One of the hottest races at the Beijing Olympics is not among the athletes, but the companies that outfit them. The gold medal is, of course, domination of the Chinese market. Sports in China were once seen as a luxury but, as the middle class has grown and the culture has changed, interest has exploded. The likes of Nike and Adidas, which have had a low key presence in the market for decades, compete for brand preference and are using the 2008 Olympics as their battlefield. Sponsorship is a major weapon for both companies. Nike, for example, sponsors 22 of the 28 competing Chinese federations and one of China's most promising athletes, Liu Xiang, wears the trademark swoosh.

But brand awareness is only part of the strategy – performance, and the perception of it, is also of major importance in this market. To keep ahead, the major players in the sportswear industry need to demonstrate innovation across the portfolio - in technology, product design, functionality, graphics and presentation. The psychological effect of dynamic, cushioned track shoes or drag-reducing textiles on running and swimming suits cannot be overlooked. Moreover, as a casual glance at MTV demonstrates, nor can the influence of fashion.

As aditional technology is embedded within products from Speedo’s Fastskin swimsuits to the Nike + iPod cobination, new developments are currently blurring the lines between fashion and well-being. Look out for more clothing that can ‘think’ for itself by using IT connectivity to PCs and gym equipment, and yet more smarter fabrics which are able to respond to changes in the environment by adjusting their pore size or thickness at a given moment to facilitate moisture transmission.

Lastly, like other sectors, sportswear is also going green. Alongside a major recent reorganisation of the supply chain for this sector to make it more sustainable, there are also a number of product changes in play: Look out for Adidas’ Grun, a collection of organic lifestyle apparel. With three guiding elements of ‘Made From’, ‘Recycled’ and ‘Reground’, Grun offers a range of products, including classic silhouettes like the Forum basketball sneaker and the ZX 500 runner, all made from recycled and natural materials. If it can work for Nike with its Considered line then this could also be big news for Adidas.