Nike Is Trying to Find a Spark
Over the Fourth of July weekend, I did something that I hadn’t done in years: visit a shoe store – one of those massive shoe emporiums in a retrofitted space previously belonging to a now bankrupt retailer. The store’s entire inventory, consisting of thousands of shoes, was positioned on the showroom floor, viewable to the public. It was an enlightening experience to see firsthand how dramatically the lifestyle shoe market has changed since the pandemic. My mind has since been stuck on Nike and where the company will go from here.
In the 17 months since we last talked about Nike, the company has seen progress adjusting to the marketplace. A recommitment to wholesale distribution has worked as intended for Nike. There was no shortage of those iconic orange boxes at the shoe emporium store that I visited. Wholesale revenue is trending up again as Nike goes back on its direct-to-consumer bet from a few years ago. Nike’s revenue for the fiscal year that just ended was approximately flat, a much better result compared to the 10% drop in FY25.
In what may come as a surprise to many, Nike is again seeing momentum in running, which suggests market share losses may be slowing. Some of that is likely driven by Nike simply having inventory available where people buy running shoes. Nike is also seeing momentum with football (soccer) and kids.
Nike’s broader doubling down on sports to create brand halos in non-sports markets hasn’t faired as well.
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