http://www.cnbc.com/id/36120334

Cleveland Cavaliers star LeBron James has signed a new shoe and apparel deal with Nike [NKE 73.50 -0.31 (-0.42%) ] , the company acknowledged on Wednesday.

"LeBron James is one of the world's best basketball players and a global sports icon that has transcended generations and cultures," Nike spokesman Kejuan Wilkins said. "Nike's relationship with LeBron has created innovative basketball products and captivating campaigns. We're proud to continue our partnership with him for years to come."

Terms were not disclosed, James' business partner Maverick Carter, CEO of LRMR, told CNBC the deal was for a longer period of time that James' last deal. LeBron signed a seven-year, $93 million contract with the company in May 2003.

"Our relationship with Nike is more than a shoe deal," Carter said. "It's more like a joint venture — meaning we are working to build a business. His latest shoe, the LeBron VII designed by Jason Petrie is the best selling shoe we've ever had in LeBron's line."

Carter wouldn't comment specifically on whether there is a clause that would pay him more should he sign with the New York Knicks this offseason, but one insider said such a clause is not in the current contract. The way James would make more money off his base contract would be by selling more shoes through a royalty agreement.

Perhaps going to New York would sell more shoes, but he'd likely sell more shoes in China and other emerging markets, where volume really counts, if he wins championships. One of the reasons why James is far behind Bryant in China is that he isn't revered as much because he doesn't have the rings that Kobe has. In that case, it might make more sense for James to stay in Cleveland, who made it to the Finals in 2007 under James and, at 58-16, have the best record in the NBA.

It is not known how much money Nike is paying James, but insiders say that it's not likely that the guarantee is more, on an annual basis, than his past deal.

While there might have been interest from other players, sources say Nike was the only one who was negotiating numbers with Carter. Carter says that's because the relationship was just too good.

But that's the big difference between now and in 2003, when James was the target of a three-way bidding war between Nike, Reebok and adidas. But when Reebok was purchased by adidas in a $3.8 billion acquisition two years later, it reduced the bidding capacity of a major competitor.

Sources say Adidas had interest, but felt good enough about focusing most of its big money on Dwight Howard and Derrick Rose and its NBA league deal. Under Armour [UA 29.41 -0.84 (-2.78%) ] basically took itself out of any conversation when it announced it wasn’t even making a basketball shoe this year, despite having Milwaukee Bucks upstart Brandon Jennings on its endorsement roster a couple years ago.

The Chinese brands such as Li-Ning, Peak and Anta, are new players in the game, but many sports marketers agree that these companies weren't even an option, as leaving Nike would certainly dilute the value of LeBron’s endorsement.

“He really couldn’t go anywhere else,” said David Falk, the agent who famously signed Michael Jordan to his then $500,000 a year deal with Nike in 1984. “It would just kill his credibility.”

Back in 2003, on the eve of the NBA lottery, as the shoe companies jockeyed for the services of LeBron, the idea was that if James lived up to the incredible hype, he’d finally be the one to live up to the commercial success of Jordan.

James did live up to the hype on the basketball court and off it too, as his personality was able to shine –- most notably in Nike commercials where he played four versions of himself.

But his shoes and apparel didn't fly off the shelves in the beginning as much as they could have.

“What happened with Nike and LeBron has proved that the days when a single athlete dominated like Jordan are completely over,” said Matt Powell, analyst for SportsOneSource, a sports market retail tracking firm. “It took Nike about six years to come up with LeBron shoes that were commercially viable and even then it paled in comparison to Jordan’s standard.”

“LeBron is one of the most important endorsers to Nike,” Falk said. “And I think, from the beginning, it was unfair to compare him to Jordan. The model everyone was talking about just couldn’t be replicated.”

Throughout the years, LeBron’s shoes still got buzz, as did the shoes Nike made for Kobe Bryant, who the company originally signed a month after James in June 2003. Bryant's deal was recently renewed as well.

But there recently came a point in time that the shoe companies just couldn't justify its dollar for dollar spend on some of its biggest contracts, much in the same way a team has trouble quantifying its biggest salaried players. The difference, of course, is that the shoe companies are public entities and shareholders matter more than fans when it comes down to making the financials work.

“I don’t think any basketball player is making $10 million a year in guaranteed money on a shoe deal ever again,” said Sonny Vaccaro, who has worked with all the shoe companies and convinced Nike to spend its entire basketball marketing budget on Jordan in 1984. “All my life, I said there would never be another Jordan and now we know. It wasn’t Kobe. And it wasn’t LeBron.”

Still, James can continue to be a powerful force for Nike — likely in a place where he can win championships as soon as possible. If it's about selling shoes and making more money, it appears like James doesn't physically have to be on Madison Avenue next year.

Lebron is a figure head for Nike just like Kobe. Jordan Brand is what rakes in the money.

nyk4ever wrote:lets sell shoes to 2million people in cleveland or to 20million people in NYC. there doesn't need to be a clause.

the article suggests that winning championships will do a lot more to boost his shoe sales than signing w/a major market would

Perhaps going to New York would sell more shoes, but he'd likely sell more shoes in China and other emerging markets, where volume really counts, if he wins championships. One of the reasons why James is far behind Bryant in China is that he isn't revered as much because he doesn't have the rings that Kobe has. In that case, it might make more sense for James to stay in Cleveland, who made it to the Finals in 2007 under James and, at 58-16, have the best record in the NBA.

