Footwear News’ Post

"During Donahoe’s tenure, Nike sales have grown 31% to $51 billion in 2023. That is more than double the results of Adidas, its closest competitor by far. New Balance reported sales reached $6.5 billion last year, and upstart On almost hit the $2 billion mark." - The Wall Street Journal / Inti Pacheco (unlocked link below) Yet the markets have punished Nike stock. Winning in the sports business requires greatness at product innovation and clean distribution. Even with 31% growth, the markets know that Nike is underperforming relative to stronger competition, especially a strong lululemon, resurgent adidas and New Balance and niche players like On, HOKA, Brooks Running, Tracksmith, Vuori and NOBULL creating new energy. If we look at history, this same negative pattern has repeated itself whenever a new CEO without a sports / lifestyle product or sales background takes over, regardless of how talented and experienced they are. And the opposite positive effect takes hold when a product leader takes over. What do my sports / lifestyle industry people think? /// #innovationeconomy #nike #sportsinnovation #therealheroistheproduct https://lnkd.in/eQjY6ppb

Whenever constructive controversies and criticisms create publicity, make the best use of these moments... On October 26, 1984, Michael Jordan signed a five-year, US$2.5 million deal with Nike, three times more than any other deal in the National Basketball Association (NBA) at the time. Nike released the Air Jordan sneaker line in April 1985 with the goal of making $3 million in the first three years. Sales greatly exceeded expectations, earning $126 million in one year. The NBA policy stated that the shoes must be 51% white and in accordance with the shoes that the rest of the team was wearing. Failure to follow this policy resulted in a $5,000 fine per game (equivalent to $15,000 in 2023). Nike designed the Air Jordan I based on the Chicago Bulls' red and black team colors with only 23% white, which violated the NBA's policy. Nike agreed to pay each fine, garnering both controversy and publicity around the shoe. Fines imposed by the NBA on Jordan for wearing the shoes bestowed upon them an iconic brand and was later regarded as groundbreaking in part due to its defiance of NBA regulations. Nike also took advantage of this marketing opportunity with the Air Jordan I "Banned" advertisement, which stated "On September 15th, Nike created a revolutionary new basketball shoe. On October 18th, the NBA threw them out of the game. Fortunately, the NBA can't keep you from wearing them. Air Jordan. From Nike." The shoe sold out at 50,000 pairs and generated more than $150 million in sales. #marketing #publicity #sales #constructivecontroversies #airjordan #nike excerpts from https://lnkd.in/d529JiEy picture from https://lnkd.in/d6KqyjG6

🚨 Insights on Nike's Recent Struggles 🚨 I read with interest Nike's recent challenges, highlighted in this WSJ article. Once revered for its culture of innovation and cutting-edge athletic footwear, Nike finds itself grappling with some major challenges : 1) Shift Away From Retail Partners : Nike’s decision to sever ties with longtime retail partners like DSW, Urban Outfitters and exit from retail saw the termination of a third of its sales partners and less merchandise sold to Footlocker, Macy’s. The move was aimed at a direct-to-consumer focus and the decision underscores the challenges of balancing innovation with established partnerships in a changing retail landscape. 2) Strategic Missteps and Stalled Sales : Despite aspirations to position itself as a future tech company, Nike's recent sales figures tell a different story. Flat sales and a 24% YoY decline in shares highlight a loss of momentum in the market. Its CEO's strategy to boost disruptive innovation and focus on digital channels has faced challenges, with the company struggling to meet its ambitious targets resulting in layoffs. 3) Tech Investments and Operational Delays : Nike's push towards digital sales and tech integration hit roadblocks with delays in implementing its new platform S/4HANA. This multibillion-dollar endeavour aimed to streamline operations, inventory, and enhance digital sales - but has fallen behind schedule, leading to layoffs even in its global technology group which includes some AI team . The company's reliance on specific partners for digital sales hasn't yielded the expected results, further complicating its recovery efforts. 4) Lost Ground In Critical Categories : Nike's missteps in re-prioritizing certain product categories, such as neglecting the running segment and focusing on high-profile franchises like Air Jordan and Dunk, have eroded its market position. The shift away from affordable footwear options and a dilution of product exclusivity have alienated segments of its consumer base. In navigating these challenges, Nike faces a pivotal moment requiring strategic reassessment and agile adaptation. For many companies and executives, it’s imperative to learn from industry giants like Nike and recalibrate strategies to stay ahead in an ever-evolving market landscape. #Nike #Ebusiness #Retail #DigitalTransformation #Strategy #BusinessInsights https://lnkd.in/gVJPMVSi

