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Though Adidas lands top schools, Nike is still the sponsorship leader

DAYTON, Ohio -- In 1994, the University of Michigan signed a sponsorship contract with Nike that was nearly unprecedented at the time. Even though their products surfaced in every part of college sports, the athletic footwear and apparel companies hadn't yet officially joined hands with college sports teams.

A decade-plus later, adidas is working to catch up with industry-leader Nike by conquering college contract after college contract. German-based Adidas Group took two steps last month by signing Michigan and Texas A&M to new deals, taking them away from rival Nike.

As the athletic apparel companies offer more, however, Nike continues to pull away. According to Nike and Adidas and interviews with industry leaders and analysts, Nike remains head-and-shoulders above the competition in a market that continues to grow around the world, worth tens of billions of dollars annually.

Tom Doyle, vice president for research and information for the National Sporting Goods Association, said Nike controls almost half of the market for athletic shoes, jerseys, and clothing.

Nike continues to lead the pack. From the fiscal years 2003 to 2007, the Oregon-based company took in $51.6 billion in revenue, according to its quarterly financial reports. In the same period, adidas -- the closest competitor that purchased Canton-based Reebok International Ltd. in 2005 to strengthen its charge on Nike -- collected $31.2 billion in revenue, just 60 percent of Nike's total.

One of the major battlegrounds rests in college athletics. Because the on- and off-campus fans remain some of the most passionate throughout sports, Nike, Adidas, and others work to write new sponsorship contracts that place their logos on jerseys and provide exclusive rights to merchandise sales.

Meanwhile, as more consumer money flows to running shoes, shorts and other athletic apparel, the major companies work to construct deals that will gain them support from the college loyalists in hopes that the scarlet and gray, or maize and blue, will automatically sell merchandise.

"I don't think the customer base is buying because of who wins games," said Paul Swangard, managing director of the Warsaw Sports Marketing Center at the University of Oregon. "They're buying because of loyalty. So, you don't want the school with the most wins, you want the school with the most fans."