It's been just a few days since JD Sports (JDSPY) Chief Executive Régis Schultz lambasted Nike (NKE) for its failure to innovate and bring in new customers through the doors.
JD Sports, one of Europe's largest sporting goods retailers, relies on the brisk pace of flashy new sporting trends to bring in foot traffic and help things like sneakers fly off their shelves.
Related: Lululemon releases a first-of-its-kind product
But Schultz says that hasn't been happening with Nike so much lately.
“Nike has been so successful but they just stopped a little bit bringing in new stuff,” Schultz told reporters during a call in late March.
He then compared Nike to some of its main competitors, claiming they have been pleasing customers by creating and capturing trends.
“At the same time, Adidas (ADDYY) is doing very well, New Balance is doing very well,” he said.
Schultz added that "shoppers get bored very quickly" and "if you don’t bring in new stuff, new product, new innovation, new color, I think the demand is suffering.”
Nike still remains the top spot for sports apparel in the world. The top five biggest brands, in order are:
- Nike
- Adidas
- Puma
- Lululemon
- Under Armour
But with New Balance quickly leaping up to spot No. 6 over recent years, and giants like Adidas and Lululemon constantly coming out with new crowd-pleasers, it's imperative that Nike work to get back on track and create something that suits everyone, from professional athletes to streetwear enthusiasts.
Nike coming out with new plans
Whether Nike execs were listening in on that call or the ensuring reporting we'll probably never know. Management does seem to be aware of the stagnation, however.
"Simply put, we need to make adjustments in four areas," Nike CEO John Donahue said during the Q3-earnings call in late March. "We need to sharpen our focus on sport. We must drive a continuous flow of new product innovation. Our brand marketing must become bolder and more distinctive."
Nike execs are aware that trends are moving faster than ever before, thanks largely in part to social media, and they intend to capture what they can in the breakneck environment. Nike has been strong with this in decades past, but its market share is quickly getting nibbled down by smaller forces as consumers gravitate toward niche brands that cater more directly to their interests.
"Trends are igniting in different places and rapidly spreading around the world. Nike needs to be faster. And so, we're accelerating a multiyear innovation cycle," Chief Financial Officer Matt Friend said on the call.
The sneaker giant quickly released new plans for the upcoming summer, which promises to excited customers — and perhaps bring back some enthusiasm for the brand.
Nike 'sharpening our brand storytelling': CFO
"We are sharpening our brand storytelling to tell fewer, bigger stories with greater reach," Friend said. "We will focus our demand-creation investments to elevate our brand and most distinctive products, leading with the Voice of the Athlete, amplifying our new innovation, and engaging consumers at the point of sale."
Nike added that it hoped the upcoming 2024 Paris Summer Olympics would serve as a tableau for its refreshed product lines and reinvigorate consumers' excitement for the brand.
"We believe the Paris Olympics will serve as a catalyst for our brands as we launch our newest Nike Air innovations for athletes," Friend added.
"As we look forward, we see that our Olympics Air for Athletes campaign will be the boldest expression of Nike's brand voice in many years. Third, we are in the midst of shifting our product portfolio toward newness and innovation," he said.
