New York, one thousand nine hundred and eighty six in front of a crowd of 10s of thousands of trio of rappers, Joseph Rev Run Simmons Darold, EMC, Mcdaniels and Jason JAM Master Jay Migel, walk on This is the place the generations of young people. This was the stage you hope to place someday with your name up in lights, on the marquee of MSG, Madison Square Garden. These three guys go back quite a ways growing up in queens in the seventies, They bonded over their love of b boy, culture, RB and hip hop musical. You're born on the streets of the big apple in eighty and they form their own group. Run D. Mc made news becoming one of the first rap acts signed by a major label. But run DMC are more than just musicians there, their icons of style,

back in the day when Kurtis Blow was making hits, he favored, flashy, sequin blazers in disco, suits, but the run D. Mc crew. Take the look in another direction: streetwear action, oil change in track jacket, black fedoras and unlaced basketball, speakers, Madison Square Garden, the trio fans out across the stage busting into one of the newest songs. It's a no. The group's favorite? They know it's not just is either

drives are everywhere every city they go through from Detroit to Boston, to Chicago the hip. Kids are the ones wearing Adidas, Tracksuit and sneakers the Eighty six Adidas stands for something. It stands for urban cool. In the hometown crowd at the garden tonight they get it The applause is sustained, the it of only it's louder when Simmons turns to Mcdaniels and begins to shout into the mic. D. Take those shoes off your feet. What are those everybody in here? If you got Adidas on your feet, hold him up. Forty thousand pairs of sneakers are hoisted into the air like a mass offering to a three strike. God. Guanaria.

From wondering this is business wars, I'm David Brown, we are Tracy, the sneaker rivalry between Nike and Adidas. To. Multi million dollar sneaker companies that clashed in the 1970s at a time when profession, sports and sports fandom was in a bold new era- and this is episode four Nike air today we're picking things up in the 1980s. The decade of big hair and big shoulder pads for the the decade, though the sneaker would take on a significance, both bigger and certainly more enduring than either of those passing fads,

need the sneaker continues to hold a special place. Today is both a fashion statement and a status symbol. But how did that happen? Well as well? He here. It had a whole lot to do with the clash of sportswear titans, but first let's get back to run D Mc rocket, a hometown crowd with my Adidas yeah proud that night and out of Towner Guy named Angelo Anastasio, Flowed out from the Adidas Office is on the West Coast. To see first hand, this run DMC phenomena phenomenon as it Diner for Adidas feels his heart racing. When the arena full of fans raise their sneakers high in the air, you can imagine I mean he'd heard this thing is big man. This is bigger than he dared to imagine after the show at a Stazio meets up with the rappers backstage. How would you like to get ok to wear Adidas

The members of run DMC don't need much time to think this went over after all, they've already become the brand's loudest evangelists days later. The news goes public. Run D Mc's become the first hip hop group in the world, sign, a major endorsement deal with a sneaker company, the payout, one million dollars in the two months after Adidas. Officially signs run DMC american sales of the shell toed sneakers sore boards featuring the rap trio pop up in cities around the country. The rapper's work with It is to develop their own line of track, suits and superstar footwear versions of which, by the way, are still being sold today, Soon competitors follow suit, signing up bridge to sport, their brand, a young, rapper named Doug E fresh is rapping. Bali

the boys are wearing Puma's grandmaster Flash never goes anywhere without his bright red pair of ponies, slammed up, sneaker culture and hip hop culture are now permanently fused but it's Adidas with the first of the hip hop endorsement deals that's in prime position to reap the biggest benefit in fact, in some ways, things that Adidas headquarters back in Bavaria have never been better. On volume alone, the German based company far outpaces its rivals, with annual sales regularly hovering around one. One slash two billion dollars: let's see it of some three billion today in the MID 80s Adidas is the industry trend setter and it's sneakers and apparel will become even more iconic as the years advance, but Horst Dassler chief of Adidas in the Son of the company's founder. He knows that there are plenty challenges facing the three stripe brand. For one thing: there's the growth

