Though already a billionaire, Tadashi Yanai seems to be insatiable. The President and CEO of Fast Retailing has one objective in mind: to completely dominate retail fashion and become the top apparel brand in the world. Yanai is dreaming of defeating iconic brands such as Nike, Zara, Gucci, Hermes, and Adidas. That is a lofty goal for any company, especially one that aims to design clothes everyone can imagine themselves in. Yanai’s clothing company, called Uniqlo, describes itself as a “modern Japanese company that inspires the world to dress casual.” Uniqlo does not consider itself a sports apparel company. Yet in today’s marketing landscape, athletes are more frequently used as global ambassadors; few are more renowned around the world than the company’s newest representative, Roger Federer.
When Federer walked onto Centre Court of Wimbledon to open play for the 2018 Championships — his 20th appearance at the event — the most tantalizing peek into current tennis-related financial negotiations ended with a gasp.
It was true. Roger Federer had left Nike, a brand he first signed with in 1994. This was a partnership he more than likely thought would last the entirety of his career. In 2008, when Federer last extended his Nike contract, who could have guessed that he would still hold as much leverage in his career? Federer — one month short of turning 37 — is world number two and reigning Australian Open champion. The end of his career continues to look more optional than immanent.
According to ESPN reporting, Federer’s contract with Uniqlo is worth “$300 million guaranteed money over ten years” and includes a clause that Federer will be continued to be paid even if he does not finish his 10-year agreement as an active player. Nike was given an option to match Uniqlo’s offer, but Federer’s unprecedented guaranteed clause may have forced Nike to consider a new direction for the future. Nike, while currently the top-ranked apparel brand, cannot afford to be as generous with cash as Uniqlo, considering its presence in multiple sporting leagues. The Oregon-based company is sponsoring high-profile athletes such as Lebron James, who is rumored to have signed a lifetime sponsorship contract worth $500 million.
In return for its investment Uniqlo is hoping that Federer will drive expansion in untapped markets such Europe and North America, where the company has 75 and 52 stores, respectively. For a comparison with one of Uniqlo’s most populated regions, Japan alone has 833 stores. Federer’s presence at Asian tour events such as the Shanghai Masters will be even more warmly received, if possible. The 2020 Summer Olympics will be held in Tokyo. Uniqlo would love to have Kei Nishikori and Federer as contenders for gold medals in what will most likely be Federer’s last Olympics to help push its global ambitions as well.
In a twist, Federer’s ubiquitous monogram, for now, will not be able to follow him around the world. Nike actually owns the design. Federer hopes that Nike will “be nice” and relinquish the rights to his initials in the near future.
Seeing Federer in Nike shoes is also not a firm given; the Swiss is working to negotiate a shoe deal to accompany the Uniqlo threads. The delay of the “RF” logo could also help Uniqlo establish a stronger online presence in selling its tennis designs. Few pieces from Nishikori or Novak Djokovic were routinely made available for consumers; that could be a major adjustment which causes disgruntlement for branded items that were once free flowing. Federer stated in his post-match press conference on Monday that he hoped to begin releasing personalized items by the beginning of 2019.
Yanai has been quoted as saying, “In my childhood, I learnt that all industries have a shelf life. Everything comes to an end.” From an end to one corporate relationship on Monday at Wimbledon, Federer now begins to shape the LifeWear of his future self at Uniqlo.