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Innovative Retailer: Nike – Retail Insider


Brought to you by Retail Insider and Flooid

Name: Nike aka The Swoosh

The Place: Headquartered in Beaverton, Oregon, but surely
one of the most globally recognisable brands anywhere on the face of the earth.

The Story: This is the story of obsessive design. Focused on one product. And how constant and unrelenting iteration of that same product can eventually lead to a market capitalisation of around $144 billion.

The famous Nike Shock Drop alert

Blimey: If I said to you – give me the iconic Nike
product – you would obviously say…

Um. The Nike Dri-Fit golf skirt? Nope, you would obviously say…

The Nike Cropped tennis tank? Oh come on! You would say the Nike Air sole.

The Nike Air sole: Finally. But, while Nike Air is undoubtedly
an iconic retailing phenomenon, behind that there are a host of innovations going
on including Nike Fit, NikeLab, Nike Adventure Club, the Consumer Direct Offence
aka Nike Direct.

Wait, that sounds like a military manoeuvre: Well it kind
of is. Announced in 2017 it basically created a new organisation within Nike
which united the online Nike.com with all the direct to consumer retail and
Nike+ digital products. Mobile-led it is designed to lessen what you might call
the traditional brand route to market via concessions neatly cutting out the
middle person.

And how does a brand do that exactly? For example SNKRS Stash which uses geo-location to unlock access to exclusive Nike products and the famous Shock Drops where hundreds of consumers suddenly get told that a boutique in a certain city will be the only one selling this particular line of limited edition trainers thus beginning a high-octane chase sometimes across continents to be one of the few lucky customers. 

I’m so out of touch: Nike has swivelled its innovative eye Sauron-like round to the
customer while kind of still keeping it on the product. It’s really quite a
feat.

It’s all a bit overwhelming TBH – can we just start gently at the
beginning:
No
probs. It’s 1964, a simpler time when people just went into shops and bought
things, the coach and athlete team of Bill Bowerman and Phil Knight start Blue
Ribbon Sports, which in 1971 becomes Nike. But even at this point the
innovation juices are running as Bowerman’s first trainer sole was based on the
grooves of a waffle iron (Nike are still producing this item by the way). But
the company had dreams of letting people run on air and in 1979 it released the
Tailwind featuring the first use of Air technology although the world had to
wait until 1987 for the first Air Max shoe – these are the ones where the mid
sole full of pressurised gas is actually visible.

With you so far: Since then there have been major design leaps in 1995 (Air Max 95); 1996 (Air Zoom Alpha); 1997 (Air Max 97); 2006 (Air Max 360 – the first one with a completely foamless sole); 2017 (Air VaporMax – the one with no glue, no sock liner and no mid sole).

Air VaporMax Plus

Yes, I agree this is obsessive design engineering: And on top
of that Nike has spun another trading arm out of its engineering prowess with
plastics. Trading as Air Manufacturing Innovation this division works with
companies throughout the world from automotive to medical in designing, manufacturing
and developing customised plastic solutions. But back to the trainers, in 2018
we had a really interesting new one.

Let me guess – no actual shoe. You are running barefoot: So funny.
But no, it was the Air Max 270 and that was the first leisure, as opposed to
running, shoe featuring the Air technology so you can now walk on air too. All
of which brings me neatly to NikeLab.

Go on then: NikeLab is a speciality streetwear line from the sports giant which
launched in 2014 and focused on creating high-end fashion style based on its
sporting design heritage while also reinventing what they call the ”retail
environment” – meaning that the shops are also very cutting edge. Nike saw the
whole leisure wear as everyday wear thing happening right from the get go. But there
aren’t many of these NikeLabs.

Have we got one in the UK? Yes indeedy. In Shoreditch, East
London. Full of limited edition stuff and customising potential. You name it. Is
it retail or is it a brand experience?

Whatever, tell me about customising trainers…It’s got its
own name obviously, Nike By You, and there are a number of designs that can be
personalised. Once the system knows that you want to edit the shoe it will keep
updating the product image so you can see how your changes will look. Customers
can even put a personal ID on it. As long as there’s no swearing, of course.

Clever: But that’s nothing compared to the individualisation of NikeFit
though which could be summarised as ‘shoe sizes are so old hat’.

Now, hang on a minute. I can cope with the loss of the half size
but this is something else entirely:
Seriously though, Nike reckons most shoes do not fit their wearer
properly. So they bought Israeli firm Invertex to leverage its foot ID
technology. So with NikeFit customers can photograph their feet on the phone
and within seconds the correct fit will be beamed back to them. Boom.

I used to like that slide machine they used in Clarks. It was very comforting: This is the same sort of thing though only done digitally because no one measures adults feet do they? And it will save so much store staff time bringing the wrong sizes and all that. And of course it would be rude not to take that data and use it for planning and marketing purposes too. Direct sales account for 30% of Nike’s profits and only an idiot would bet on that going down.

Nike Fit in action

So this whole digital thing is pretty massive for Nike? Fundamental –
especially as that part of the business is performing so very well, all part of Nike’s promise to be “more personal
at scale”. There are a number of apps now and
as you would expect Nike is constantly debuting new functionality so for
example when you enter a Nike store, the store recognises you and shows you
products tailored to you on the app, you can reserve products to try on, which
will be held for you in a personal locker, and pay through the apps too.

And honestly I don’t
even have space to go into the personalised subscription model service for
children – the Adventure Club. But it’s a win-win, which is fitting because
Nike is the Greek goddess
of victory, you know.

Final thing – do you pronounce it Nike
or Ni-key
: As long as you’re part of the
community who cares. Whichever.

Yeah, Just Do It: Hey that’s good, you should trademark it.
Oh, wait…

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