wave that Adidas has been riding since the 60s and 70s mean how much longer can this go on for another. There a lot of competitors wanting a piece of the Sneaker action Puma the company run forced cousin are mean is gobbling, market share in Europe. In the U Reebok is selling hundreds of thousands of pairs of aerobics and running shoes, but they're, not the greatest read to Adidas's continued dominance, not by a long shot and Horst knows it. Greatest threat to Adidas's top position is a certain company out of Beaverton or named for the goddess. Speed which is scored a literal hit with the run D Mc campaign Nike has been gathering momentum with a raft of its own smart endorsements, to say nothing of the shoes themselves. Sneakers that are Changing the game with high tech features like the Cortez. By many to be the first modern running sneaker the little company that

good sprinted from annual revenue of less than twenty nine million in nineteen seventy three to more than eight hundred and fifty million just a decade later yeah, that's only half of the d annual revenue, mind you, but still the kind of x, actual growth that turns up the heat on the Germans, ask for sure back in Beaverton Company, founder Phil Knight draws up a list of Nike principles and distribute and every new employee at headquarters point number one. Our business is change. Number two we're on offense all time you know night may have an mba, but this isn't a big. As planned. This is more philosophy, a state of mind, and it's not just that wants to impart what makes a successful company he wants understand where things could go wrong to things like getting, in bureaucracy and personal ambition make the list the take away New recruits is clear:

power to be creative, but at the end of the day, you're part of a team. You know something though with all this talk of team spirit. Along comes a superstar who changes the business forever on his shoulders, Nike will leap past every other sneaker maker on the planet, including the in one thousand nine hundred and eighty three, a young executive name, Rob Strasser, writes a memo to his boss. Nike CEO Phil Knight individual athletes. He writes even more than teams will be the heroes, symbols more and more of what real people can't do anymore risk and win. You know so about these two guys night and Strasser. They don't really have a whole lot in common to be honest night cerebral and measured Strasser

he's an overweight, bearded career party or who rarely hold anything back knight likes to call in Radically honest and though he says he respects that radical honesty will there may be something night appreciates even more than that honesty, stressors intuition night for search the memo on to some of his other employees. As he knows, his company is entering a crucial period of transition, although now He is made its name as a purveyor of innovative high tech footwear, they are not alone in the chase. The same flood of sneaker company threatening Adidas, Delicious, threatening Nike too, when Nike stumbles with a rare losing quarter night is for wish to lay off a handful of employees at this point, Nike needs a shot in the arm. Strasser, writes in his memo. He needs a hero Well, as it happened, Strasser has spotted one This is a guy who plays college hoops for the University of North Carolina,

dressers not alone in noticing this guy special, consensus among basketball. Insiders is that this new player, Michael Jordan, This might be the best all rounder to come along in decades. Maybe ever he's a pure athlete, muscular, strong, driven and charismatic, in one thousand, nine hundred and eighty two Jordan leaves the tar heels to an NCAA championship, beating out of Georgetown Squad, headed up by Future Hall of Famer, Patrick Ewing in nineteen. Eighty or he's drafted by the Chicago Bulls. One with this time, Jordan and his agent David Falk, start discussing what sneakers she'll be wearing in his NBA debut in call Jordan wore converse, but in high school Jordan sported the three can in Adidas, are still his personal favorites Nike. A lot of my guys. Wear Nike Jordans, not interested just what you need to do to get me with. Adidas, alright is Rob Strasser, not worked at Nike. It's

Miscible, that Jordan would have eventually gotten his way. But Strasser is a basketball. Speak of supersized proportions. He makes it his Business to know every up and coming prospect in the game, and when he hears that Adidas isn't going to recruit Jordan, I mean the company can't afford it, or maybe they don't realize what a star the kid is will stress. Her pounce is two thousand one hundred and seventy six to Portland now departing gate. Seventeen that Jordan in folk, along with Jordan's parents, James and Dolores fly. To Oregon to meet with executives at Nike's headquarters. Now Jordan, is reluctant he's, never worn a Nike shoe in his life, but after fault, Seeds with James and Dolores Well Michael agrees to make the trip out to the West Coast in the eighty four the Beaverton campus is nothing like the. Multi million dollar lab. It is today N, Jordan, reluctantly trails, his hosts across the modest green he's, making it a point. The to smile,

