Case Study:
Nike Regains Its Stride in the Digital Market
By Casey Neal
For anyone who has watched, played or read about sports in the last 30-plus years, it would be nearly impossible to not know about Nike and the impact the company has had on the athletic footwear and sportswear market. With iconic, world-class athletes as the face of their brand, Nike quickly achieved global success in the 1980s. They followed that with the brilliant “Just Do It” campaign, which challenged consumers to use Nike products to achieve their own athletic greatness. Today, the company continues to strengthen their brand through a commitment to digital and social media marketing — and they are once again leaving the competition in the dust.
In the beginning, Nike hit on a brilliant branding strategy:
Have the world’s elite athletes define your brand.
And no athlete gets more credit for defining the Nike brand than NBA legend Michael Jordan. The partnership was so powerful, in fact, that Nike actually helped define Jordan’s basketball career, as they created the sports world’s first signature shoe, the Air Jordan. Check out this classic Nike ad, featuring Spike Lee and Michael Jordan.
And the Jordan-Nike relationship is still going strong. According to Forbes.com, the Jordan Brand, a division of Nike that includes Jordan’s signature shoe line and athletic-apparel line, accounted for the vast majority of Michael Jordan’s $80 million corporate-partnership earnings in 2012. For more on the revolutionary Jordan-Nike partnership as well as the value of co-branding, be sure to read this article by my Britton colleague Steve Penhollow: “Co-brands Are a Brand’s Best Friend.”
Today, Nike continues to partner with world-class athletes, such as tennis star Rafael Nadal and NBA star LeBron James. But in the post-Jordan era, this strategy has shown its limitations, as evidenced by Nike’s tarnished relationships with American cyclist Lance Armstrong and PGA golf phenom Tiger Woods. Armstrong was caught in a blood-doping scandal and stripped of his seven Tour de France titles. Woods was hounded by intense scrutiny over marital infidelity and other negative publicity regarding his personal life. Nike quickly cut ties with Armstrong, and they were forced to reposition their partnership with Woods. But the damage to their brand had been done.
Nike began experiencing a problem many brands would love to have. They had grown so large that it was becoming difficult for them to stay cutting-edge with a strategy that had served them so well. After all, there is only one Michael Jordan. Fortunately for Nike, they had already been rethinking their branding strategies.
As early as 1996, Nike was experimenting with digital marketing (they launched Nike.com that year for the Summer Olympics in Atlanta).
The Internet presented a new frontier, and with their established global appeal, Nike was well-positioned to take advantage of this emerging digital platform.
By 2005, Nike was moving into social media, joining MySpace and YouTube. Taking advantage of Internet users’ affinity for sharing content, Nike began posting videos to YouTube, including the now-famous Ronaldinho “crossbar” video, one of the first videos to go viral 1 . The video features Ronaldinho, a world-renowned soccer star, pulling off an amazing trick shot.
But it’s clearly not traditional advertising. It doesn’t sell a specific product. It sells the brand. And it’s done through free, shareable digital content. Nike was making their brand accessible to a modern, plugged-in global audience. And from there, they only got better at the game.
In 2010, Nike really kicked their digital marketing into high gear, with their Nike+ running app, which uses GPS technology to track users’ workout data. And it doesn’t just provide dry statistics. There are a number of little touches within the app that really tell you Nike listened to feedback from athletes about how they train. For example, there is a countdown before you start so that you can put your device in its holder and start running before the application starts. There is also a feature where, at the end of your run, a Nike athlete, such as Tim Tebow or Rafael Nadal, will give you an “atta boy” for finishing a workout or setting a personal best 2.
The app integrates with Nike.com as well as Facebook and Twitter, allowing users to post and share their workout information. It has essentially created Nike’s own social network.
In his article “How Nike Is Killing It in Social Media Marketing,” John Cashman of Digital Firefly Marketing describes the power of Nike+. “[It] allows you to track your activity throughout the day, either generally or with activity-specific applications. Their bet is that by owning the data and providing services to you, your brand loyalty will increase, and you will be more likely to buy from Nike than another brand. Nike has realized that the purchase of a Nike product isn’t the end of the marketing cycle, but the beginning, [as] they can offer a consumer a wide variety of products and services tailored to individual needs.”
And Nike is starting to see impressive results, both in the sheer number of users (to date, over 7 million members of the Nike+ community 3) and in profits. According to the brand-consultancy firm Interbrand, “The [Nike] brand returned to growth in the past year [2013], with revenue increasing across every category and region, up 16 percent to USD $24.1 billion, the highest rate in 15 years. It’s a clear signal that Nike has moved beyond conventional category boundaries toward creating a true lifestyle brand.”
With their savvy, cutting-edge transition into digital and social media marketing, it certainly appears that the Nike brand is back and better than ever — and that can’t be good news for the competition. Nike’s revival can certainly teach us a thing or two about how the best brands survive and prosper. Success can be fleeting without a strategy that allows you to constantly self-assess your brand, enabling you to innovate and push the boundaries by never becoming complacent with your success. And you need to be willing to evolve, using all the tools at your disposal to gain an advantage.
Hmm, that kind of sounds like the qualities of a great athlete — one who is destined for success. Is that a coincidence? I’m sure Nike doesn’t think so.
Casey Neal
Editor
BMDG
Please note: Britton Marketing & Design Group admires the Nike brand, but we are not affiliated with the company in any way.
Photo: multitel / Shutterstock.com
References:
1 http://mashable.com/2011/09/22/nike-social-media/
2 https://digitalfireflymarketing.com/how-nike-killing-it-social-media-marketing
3 http://nikeinc.com/news/nikeplus-experience
