Nike says goodbye to more longtime wholesale partners
Nike reportedly plans to stop selling to six additional wholesale accounts — DSW, Urban Outfitters, Shoe Show, Dunham’s Sports, Olympia Sports and Big Five — as it increasingly emphasizes direct-to-consumer (DTC) commerce and exits “undifferentiated” wholesale accounts.
Nike apparel will also soon no longer be found at Macy’s, although athletic footwear sales will continue through in-store shops operated by The Finish Line.
Sam Poser, equity analyst at Williams Trading, broke the news based on his proprietary checks. Nike didn’t confirm the exits but several stores have done so to the media.
Nike first announced its Consumer Direct Offense strategy in 2017 as a five-year plan to focus growth on 40 “strategic” retail partners and its own DTC.
Last year, Mr. Poser reported Nike was ending its relationship with nine accounts: Belk, Bob’s Stores, Boscov’s, City Blue, Dillard’s, EbLens, Fred Meyer, VIM and Zappos. The brand has also cut off numerous smaller independents.
The latest exits were more surprising — three sporting goods chains that helped first establish Nike in the sports space, two major off-pricers that reach families and fashion players in Macy’s and Urban Outfitters.
Since 2017, digital has become a bigger priority for Nike. Online across owned and partner sites are expected to eventually account for half of sales, up from 35 percent in its most recent quarter. The company has developed three digital-first retail concepts — Live, Rise and Unite — and is set to accelerate the store openings.
Nike officials have also regularly called out the importance of select retailers, including Dick’s Sporting Goods, Foot Locker and Nordstrom in North America, that are collaborating with the brand on unique in-store concepts or driving member engagement.
Last summer, CEO John Donahoe expressed what the strategic vision would be. “Consumers want modern, seamless experiences, online to offline, so we’re accelerating our approach,” he said. “Our OneNike marketplace strategy leads with Nike Digital in our own stores and embraces a small number of strategic partners who share our vision to provide a consistent premium shopping experience.”
On Nike’s recent third-quarter earnings call, Mr. Donahoe said, “We’ll work with a smaller number of strategic partners that see the same future we do, and that want to and are willing to share membership data so that we can, together, deliver a very seamless experience, a very personalized experience for our consumers.”
- Nike Will No Longer Sell to DSW, Urban Outfitters, Shoe Show + These Stores, Analyst Says – Footwear News
- Nike Inc (NKE) Q3 2021 Earnings Call Transcript – Nike
- Nike Inc (NKE) Q2 2021 Earnings Call Transcript – Nike
- NIKE, Inc. Announces New Consumer Direct Offense: A Faster Pipeline to Serve Consumers Personally, At Scale – Nike
- FY 2020 Q4 Earnings Release Conference Call Transcript – Nike
- What? Should Nike drop Zappos and others to focus on consumer-direct? – RetailWire
- Nike turns its back on ‘undifferentiated, mediocre’ retailers – RetailWire
- Nikes are getting harder to find at stores. Here’s why – CNN
DISCUSSION QUESTIONS: Is Nike at risk of no longer reaching certain customer segments or geographies with its pivot to direct-to-consumer and select “strategic” wholesale partners? Do you think Nike may need to make adjustments (if so, what kind) along the way?