still holding out for Adidas with his parents and his agent Jordan settles into a small conference room inside Strasser, who can hardly control his enthusiasm, Q designer Rob Moore and Sonny Vaccaro, the head of Nike's basketball operations, Phil it's nowhere to be seen in fact, he's actually waiting in the wings he's the closer but Jordan. Strasser hits the light a highlight reel of Jordans College days appears on a tv screen, the pointer sisters, blasting from the speakers and then, as the montage reaches its climax, one of my These designers Peter more steps forward to hand Jordan a special gift. It is bright red and black, the colors of the bulls. It's a high top. A signature sneaker made just for this moment exclusively for Michael Jordan. What do you think.

Sharp, looking shoe huh Jordan. Less than impressed, Part of the reason I like Adidas is their shoes are lower to the ground. You know the These souls here, they're just too high, no problem we'll tailor them Taylor them at this Jordan perks up, see others who would courted him like converse hadn't offered to customize any sneakers for Nike Jordan. Nike wants more than just a name. They I actually want a partner here. He trailed the Nike crew. Another conference room, their Nike, CEO Phil, Knight, joins him the cargo holds out to die, cast models of Mercedes automobiles night pretends to be having a heart attack. Clutches his chest as if no one had warned him that too extreme expensive sports cars might be part of the offer the car just forward anyway.

You come with Nike, he trails off. Look, the implication. Is cool If Jordan signs with team swoosh there will be more than sneakers in cash as compensation and, at this point, George Finally, cracks a smile that evening. The Future Hall of Famer in his agent Falk, huddled together for a debriefing Jordan is emphatic. I don't want to go to another meeting. Let's go with Nike, let's just go with Nike. Nike later offers Jordan a half one million dollars per year over five years at the time the fattest athletic sponsorship deal ever an historic partnership is just been sealed. At the start of the nineteen eighty four NBA season. Jordan takes to the In a pair of bright red and black shoes, air Jordans Nike calls them to the new star players, pension for taking elegantly to the sky hoop

after support for business, wars comes from capital, one with the spark cash from capital one. You earn unlimited two percent cash back on all of your business purchases. Think about it. Unlimited two percent cash back on everything you buy for your business and that cash back can add up to thousands of dollars, which you can reinvest back in your business, so you can keep growing. Imagine what unlimited two percent cash back could do for your business. Learn more capital, dot com. What's in your wallet. Business. Wars is sponsored by fastly fastly as an edge cloud platform that powers today's bed brand, so their websites and apps are faster, safer and way more scalable, and that's not an easy thing to pull off because behind the scene

businesses have to handle millions of visitors, update inventory or the latest news in an instant and ward off the mini scary security threats of the internet. So, whether you need to stream live events handle black Friday traffic or simply provide a safe, reliable experience vastly can help see how fast we can help your teams at Basf. We dot com, Slash B, W, that's F, a S. T l y dot com. Slash, be! it's likely that the air Jordans would have been a smash hit, no matter what the NBA did. After all, these were sneakers, worn by a player who could rack up, and kredible forty five points in a single game, and that was as a rookie, but during

Eight thousand four hundred and eighty five season League official make a decision that ends up helping Nike immensely. They decide to Let's stop Jordan from wearing his black and red signature. Sneakers the NBA says the shoes don't fit. The league codes which stipulate that a player must wear is that not only match their uniforms but match the shoes worn by their teammates. That's when a company, that's about Famous for branding and marketing sets a new bar for ingenuity to in a commercial that hits the airwaves in nineteen. Eighty five, a camera pans down slowly from Jordan's head to his black red and white, uniform right down toes as he wordlessly bounces a basketball pawn October 18th the NBA threw them out of the game. Fortunately, the NBA can't stop you from wearing them. Air Jordans from Nike, it is difficult.

