On and on and on: what Mbappé's shoe swap means for the sportwear sector

16:15James Emmett:so on have signed Kylian Mbappe kind of snatching him away from Nike Nike has to respond slap back and it did immediately by um selling so Mbappe was um pictured wearing all the next game after he signed for on he was still wearing Nike boots they just had the swoosh kind of whited out and nike slap back by selling those whited out boots um yeah i just think it's a funny frame of discussion um that everybody seems to slip into in terms of how these competitors respond to market moves by others as if as if it's some kind of battle all the time it is worth just having a business lens on the landscape that the landscape that on has marched into here.

17:09James Emmett:Nike, though it is in the midst of a very public plummet in share value. Some would call it an existential crisis. Completely. Its share price is down nearly 80 % below what it was in 2021 at an all-time high. uh the yeah there is this existential crisis going on um it made some strategic errors it seems to be the accepted wisdom in terms of its distribution strategy trying to move to a direct to consumer model and away from outlet kind of uh dealerships um but it's still a monster in

17:54David Cushnan:the space well it is the monster the monster by some distance the market leader still and and And by way of comparison, Nike's market cap around about$53.94 billion. On's$9.13 billion or thereabouts. So there's an enormous gulf between these two brands from a sort of financial standpoint. And that sort of bears out in terms of physical retail stores as well. Sorry, Adidas.

18:25James Emmett:Adidas in the middle of those two pretty much.

18:27David Cushnan:Yeah. Now, in terms of physical stores, the sort of best guess, and they're going through a period of sort of rapid expansion and they have big plans in this area, but on have around about 70 owned stores around the world at the moment, including plenty in China, around about 38 in China. Nike have around about 980 or so, including nearly 350 in the US. adidas actually our list is having over 2 000 a lot of those are factory outlets so again there's there's not necessarily completely apples for apples under armor who we haven't really mentioned sort of sitting in and around um 450 odd physical stores so so on is very much the the challenger brand here and it you know it's all i think you know in many uh scenarios in many industries it's nice to be the challenger brand and they're getting a lot of noise building on their challenger status at the moment.

19:29David Cushnan:But this is the moment signing in Mbappe, you're suddenly playing in the big leagues and the mainstream scrutiny on product will come. The, you know, potentially the sort of the more of more of the sort of business journalism around on might well start to step up as well. And so it's going to require some new skill sets and certainly from the leadership team on, and they've made a number of leadership changes in recent times that they build out, there's going to be new pressures. Totally.

20:06James Emmett:It is interesting what's happening in this footwear, sportswear landscape. It's a complicated time. There is this cultural capital thing going on, which is sort of embedded deep within the marketing strategy of pretty much all of these companies but there's never really been a richer more varied landscape um for well there's competition for for nike and adidas basically everywhere they look the old established pumas asics um even under armor is is a long-term competitor now they're still there they're still um competing across lots of different fronts in lots of different categories We are in the midst of a running technical where bleeding into lifestyle where sort of boom on is absolutely leading the pack here.

20:56James Emmett:But there's also Hoka, New Balance as well in there seeming to be making ground in the kind of cultural capital stakes all the time. A fascinating, yeah, fascinating time for all of this. You mentioned Roger Federer taking equity in on earlier. Kylian Mbappe has done that as well. Part of this 10-year deal, it has to be said, which takes him through to being 37, is that he will have equity in the brand and everybody sort of saying, well, this is super important. And organizations that do this absolutely showing their commitment. And it's going to be a huge breakthrough. A couple of challenges in this space have done this very recently too, but with much less of an impact.

21:49James Emmett:And I would point to, and maybe it's because they haven't quite got their cultural capital acquisition marketing quite right. Decathlon, recent moves into the football market. I think they signed Griezmann a couple of years ago. Harry Kane is with Skechers as well. I'm pretty sure he's got equity there also doesn't seem to have made quite the impact that Mbappe joining on has Mbappe of course is the fourth most followed footballer on social media behind Neymar, Messi and Ronaldo which counts for a lot these days David who's the fifth most followed footballer? Is it Haaland? According to the data that I can see it's David Beckham who hasn't hasn't kicked a football in anger for a while.

22:42David Cushnan:Just to name check some of the leadership team on who I think are going to become ever more prominent across the industry. So Alex Griffin is the CMO there and has been for nearly a decade. So he has really sort of grown with the with the business. Interesting move or promotion fairly recently for Rebecca Kai, who ran the APAC region for AARN. And we mentioned they have been doing a lot of building in China, but Rebecca Kai now has the role of Chief Global Markets Officer and an intriguing hire just recently, Alice Della Hunt, who was formerly Ralph Lauren's Chief Digital and Content Officer, has joined on as chief customer service officer.

