How Nike Executives Think About Its Digital Ecosystem
Nike’s recent efforts to link your loyalty program together with one of its main wholesale partners, Dick’s, is representative in many ways of Nike’s strategy as a whole. One of the key pillars of Nike’s wheel is to effectively connect its shopping experience so that a customer buying on the app, online, in stores or even from its wholesale partners remains in its core ecosystem.
Daniel Heaf, vice president of Nike Direct, succinctly laid out the retailer’s goal at a media event on Wednesday. âWe use digital services to create a distinctive Nike experience that blurs the line between digital and our stores,â Heaf said.
Nike’s membership program, which now has more than 300 million members, is critical to making the effort work. Customer data is Nike’s ability key to keep customers in its environment, and Nike uses its membership to actively personalize a customer’s experience by recommending products or enticing buyers to access content in its training apps.
According to Iris Yen, vice president of Nike Direct Digital Commerce, Nike also uses the customer data it collects for very specific promotions to increase loyalty. On the retailer’s SNKRS app, for example, Nike sent out personalized offers to buy its Off-White Dunk, 90% of which went to members who previously missed out on an Off-White collaboration.
Nike executives cited a recent collaboration with Megan Thee Stallion as a prime example of the kind of connections they’re trying to make: The athletics retailer has created wellness and workout content with the artist for her workout apps then also created a collection of clothes with her that customers could purchase.
âIf a member engaged with us through one of Megan’s workouts, we could immediately connect her to the inspirational story or selected looks on our commerce channels,â said Steve Scarpetta, vice president. and Managing Director of Nike Direct Digital Commerce for North America.
This particular effort was aimed at Generation Z, a demographic that Nike is also targeting with one of its new Nike Live stores in Williamsburg, New York. Nike’s membership and apps are closely linked to the in-store experience in its small format stores, and each location is built to fit the neighborhood. In Williamsburg, that means targeting Gen Z women.
The company opened the store primarily because it noticed high engagement in the region with its training apps, but no physical point of contact for these shoppers. The store has local partnerships with gyms and fitness studios, and the products are also customized to Gen Z preferences, with an entire floor being marketed in a gender-neutral manner, according to online stores vice president Nike Direct. for North America Frank Ha.
âNike Live is where we’ll see our biggest store growth, expanding into many of our key cities,â Ha said. âThis small format allows us to be part of consumers’ shopping journeys, especially in the neighborhoods where they live, work and play. Our Live stores have a strong focus on women and are our best expression of retail for women across all of our concepts. “
While Nike Live stores are perhaps the most obvious in their use of data to personalize the shopping experience and assortment, Nike’s other key concepts are also data and digital driven. The flagship products of Nike House of Innovation, although much larger than Live stores, offer many services via the app, as well as in-store customization options. Nike Rise is a concept similar to Nike Live, but customizes at city level rather than at the neighborhood level. According to Ha, this store concept will arrive in North America in the near future.
In fact, a lot is coming to North America soon. Nike plans up to 200 small stores worldwide in the years to come, and executives said Wednesday that many would be in North America, where Nike “is growing rapidly and deliberately.”
âIn November and December alone, we’ll be opening nine new stores, and that’s more stores in two months than a few years before the pandemic,â said Shannon Glass, Nike Direct vice president and general manager for the North America.
According to Glass, the openings will cover both Nike Live and Nike Rise, as well as its Nike Unite concept, which is a value-driven store described as an âevolutionâ of the old Nike Factory stores.
Overall, Wednesday’s message was pretty much the same from Nike: digital channels and its direct-to-consumer stores will continue to lead its growth efforts. And the goal of creating a connected ecosystem is more present than ever.
âNike Digital is not a separate or siled job,â said Scarpetta. âDigital is truly the common thread of our One Nike Marketplace vision and it is at the heart of the daily lives of our consumers. “