Overstate the impact the air Jordan has on Nike's fortunes and the fortune. Phil Knight, of course, nikes hard show. A former runner had founded his company around track shoes, but it is a basketball Here it is now defining the brand to his friends night begin speaking of a turnaround, a new chapter Nike history. A few months, Nike ships, one one slash: two million pairs of air Jordans across the country stores, draw up waiting lists for customers too slow to get their hands on a pair in one thousand nine hundred and eighty six sales climbed to four million units. Crimson infants versions are introduced. A Nike spokesman sums it up in a truly 80s fashion. Air Jordan has become our cabbage patch doll. It's one of the best things that ever happened to us, but the air Jordan is more the fad soon. It's obvious that the power of the sneaker won't only be felt on the court it'll be felt in pop culture too.

Rappers want to wear them. So do Hollywood Stars YO, Mars, Blackmon with my main man, Michael Jordan, Spike Lee, assuming the persona of Mars Blackmon his character from the movie she's gotta. Have it the commercial for Nike hyping the power of the shoe. Is it an extra long short in Jordans? Have a halo effect as well, boosting Nike as a brand and serving as an entree to the swoosh universe, run D, MC or don't Adidas for stars no longer seem to shine. Like they once again now it's Jordans members who are climbing over each other to get those or another Annunaki called the air MAX or It's the Nike alpha force with its iconic velcro strap or it's the funky leper spotted Nike AIR Safaris with the rapper biz Markie adopts his his signature sneaker in what seems like no time nikes pulling away, every competitor in the United States doubling and then

tripling Adidas is american sales. The Nineteen eighty seven to help nail down Nike's dominance. Phil Knight approves a big increase to the marketing budget. Nike upset marketing budget of fifty million dollars to stay ahead of the competition if there were Any doubt before it now seems settled. The tables have turned. In one thousand, nine hundred and eighty seven Horst Dassler the businessman who put Adidas on the map in more than one hundred and fifty countries, the man who helped transform his father's company into a multi billion dollar concern. Dies suddenly at the age. Fifty one

for the german firm. The timing couldn't be worse. Not only is indeed is getting pummeled in the: U S by Nike, but Phil Knights, getting ready to launch a european invasion right there. In the d, this is back yard. It's stronghold and other rivals like Reebok Aram, pushing the three Stripes brand from the other side, approaching annual sales of a billion plus. The closing years of the 1980s mark a new kind of low for Adidas. Shrinking sales, shrinking market footprint and, above all, a noticeable lack of the type of innovative new products that Nike appears to be able to crank out by the truck load, Adidas. Is flailing in two hundred directions at once: trying expand into areas it has no business being in like casual, outerwear and inside This is headquarters. Well, it's basically open warfare after Horst Dassler die Twenty percent of his shares go to his kids Audi, Junior and Suzanne, but

First also has four sisters and they can the remainder of the company. Sisters begin working together and they start agitating for a sale of the company. The once proud three stripes losing out to Reebok and Nike. It's unconscionable. It's embarrassing Audi Junior and Suzanne initially fight their arts, but they have a pretty high tax bill, from their inheritance, and they eventually decide to give up their shares road to assail appears to have been paved and soon horse. Sisters of located a potential buyer in the form of Bernard Tapie, a French This man who puts together a two hundred and ninety million dollar offer using fund from a consortium of eight french, german and japanese banks. The sale goes through in nineteen ninety dancer owned Adidas era is over the French now controlled employee morale hits a new low, but you know

