“This is the best sports business deal in history.” There is a very good reason why popular sports analyst Joe Pompliano says this. The “best” sports business deal is so robust that disappointing fourth-quarter results barely dent the empire's growth. This deal became the only source of income for the creation of the world's first athlete billionaire. And although long-standing rivals bring with them outstanding top athletes, there is no threat to the trajectory. This is the upward path of Nike and the Michael Jordan brand. Individually.

The parent company and its bestseller dominate the largest share of the global sneaker market. Nike is on its way to becoming a $7 billion Goliath and making Michael Jordan richer. It's a gap that rivals will struggle to catch up with, unless there's another “best” sports deal worth mentioning.

Nike's big gamble paid off sixfold

In the early '80s, Nike was in the red and needed a revival. Her biggest opportunity was as a standout future NBA superstar at UNC, fresh off Olympic gold. They were about to bet their entire $250,000 annual advertising budget on him. But Michael Jordan hesitated. But a push from his mother, Deloris, led him to sign with Nike.

Young Michael Jordan received a salary of $2.5 million for five years. Nike's first expectation of him was to sell 100,000 pairs of the Air Jordan 1, released in 1985. Jordan sold 1.5 million pairs, earning Nike $100 million. They knew they had a goldmine and even made an effort when MJ was on the verge of leaving during the infamous “broken leg season.”

Jordan created the blueprint for brands and elite athletes of the future. Not only did he ask for a stock option, he also asked Charles Barkley to do the same. Chuck thanks his former best friend for the advice that makes him money that day.

Through unique commercials, mostly designed by Spike Lee, and the “Be Like Mike” campaign, Air Jordan's sneakers became a mainstream cultural phenomenon. As sneakers have now become the norm, Nike and the Jordan Brand have capitalized on the relevance.

Michael Jordan thrives on relevance

Its lightness In 2003, the Jordan Brand was retired, but the Jordan Brand remained relevant in various colorways, retro releases, and new sports and entertainment brand ambassadors. With recent forays into football, track, baseball and collegiate sports, Nike is far from the bankrupt laggard of the '80s.

In 2018, the Jordan Brand did something new by entering the soccer world and signing with Paris Saint-Germain. That year, Nike's sales exploded to $2.8 billion. There has been no annual decline so far, and 2023 was at $6.6 billion.

Nike is expected to earn $7 billion in 2024, although the company reported a fourth-quarter loss in June. Michael Jordan still smiles because his silhouette on every shoe is worth 5% of those billions. In 15 seasons and three retirements, Jordan earned $94 million from his storied NBA career alone. His lifetime earnings from Nike are at least $1.2 billion. Excluding new advertising campaigns featuring the namesake, Air Jordan's sales are at least $350 million per year.

After becoming the first billionaire athlete, the sale of the Charlotte Hornets last year boosted his net worth to $3.5 billion. This puts Jordan on the Forbes 400 for the first time in 2023. He dropped a few spots in 2024, but is still above Magic Johnson on this list.

He will only get richer if he makes $350 million of that $7 billion. The 5% stays the same, but the takeaway increases with Nike sales. Currently, the entire sneaker market is occupied by two brands – Nike, followed by the Jordan brand. The other brands follow.

While Adidas – which gave up Jordan – has reeled since canceling one of its best-sellers and Shaq is trying to revive Reebok, Nike is safe. Because the 40-year-old venture has paid off.