Nike’s Mark Parker Talks Price Points Less Than $100 on the Radar, Digital Shopping and More
Although the company fell short of analyst expectations, Nike Inc.’s Q3 sales in North America grew 7 percent to $3.8 billion. And on the firm’s conference call today, Mark Parker highlighted the period’s successes.
“In innovation, we led with bold platforms like Air Max in sportswear and adaptive technology [Adapt BB] in basketball, we kept consumers coming back for more with a fast pace of fresh options in our power franchises. And with the energy for sportswear at an all-time high, Nike continues to stand out in the active lifestyle marketplace through our authentic position in sport,” the company’s chairman, president and CEO explained.
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Concerning the popular Air Max franchise, Parker noted that newer looks such as the Air VaporMax and Max 270 were hits, and classic silhouettes including the Air Max 95, Air Max 97 and Tuned Air performed well. Also, the Air Max Dia for women was deemed a success.
And the latest lifestyle-focused look from the franchise, the Air Max 720, has experienced strong consumer demand since its debut, Parker explained.
Aside from the Air Max line, leading looks in other key franchises boosted sales such as the Air Force 1, the Air Jordan 1, the Kyrie 5 and the LeBron 16.
“We’re delivering a faster cycle of fresh assortments of our power franchises,” Parker said. “We do that by offering more options of colors and materials, inspired by more targeted and relevant storytelling and the strategy is paying off.”
And the digital connection Nike has with consumers was also a bright spot for the company. During the call, Parker stated the company’s digital business was up 36 percent during the quarter, on a constant currency basis.
Traffic and revenue for the quarter from the SNKRS app, according to the exec, was up triple digits and that 17 of the top 20 launches on the platform had 100 percent sell through (including the Air Jordan 11 “Concord” launch, which he described as a record-breaking). Also, the company’s “physical to digital” retail experience continues to be successful, with more than 50 percent of the transactions at the House of Innovation stores in New York and Shanghai coming from Nike+ members.
Looking forward, Parker said consumers can expect to see collections in stores with more digestible price points.
“Specifically, for next fiscal year, we’ve fast-tracked new collections under the $100 price point and we’re aligning the merchandising and marketing teams to support them throughout the marketplace,” the exec said.
Parker also teased an upcoming running cushioning system and the release date for the debut signature sneaker of NBA star Giannis Antetokounmpo.
After Nike Inc. reported today its North American Q3 sales missed the $3.9 billion mark that analysts had predicted, the company’s shares stumbled in after hours trading. Overall, the company reversed its year-ago losses to post Q3 profits of $1.1 billion, or 68 cents per share, besting the 65 cents per share analysts had predicted. Revenues also gained 7 percent year over year to hit $9.6 billion, in line with what market watchers had expected.
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