Retail news that keeps industry pros in the know
Retail Brew delivers the latest retail industry news and insights surrounding marketing, DTC, and e-commerce to keep leaders and decision-makers up to date.
Nike’s Q4 earnings sprinted past estimates last week with no signs of slowing down. The athletic wear giant is expecting revenue to surpass $50 billion in 2022—and seems to have landed on the winning strategy.
The workout: Nike is exercising a focus on customer loyalty with its membership model. 300 million Nike members worldwide helped fuel a record $3 billion in online sales during the quarter.
“The loyalty program and [Nike’s] various apps [help Nike] figure out who that customer is, so they could then feed that into what they’re doing on Nike.com,” Kristin Kohler Burrows, senior director of Alvarez & Marsal’s consumer and retail group, told Retail Brew.
Cut from the team: The company is also thinking strategically about wholesale partners as it zeroes in on DTC. Chief Financial Officer Matt Friend said in an analyst call that DTC is expected to comprise 60% of the biz by 2025, up from ~40% now.
- In March, Nike said goodbye to Big 5 Sporting Goods, DSW, Dunham’s Sports, Olympia Sports, Shoe Show, and Urban Outfitters.
- Last year, nine partners, including Belk, Dillard’s, and Zappos, met the chopping block.
“Nike only picked those partners that could really represent the brand the way they want it to be represented. If you look at their partnership with Footlocker, they've identified the biggest player in the marketplace. They both need each other,” Burrows said.
“At the same time, those players are so reliant on Nike that they also realize they have to play by Nike's rules.”—JG