23:33David Cushnan:Scott McGuire is president and chief operating officer, effectively runs the business on a day-to-day basis. The two co-owners having sort of stepped away from that frontline responsibility. And the other key person here, and we talked about product and that being fundamental to anything that's going to go wealth on over the coming years as Mbappé plays out his initial decade-long contract. Gerald Merolf is ONN's chief product officer. And we talked about the way that these companies talk to each other or are talked about by media. And what comes with that, and Nike have, of course, led the way with this over several decades, is bold, brash advertising, bold, brash statements.

24:25David Cushnan:How about this one from Gerald Marolf at Ons Investor Day, which took place yesterday, Tuesday, which is around which all of these announcements about the new football division have been made. He said that he has been testing a prototype boot with Kylian Mbappe just in the last week or so. And he has said, and I quote, I can guarantee you this is going to be the best football shoe that was ever made. That's a promise. big talk. Such garbage, isn't it?

24:56James Emmett:I mean, football boots are football boots, isn't it? Really?

24:59David Cushnan:I think so. But a lot of people would disagree. And, you know, it is all about the technology and the innovation and the edge.

25:07James Emmett:So on's in running. It's in tennis, now established in tennis. It's into football now. Clearly, they'll be wanting to sell a lot of these revolutionary new boots. It's going into golf as well. Is that right?

25:21David Cushnan:Yeah, there's certainly speculation that it is going into golf. And I think actually Roger Federer was at the Investor Day wearing a new golf shoe that On has put together. So that does seem to be coming. It's also worth saying that ON, which as we have talked about, has Swiss roots, has put quite a lot of money into the Swiss Winter Olympic project that is for 2034? No, 2038. 2038. 2038, this national project for Switzerland to host the Winter Olympics. So I think we can perhaps glean from that that there's going to be ever more of a focus on winter sports, certainly in Central Europe. And who knows where else?

26:13David Cushnan:I mean, we touched on F1 earlier. That was Adidas' sort of fundamental growth.

26:18James Emmett:You know, they wanted to provide a shoe for every single Olympic sport, didn't they?

26:22David Cushnan:Yeah. And we talked about F1 earlier. Adidas have gone quite heavily into F1 with certainly the Mercedes team over the past few years. there seems to be a lot of ongoing speculation, which I can't add any sort of validity to, can't confirm or deny, that Nike are sniffing around F1, looking at some sort of major sponsorship, perhaps with F1 itself. So again, you know, F1 has a sort of level of cultural appeal that is probably appealing to and on as it looks in all these different, into all these different sports in perhaps a bigger way.

26:59James Emmett:I think F1, have we talked about F1 clothing and the difference between sort of football clothing and F1 clothing? Obviously, they're both on this trend of becoming cool, operating in this sort of lifestyle culture kind of space. Which I can't emphasize enough, we are not in it. We're not in it. So, you know, this is tricky for us. but i do feel if you see if you see a football shirt around there's a chance that that football shirt looks cool you know whereas f1 team shirts yes just look like they're i'm not sure that they

27:37David Cushnan:do look cool on the street i think f1 teams certainly the bigger f1 teams are moving in that in that more lifestyle direction but yeah probably a work in progress there's been other bits can i Just say, on, the final word on On. Bob on track. Very difficult thing to Google. Oh, big time. That's a challenge. That is going to be an ongoing challenge for their marketing team.

28:01James Emmett:Yeah. There are a number of sort of sports industry companies that haven't been put together with Google or indeed AI in mind. There are other bits and pieces going on, David. Let's move away from On. Let's turn it off. No, don't turn it off. We're always on. Lambis Constantinidis, who used to work at Paris 2024, is the new COO at the troubled Alps 2030 Winter Olympics. MotoGP have hired Ryan Norris as CCO. He joins from Tottenham Hotspur. They've also hired Louise Young from Formula One as chief operating officer. And Samir Pabari, who used to run the NFL's international media rights operation, as chief media officer.

28:49James Emmett:and Srinath Sripath has been promoted to a senior media rights sales role at the IOC.

28:56David Cushnan:Meanwhile, Johan Lacroix, whose exit from the IOC media rights department preceded Sripath's promotion, has launched a new player representation agency alongside former footballer Mathieu Debussy. It's called Strive. Freddie Long, who ran betting and data at IMG through IMG Arena, has launched a B2B SaaS company for sports and betting organisations called Sport HQ. And Ferrari has signed a multi-year deal with Rakuten that will see the Japanese tech firm take the telecoms and e-commerce sponsorship categories at the famous Red F1 team from next year.

