Digital innovation drives Q1 growth for Nike
Sportswear giant Nike reported a 10 per cent growth in revenue to US$9.4 billion (AU$12.96 billion) for Q1 of 2019, largely driven by the success of the brand’s Consumer Direct Offense initiative.
The initiative was announced in June 2017 as a new company alignment to leverage the power of digital to drive growth.
Net income increased 15 per cent to US$1.1 billion (AU$1.52 billion) as a result of this revenue growth, paired with an increase in gross margin to 44.2 per cent.
“Nike’s Consumer Direct Offense, combined with our deep line of innovation, is driving strong momentum and balanced growth across our entire business,” Nike, Inc chief executive and chairman Mark Parker said.
“Our expanded digital capabilities are accelerating our complete portfolio and creating value across all dimensions as we connect with and serve customers.”
The sportswear company noted it’s US$5.2 billion (AU$7.17 billion) inventories were healthy across all geographies due to strong, full-priced sell through of product, leading to a clean marketplace.
“The future of sport will be decided by the company that obsesses the needs of the evolving consumer,” Parker said, adding that Nike was getting more aggressive in the digital marketplace, targeting key markets and delivering product faster than ever.
Earlier this month the company revealed a controversial advertising campaign featuring US football player Colin Kaepernick, and the phrase “Believe in something. Even if it means sacrificing everything,” leading to heated debate amid calls for boycott.
Apex Marketing Group told Bloomberg at the time that the brand received more than US$43 million (AU$59.27 million) worth of media exposure within the first 24 hours of the campaign, which likely helped Nike achieve a strong start to the year.