Nike wants to be more nimble on its feet.
The sneaker maker said on Thursday that it plans to focus on the hottest-selling sneakers, slash the number of styles it offers and sell more shoes directly to customers online as part of a restructuring in which it also will cut about 1,400 jobs.
Nike said the moves will help it offer products to customers faster as it is facing increasing competition from smaller brands and premium labels. Another problem: The running and basketball shoes Nike is famous for may be outdated.
More people are choosing fashion over function, with sales of classic sneakers industry-wide climbing 26 percent last year, according to research from The NPD Group. Meanwhile, sales of running performance sneakers were flat and sales of basketball performance sneakers dropped, according to the same report.
“Nike missed the fashion shift away from performance basketball to retro,” said Matt Powell, the sports industry analyst at NPD. “They still have not caught up.”
Nike, known for its swoosh logo, will also make its sneaker-selling apps available in more countries at a time when online sales mean many big retailers and department stores are closing stores.
“We’re getting even more aggressive in the digital marketplace,” said CEO Mark Parker.
Nike said a main focus will be the 12 key cities in 10 countries that it expects to represent more than 80 percent of its projected growth through 2020. Those cities are New York, Los Angeles, London, Paris, Milan, Mexico City, Tokyo, Seoul, Shanghai and Beijing.
“It appears to us that everything Nike is working on is a brand-first story. If the initiatives don’t help the Nike brand, they do not happen,” the Susquehana analysts said.SHOW MORE