How Roger Federer Struck GOLD by Leaving Nike

what's in a clothing brand at first glance it's just a logo on some piece of apparel that looks nice and for many people that alone serves the clothing's purpose however interesting designs by themselves don't build empires when sporting apparel companies partner with famous athletes the athlete's purpose isn't just to wear an outfit on game day but embody a brand's ideals and purpose wherever they are no matter what they are doing to become synonymous with the brand as equally as their own sporting success for upwards of two decades within the tennis world roger federer was nike having sported the iconic swoosh in every one of his 20 grand slam triumphs to date though the brand has enjoyed a considerable presence in the overall professional tennis landscape federer's international appeal and overwhelming superstardom made the swiss stars image and branding nike's face in the hole whereas without one you seemingly couldn't have the other which is why fans around the world were shocked in 2018 when federer played that year's first round match at wimbledon wearing uniqlo a japanese casual werebrand later announcing that his team had severed all ties with nike and signed on a 10-year deal with the much lesser-known uniqlo a massive change which while questionable at the time in retrospect has been seen as one of the most calculated and smartest business decisions ever undertaken by a single professional tennis player the first step in a series of pivotal decisions that would in turn double his total career earnings past 1 billion dollars just 3 years later what's in a clothing brand you may ask for roger federer a whole lot of dollar signs for many it was his fourth round win against pete sampras at the 2001 wimbledon championships that first put roger federer on the map as not only a potential tennis star but a marketable icon for nike however roger at that point was a mature investment that was only beginning to pay dividends see flashback 7 more years to 1994 and federer first made waves at an under 14 tournament taking place in miami where the young swiss's sublime talent yet terrible attitude caught the eye of a nike talent scout who later said if he was nervous it was because he hated to lose which is essential nike's offer a five-year 500 000 contract with a good bonus if he managed to break through and break through he did just three years later federer was recognized as the itf world junior tennis champion of the year having won back-to-back junior wimbledon and orange bowl titles all while sporting a much calmer focused attitude on court in short order roger would come to dominate the professional scene attaining the world's number one ranking by 2004 and claiming 11 grand slam titles to his name at only 25 years old though the swiss's suave coolness and universally liked personality drew in major sponsors over the years it was nike that remained his most valuable asset bringing in a reported 10 million per year by 2008 with his now iconic rf logo created to grace apparel for years to come so why is it then that federer at the very tail end of his career decided to exit his handsomely paid and famed contract with nike for uniqlo in 2018 yet as you might already know upon the announcement of uniqlo's contract terms the correct question might instead be why wouldn't he [Music] see at the time his renewable contract with nike was set to expire in early 2018 what became obvious to roger was that his global image was becoming far more valuable to sponsors than his tennis talent leading federer's team to believe he was worth more than nike was paying him in addition there's no indication that nike's contract included any post-retirement guarantees so unbeknownst to many federer's team first approached nike with the same exact terms he would later sign onto uniqlo with a 300 million dollar 10-year contract with no retirement clauses meaning that federer would still get paid 30 million a year even if he retired three years into his contract effectively three times what they were already paying him nike's response they offered to expand his clothing line through the company-owned rf brand but nothing else so federer walked and uniqlo scooped him up a change that while shocking at first glance actually worked in both companies favors and here's why by all accounts nike tennis merchandise sales have always pailed in comparison to specific pricey apparel promoted by the likes of lebron and ronaldo sports star is much likelier to then attract audiences to nike's urban ware than roger federer ever could in essence what nike was already paying roger likely hurt their bottom line contrast nike to japanese casual wear brand uniqlo who in 2018 were not just looking to push their smart sophisticated tennis clothing into europe and north america but all clothing considering federer would most likely retire from tennis before even half of his 300 million contract was up uniqlo clearly viewed federer as an asset whose value would grow with confidence they could leverage his image and influence to their benefit for years