Nike’s latest retail concept opens at nine locations worldwide before 2021. (San Antonio Location
Source: Nike Unite Retail Concept
If Nike wanted to ramp up store openings, they could. I’ve written continuously that retail should really consider themselves as dialysis patients and Nike is the machine that cleans the body. At any moment, Nike could decide to shut off the machine. At any moment, Nike could decide to look closely at the body and determine if dialysis is still required. I know it’s uncomfortable to read a statement comparing Nike to a dialysis machine, but consider the quote above. Nike is opening nine locations during Covid-19 when other businesses are struggling. Nike is continuing to remove store accounts. Nike remains on a path to 50 Billion. This doesn’t happen by giving wholesale accounts more product, except in places where Nike doesn’t really want to be… like Cleveland, Mississippi or Lawton, Oklahoma (Hibbett Sports, your smartest play was opening stores in small towns).
Nike’s Unite Retail Concept was formulated by the initial investment into Nike Live stores. Nike took data from the community (stores that sell its footwear) created pop-ups, harnessed more data and then made a decision to create Nike Live, Nike Rise, Nike House of Innovation. These more informed retail locations diminish the abundance of inventory and cater to what the area wants. The initial data for Nike Live came from purchasing inside of the digital space owned by Nike. Remember in 2017 Nike garnered 3x’s the amount of purchasing from consumers in their digital ecosystem. That’s powerful. This new Nike Unite Concept isn’t a ‘new’ idea. Consider an older post from 2018 when I went to Harlem to visit Jimmy Jazz:
In this post, I stated:
Within the Harlem location the art inside was created by local artists. There is a homage to Harlem inside of the store. The store is so thoroughly integrated into the neighborhood that it feels like a part of the community as opposed to the sterile sameness of the Footlocker and Footaction across the street. My thoughts were, “If they can reproduce this local loyalty concept within stores in every region while also leading the way with technology in store, Jimmy Jazz could be the biggest threat to every small chain and even the major chains.
In Nike’s description of their new Nike Unite Retail concept:
Nike Unite exists to serve and celebrate the people in each local community, and each store is designed to be a reflection of their heart and spirit. Consumers are welcomed by an in-store community wall highlighting the store team and local partnerships, and design elements throughout the space also look to tell the story of the community. From local landmarks to hometown athletes, the design allows the local residents to feel represented in the space.
I wrote my paragraph over two years ago. Those strategies look and sound the same. It’s not lost on me that even FootLocker and their Power Centers are rooted in the same strategy. Nike isn’t biting off of Jimmy Jazz; Nike is simply creating better retail. In doing so, there is an inherent danger to stores carrying the product. Who can better serve their consumer?
A. the company that created the product (think Apple)
B. the company that carries multiple products and isn’t aware of all of the details
I’ve written about this before in both books:
Nike’s Consumer Direct Offense and in Sneaker Resale & Retail In the New Normal. I said Nike would continue infringing on their wholesale accounts. Is it right? This isn’t a matter of right or wrong, it’s business and Nike is operating an elegant system. While it seems that their partners who remain shouldn’t feel any pressure, Nike Live and Nike Unite tell me something different.
Note: Are you interested in what retail and resale looked like post quarantine from July to October? Buy the SRRRA.