Nike Extends Digital Innovation Across Channels and Geographies

In an interview yesterday at Shoptalk in Las Vegas, Michael Martin, vice president of digital products at Nike, discussed how the athletic footwear, apparel and accessories brand is using innovative digital products, platforms and technologies to create new opportunities to serve existing customers and attract new ones across all of its sales channels. Martin was interviewed by Deborah Weinswig, founder and CEO of Coresight Research. Here are some highlights from their conversation.

House of Innovation Flagship Stores in Shanghai and New York City

These two retail outposts, which opened in last year's fourth quarter, represent Nike's vision for bringing immersive brand experiences to life, connecting digital and physical platforms, with the goal of better serving athletes in the local community. From enabling customers to customize apparel and footwear to an entire floor that uses local data to stock and merchandise its shelves, the stores represent the future for Nike's customer experience.

The Shanghai flagship was the first of Nike's new store concept, Martin noted. "[It] Meets consumers at the intersection of digital and physical. A lot of research went into the design process — it was more like building an app than a store."

The House of Innovation flagship in New York City was the second such store that Nike opened. Martin said the same overall concept is applicable to both stores, but the New York version was a remix.

"There are different behaviors in that market vs. Shanghai, and we want to provide a localized experience," said Martin.

Nike by Melrose

Another innovative store concept that Nike has recently introduced is Nike Live, a new store concept that was inspired by and built as a hub for its local NikePlus members in Los Angeles. Nike by Melrose (the store is located on Melrose Ave. in West Los Angeles) offers city-specific styles, which are determined by Nike digital commerce data (e.g., buying patterns, app usage and engagement), to serve local NikePlus members exactly what they want when they want it. New apparel, footwear and accessories that are specific to that local market's needs — regardless of Nike’s broader seasonal priorities — will fill the store on a bi-weekly basis (a Nike first), and sometimes even exclusively.

"The location of the store was identified by data from our online members," said Martin. "These data points showed incredible member engagement. They [NikePlus members] located the site of the store, but also drive the merchandise assortment in the store. The merchandise accurately reflects the unique nature of that neighborhood. The digital consumer is thinking about an individual product — we need to reflect that in our in-store assortment."

Accessibility of Product

Nike has set the lofty goal of increasing participation in sport and fitness by two X across the globe. Accessibility to product is core to reaching that goal, as well as to Nike's overall mission. In pursuit of that goal, the brand has used mobile apps to not only feature its product, but create a community for athletes worldwide. 

"We want to inspire and motivate all athletes across the globe," Martin said. "We've created a worldwide community with our sneaker apps. Yes, we want to increase participation in sport, but we also want to get to know our customers better so we can better serve them on their journeys. Leverage that success and multiply it across the company."

Martin noted that the sneaker community is global, but also contains micro-communities. Nike is mining insights about those micro-communities from it digital platforms to create products (e.g., shoes) specific to each community. Micro-targeting has had a ripple effect, expanding out to beyond that micro-community, added Martin.

Two prime examples of Nike creating community through digital platforms are the brand's Run Club and Training Club apps. For example, the Run Club app offers users practical content related to the sport, the ability to track the progress of their runs, access to group runs, personalized coaching, among other features. And the Training Club app is billed as users' "ultimate personal trainer," offering nearly 200 workouts, audio and visual guidance for those workouts, and collections to help them reach their goals with curated workout recommendations and expert tips. 

"The Run Club app was a pioneer was in the space," Martin told the audience. "It's the world’s most engaged and successful running app."

Culture of Innovation

Nike's CEO, Mark Parker, is obsessively dedicated to innovation, Martin said. His leadership and vision has spread throughout the organization, resulting in a company that's continuously searching for ways to improve the experiences of its customers through digital innovation, no matter the channel. However, Martin was quick to point out that Nike takes a disciplined approach in ultimately deciding which innovations to roll out to its customers.

"We're looking for solutions that are going to offer the maximum amount of impact for our customers," said Martin. "Those are the areas we’re most likely to invest."