As U.S. Open approaches, competition heats up off-court

Nike seeks help of star players to grab shoppers' attention
By Andria Cheng, MarketWatch

To be sure, the $300 million U.S. tennis apparel market is a small part of the $24 billion athletic apparel market, according to Matt Powell, an analyst with SportsONESource. In comparison, basketball apparel is a $2 billion market and running a $750 million market, he said.

Nike's worldwide sales this year are projected to be $18.8 billion alone, according to analysts surveyed by FactSet.

Branded companies such as Nike and Adidas also have been losing share to private label brands from Dick's Sporting Goods Inc. (DKS 22.31, -0.51, -2.21%) and other retailers, Powell said. Nike, the No. 1 player, had about 30% of the tennis market share in the U.S. in 2008, down from 35% in 2007 while No. 2 player Adidas saw its share declining to 11% from 20%, Powell said. Combined share from various store brands, meanwhile, grew to close to half of the market, the analyst said.

"The return on that investment is small," said Powell, referring to Nike's tennis efforts. "It's much more about building brand equity than about tennis apparel business. There's potential for some halo effect."