Nike: Direct Relationships & Digital Penetration
Nike has the brand, product and scale to go direct to its customers
Benedict Evans • The Great Unbundling
Epic post on how Nike lost $25B in a day by trying to make everything data-driven:
"Nike invested billions into something that was less effective but easier to measure vs something that was more effective but less easy to measure.
In conclusion: an impressive waste of money." https://t.co/YyLH98B0eH
Nike is down 30%+ YTD (wiping $60B+).
A former Nike branding exec wrote a viral post and blames it on three decisions Nike made in 2020 under incoming CEO John Donahue.
The plan prioritized the direct-to-consumer (DTC) business but backfired:
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(1/14)After observing $250M+ in ad spend on @facebook, I’ve noticed that DTC brands that scale very quickly have a few things in common:
- High margins & high AOV
- Business model is focused on retention
- Cross-border activation is simple
- Product is a consumable & impulse buy
Faheem Siddiqitwitter.com