Kicks

Nike is a Most Improved Player, but its retro sneakers are the real MVPs

Friday, September 25, 2020 by Robinhood Snacks | Disclosures
_'80s vibes only_

'80s vibes only

Swoosh swoosh... Despite a global crisis, Nike was its own Most Improved Player last quarter. Sales slipped less than 1% compared to last year and profit actually increased. That's a big glow up from June, when Nike posted a loss and 38% sales plunge. Nike's stock is up 8% in the last week on the performance.

The OGs are the real MVPs... What fascinated us most: Nike is cashing in big on its vintage shoe styles. Whenever there's a slump, Nike can fall back on its trusty OGs. That's a major advantage that iconic brands have over newer players (no one wants Lululemon's 2001 leggings).

  • Nike's Air Force 1, born 38 years ago, saw a major resurgence last quarter. AF1 is the most-purchased shoe of 2020, according to the NPD Group (and your Insta feed).
  • Air Jordans, 1st released in 1984, were the only highlight of Nike's sad June quarter: the Jordan brand hit a record $3.6B in sales thanks to surging demand from China and "The Last Dance," a Jordan documentary on ESPN.
THE TAKEAWAY

Nostalgia is one of the greatest marketing weapons... especially during hard times. Nostalgic products evoke a sense of comfort, reminding us of better times. Plus: they don't require much experimenting or creative work. Demand is clear, making a flop much less likely. And it extends beyond just fashion:

  • Food: Campbell Soup and General Mills have been pandemic thrivers, putting new spins on OG products like Dunkaroos and Go-Gurt.
  • Media: This summer, we've pretty much exhausted every possible sequel, prequel, and remake imaginable. Disney's leading the charge on that.