marketing Strategy, Adidas has the potential of making multimillion of dollars, and the 180 Million does not seems like such big amount of money any more.

I guess this can really justify why many teenagers are dreaming to be good enough to be able to play in the professional sports such as NBA.

 

Let’s watch a Youtube Video of Andrew to see if he is really that good!

Andrew Wiggins video

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