New Balance kicked off its largest-ever ad campaign today, taking aim at Nike, which spent $3 billion last year on “demand creation.” The tech-inspired “Always In Beta” campaign will reach consumers via social media and traditional TV ads, suggesting that the company recognizes the increasing imperative to compete in digital.

With $3.3 billion in revenue last year, New Balance is growing faster than its enormous rival. However, the company – ranked 8th in L2’s Digital IQ Index: Sportswear – has yet to reach Nike’s level of investment in social media. In comparison with Nike’s nearly 9 million Instagram followers, New Balance has close to 650,000. Nor has the company invested in technology like Like2Buy, which turns Instagram likes into sales by linking photos to the brand’s site.

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New Balance is not among the top 10 brand pages on Facebook, Twitter and YouTube, which are dominated once again by Nike. While the company recently raised its Twitter profile by working with brand ambassador Heidi Klum (2.7 million followers), this might not help fulfill New Balance’s stated goal of rebranding itself as an athletic rather than a fashion brand.

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New Balance will also have to content with the other sportswear brands currently challenging Nike’s digital dominance. Under Armour recently created a mobile-based social network (UA Record) that smoothly integrates content and commerce and can work on any device, unlike Nike+. Many companies have come out with innovative means of engaging fans, like Timberland’s #inMyElement photo-sharing campaign and L.L. Bean’s “Base Camp” Facebook app.

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