Nike CEO John Donahoe recently said, “Digital is the new normal. The consumer today is digitally grounded and simply will not revert back.” Nike’s direct sales grew by 83% in Q1-2020. In June 2021 Nike topped this again. Nike announced its fourth-quarter (Q4) and annual performance for the fiscal year ending May 31, 2021 with annual profits soaring 196% over last year and 42% over 2019 which was pre-pandemic.
How? Nike is a marketing powerhouse and can be found in athletic big box stores just as readily as high end boutiques for its exclusives with designers. But it’s new line of growth isn’t store driven, it’s Direct-to-Consumer (D2C).
Nike is not considered a D2C brand. It’s not the first name you think of along the same lines as Warby Parker and Casper. But a look into Nike’s latest earnings report paints the real picture of the success. This picture clarifies why Nike is a role model in this shift to digital.
Nike isn’t just selling shoes now. It’s selling an experience. For runners, we often don Nike gear – shoes, shorts, shirts. That’s the usual. Now we can also have Nike as a virtual coach on our Apple Watch or iPhone using the Nike Run Club (NRC) app.
In the old normal, I used to travel to Las Vegas for multiple conference a year. One Sunday, after hotel check-in and a bit jetlagged coming over from Germany, I put my sports dress on (Guess what brand) – and went for a run from my hotel down to the fabulous Las Vegas sign. As a loyal customer I am also using the NRC (Nike Running Club) app for tracking my running results. The app holds my current running shoe, my weight, my age, my height. For me it is motivating to check how I did this day, or month over month and so on. What a great time. See my picture from that sunny Sunday.
After my shower I looked at my phone and checked my emails. Nike send me congratulations email for my Sunday run. This was just the beginning. As they knew I am in Vegas, based on my tracking, they recommended to stop by the local store. The email contained the map and address. Via Google Maps I could see it is only a 10-minute walk for me. As I had time this afternoon, I went out for window shopping, which turned into real spend.
Finding new trends in a flagship store is easy, but Nike made it even more simple for me, as the logged me in on the mobile device of the store assistant. With my Nike ID all my customer data & profile is available and ready to use. I checked out and paid directly with the store manager and left with a new pair of shoes.
Data is behind Nike’s growth, but it’s their right use of data. Nike creates a relevant customer experience, connecting the dots between product, profile, location, and engagement. Nike leverages its master customer data and connects to customers in real-time or near-real-time.
Broadly speaking, modern Master Data Experience Platforms allow users to graphically view products and the relationships: child-variants, vendors, customers, locations, and geography. With a multi-domain platform, visualizing an enterprise 360 is made easy with Vendor, Supplier, Customer, Product, and Location, among other domains, all in one view.
And this is how Nike continues to succeed: Nike recognizes the importance of experience and continues to invest in building a more direct line of experiences, not just product, to their consumer base. Nike connects the dots of product, experience, and context.
As a result, they reach beyond their core athletic market and build direct, deeper, experiential bonds with a broader audience.