Nike Core Strategy Poses Major Threat To Department Stores & Shoe Retailers. – DrillKing
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Nike Core Strategy Poses Major Threat To Department Stores & Shoe Retailers.


on Bad news for a lot of shoe retailers around the U.S. The very core of Nike’s strategy will pose a major threat for retailers in North America.

In his first quarter report, CEO Mark Parker emphasized Nike’s primary focus aiming for Direct interaction with the consumer, which directly means bypassing traditional shoe such as Foot Locker, but it could also harm smaller city store too.

“We have aligned into a new formation, the consumer direct offense, to focus on reinventing our business and the industry,” Parker said on the company’s earnings conference call. “With the new consumer direct offense we are taking that consumer connection one step further. We are going deeper. We are connecting more personally to help each individual make the right choices for them.”

Nike plans to grow the E-commerce business by a factor of seven, with a billion dollar in 2015 to $7 billion by 2020, which is actually three times the expected growth rate of the e-commerce industry itself, as the NRF (National Retail Federation) estimates 8-12% US e-commerce growth in 2017.

“Over the past 90 days it has become increasingly evident to all that the North America marketplace is undergoing significant transformation.”

get link Reports are crystal clear.


‘This is a core focus in the US, where the company emphasized the dire need to shift its strategy.’

As of Sep 27, 2017, The Financial Times reported that the consensus recommandations  investment analysts covering Nike Inc advises that the company will outperform the market. ouf of 40 votes from the most notorious analysts .

(Def : A consensus recommendation for an individual stock compiles ratings from a number of analysts who track that stock.)

Nike has emphasized its digital business and branded stores to increase customer interaction. In fact, 90% of Nike’s business in China is already transacted through Nike-branded experiences (digital and physical).

The newest technologies such as the auto-lacing ‘Hyperadapt’ sneaker propelled by Ronaldo and others combined with the Vapormax designs are part of this accomplishement.

“Nike has the firepower and will to generate enough interest outside of traditional channels,” UBS’ Michael Binetti said.

Let us know what you think will be the consequences for smaller shops or for big wholesalers.

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