Over the next decade, we will see the world's middle class population grow by 1 billion consumers. NKE seems positioned to be the shoe for athletes and weekend warriors around the world. NKE is dominant in two categories with running the “heart” of the NKE brand and Basketball the “soul”. In fact in the United States NKE basketball holds upwards of 90% market share.
Jordan more popular today than in his playing days
Michael Jordan is its own brand. Amazingly when the first Air Jordan was released back in 1985 the shoes were banned by the NBA because they did not have any white on them. Jordan wore the shoes anyway and every time he stepped on the court he was fined $5,000. Nike of course used this as a marketing tool hinting that the shoes had a certain edginess to them. Brand Jordan is now selling 3x more today than when Michael Jordan was playing.
Custom made shoes are coming
NikeId has customised shoes that lets customers choose colours and styles. Hope not many choose this option below but glow in the dark elephant print is available to help you stand out at night and be somewhat subtle during the day. NKE believes in over two years time they will be able to scan your foot and have a shoe created specifically for you.
All about innovation
NKE is at the forefront of innovation using digital technology with Nike+ and the ability to customise shoes. Their latest invention the Flyknit shoe is meant to feel like a sock not a shoe. When customers/athletes first wear the shoe they start looking down at their feet because they forget they are wearing shoes! It might be strange at first but apparently its hard to go back to a normal shoe.
NKE also leads digitally with NIKE+ which lets 20 million members track activities like running and helps you to set and achieve fitness goals. They have run over 1 billion miles. This is important for NKE as they receive information on runners activities so they customise their NKE experience based on their habits.
Finally for NIKE women is a huge opportunity. Today, in North America NKE's Women's business makes up less than 25% of overall business.
Jason
Disclosure: Decisive has no long position in Nike (NKE) stock
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