Was It the Shoes? Kawhi Leonard Scores Big for New Balance
Tonight as Kawhi Leonard of the Toronto Raptors takes to the court in the Eastern Conference Finals, fans will be wondering: Will he repeat the dazzling high-arcing, triple-doinking buzzer-beater jump shot that won the Raptors Game 7 against the Philadelphia 76-ers? And, was it the shoes? Kawhi’s game-winning shot was among the most iconic sports moments in recent memory, and it was equally notable for New Balance as it was the first time Leonard wore his New Balance OMN1S sneakers on the court.
New Balance, which is privately held, released the Kawhi 2-Way Playoff pack last week, which feature a retro-themed blue, gold and black colorway. After outbidding Jordan Brand for a partnership with Leonard in November, the Boston-based footwear company committed itself to a marketing strategy uniquely suited to the superstar’s reserved yet focused demeanor. Leonard certainly went on to do his part: his ascension this postseason is the type of marketing coup shoe companies dream about.
Even before Leonard’s Game 7 heroics, the 2-Way Pack sold out in seconds at a premium retail price point ($140 for the OMN1S, $130 for the 997S) last Tuesday, and both sneakers have dotted the resale market at inflated rates in the week since. Though New Balance has not released sales figures, the fervor surrounding it feels a weighty feat for a brand just six months into its grand return after three decades absent from the basketball footwear arena.
It wasn’t exactly an auspicious time to reenter the fold. According to NPD Group, Inc. data obtained by Footwear News, basketball sneaker sales have been on the decline—dropping 12% in 2017, 7% in 2018 and 21% in 2019 (as of March). And even with disruptors like Under Armour (Steph Curry, Joel Embiid), Puma (DeMarcus Cousins), ANTA (Klay Thompson, Gordon Hayward) and New Balance (Leonard) inciting competition for sponsorships, Nike and Adidas continue to dominate the marketplace from a revenue, retail space and product portfolio perspective, with no signs of giving significant ground. The on-court performance of one star can only take you so far.
But being the biggest brand in basketball footwear isn’t necessarily New Balance’s singular goal—they are playing the long game. According to an analysis by David Swartz of Morningstar, Inc., the Chinese activewear market is already the second largest in the world behind the U.S. at more than $30 billion per year and has the potential to grow per capita, to ten times the addressable market in North America. This is a market New Balance has expressed intent to break into. In a 2018 interview, Chris Davis, the company’s VP of Global Marketing, made reference to their building of 3,000 stores in China and stressed that the company was and is unafraid of taking risks. Re-entering the basketball shoe market is a risk, but given the sport’s burgeoning popularity overseas, it’s a calculated one.
After all, you have to shoot to score.
More must-read stories from Fortune:
—How to invest during a trade war
—The 9 biggest IPOs of all time
—The uncomfortable truth about going public with a money-losing business
—Trade war takes giant bite out of Apple’s market value
—Uber is one of the worst performing IPOs ever
Follow Fortune on Flipboard to stay up-to-date on the latest news and analysis