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Negative inflection · Promotional outlier focus

Nike: wholesale partners sent record discounts

Promotions direct from Nike were stable, but our keyword tracker captured record volumes of Nike coupons from its wholesale partners, a sign of lagging organic demand.

NKEFLASOSCVLMDKS▲ Promotions intensifyingGreg RobinAug 15, 2023
+67%year-over-year rise in Foot Locker emails mentioning "Nike", May–July, a record in July
65%of Foot Locker's athletic merchandise was bought from Nike in its latest fiscal year
5% vs 14%Nike's year-over-year revenue growth last quarter, down from the prior quarter

What changed

Last quarter Nike reported slowing revenue growth: consolidated revenue rose 5% year over year, down from 14% in the prior quarter. Promotional activity direct from Nike stayed stable. The pressure showed up one step removed, in the email its wholesale partners sent.

Our new keyword tracker uncovered the largest spike on record in "Nike"-related keywords across key wholesale partners' emails over the past two weeks. Record volumes of Nike coupons from partners imply lagging organic demand. We also anticipate a weak quarter for Foot Locker, which bought 65% of its athletic merchandise from Nike in its most recent fiscal year.

Exhibit 1 · Year-over-year change in "Nike" promotional email volume, May–July
Shoe Carnival (SCVL) +2,783% bar truncated · off scale Foot Locker (FL) +67% Academy Sports (ASO) +49%
Nike partner promotional highlights

Four wholesale partners leaning on Nike offers

  1. FL
    Foot Locker sent record Nike promotions in JulyEmails containing "Nike" rose 67% year over year for May–July.
  2. ASO
    Academy Sports + Outdoors pushed more Nike this summerEmails containing "Nike" rose 49% year over year for May–July.
  3. SCVL
    Shoe Carnival's Nike promotion volume explodedNike-focused promotion volume rose 2,783% year over year for May–July.
  4. M
    Macy's ran a rare Nike offerWe captured a rare "Special 20-25% off from Nike".
How we caught it

Tracking desperation keywords

The Random Walk keyword tracker helps investors detect changes in the promotional intensity brands use with their leads. It finds inflections in core demand by tracking desperation keywords in emails, such as:

"extra""extended""one more day"

Applied to brand names inside retailer emails, the same approach shows when a supplier's product needs extra help to sell through, even while the supplier's own promotions look calm.

This case study is based on a preview of the full Random Walk report. Figures from Random Walk promotional email data and Nike's reported results. Not investment advice.

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