For Golden State Warriors sharpshooter Klay Thompson, his career trajectory continues upward. On the court, he's looking to help lead his team toward the all-time single-season wins record and another championship after once again earning All-Star honors. Off the court, he's learning to expand his visibility and personal brand, taking on several endorsement deals over the last two years, none bigger than his shoe deal.
When his rookie shoe deal with Nike was set to expire during fall 2014, Thompson and his agent, Bill Duffy, were initially open to all suitors. Klay had yet to appear in an All-Star Game, the Warriors hadn't yet gone deep into the playoffs, and he wasn't yet the star he'd soon become.
As the founder of BDA Sports Management and a longtime agent for several of the league's biggest stars, Duffy also was familiar with the Chinese market after representing Yao Ming during his playing career. He later negotiated breakthrough deals for clients Baron Davis and Steve Nash with Chinese athletic companies.
When his negotiations with brands began, Thompson was in the final year of his first contract with Golden State and was making $3 million. He hadn't yet signed his four-year, $70 million extension with the Warriors when Anta offered a shoe deal worth $2 million annually, which was around three times more than what other brands were offering. The deal included his own signature shoe available in China, input on his product, massive billboards and store banners, and an annual appearance tour in China. The offer was simply too good to pass up.
“I wanted a shoe deal where I could be featured more,” Thompson told The Vertical. “More input on what I wear, and with Anta, I'm one of their main guys and it's a huge blessing.”
So, what exactly is Anta?
It’s a Chinese brand that was founded in 1991 and has recently become focused on basketball and the NBA during the last five years. The brand’s current NBA endorsers include Kevin Garnett, Chandler Parsons, Rajon Rondo and Luis Scola. One of their main native competing brands, Peak, has an opposite marketing approach, looking to throw cash at as many players as possible for maximum brand visibility. Anta looks to sign a small core of already established veterans with winning pasts that China's hoops-crazy fan base will recognize.
Thompson did his due diligence and checked with Rondo, a fellow BDA client, and other players to learn about their experience with the brand. “I saw what Rondo was wearing, and he said he enjoyed playing in it,” Thompson said. “They had all good things to say.”
While the brand may be unknown to American consumers, it has more than 8,000 stores throughout mainland China and sold over 40 million pairs of shoes last year. That led to 40 percent annual growth for the company, which Ben Tsai, Anta's basketball merchandising director, credits to its official partnership with the NBA and the signings of Thompson, Rondo and Parsons. The deal with the league allows for the brand to use official team logos on its shoes.
Tsai says around 50 percent of Anta's basketball shoes are tri-branded in China, featuring the brand logo, player logo and team logo. "Working with the NBA, we can catch each team’s fans and tell their color stories,” he says. That's a huge difference from the sneaker strategy stateside, where shoes rarely incorporate a team's logo.
Other major differences between the U.S. and Chinese markets are how and where people play the sport. In the U.S., most consumers play indoors in gyms and routinely pay more than $100 for sneakers worn exclusively for the sport. In China, more than 90 percent of players play pickup games outdoors, often in sweltering conditions, and wear the same shoes throughout the day. They're looking for more versatile sneakers at a lower price than $100.
“According to the NBA, we have over 300 million basketball fans that regularly watch the NBA and participate in the sport,” Tsai said. For comparison, that’s almost the population of the U.S.
The massive market is the main reason why NBA players have looked internationally for their sneaker deals. Not only are Chinese brands offering more pure cash to players of all levels, from veteran champions such as Garnett and Dwyane Wade to role players such as Beno Udrih and Miles Plumlee, but the chance to earn royalties on signature products also raises the potential value of the deals.
Thompson's first signature shoe, the Anta KT1, is only available at a handful of Champs Sports stores in the Bay Area and on ShopKT1.com. There was an official unveiling earlier this season in San Francisco, but the reality is that the sales will be coming primarily from overseas. “Ninety-nine percent of our business is in mainland China,” Tsai said. Klay's $90 shoe can be found in thousands of stores throughout China. Anta doesn't plan to compete directly against the higher-priced sneakers of adidas and Nike.
“My boss wants to be Toyota instead of Mercedes,” Tsai said. “Mercedes is a luxury brand, but it's a small market. Toyota is the biggest company for the widest audience."
“Sharp and simple” was the approach for the KT1, according to Tsai. The shoes feature straightforward modern construction, foam midsoles and Warriors team colors throughout. The most defining trait of the shoe would be the custom logo along the tongue and heel that incorporates Thompson’s initials along with his jersey number in two subtle slashes. “I love the logo,” Thompson said. “The logo is so unique. You've got my initials and my number, and it's so subtle. Some people might just think it's a K. They really did a great job with the logo, and I'm so proud of it.”
As Tsai explains it, the brand is looking to craft simple shoes to play in during an era in which he feels other brands are throwing countless technologies, trinkets and embellishments onto sneakers in the name of innovation.
“We think right now that the basketball shoe market is getting more and more overcomplicated,” Tsai said. “I think they're over-engineered. In our case, we just want to build a good shoe that is sharp and simple. We hope that we're leading the kid to play basketball instead of spending expensive money on a basketball shoe.”
Less than two years into the deal, Thompson is still getting used to the feedback process and how to offer his own ideas after not having much involvement in his prior shoe deal. Creating a signature sneaker from scratch is typically a 14-month process, and it's a process he's still admittedly new to. “I didn't know how hard it was to design a shoe until I tried to give input. There's a lot of creative minds out there – I wasn't one of 'em,” he said laughing.
Despite the responsibilities involved with his shoe deal, Thompson is focused on the Warriors’ quest to break the 1995-96 Chicago Bulls' record of 72 regular-season wins and repeat as NBA champions.
“A lot of people thought we'd have a championship hangover, and we might get complacent, but I think we proved them wrong,” Thompson said. “We want to be one of the best teams that's ever played this game.”
More NBA coverage on The Vertical: