NEW YORK — Nike will buy $1.4 billion of the retail giant’s advertising assets over the next five years, according to people familiar with the matter.
The investment by the shoe company, which will be led by its ad agency, is part of a broader effort to expand its ad business beyond its core sports apparel business and beyond its existing business of sponsoring college football teams and other sporting events.
Nike is the biggest sports brand to make a large investment in its ad businesses.
Its advertising budget for the 2015-16 season, the most recent year for which data is available, was $5.6 billion, according the company.
Nikes ad revenue for the 2016-17 season was $3.9 billion, the company said in a filing with the Securities and Exchange Commission.
The new ad purchases represent an increase of $1,000 per year for Nike from its current revenue, the people said.
The company also plans to spend $1 million annually on additional advertising to help build its ad network, they said.
Niles spokesman Andrew Miller said the ad buys would be for the shoe’s brands and would not impact its advertising footprint or its sales or marketing activities.
Miller declined to comment on the size of the new investment.
Nasdaq data shows Nike is the most-traded U.S. stock index.
It has surged about 30% in the past year to reach $6,872.25 on Tuesday.