Innovation momentum waning at Nike
Some of the challenges facing Nike specifically include waning innovation momentum, with its sportswear offerings – historically a strong driver of profitability – “very dated”, according to our specialist. Nike is re-launching past favourites, we heard, which is “not a sign of strength”.
Meanwhile, emerging players such as Hoka, Saucony and Salomon are slowly eating into market share. “It started really with Brooks and Hoka years ago, having been a force in running… and… taking market share from Nike women’s,” the specialist said.
In athletic footwear, running has dominated the space but trail is gaining traction. Here, Salomon has “locked that up through authenticity and some of their partnerships”. Puma is also making strides in casual as well as in basketball with its Lamelo shoe and partnership with Foot Locker. In the specialist’s view, Nike is not facing “one behemoth competitor”, but “spread out threats” that are nipping at its heels.
The Interview also discussed wholesale’s re-emergence as a highly relevant channel after Covid-induced pullbacks. “Nike has realised, as have a lot of other brands, that they need a healthy wholesale marketplace to speak to a variety of different consumers for a variety of different reasons.”
Overall, Nike is “still in a relative position of strength in the industry and compared to its peers”, the expert said, thanks to its stable of successful franchises. The company is focusing on selling to consumers “more of their favourites” and clearing inventory profitably through back-to-school and into the holiday season.
The expert also noted that product partnerships are key for brand success but that a saturation point has been reached in the industry. “It’s going to be critical for Nike to continue forging into new partnerships, being more nimble to work with younger, more relevant, maybe even some slightly unknown brands.”
Click here to access all the human insights in Third Bridge Forum’s Nike – Channel-Mix Strategies & Inventory Turnover Interview.
Related Transcripts
The information used in compiling this document has been obtained by Third Bridge from experts participating in Forum Interviews. Third Bridge does not warrant the accuracy of the information and has not independently verified it. It should not be regarded as a trade recommendation or form the basis of any investment decision.
For any enquiries, please contact sales@thirdbridge.com
