LIVE ISSUE/NIKE: Can W&K hang on as Nike revitalises its image? Karen Yates looks at Nike’s plans for a total overhaul of its marketing strategies

Last week, Nike’s new ’I can’ slogan blew up in its face when the sportswear group finally admitted it couldn’t shift the shoes piling up in its warehouses, couldn’t handle the free-fall in its share price and couldn’t keep spending dollars 890 million a year on marketing.

Last week, Nike’s new ’I can’ slogan blew up in its face when the

sportswear group finally admitted it couldn’t shift the shoes piling up

in its warehouses, couldn’t handle the free-fall in its share price and

couldn’t keep spending dollars 890 million a year on marketing.

More specifically, Phil Knight, Nike’s sport-obsessed founder, announced

a dollars 100 million cut in his US marketing budget as part of an

effort to cut costs by a staggering dollars 325 million. Worse, Knight

chose to point the finger at marketing and - by implication - Nike’s

fledgling US ’I can’ campaign.

But is it fair to blame a positioning which is only three months old for

all these troubles? The writing was on the wall well before the

redoubtable Wieden & Kennedy unveiled the work. Not even the punchiest

of campaigns could single-handedly bring down a robust corporation so

quickly. Could it?

Knight, however, was taking no prisoners. ’Our problem has not been too

much marketing, but too much ineffective marketing,’ he said, adding

that marketing efforts over the past six months had not worked.

Both these statements could be - and have been - taken as sideswipes at

W&K, the agency that has been in bed with Nike in Oregon for the past 16

years. Dan Wieden’s empire has expanded through the years in tandem with

Knight’s: it has been Wieden and Nike, Nike and Wieden. But, like most

love affairs, the relationship has its rocky periods. And, like many

love affairs (outside of the White House), both partners fight shy of

talking about it.

’There was never any criticism intended of ’I can’ or of W&K,’ Graham

Anderson, Nike’s public relations manager, stresses.

Nike, however, made similar placatory noises a year ago when it bypassed

W&K to appoint the San Francisco-based Goodby Silverstein & Partners -

its first roster agency outside W&K. And it repeated them when Goodby

got most of Nike’s fastest-growing business, a fact that became

glaringly obvious when Goodby won Nike’s newest and most cherished

project in the US, a top-secret sub-brand called Alpha.

But to focus purely on Nike’s advertising misses the heart of its

current problems. To find this, you have to go much deeper than the

merits of a particular ad campaign.

Knight, a keen runner, and Bill Bowerman, his coach, started Nike in

1968. Named after the Greek goddess of victory and buoyed by

revolutionary Nike Air technology, success followed success and

quick-thinking ensured Nike stayed ahead of the game. When enthusiasm

for running faded, for example, Nike responded with shoes for other

sports and, as worldwide fashion trends tilted towards sporty gear,

Knight increased output and sales soared.

The past three years saw average sales growth of 34 per cent. Then came

the third quarter of the 97/98 fiscal year. Figures released last month

revealed that growth had faltered to only 6 per cent over the past nine

months. Great results by many standards, but not by the goal-obsessed

Nike. Management blamed the turmoil in the tumbling markets of the Asian

Tiger economies and swiftly moved to axe 1,600 jobs around the


But what they also have to face up to is that the future is not as

bright as it was. Fashion is swinging away from athletic shoes to the

so-called ’browns’ - outdoor shoes such as Timberlands or Wolverines.

Moreover, the patent on Nike Air ran out last year and, to cap it all,

its arch rival, Adidas, has recently staged a spectacular comeback,

especially in Europe.

Nike has become a victim of its own success. In 1996, it had 47 per cent

of the US athletic footwear market and sold more than a third of the

world’s branded games shoes. But it proved hard to be a rebel ’just do

it’ brand when everyone’s mum was wearing Nikes.

Tim Delaney, the executive creative director of Leagas Delaney - the

agency for Adidas - sums up Nike’s problem as: ’It’s about how to remain

a young irreverent sports brand if you’re ubiquitous.’

So, Nike did three things. It began selling its own ’browns’. It

diversified into clothing (both accounts now held by Goodby), and it

developed a new advertising strategy.

’I can’ was designed to be the caring, sharing, 90s version of the more

aggressive ’just do it’, first coined in 1988. This great democratic

rallying cry and the ’swoosh’ logo were suited to the Nike of the 80s.

Nike of the 90s had to be more universal. As one source close to the

business observes: ’These days, people do sport for a whole host of

reasons other than winning. For health, for companionship. ’I can’ tells

you to set your own limits. It tells you that what you achieve is up to

the individual.’

So, armed with a more empathetic positioning and a rapid, if slightly

behind-the-pace, diversification out of athletic shoes, Nike squares up

to the future. While staunchly defending ’I can’, Knight has also

promised a ’review’ of all marketing strategies and tactics.

No doubt, this summer will see a more sober Nike - and W&K. One which

will not make a staggering 150 films in 12 months, as it did last year,

or pull in the Brazilian national football team, plus the retired soccer

star, Eric Cantona, for just one commercial. But Nike has survived

pressure before. The question has to be, will W&K still be with it?

Mills on Marketing, p21.

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