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While the market is busy buying shares of Nike because of the report on Investor’s Day, I’m busy sitting here with a look on my face that reads, “not surprised”. I’ve been writing here for a few years explaining that people have been overreacting to many of the “problems” Nike has been having. Granted, Nike shoes are not selling through at retail as quickly as they once did and adidas has a solid grasp on marketing and moving in this retail environment; Nike’s work on DTC was basically draining resources from the brand and they had to literally “edit to amplify”. Nike had to trim the hedges.
It wasn’t a good thing for me as a lot of my work was with smaller retail outlets and the shift in business by Nike wiped me out and I predict that retailers similar to the chain I worked with will begin to feel the pinch of Nike’s Consumer Direct Offense very soon.
I simply wasn’t surprised by people regaining confidence in the brand. The writing was on the wall for years if people stopped listening to analysts analyzing retail data when Nike simply doesn’t place much emphasis on retail anymore. During Investor’s Day the brand announced they are looking to dominate their sales channels at the tune of 80% to 20% in North America. I explained this in detail in a few posts:
During the Investor’s Day Nike’s seemed to have a primary focus on regaining those margins. Throughout every presentation there were keywords and phrases used to explain how the brand plans to reduce the issue with the promotional environment.
Last year I made a prediction and I stated that by this time this year the brand would be back at the mid to high 50s. That’s why my face is in this “not surprised” mode.