Nike Inc. admitted that some of its sneakers sold in China were inaccurately marketed, after state television accused the company of making false claims in a high-profile broadcast.
Source: Nike Apologizes for Selling Sneakers in China Without ‘Air’
Liza Lin and Sara Germano are reporting via the Wall Street Journal on a CCTV broadcast that coincided with Consumer Rights Day. The broadcast is interesting because it seems that this show has been the drive behind exposing a number of issues with businesses attempting to deceive the buyers.
Nike advertised the Nike Zoom Kobe Hyperdunk FTB as having full length Zoom Air Cushioning. “Nike faced similar accusations in 2012, when state media said the sportswear brand was fined 4.87 million yuan ($704,000) based on claims that it was overcharging consumers and advertising its high-end basketball shoes as having a double air-cushion, when the shoes were found to only have one. Nike China apologized and offered refunds for the consumers who bought the affected shoes, according to the state-run Xinhua News Agency.”
The shoe was a celebration of Kobe’s career and the FTB (Fade to Black) attachment has actually driven resale on the shoes and made them a sought after model. Nike recently dealt with a similar situation here in the US with their Air Jordan 15 Retro release. The shoe was supposed to have Zoom Air in the heel and forefoot, but a dissection of the shoe showed only one Zoom Air pod.
With adidas continuing to improve its business in the US and basically staying even with Nike internationally, this episode has to worry the brand. If your signature technology is not being placed in the shoe during manufacturing it calls into question all of your footwear. The story hasn’t taken off in the US for the Jordan and isn’t very big in China, but if this gets legs and begins to grow (Nike did get in front of it by admitting and offering refunds), brand loyalty could be affected.
This could be a positive for Chinese brands Li Ning, Anta and 360 and it also allows an opening for Under Armour who is looking to expand internationally in order to reach 7 Billion a year.
This is definitely a story to keep an eye on.