The article says terms of the agreement were not disclosed. But and "insider" said it was not "likely" that such a clause does not exist. Big whooopdedoo

Cleveland wasn't able to put a championship team around him for 6 years. So yeah lets sign with them for another 6. Makes perfect sense.

loweyecue wrote:Is there a link?

The article says terms of the agreement were not disclosed. But and "insider" said it was not "likely" that such a clause does not exist. Big whooopdedoo

Cleveland wasn't able to put a championship team around him for 6 years. So yeah lets sign with them for another 6. Makes perfect sense.

nyk4ever wrote:lets sell shoes to 2million people in cleveland or to 20million people in NYC. there doesn't need to be a clause.

Bingo. I just talked about this the other day...Don't for one second think this won't be part of his decision. Huge difference fellas -- the potential's there to sell shoes at a rate almost 7X over if he came here (and this article just talks shoes - it fails to mention other Nike products, such as shirts, warm-ups, gym bags, etc. Basically anything Nike that has his name attached to it. I mean what about those ancillary Nike products?? I would think he would get a cut of the sales generated on those items as well, no?)... I never believed this rumor that he was getting an automatic $100,000,000 under the table from Nike in his subsequent deal. Like everyone I thought, "wow maybe" at first but when you think about it, it really made zero sense from a business standpoint. However the article clearly states, "Carter wouldn't comment specifically on whether there is a clause that would pay him more should he sign with the New York Knicks this offseason...," so that gives me a little pause. And what exactly does, "but one insider said such a clause is not in the current contract" really mean anyway? First of all, who's the mystery insider?? LeBron's agent? One of his attorneys? A Nike representative or attorney? I can't picture any of these people divulging any information hours after he signed on the dotted line. And what contract is the insider even referring too when he says the "current contract," the new one or the contract he had previously?? This information's a little ambiguous and up for interpretation... Hey regardless, it's all good though. Let's assume this other stuff is nothing more than fantasy. Here's the reality: exactly what nyk4ever just said -- the potential's definitely there for this man to earn more here in NY based on this population differential than if he stayed put (a whopping 7X more at least)...

Now on to the other point -- establishing a winner here in NY with this guy. I agree it's important. The buck can't stop with him, and I don't think it will. The plan's obviously to hopefully land LeBron and another all-star this summer, presumably another max contract-type or close to it. I think two max players could accomplish a lot together fellas and you know damn well that the free agents themselves will be considering that too...Say if that player was Chris Bosh (and this should be the guy imho based on a slew of things -- position, production, height, health, age...). I could certainly see not only Donnie Walsh, Mike D'Antoni & Bosh's agent (who's from NY, went to college locally and grew up a Knick fan) playing pivotal roles in the process but also LeBRON HIMSELF. You don't think that if we bring LeBron in & he liked the plan & what we had to say, you don't think he won't be on the phone immediately running it past Bosh or whoever this 2nd guy might be?? Man if I were another prized FA & LeBron called me up & told me, "look I want you & so does NY - we have a chance to do some big things here together - this is an explosive opportunity for both of us dog. Hold on, let me put Donnie and Mike on...," you better believe I'm hearing everyone out.. This whole thing could come together pretty quickly --- I'm confident that if LeBron was on board, we could field a similar if not better team than the one he's playing with now in Cleveland either in year 1 (with the 2nd max player) and definitely by year 2 (when Curry's money comes off the cap). Mo Williams and Antwawn Jamison are good players but they're no Chris Bosh in his prime... I agree winning will only improve his stature and endorsement opportunities here and abroad. What I fail to see though is how it absolutely can't happen in NY as both the NY haters and some pessimist NY fans suggest. Of course it could man. Have some faith. This ain't over until the fat lady sings...

Pharzeone wrote:

nyk4ever wrote:

TMS wrote:

nyk4ever wrote:lets sell shoes to 2million people in cleveland or to 20million people in NYC. there doesn't need to be a clause.

the article suggests that winning championships will do a lot more to boost his shoe sales than signing w/a major market would

Perhaps going to New York would sell more shoes, but he'd likely sell more shoes in China and other emerging markets, where volume really counts, if he wins championships. One of the reasons why James is far behind Bryant in China is that he isn't revered as much because he doesn't have the rings that Kobe has. In that case, it might make more sense for James to stay in Cleveland, who made it to the Finals in 2007 under James and, at 58-16, have the best record in the NBA.

The second quote might be true TMS, but I can't see how winning a championship equates to more shoes. My feeling is that Kobe playing in LA has more to do with it than anything else.

It does. Kobe sneakers Zoom IV got a boost in sales after his championship win in what was view as a bad market for apparel. And his limited edition Kobe IV Rings sold well too. Much like the Air Jordan VI Rings sold the year before.

I mean all that sounds well and good, but did his shoes sell because he won a championship or because he was featured on TV more since it was the playoffs and the finals, which is broadcasted more around the world?

woe is us!!!!