'나이키'의 방황, 결국 가장 중요한 건 기본

Just do it? Don’t do it!

It is quite weird to see Nike struggling to compete with rivals that Nike once didn’t even consider threatening. The company is worth more than a hundred billion less now than during The Last Summer Olympic Games.

Established in 1964, Nike has been one of those companies that is considered unreplaceable and everlasting. It invented the sportswear market as we know it today and it did it with unique innovation partnerships, iconic marketing, and the best slogan in the marketing history. So how did it run into trouble?

Nike’s success has much relied on its partnership with wholesalers. However, over the past few years, the company started to wonder if sharing its profit with wholesalers is a good idea in the age of e-commerce.

Then, the pandemic happened. The company accelerated its pivoting to online operations, which was already executed before the lockdown. Nike was very aggressive in replacing its traditional wholesalers with e-commerce stores.

At first, things seemed just fine. During the pandemic, people didn’t have to go to work or social events every day so they moved towards casual sneakers instead of formal shoes. Nike soared to record sales and profit beyond everybody’s projection. It seemed like Nike’s e-commerce strategy was the right move.

But it forced wholesalers to find a way to survive without Nike. They were desperate to find alternative brands that could fill up the shelves. It presented new opportunities for the small rivals to present their fresh ideas to the world.

Soon after, the pandemic was over and the world reopened. It didn’t take long until the world found out that people still liked buying shoes in stores. Instead of Nike, the shoppers discovered fresh new brands.

Yes, it is evident that there is a trend in retail away from bricks and mortar and towards e-commerce. But sometimes pivoting too fast can backfire. Nike abandoned its traditional sales pipeline too fast ahead of the curve.

But the sales strategy wasn’t the root cause of Nike’s fall. The real problem was that customers found Nike’s products weren’t as cool as they used to be. Nike had a line of successful brands that dunked in the hearts of people.

But over the past decade, Nike just got lazy and started to release their brands in different colors. There wasn’t any innovation. Once known as brave and bold, Nike is now viewed as old and dull. The pandemic sales boom wasn’t a blessing but a curse because it masked Nike’s lack of innovation while its competitors were working on new styles.

Nike is still one of the most powerful brands in the world. Nike’s brand awareness and resources are still unrivaled in the world of sportswear. Only if it can rebuild its relationship with, then Nike will be able to make a comeback. But to do that, it will need a powerful hit to demonstrate to the world that Nike is cool again.

Lessons

1. A great product is the core necessity to craft business success and all other things are side factors.

2. Change isn’t always a good thing. You must know yourself to implement the right change at the right time.

3. Nobody is invincible, not even Nike.