Nike reportedly cut ties with nine retailers

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You may no longer see Nike products on sale at select major retailers, both the brick-and-mortar variety — VIM, Belk, and Dillard among them — and online, like Zappos.com. The sportswear maker is said to have cut a total of nine retailers. This is part of Nike’s recent strategy to control the sale of its products more tightly and sell more directly to consumers.

Nike tries to sell their gear and make their customers feel special, like LeBron James or Serena Williams. Sam Poser, an analyst at Susquehanna Financial Group, said the stores Nike is dropping “were selling Nike products, but it wasn’t a place that was really doing anything to improve the Nike brand.”

Nike would neither confirm nor deny that it is cutting stores’ accounts. But the company said it “doubles down” with “strategic partners”. Poser said that means retailers with flashy Nike displays.

The company is also stepping up its efforts in its digital approach. Last year, Nike severed ties with Amazon, in part so it could collect its own customer data.

“They’re going to know basically everything they want to know about a consumer, which could be information that’s been kept close at hand by retailers,” said Jeff Galak, a marketing professor at Carnegie Mellon. “Now Nike has control of that data.”

Taking control is the key, according to Matt Powell, sports industry adviser at The NPD Group.

“They’re able to control their messaging, they’re able to control the product, show the product the way they want it, and to some degree impact pricing,” Powell said.

With so many brick-and-mortar stores closing, CFRA Research analyst Camilla Yanushevksy said it’s also a great way for Nike to “protect itself from the revenue decline that’s already going to happen.”

Nike isn’t the only brand taking more control, Yanushevksy said. Ralph Lauren, Skechers and others are doing the same.

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