Nike focuses on consumer-led transformation

30 Oct '17

3 min read

Courtesy: Nike

Nike, Inc. is focusing on consumer-led transformation to ignite its next phase of long-term, sustainable and profitable growth. It expects to drive high-single digit revenue growth, expanding margins and mid-teens earnings per share growth on average over the next five years, the company said during an investor meeting that was held recently.

"The consumer today expects a premium experience, with innovative product and services delivered faster and more personally," said Mark Parker, chairman, president and chief executive officer of Nike. "Fueled by a transformation of our business, we are attacking growth opportunities through innovation, speed and digital to accelerate long-term, sustainable and profitable growth."

Recently, the company expanded on its new Consumer Direct Offense which aims to serve the athlete faster and more personally, at scale, led by digital. With focused growth through key categories this new offense will connect the Nike brand and products with consumers in new and more powerful ways across 12 key cities and 10 key countries.

The company has also invested in its triple double strategy to drive growth through three core areas of the business: 2X Innovation, 2X Speed, 2X Direct. In order to double the cadence and impact of innovation, the company will lead with more distinct platforms and scale innovation faster, will edit-to-amplify to give consumers better choices and will create new aesthetics spanning both sport and style. Further, the company will increase the speed to market by reducing the average product creation timeline by over 50 per cent through investments in end-to-end digital capabilities to serve consumers faster. Nike is also looking forward to double direct connections with consumers and shape the future of retail led by Nike.com.

"We expect to grow North America in the mid-single digit range, Europe, Middle East & Africa (EMEA) in the mid-to-high single digit range, Greater China in the low to mid-teen range, and Asia Pacific & Latin America (APLA) in the high single-digit to low double-digit range, in each case on average over the next five years. We hope to reinvest three to four percent of Nike revenue over the next five years through capital expenditures and expect the target range for Return on Invested Capital to average in the low 30 percent range," stated a company press release.

Focusing on long-term growth, the company announced its new NikePlus membership program that will provide member-only access to the products members love, matched to their individual preferences and buying patterns. This unique access to Nike’s greatest innovations and hottest styles is about three key services that serve consumers on their terms: first access to the latest products, exclusive access to personalised services and experiences, and reserved product for members only. (RR)

Fibre2Fashion News Desk – India

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