How Phil Knight Created Nike
A review of Shoe Dog by Phil Knight, Nike founder.
LeBron James, Michael Jordan, Cristiano Ronaldo, Tiger Woods. What do they have in common? They all wore that Nike swoosh. Funny logo. Where did it come from? And, “Nike,” what does that even mean? What makes people swear by the brand? What makes sneakerheads and athletes obsessed with it? The story of Nike is a story of creativity. Phil Knight is the mind behind Nike, and he is one inspired man.
Phil Knight wrote the fascinating memoir Shoe Dog for you. He wanted to inspire you with his journey as an entrepreneur. He wanted to show you that obstacles should never, ever hold you back. Does he succeed at his goals? Yes, yes, and yes. From lost business school graduate to struggling entrepreneur to CEO of a publicly-traded multi-billion dollar company, Knight goes through a lot and confesses everything about it.
We begin in Oregon, where Knight found himself living at home with his parents in his twenties. He graduated Stanford Business school, but he felt lost in life. His most powerful dream was to sell Japanese running shoes in the United States. He needed to go to Japan to make it happen. So, he and a friend flew to Hawaii with the intention of traveling the world. They found Hawaii to be so beautiful that they stayed for a while. After jobs in encyclopedia and stock sales, Knight realized that his dream was wasting away.
That Thanksgiving, Knight flew to Japan. The country was a spiritual wonder to him. He writes, “I spent hours sitting on benches in walled gardens, reading about Japan’s dominant religions, Buddhism and Shinto. I marveled at the concept of kensho, or satori — enlightenment that comes in a flash, a blinding pop.” Knight became obsessed with enlightenment, feelings of oneness, and the loss of self. Those ideas would guide his philosophy of Nike.
When Knight met with the Japanese Shoe company Onitsuka, he made the first step to building today’s Nike. He pitched to Onitsuka executives that he would sell the brand in the United States. They agreed with the idea. They even were thinking about it themselves. Knight called his makeshift company Blue Ribbon. He had an order of Onitsuka Tigers shipped back to Oregon. But, he did not go home so fast.
You could see that Knight was an artist at heart. He continued his travels around the world. He used those travels as personal inspiration. Hong Kong, the Philippines, Thailand, Vietnam, India, Egypt, Israel, Italy, France, Greece — these countries sparked Knight’s imagination. When he arrived in Greece, he fulfilled another dream. He visited the famous Acropolis. He saw the Parthenon and the Temple of Athena Nike, the goddess of victory. This event would later influence Knight in building his company.
With a return to Oregon, Knight tried to embark on the business of Blue Ribbon. There was one small problem. The shoes weren’t there. He became an accountant and waited. He waited too long. Way too long. The Onitsuka shoes finally came after nearly a year. The shoes were incredible art to him. He writes, “I’d seen nothing in Florence or Paris that surpassed them.” Knight was the aesthetic visionary, the man with the imagination for powerful images. He needed a technical mind to pair with himself. And, that technical mind was Knight’s old track coach from the University of Oregon. Bill Bowerman, the coach, had been obsessed with the construction of track shoes. He often experimented on student shoes and kept a workshop at home. Knight split ownership of the company with Bowerman.
The sales inspiration for Knight was the runner. Knight went to sell at track meets. Sales were great. His belief in running was strong. It was inspirational to customers. He writes, “I believed in running. I believed that if people got out and ran a few miles every day, the world would be a better place, and I believed these shoes were better to run in.” The art of sales is the inspiration of belief.
Knight expanded the sales region past the Pacific Northwest to California. By hiring friend Jeff Johnson, Knight would make the Nike legend possible. Johnson was a successful salesman who helped Knight build the business in California and the East Coast, among other areas. Knight and Johnson spent years fighting against a competitor U.S. distributor for Onitsuka. They flew to Japan for meetings to argue their right for distribution. Knight struggled with banks for loans to buy stock for the growing Blue Ribbon. They worked against competitors like Adidas. The battles were constant. He quit his job as an accountant to work as a professor. He wanted more time for Blue Ribbon.
The move paid off. Sales reached $150,000 in 1968 and about $300,000 in 1969. Knight became full-time CEO and left the professor job. He experienced years more of struggle with banks and Onitsuka. He conflicted too often with Onitsuka, so he found alternative factories and producers for his shoes. Onitsuka tried to bring in other distributors. Knight sidestepped everything by producing soccer shoes for football in a new factory in Mexico. It was not a breach of contract with Onitsuka because the contract specified only track shoes in the U.S., not football or soccer shoes.
Here’s where Knight got really creative. He used the conflict with Onitsuka to start his own brand with the Mexican factory. By collaborating with his team, he basically came up with the brand we know today. Knight began with the logo. He instructed his artist with an idea that might represent running or athleticism. Knight writes, “Something that evokes a sense of motion.” From the confused exchange between Knight and his artist, the result was iconic. The logo was the Nike swoosh. Knight writes about the team’s responses to it, “It looks like a wing, one of us said. It looks like a whoosh of air, another said. It looks like something a runner might leave in his or her wake.”
The creativity of the logo is only matched by the inspiration of the brand name. Here, we go back to Greece. But, it wasn’t Knight who made the name. It was the salesman Jeff Johnson. It came to him in the night. He had a dream with the name. It was Nike. The factory had a deadline to start production. So, Knight decided quickly on Nike. He thought that Nike had strong sounds in it. It was short, too. Knight writes, “Also, I liked that Nike was the goddess of victory. What’s more important, I thought, than victory?” And, Knight achieved victory. But, not so fast.
The new factory was a failure. It produced bad, fragile shoes. To continue to compete against Onitsuka, Knight collaborated with a man named Sole. Sole had factories in Japan that could produce a variety of shoes. Knight had the factories make types for tennis, basketball, and running shoes. He felt inspired to name them all. U.S. Open for tennis. The Blazer and Bruin for basketball. Marathon for running. These name examples had origin stories in Knight’s mind. The important thing is that Knight felt creative and inspired. He writes, “I was feeling it. I was in the zone. I started dancing around the room. I heard a secret music. I felt like an artist, a creator.”
In the rest of the memoir, Knight details the continued financial and production troubles of Nike. They overcame legal conflicts and fierce competitors. Through technical innovation in the shoe and strategic athlete endorsements, Nike dominated the American market by the end of the 1970s. Some of the famous early endorsements were from runner Steve Prefontaine and tennis player John McEnroe. Knight believed that his athletes were more than human advertisements. He wanted Nike to be a vehicle for the spiritual transcendence of sport. A throwback to that trip to Japan. He writes, “When sports are at their best, the spirit of the fan merges with the spirit of the athlete, and in that convergence, in that transference, is the oneness that the mystics talk about.”