29:34James Emmett:Karan Yadav is the new CEO of the Indian Super League football competition. Tyler Rutstein is the new CMO of the PGA Tour. And Tom Glover, formerly of Tottenham Hotspur as well, has moved to Mercury 13 as commercial director. And long-time football comms man, Adrian Bevington, is the new CEO of Aberdeen. And I have to say, Adrian Bevington is rooted to the bottom of my FPL league that I'm in with him. Boy, he's got other things on his plate now, suddenly. He's been going through this process to become the CEO of Aberdeen. congratulations one and all all the moves and shakers there what a uh what a power move by

30:15David Cushnan:moto gp three and one trio of uh triple signings big c-suite signings um good people joining moto

30:24James Emmett:gp well there's been a bit of a limbo there hasn't there in the commercial department certainly since dan rossamundo who did such great things when he was there for two and a bit years um decided that the travel was a bit too much for him um there's been a bit of a gap since he left more or less a year ago now i think ryan norris coming in as a chief commercial officer is big very successful across the football space he's got broad european north american with broad european experience he's been at roma he's been at spurs he's sold sponsorship deals um small and large um louise young who we had on the show not too long ago specializes in um that diplomatic commercial space um it takes a very it takes some some uh particular characteristics to to to work well here but that um she ran promotions uh the promoter team at formula one so she was in charge of the relationships with the hosts basically um and she'll bring that skill set to moto gp as well and samir pabari who's very highly rated in sports industry circles um coming in uh as chief media officer he'll be um he'll be selling media rights far

31:48David Cushnan:and wide yeah um we have said it in previous weeks but yeah keep your eyes on moto gp lots uh Lots happening there under Liberty Media ownership. A couple of big jobs available as well, or will be available. Chief commercial role at Tottenham Hotspur, big job. You know, still a stadium naming rights project, potentially for the next person doing that job.

32:14James Emmett:Is Al Scotcher still at Tottenham?

32:17David Cushnan:I don't know. I'm not sure. But in terms of F1, as you say, that's a very particular role that Louise Young has done. And she took on that role, took over that role after the departure of Chloe Target Adams, who did that job for a good number of years. And that was an internal promotion at the time. So it will be fascinating to see whether F1 do look externally for a very specialised and multi-stakeholder focused role.

32:50James Emmett:Yeah, they seem to have got it. I'm hearing a lot of positivity around the sort of team investment side in MotoGP as well. I think we're expecting another team sale slash acquisition any day now. um yeah it's it's very much a sport and a series on the art a quick word on rakuten you said david that they're becoming coming in um to take the telecoms and e-commerce categories of the famous red f1 team um they rakuten of course have a bit of budget um because they just signed a new deal with the golden state warriors they were on the shirts of the golden state warriors for a few years no longer on the shirts i'm hearing that that patch will be replaced very soon by a rival

33:37David Cushnan:company to rakuten watch this space a secret uh james can we talk um about an event that um

33:46James Emmett:neither of us know too much about do you know what the asian games you're going to talk to me about the asian games spoiler is the asian games um i don't know much about it i've not watched it But I am finding in this final few weeks before our big event in London, Leaders, I'm finding that a disproportionately large number of the people that I'm trying to get in touch with to see if they're coming are in fact at the Asian Games.

34:12David Cushnan:Yeah, well, it's massive. And it's my favorite type of sports event because it's a massive thing that certainly here in the UK, I would wager in lots of parts of Europe and the US, just does not make a dent, but is huge in terms of scale. So the Asian Games are underway. They happen every four years. This year's edition in Japan, in the Aichi Nagoya region. And the numbers are enormous. 10 ,787 athletes competing. By comparison, at Paris 2024, 10 ,714 athletes competed. So in terms of, you know, scale, very similar. There are 460 more athletes. Yeah, but still, it's a regional event. at 469 different competitions in 43 sports and 71 disciplines.

35:20David Cushnan:Started last week, runs until the 4th of October. This is the, as I said, the quadrennial regional event, multi-sport event organized by the Olympic Council of Asia, which is an organization that you tend to hear about around the time of IOC, International Olympic Committee elections, because they have a lot of sway and influence and members and um there are a few uh newslines coming out of the current edition which has um for the asian games really trialed a slightly lower cost operating model uh you try to utilize as many existing venues as possible to avoid new builds they have been trying to grapple with the challenge of accommodating uh i think it's around about nearly 1700 17 000 people when you include coaches um and add them to the 10 000 plus athletes so they've they've brought in cruise ships they've brought in what by all accounts seem to be quite basic accommodation sort of wooden hut style accommodations to try and get everybody, frankly, having a roof over their heads.

