Nicks, in his fifth season as Crows coach but yet to reach the finals, had been due to fall off-contract at season's end.
But with signing a fresh deal until the end of 2026, he says, comes pressure to return Adelaide to the finals for the first time since 2017.
"With expectation comes pressure. With ambition comes failure," Nicks told reporters on Thursday.
"So we've got to work our way through that, it's a space we're in at the moment.
"We have seen a lot of young sides get to this point and momentum is there - it's definitely not linear though when you talk about a young group developing.
"So the challenge this year is to handle that pressure."
Nicks, a former assistant coach at Port Adelaide and GWS, was appointed as Adelaide's coach for the 2020 season.
The Crows finished last in his debut season, the club's first wooden spoon, with just three wins.
Nicks and the Crows won seven, eight and 11 games in the following seasons and he has 29 wins and 55 losses overall.
"We have been developing a young group of players now for four years," Nicks said.
"There has been clarity in what it is we're trying to do."We have been very deliberate in the way we've gone about things both from a list management point of view, acquisitions, our game style - we believe strongly that our game style will stand up in finals.
"The work we have to do is get ourselves there ... we want to be up there fighting for a premiership again."
Nicksy is locked in for another two years 🔒— Adelaide Crows (@Adelaide_FC) Details: https://t.co/exYG4ruKe4#weflyasone pic.twitter.com/jij1J5f0nGMarch 20, 2024
Adelaide chief executive officer Tim Silvers said despite Nicks' results thus far, he was confident the coach would take the Crows back to the finals.
"When you invest into a strategy, you have to hold, you have to stick fat," Silvers told reporters.
"What I've been proud of is that as a footy club we made a decision to go through this process and rebuild.
"And it's been a deliberately management strategy over the last couple of years and we haven't deviated from that.
"There are ways that you could try to find quick wins to move up the ladder to get into that mid-tier but our process was let's build the foundation ... and do a steady climb.
"It's hard to be patient as a supporter of the footy club, we understand it.
"But now we're in a process where the foundations are there, we feel like we've got to take the next step.
"And that's where we think Matthew and the leaders around him are going to be those people that are going to be able to deliver us to take us to that next step."
12°C