to come though not all was perfect see there were actually two major issues with the deal that federer would initially have to contend with unlike nike uniqlo doesn't make tennis shoes and that iconic rf logo federer didn't own it nike held the trademark in typical fetter or fashion however he saw these issues not as problems but major opportunities upon federer's uniqlo reveal at 2018 wimbledon journalists were quick to point out that despite the new look roger still rocked his classic nike court zoom vapors he confirmed in a later press conference that nike have shown interest to have a shoe deal with me but everything is open it's very exciting also again to see what's out there though he would continue his unpaid use of nike shoes for at least three more years while fielding offers from major footwear brands roger had his eyes set on a much smaller brand with whom he shared a personal connection founded in 2010 on or more widely known as on running is a swiss performance footwear company lauded for their proprietary cushioning technology whose focus at that point in time was set on global expansion while remaining true to their swiss roots as it would turn out when not on court federer happened to use on shoes for his sprint's training after seeing people on the streets his friends even his wife wearing them as on co-founder olivier bernard explained the relationship with roger developed naturally we noticed roger wearing on shoes and reached out to him that's when we found out he is a long time fan of on and of course we are longtime fans of his switzerland is a small place and we started having dinner together dinner which in turn blossomed into an eventual massive investment of 50 million francs for part ownership of the company and unlike his partnership with nike federer's significant stake in the company allows him roles in product development marketing and fan experiences to help shape the company's future which of course now includes tennis shoes debuted by the swiss in early 2021 finally thanks in part to the lockdown inspired boom in the running outdoor and casual clothing sectors the company's massively boosted profile gave way for a successful september 2021 ipo where soaring shares value the company today at 11 billion dollars roger stake three percent now worth about 330 million dollars with clothing deals squared away one issue still persisted for roger federer his initials or more accurately the rf trademark and clothing line nike had registered in 2009 that federer had embraced for much of his career a brand whose distinction and reputation had raised his market value to 27 million dollars by 2018 according to forbes magazine under trademark law nike could theoretically sell rf logo clothing in perpetuity despite federer no longer having any association with the brand though the swiss star initially stated regardless they are my initials they are mine the good thing is it's not theirs forever the end result though for years nike expressed no interest in selling the trademark with uniqlo even stating in 2019 that they had no plans to acquire the logo from nike the oregon based sports giant had their own dilemma not only was nike's interest in developing the rf line significantly reduced due to their loss of federer but continued sales of existing rf stock had the risk of bringing about a potential lawsuit according to ip lawyer john shaw there was a risk that nike would be stopped from using their own trademark because a claim could be made that they are passing off their wares as being endorsed by federer when no such sponsorship deal existed worse if nike allowed the logo to go dormant for a period of five years federer had the legal right to request its cancellation so federer himself negotiated with nike to purchase the rf logo in early 2020 and by the following year uniqlo announced their line of iconic rf logo hats finally putting federer and nike's relationship to a somewhat tumultuous but definitive end with total career earnings having now exceeded 1 billion dollars an overwhelming majority of which was earned off the tennis court roger federer's financial success exemplifies not only how a sportsman's marketing potential can far exceed athletic talent alone but teaches the importance of knowing your worth though his playing days may soon be over you can guarantee that the ambitious and calculated business decisions federer undertook when leaving nike set a new precedent for players that gold can be struck even without a tennis racket [Music]

Channel: CULT TENNIS

Views: 897,367

Keywords: Federer Uniqlo, Federer Nike, Cult tennis, tennis cult, Federer on running, Federer billionaire, Federer net worth, Roger Federer rich, Federer money, Uniqlo tennis clothing, Uniqlo tennis shoes, how much Uniqlo paid Federer, Federer rf logo, federer 2018 Wimbledon, nike tennis Federer, worlds richest athletes, billionaire athletes, tennis billionaires, tennis video essay, tennis documentary, Roger Federer, Federer money earned, Federer on shoes, Federer RF logo

Id: pTFJs2l_goQ

Length: 8min 48sec (528 seconds)

Published: Wed Oct 20 2021