Nike: Air Jordan's Business Model

Michael Jordan entering the league was more than just a super star being a human highlight reel. Michael signed an endorsement deal with Nike Incorporation. “Jordan, an untested rookie, would be paid $500,000 dollars a year for five years to wear Nike basketball sneakers” (Dolan). The Air Jordan shoe would not of started if it was not for his agent. David Falk, Jordan’s agent, “insisted that he not sign on as just another basketball player endorsing a sneaker, but that he have his own line. In time Nike agreed, and the Air Jordan was created” (Beahm 49). Rising faster than his game his shoes were a huge hit for white and black Americans. Nike began thinking the Air Jordan line might bring in $10 million in the first year, but Nike sold $130
The one thing that was holding back sales from shooting thru the roof was the price. Low-income minorities could not afford Nike’s pricing of the Air Jordans. (Marantz) When the 1990s rolled around Jordan became the CEO of his own brand and priced the shoes twenty percent below Nike’s recognized price expanding the product to more of his fans. (Marantz) To help improve the prices Nike decided to make a move across the Pacific. Opening factories in Indonesia hiring 30,000 plus factory workers. (Winder) This investment reduced the prices even more of the Air Jordan and rose the amount of money Michael Jordan and Nike were taking in. This was great for Michael Jordan and people who wanted a pair of Air Jordans, but the Indonesian workers were not as happy. Jordan was making “$15 million to $20 million a year...white factory workers make $2 a day” (Marantz). Adding it all up “Michael Jordan was paid more money for endorsing Nike shoes than the company’s 30,000-strong workforce of cobblers in far-off Indonesia” (Winder). As the seasons went on, more and more Air Jordans were being sold. Every year, the newest and coolest Air Jordan were released and people were spending their money and putting it directly into Jordan’s pocket. Even the media began to notice and ask questions. A reporter stated ‘“I saw a list that says you make $78,000 a day in endorsements alone.’ Jordan: ‘Really? That might be a
Michael Jordan’s “ basketball shoes, Air Jordans, are the best-selling sneakers of all time” (Christopher 72). Being lucky enough to watch this outstanding basketball star or not, the Air Jordan was the must have shoe. Every kid had to have a pair of Jordans or Nikes “No one wore Nike trainers because they admired the artistry of those quick-fingered Indonesia stitches” (Winder). The Jordan Brand even released a new slogan “I’m not Michael, I am Jordan” this was introduced to the kids who were too young to remember Jordan’s playing career. (Golliver) Current players today who grew up watching Jordan are now being sponsored by his brand. Players like “Carmelo Anthony, Russell Westbrook, Chris Paul, and Blake Griffin” (Golliver). These players are now the newest faces of the Jordan brand and will work everyday to live up to the expectation. Attempting to be comparable to the legend on their