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In 2021, then-Nike senior brand director Massimo Giunco was baffled to hear online fashion retailer ASOS come up repeatedly in meetings.
Giunco, who left Nike in June 2022 after 22 years there, had been in internal conversations in which Nike staffers suggested they meet with ASOS to borrow its digital tactics, he told ADWEEK.
These conversations made him uneasy because this wasn’t the Nike he’d long known: a brand with a gut instinct for groundbreaking creativity and emotional storytelling that inspired generations of consumers.
Mimicking ecommerce businesses had become a fixation among some Nike employees under current CEO John Donahoe, said Giunco. Another former staffer and agency partners who spoke with ADWEEK echoed Giunco’s assessment. Donahoe was a former eBay CEO and management consultant who joined Nike in January 2020, where he doubled down on a strategy to cut ties with many wholesale retailers and grow revenue from direct-to-consumer (DTC) sales.
“There was this shift in attention to any digital player while neglecting the great things we were doing,” Giunco told ADWEEK.
The strategy initially seemed to work.
According to Kantar’s BrandZ rankings, which determine brand value using financial data and consumer research, Nike’s brand value more than doubled between 2020 and 2022, rising from $49.9 billion to $109.6 billion amid a pandemic fitness boom.
But post-pandemic, it has slid back down to $71.6 billion.
Nike’s June 2024 earnings report was a disaster, sending shares tanking 23% after it revealed its revenue dipped 2% to $12.6 billion in Q4, its direct business fell by 7% and digital was down by 10%. Nike also expected sales to drop 10% this quarter.
Nike has already laid off 740 staff at its Beaverton, Ore., headquarters in 2024, including vice presidents across its marketing, technology and innovation teams—all in service of a cost-cutting plan to reduce its workforce by 2% by 2025.
Yet, Nike is also investing more than ever in this year’s Olympic Games, unleashing a global campaign to reset and regain its swagger.