You know that saying about its darkest before the dawn, well in business. Sometimes when things appear most dire, those with open eyes can spot the biggest or to nitties and in the case of Adidas, well, the first step toward the re invention that would bring them roaring back comes courtesy of an unexpected source, Beaverton or you. Remember, Rob Strasser of Nike. We were talking him earlier, he's the big loud hard drinking guy who Phil Knight once called his Mvp, the guy spotted a superstar named Jordan once upon a time, no one for hyperbole night once gushed. That he was ready to follow Strasser into any fray any fusillade but night In Strasser. At the end of the day, they were like brothers. This just think it's set them off. Sometimes it was dress code like the day Phil finally lost it with Rob's baggy loose fitting work. Attire promising to

find every time he didn't, dress right, which roster took is an open invitation to keep showing up in baggy bermudas at some point enough was enough Despite the success of air Jordan. Strasser, left the company to start a new consultancy taking designer Rob more along with him night? Well, he considered it a major betrayal. Let's go back to Germany, it's one thousand nine hundred and eighty nine is, it This is going up on the auction block. Will more in Strasser now control once they get an invitation to visit, they know exactly what their old boss would think of such a thing, but hey they don't for Phil, Knight anymore, so they accept the invitation and speed down the autobahn to Adidas headquarters. But Strasser and more drawn to a halt in front of the fortress that serves as Adidas is HQ

Something dawns on more he realizes just how far from home he really is Deep down he's a bearded man he's got no business in Bavaria. Oh let's get out of here Strasser's not so sentimental lutely, not so for the next several days, more and hunker down and intensive meetings with what room. Means of Adidas is leadership. Over one red wine fuel dinner, in particular at a restaurant near Adidas headquarters, tells in Adidas executive. He can remember well when he viewed Adidas as his greatest rival no offense, but A decade our mission was to kick your ass executive smiles and lifts his glass of wine, but Peter did kick our ass. That's why you're here.

More instructors, great revelation comes the next day when they're, given time to explore. Adidas is vast archives of museum quality collection of old Adidas shoes. What looking at inside. That room is corporate history. But soon they realize they're looking at something else, too they're looking at the company's future, a company that, before any other sneaker company, did first on the athlete before leaving Germany, the two consultants make two recommendations: the first is to double down on the kind of committed technical gear that ADI Dassler prized back in the day. Lynn Color palettes limit the number of futuristic features: the blatant Nike rip offs, stop trying to chase Nike and Reebok. That's a strategy that rarely works anyway. Better. Reconnect with core functionality. Get back to What Adidas does best and then more

Strasser make another suggestion. Adidas should under no circumstances abandon the classic brands like the Stan Smiths in the superstars embrace It's the old stuff appeal to the sentimental instincts of old Adidas fans and revive refine. The classics keep those core shapes and colors, but update him with MOD fit in modern technology like improved souls and lighter rubber. But then, if you x, Strasser and more beneficially retained by their old arch enemy. Fear, had a line of performance apparel known first as if he is acquitted and later is indeed, as performance lives there tailored to appeal directly to athletes. They begin collecting the classic Adidas styles in a group called Adidas, Originals Strasser and more changes. Don't have an impact right away:

two former Nike executives have crafted a path that will eventually lead Adidas out of the wilderness and back into the thick. I hope you enjoy this episode of business works please describe on Apple podcasts stitcher. Tunein or wherever you happen to be listening to this podcast right now add a link on the episode notes, just tap or swipe over the cover art you'll, also see some offers from our sponsors, and we love for you to support our show by supporting them. Now, if you like what you heard, why don't you it's five star rating and maybe tell your friends how to subscribe, to there's another way to support us and that's to answer a short survey at one three dot com: Slash survey: we love for you to tell us what business war stories you'd like to hear if you interested in reading more about this topic, the author recommends a pair of articles he drew on for this episode. This is David Womans, two thousand and sixteen profile of Rob Strasser from the

by two thousand and sixteen issue of Portland Monthly magazine. The second is uh thirteen article by ESPN's Darren Rovell. It's called how Nike landed Michael Jordan. I hope David Brown If you share wrote this story, Karen Lowe is our senior producer and editor sound does I, by Bay Area Sound executive produced Marshall Lewis and Hernan Lopez, four one

hey, I'm Dan Rubenstein, the host of the Wondry show sports wars. This week we start anew five episode series on the battle between two of the greatest players to ever catch a football or talk trash, Jerry, Rice, VS, Deion Sanders, one loved, only football, the other loved only himself. They were like in one way, though both men hated each other's guts to listen to Dion versus Jerry and other great stories subscribe now to sports wars from wonder,