Did you know that in 1984 the N.B.A. banned the original Air Jordan shoes? It's true! Read on for the rest of the story. Back then there was a league rule that said the sneakers players wore in games had to be at least 51% white. Non-compliance with this rule resulted in a painful $5,000 per occurrence fine. This was sufficient to deter most from even questioning the rule, let alone violating it. But, the folks at Nike saw it as an opportunity. See, Michael Jordan was well known as a college player at the University of North Carolina and had been the third overall pick in that year's N.B.A. draft. As such, they were certain he would get much publicity in the professional game. Nike, which was founded in 1971, had gone public in 1980 but was struggling to gain the traction they wanted. In a bold and unprecedented move, they spent nearly all of that year's marketing budget on signing Jordan to an endorsement deal for a new basketball shoe named for him. Part of that deal was Jordan wearing those shoes in games - even though they were out of compliance with the 'at least 51% white' rule. By wearing them in a game, MJ was assessed the $5,000 fine each time. For the 82 game season, the fines totaled $410,000! And, per their endorsement contract, Nike paid those fines. The even ran an ad campaign around it called Banned. (see the video in the c@mments) How did breaking the rules work out for Nike and Jordan? Jordan became the NBA Rookie of the year and Nike sold over $126 million of his shoe. Last year, the entire Jordan brand sold over $6 billion and the association has earned MJ over $1.5 billion in lifetime royalties. 😲 I'd call that a successful collaboration, wouldn't you? Speaking of successful collaborations, I am pleased to be co-hosting a webinar with Rob Deptford on May 23rd at Noon US Eastern time. Titled, YouTube Automated Prospecting, it may violate what you believe to be 'the rules' of how to grow your company. (l*nk bee low) But, sometimes the rules NEED to be broken, don't they? 😊 #FreakingBrilliant #Creativity #Innovation #Success

👟 Nike doesn't want you to know that their iconic "Just Do It" tagline is inspired by a murderer. There was a person named 'Gary Gilmore' who murdered 2 people in the US, and he was then sentenced to death. When the firing squad was in front of him asking what his last wish was, he said, "Let's do it." Dan Wieden, who made the tagline for Nike, when he heard about this, liked the 'do it' part of Gilmore's line. And then he made "Just Do It" from "Let's do It." Nike launched this tagline in 1988, totally unaware that they have created an iconic tagline inspired by a criminal, which will be remembered for decades. 🚀🕰️🔥 #business #nike #marketing #businessadvertising #viral

Nike, the giant fashion retailer that built one of the world's most valuable brands, has stumbled. Pursuing "digital revolution" and edgy cultural trends, it lost touch with consumers that liked seeing their product in bricks-and-mortar stores and wanted to try them out on the streets. If you think this post is about shoes, you haven't been paying attention. This post is about having a passion for your #customers and your #products. It's about putting them in front of what cultural elites and political leaders tell you is inevitable. It's about remembering why you got into your business in the first place, and who helps you be successful. That includes retailers that sell and service your product. That includes customers that choose your product based on what they want it to do, not what influencers or regulators or technology gurus post on social media. It would be acceptable to me if everyone in the fashion industry ignored this article, and every executive in the auto industry read it. Then the alcoholic beverage industry, then the tech industry. The lessons here go far beyond shoes. Pay attention to your customers, and the people that sell your product--or watch your sales go "swoosh." #automotive #autodealers #retailers #franchising #francisees #ford #generalmotors #chrysler #tesla #EPA MICHIGAN AUTOMOBILE DEALERS ASSOCIATION Ohio Automobile Dealers Association National Automobile Dealers Association (NADA) https://lnkd.in/evnSPa3r

A(nother) Battle of the Stripes… 👟 By now it is well established that adidas has adopted a full-scale trade mark war against any clothing manufacturers using stripes as part of their brand. Their latest target forced to defend the Stripe Monarch is Wilson Sporting Goods Co. Adidas recently filed a Notice of Opposition with the USPTO to block one of Wilson’s trade mark applications for a logo featuring stripes (not three stripes we might add). This isn’t Adidas’s first stripe-related trade mark dispute. They have been involved in numerous cases, sometimes winning and sometimes losing, where they argue that their “3-Stripe” trade mark should prevent others from using stripes (in general). The aggressive nature of these efforts by Adidas raises questions about their true intentions; are they enforcing or bullying…? While we are in support of brand owners who protect and enforce their trade marks to avoid losing rights, it can easily be taken too far, especially by spe of the larger monopolies in industry. What do you think? Has Adidas gone too far this time, or do they have a valid opposition against Wilson? Share your thoughts and learn more about trade mark protection strategies with us at STEYN IP®. 🚀 Source: The amazing Mr Josh Gerben 🤘🏼 #STEYNIP #DreamersWelcome #AINNO #LegalMavericks #ProtectingCreativity #ProtectingDreams #IPinsights #createPROTECT #letsTALKip #intellectualproperty #intellectualpropertylaw #trademarks #patents #copyright #designs #YourBrandProtected #dreamBIG #IPLaw #ip #InnovationMatters #FileFirst #SIP #wilson #adidas