36:37David Cushnan:And one of the key events contracts for the Asian Games is a sort of reported$400 million contract that was awarded to GL Events, the French company, who are the primary event delivery entity who have been fitting out and managing the 58 competition and non-competition venues this is a vast event as i say doesn't make a mark in terms of you know news profiles storylines broadcast in uh certainly as i say the uk um and i find i find it absolutely fascinating um there's a couple of uh editions coming up that I think will look and feel very different to the current one in Japan, which, as I say, has been operated on this lower cost, slightly more sustainable model.

37:30David Cushnan:So the next two editions are Doha 2030 and then Riyadh 2034. So it doesn't take a genius to sort of look at those and think we are potentially looking at warm ups for the global prize of a summer olympic games at some point maybe 2036 who knows uh the next available summer olympics um insofar as you can call an event that has 10 000 athletes and so many venues and so many sports

38:00James Emmett:a test event for anything um yeah huge event doesn't make a dent over here um i wonder if there are there must be countless examples of this and you can sort of understand it for the Asian Games because this part of the world, we don't have any competing kind of, you know, athletes there. There are some other events, some other large scale of events that have a peculiarly low impact in the UK, I'd say.

38:35David Cushnan:Yeah. Well, there is on the multi-sport side, you obviously also have the Pan American Games and there's about 7 ,000 athletes who tend to participate in those. Next edition is in Lima next year in Peru. Again, in this part of the world, not something that would necessarily come onto radar. I'd probably throw in the European games. Do you know where the 2027 European games are being staged?

38:57James Emmett:Honestly, I didn't know the European games were still a growing concern.

39:01David Cushnan:Precisely. They're going to be held in Turkey, in Istanbul in June next year. And again, it's, you know, maybe there's something specific about these regional multi-sport events that sit underneath the Olympic Games in terms of the sort of sporting structure. But as you say, there are definitely other examples. I would probably point, you know, big stuff that doesn't make an impact in the UK, at least. I always think of the, you know, occasionally we see the enormous crowds that you see at biathlon and cross-country skiing in certain parts of Europe during the winter. um incredible spectator sports great tv actually but but again for reasons of climate and history and you know pedigree in the event just doesn't doesn't make a mark and there will be others as

39:52James Emmett:well yeah well there's definitely others i'm just thinking of um you know there's always there's all this fuss and kerfuffle over um nba europe and what's going to happen with um european basketball and all of these um commentators coming out saying well europe already has a you know a top level European basketball scene and competition. Did you watch the EuroLeague Super Cup, the first edition of the EuroLeague Super Cup in Abu Dhabi this weekend? I must say I didn't. I missed it as well, I'm afraid. I mean, it sounds like it went very well. And this is, you know, the EuroLeague and IMG team sort of scrambled to put this new season opening Final Four style tournament together at three months notice.

40:39James Emmett:it was only ratified at a board meeting in July that they would go ahead and do this so impressive work but if you does have such a rich basketball scene you'd expect something

40:49David Cushnan:like that to make a big impact yeah and of course you're going to have small pockets of fans you know in any market who are will be tuning in but in terms of having any sort of wider profile as you say it just doesn't quite cut through there was a big event in London on Saturday that you might have missed as well um in the college football world i read such a um again i'm not

41:11James Emmett:sure that this will have made quite the impact um that brett yormark certainly the big 12 commissioner will have wanted so this was big 12 college football coming over to play at wembley following in the footsteps of the nfl 46 583 the attendance i think they probably would have wanted a bit more

41:34David Cushnan:yeah the top tier effectively closed um and i think a lot of suggestions that uh maybe the ticket pricing was a bit ambitious yeah and they didn't bring the full traveling circus a lot of

41:46James Emmett:college sports experiences about the bands and the um you know the bits and pieces that come along with the game itself and obviously that's an expensive thing to ship over i remember these arguments when at the beginning of the nfl coming over they didn't they didn't bring the full the full super top whack experience um but brett you'll mark the commissioner seems to on the surface he actually sent me a message david said uh um thing it's going great double thumbs up okay um but i i suspect he will have wanted a bit more there and it probably does underline what a

42:23David Cushnan:what a consistently great job the nfl has done with its international games because they create a, you know, a hype and an interest. And we are rapidly approaching that period, of course, when the NFL lands in London for two or three weeks of the year. And also at the end of October, the first NFL regular season game in Paris, which is the sort of next new venue this year. So as with Spain last year and Australia just last week or a couple of weeks ago, I think it's always uh always fascinating to see how how the nfl does land in new places

43:02James Emmett:i read a uh whoever does it does the media and press relations for the big 12 and this college game that took place in wembley deserves a pay rise because i read a such a warm write-up of it on the bbc no less where they focused on as if it was some sort of exotic beast that was doing a tour of, you know, zoos around the world. Shall we draw a line under it there, David? Let's do that. We'll reconvene next week. This time next week. Goodbye.