It used to be easy.
Sign a star basketball player.
Make a signature shoe.
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Put him in a cool commercial.
Sell lots and lots of sneakers.
But reaching the 12- to 24-year-olds, who often spend more hours playing basketball video games than watching the NBA or playing hoops, by using traditional advertising methods is increasingly difficult. Not only are these key consumers watching fewer commercials, but their favorite artists are influencing what they wear just as much as their favorite athletes.
In a cluttered marketplace -- there are too many sneaker options for any athlete to have the impact that Michael Jordan had when Air Jordans were first released 20 years ago -- shoe and apparel companies are rethinking the formula to selling athletic shoes in the coming decade.
Ultimately, it's not just about spending the most money to create new brands or sign up a top athlete. Nike has spent millions of dollars developing the most technologically advanced sneakers with the slickest designs, yet many kids still want a pair of plain white Air Force Ones.
"Reaching the skeptical kid without them knowing you're doing it is no easy task," said Jeff Chown, managing director of The Marketing Arm, a sports and entertainment consultancy firm. "The kids will tell you who and what has 'cred' and who and what doesn't."
So what are leaders in the industry doing?
When they see huge potential, shoe companies will still dish out the almighty dollar. Case in point: LeBron James, who will earn three times more this year from Nike ($13 million) than from the Cleveland Cavaliers. While there are more shoes on the market than ever, there are fewer athletes deemed worthy enough to sell a signature shoe. Even with LeBron, it's clear that Nike's huge investment hasn't yet earned the company a profit.
Appealing to the mass market doesn't mean pitching to the mass market. Traditional advertising isn't dead, but there is plenty of data that suggests it is less effective -- especially with the target market of athletic shoes. So the latest marketing technique is the buzz party in which the shoe companies invite influential people in key communities and center a bash around the latest product. The community leaders than help create the product buzz to their friends. You can go to a Nike buzz party and not see a single famous person. But that's not what this type of shindigs is about.
Virtual advertising is vital. Five years ago, video-game makers were begging shoe companies to put their logos in the games free of charge, to make the games look more realistic. Now they are charging big bucks and the marketplace has been extremely active. Nike and Reebok have had their shoes integrated into games so that when a new sneaker hits the shelves, gamers can access the shoes via special codes built into the game. It's an effective way to reach more than 2 million gamers who will run out and buy new sneakers.
Aggressively seek out product placement opportunities. Product placement has also taken on a greater importance. Apparel company Under Armour has been featured on "Any Given Sunday," "The Replacements" and "Playmakers," while Reebok logos were featured on the jerseys of the "The Longest Yard." The company recently inked a deal for apparel rights to high school football teams featured in ESPN's upcoming reality show "Bound for Glory."
Integrate entertainers. Reebok has been the most aggressive in using hip-hop performers to sell sneakers, signing 50 Cent and Jay-Z to unique deals that have resulted in their "G-Unit" and "Sean Carter" lines. Not only do the two have lifestyle shoes, but they also have functional performance signature items. NBA players Jamal Crawford and Kenyon Martin wore the S. Carter shoes during games this past season and 50 Cent recently released a cross-trainer shoe called the GXTII July 1.
"Athletes are credible [endorsers] for performance shoes, but it's not as clear that they are as credible in the fashion world," said Dr. Carl Mela, professor of marketing at Duke's Fuqua School of Business and a board member of the World of Mouth Marketing Association (WOMMA). "If kids are going for fashion, they are not buying sneakers; they are buying an identity."
Darren Rovell, who covers sports business for ESPN.com, can be reached at Darren.email@example.com. Check out Darren's Sports Business Blog or his latest book, "The First In Thirst: How Gatorade Turned The Science of Sweat Into A Cultural Phenomenon."