Depth vs shallowness is the difference that makes a controversial campaign worth the effort. With authenticity being the buzzword and desire of many in the marketing world, often controversial brand ideas are in discussions. Now in 90% of the cases, they're put off because they just don't want to be in the bad books of any customer. But I guess knowing what makes it worth makes it easier to make a decision. Here's a comparison of two brands in the past that posted their take on the George Floyd movement in America. One by Nike, where for the first time it said, "For Once, Don't Do It," inspiring people not to be quiet about racism or social injustice or to think it doesn't affect them. The other one by Pepsi, which USED the movement to sell its cans through an AD featuring Kendall Jenner and appropriating the whole movement. While it's clear who won, it's not that Nike didn't face any backlash from authorities of course it did but it was well aware of the risks and was prepared to receive it because they knew they were promoting something deeper and more important than its shoes. Whereas Pepsi still considered its cans more important. https://lnkd.in/dPCNkpkq

Complex and major initiatives often require an increased focus on initial expectation setting and managing expectations during the change. Also, a potential reminder that Wholesale can be an important channel and that many times a Both/And solution can surpass an Either/Or. Meeting a wide variety of customers using the Reach of E-commerce and Wholesale partners AND including the touch/experience at Nike Stores as well as stores in areas that may not easily be served by existing Nike Stores ( ~300 in the USA and ~1,000 globally). Your thoughts? Excerpts: Dive Insight: Nike’s Consumer Direct Offense and Acceleration plans are coming under attack in a new class action lawsuit that alleges two of the brand’s top executives misled investors about how successful the strategy was. “Throughout the Class Period, Defendants repeatedly touted the purported strength of Nike’s business model, and in particular, the claimed success of its digital and direct-to-consumer strategies to produce sustainable growth, while downplaying the significant competitive pressures facing the Company,” the lawsuit reads. The lawsuit recounted Nike’s efforts to ditch wholesale partners in 2020, which continued into 2022 in a much-discussed shift away from Foot Locker, as well as the retailer’s subsequent return to many of those partners when its DTC strategy didn’t deliver as intended. Indeed, on the back of disappointing sales results, Nike late last year rolled out a cost-savings plan aimed at driving growth and profitability. The plan included layoffs, as well as a simplification of its product portfolio, with executives referencing its shift to a DTC model as a reason for the cuts. “Since fiscal ’19, our investments in accelerating Nike’s consumer direct vision have created new operating capabilities, added tens of millions of new members to our member base and delivered a return of more than $12 billion of incremental revenue,” Friend said on a call with analysts at the time. “However, we have also added complexity and inefficiency. In this competitive environment, we need to accelerate our pace of innovation, elevate our marketplace experiences, maximize the impact of our storytelling, and increase our speed and responsiveness.” Donahoe followed that up in March by acknowledging that the company needed to make some “important adjustments” to its Consumer Direct Acceleration strategy, as Nike was not “performing at our potential.” #Nike #DTC #Retail

🔍 𝐒𝐩𝐨𝐭𝐥𝐢𝐠𝐡𝐭 𝐨𝐧 𝐃𝐋𝐂 𝐜𝐚𝐬𝐞 𝐜𝐚𝐫𝐝𝐬 - 𝐋𝐚𝐧𝐝𝐦𝐚𝐫𝐤 𝐂𝐚𝐬𝐞 #𝟐: 𝐀𝐜𝐭𝐢𝐨𝐧 𝐒𝐩𝐨𝐫𝐭 𝐯 𝐍𝐢𝐤𝐞 (𝟐𝟎𝟎.𝟐𝟑𝟏.𝟕𝟔𝟒/𝟎𝟏) 🔍 Time to highlight another case card! Are you familiar with the Dutch Action Sport v. Nike case? 𝐊𝐄𝐘 𝐅𝐀𝐂𝐓𝐒 📌 • Nike terminated its distribution agreement with its Italian distributor Action Sport for breaching its selective retailer distribution policy by selling Nike products on Amazon, which was an unauthorized platform. • The policy stipulated that distributors could only sell products online through their own websites, authorized resellers, or authorized third-party platforms. By not adhering to this, Action Sport breached its distribution agreement. • Action Sport contested the termination, arguing that Nike’s selective distribution system did not meet the Metro criteria and violated Article 6 of the Dutch Competition Act, as Nike’s products are not luxury items. 𝐂𝐎𝐔𝐑𝐓 𝐑𝐔𝐋𝐈𝐍𝐆 ⚖️ Both the District Court of Amsterdam (October 2017) and the Court of Appeal (July 2020) ruled in favor of Nike, determining that their selective distribution policy did not constitute a hardcore restriction. The Court of Appeal hereby referenced to the ECJ’s Coty judgment clarifying that selective distribution systems are not limited to luxury products. Check out the case card on the DLC platform (https://lnkd.in/eTK-2wxf) to examine all the details of this case! #LegalUpdate #CompetitionLaw #Distribution #Nike #ActionSport