Can't blame Under Armour for the attempt, at least.
The company offered Kevin Durant a ten year deal that would pay him more than $260 million dollars over that time in an effort to steal away one of the most valuable pieces of Nike's army of athletes. Unfortunately for Under Armour, Nike had a clause in Durant's original contract that would allow them to match any offer from a competitor. I sure hope that lawyer who included that clause in the contract got a nice bonus as a result.
Nike, unsurprisingly, decided to match the offer. While Under Armour bet the house by going after Durant, resigning him was an absolute no-brainer for Nike. Under Armour is certainly going to make Nike pay a little more than it was hoping - reports were that Nike offered an initial deal that would pay Durant only $20 million - the Swoosh really only had one choice in the situation.
Some experts speculated that the steep price may keep Nike from resigning Durant. They already boast the biggest collection of valuable marketing assets in the world when it comes to basketball, so if they had to let one go, it wouldn't be the end of the world. But Nike is smart enough to know that while shelling out a little extra money may hurt the bottom line at the end of the day, keeping the third most recognizable basketball player in the world (LeBron and Kobe being #1 & #2, respectively) under their contract and not a major competitor like Under Armour is critical for future success.
Under Armour is trying to break into the basketball market that long has been held by Nike and Adidas. It recently picked up Steph Curry as an endorser, but it knows that it needs to land a whale in order to really make a splash. That's why the aggressive move to go after Durant made sense. It would give them immediate credibility and open up the company to greater international reach, somewhere where the company has lagged behind Nike and Adidas, especially in basketball.
But I would not be surprised if Nike was prepared months earlier for a massive bid and simply needed to see exactly how much it would cost the company. Because at the end of the day, this really won't cost Nike too much. Durant's signature shoes fly off the shelves. As long as he continues to perform at the same level he has, which following an unbelievable MVP season isn't unlikely, those shoes will keep selling and Nike will keep stacking cash.
Sure, $300 million is no small amount. But Nike has proven time and time again that it makes the most out of every single dollar it puts into sponsorships. The company's marketing panache practically ensures that they'll get ridiculous ROI from Durant. And, perhaps more importantly, it's left a competitor empty-handed and pondering the next big move it must make to take on the king.
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