Air is the true story of how Nike managed to land Michael Jordan and kick off the most successful shoe campaign in history – Air Jordan. It transcended culture and athletic sales and while the movie is impressive in its production and execution of an incredible story – from a business perspective, it’s just, well, too incredible to be replicated. In other words – excellent movie, but this is no way to run a business.
Nike in 1983 was a far cry from the behemoth company it has become today. Buried in the woods in Oregon, Phil Knight’s (Ben Affleck) company was toying with eliminating its basketball division because they had such bad luck signing stars amidst competition brought by Converse (which ironically is owned by Nike today) and Adidas. That all changed when Sonny Vaccaro (Matt Damon), a Nike consultant at the time, bet the company’s future on $250,000 and a three-month pursuit of a 21-year-old kid named Michael Jordan, who, strangely enough, played no role in the film.
And here’s where, from a business perspective, things went off the rails. We all know the end of the story and Nike’s creation of the Air Jordan brand (Nike has made $19 billion off of Michael in the past five years alone) was and continues to be one of the greatest stories in the history of business, apparel, and footwear. But how they got there? Don’t try this in your industry—some examples.
- Nike’s entire basketball endorsement budget, originally to be shared by three players, was spent on a hunch that a consultant had about a kid from North Carolina who went third in the NBA draft. Not first. Not second. Third. We all know who Michael Jordan became, but this decision was akin to betting a company’s future on a 30-to-one horse to win a race. Never. Ever. Bet a company’s future on one horse. That said, companies have to find a happy medium between risky and risk-averse behavior. Taking calculated risks is what ultimately makes a company succeed and if you’re afraid to make one, you could lose your company.
- Nike was held hostage, not by Michael, but by his Mother, Deloris (Viola Davis). This movie’s crux makes little sense from a business perspective. Once Michael and his family had accepted the $250,000 per year (over five years) signing offer from Nike, Deloris knew she smelled desperation and held the contract for ransom until the company offered a percentage of sales. Again, Nike was betting its entire future on one horse controlled by his Mother. Good for her. Bad for business. The signing affected how basketball shoe contracts were constructed for all companies from then on and Michael has made $1.8 billion on the contract since.
- If you’re the CEO of a company, then you should run the company and not let the company run you. Knight is portrayed here as flaky and soft, allowing Vaccaro to run all over him. Even though Knight said no multiple times to betting the farm on Jordan, Vaccaro went off on his own and cut his own deal, ignoring the CEO at every turn.
On the plus side, Nike had a core set of values that they adhered to. A lot of companies have mission statements, stated values or core principles they publish but don’t follow. Nike lived by their core principles and it was a big reason they’ve been so successful over decades.
The movie itself was fantastic and, in my research, was absolutely true to the story, except for some small Hollywood moments added. Damon was fun to watch as the frenetic Vaccaro, but it was Davis who carried the movie. Although, Affleck, who wrote the film with his buddy Damon, was an odd choice for the Knight character. The ’80s soundtrack was a little too obvious (Hey everyone, it’s the 80s, so we’re going to play yet another song to remind you!), but the movie was highly entertaining and might be one of the top 10 sports movies ever produced.
The Air Jordan shoe remains as popular (and expensive) as ever, and Nike continues to be a giant in the shoe and athletic wear industry. Sometimes you can bet the house and win. But Nike’s bet was a once-in-a-lifetime event. And to try and copy it would just, most likely, get you “busted.”