CALI ARTIGUES ANTHONY OBANER JAMES HOU
FASM410-02 RETAIL MANAGEMENT PROFESSOR DONALD LEVY
MISSION
BRING INSPIRATION AND INNOVATION TO EVERY ATHLETE* IN THE WORLD *IF YOU HAVE A BODY, YOU ARE AN ATHLETE.
EXECUTIVE SUMMARY NIKE, Inc. continues to prove why they are the leading sportswear company in the world. However, being at the top does not hinder the determination for constant improvement. As collaborations with prominent influencers garner more popularity, Nike’s next initiative after the successful Off-White collaboration is with Nike Master Trainer, Joe Holder. The Ocho System’s founder has developed the philosophy where health and wellness are encouraged and balanced through positive-thinking and effective exercise. With an exclusive 20-piece collection, The Ocho Collection’s pop-up shop will serve as a luxurious experience where fitness, lifestyle, and optimism coexist.
HISTORY (and hers, too)
Founded in 1964 by Phil Knight and Bill Bowerman under the name Blue Ribbon Sports; previousy operated as a distributer for Onitsuka Tiger (now Asics).
Named for the Greek goddess of Victory, NIKE adopted their new name in 1971. The iconic Nike swoosh was designed by graduate student, Carolyn Davidson, in 1971 for $35.
Best known for their sneakers, NIKE offers a variety of products and services, including:
- Men’s, Women’s, Children’s, footwear, accessories, equipment, and action sport apparel.
CORPORATE INFORMATION NIKE, Inc. accumulates the largest share value with 3 percent globally. This makes it the largest apparel and footwear company in the world. With 1142 Nike stores worldwide, Mark Parker currently holds the Chief Executive Officer (CEO) position at NIKE, Inc. He oversees 179 senior officers and leads over 70,000 total employees.
2016 SALES BY REGION (One Source)
Alongside the Nike brand, NIKE, Inc.’s portfolio also includes Hurley and Converse. In 2017, Nike’s sales reached over 34 billion. Assets reached over 23 billion with a market value of 104 billion. Almost all Nike’s sales in 2016 were generated from sportswear - 61 percent of that from footwear. In the 2017 fiscal year, 44 percent of Nike’s total sales came from North America.
North America Western Europe Greater China Converse Central & Eastern Europe Japan Global Brand Divisions Total
46% 18% 12% 6% 4% 3% 100%
2016 SALES BY NIKE CATEGORY (One Source)
Footwear Apparel Equipment Other Total
61% 28% 5% 6% 100%
NIKE CUSTOMER A. Women Women in their 20s and 30s largely driving the “athleisure trend,� in which customers buy leggings with the intent of wearing them to the gym, errands, and brunch B. Young Athletes Partners with professional athletes draw in young consumers C. Runners Buying Nike because of their quality and high tech products
NIKE PRODUCT
Price Accessibility Matrix: • Sneakers - $50-$250 • Tops & Bottoms - $20-$95 • Equipment - $20-$240
NIKE MARKETING Nike’s marketing strategy encompasses selective athlete sponsorships through sports teams and celebrities. Most impressively, Nike advertisements rarely are promoting the sale of a product, but of lifestyle accomplishments through encouraging word choice. Through selective styling, ethos, and casting, Nike associates triumph and superiority within all their ads. Instagram: 75.5M followers Facebook: 29.5M followers Twitter: 4.5M followers Pinterest: 215k followers
MARKET ANALYSIS Dominating the sportswear market, the United States is expected to grow annually by 3.8 percent through 2021 in the sports and swimwear category; revenue growth percentage will decrease by 2.1 percent to 3.4 percent in 2021. Athletic footwear will increase by over 4 million in revenue through 2021. Totaling $16,142.6m USD, the United States leads in generating the most revenue for athletic footwear with Brazil and China following.
With knowledge of the decline of sports apparel, The Ocho Collection will focus heavily on athletic footwear to cater to the needs of our athletes. The increased tension of international politics and restructuring of trade/imports within the US under the Trump administration may cause strife and delay in growth, but will not drastically affect international sales. Statistics found via Statista’s Sports and Swimwear, and Athletic Footwear Reports.
NIKE SWOT ANALYSIS STRENGTHS
• Strong hold on the US market with no immediate threats
• Geographic presence reaching
international markets effectively
• Operational capabilities
• Leader in product innovation
WEAKNESSES
• Lawsuits: constant innovation leads
to intellectual property, patents, etc. lawsuits
• Nike’s dependency on third party
selling could lead to compromised brand equity
OPPORTUNITIES
• Expanding Retail Market in the US • Initiatives
• New product launches
• Growing footwear market in the US • Women’s products
• Leverage technology
THREATS
• Increase in counterfeit products • Foreign exchange risks making it difficult to make profitable sales
• Rising labor costs in the US
• Competitors with imminent growth should be watched
• Crippling USD
COMPETITION
Product Direct Competition: Lululemon, Fabletics, Athletica Indirect Competition: Levi’s, Columbia Sportswear, Vans
PRICE ACCESSIBILITY MATRIX High Price
High Accessibility
Low Accessibility
Low Price
NIKE DISTRIBUTION 1142 Nike stores worldwide United States: 209 Nike Factory stores 24 Nike In-line Stores Secondary retailers: - Champs, Dick’s Sporting Goods, Academy, Target, JCPenny, Macy’s, Kohl’s, Nike Factory Outlets, Zappos, Foot Locker, Rack Room Shoes Sold online through Nike.com, as well as retailers listed above
JOE HOLDER.
Instagram: 44k+ followers
Twitter: 2,004 followers
A nationally ranked track star at 8 years old, Joe Holder has been an athletic star his entire life. And the Nike Master Trainer has the work ethic and abs to prove it. As founder of The Ocho System, Holder developed this holistic philosophy at the University of Pennsylvania to promote physical progress while bridging “the behavioral and cognitive gap” that causes people to fall short of their goals. In other words, it is a guide to balancing the want to improve with the need to be happy, high achievement with downtime, and going hard with going home. He looks at his clients as people, not pay checks. This allows Holder to give individualized attention to each client so they can reach their personal goals in and out of the gym. • Strength and Body Composition Trainer at S10 Fitness
• High-profiled clientele including: Naomi Campbell, Bella Hadid, Riccardo Tisci, Phillip Picardi, Derek Blasberg, Virgil Abloh, etc.
• Gets invited to NikeLab events to test out new product
• Has been featured in Vogue, Esquire, High Snobiety, Elle, etc.
Instagram: @ochosystem
THE OCHO COLLECTION NIKE, Inc. will be introducing a line of curated and exclusive products with longtime Nike Master Trainer Joe Holder, health consultant and performance specialist at S10 Training.
With a clientele that includes leading fashion figures like Naomi Campbell, Bella Hadid, and several other influencers, this line will unify fitness and fashion for women and men.
The “Ocho” Collection will be a physical expansion of Holder’s Ocho System, the philosophy with a belief that a fulfilled and healthy lifestyle can be achieved through individual balance of mental and physical health.
Holder’s exclusive line of products with Nike will give the opportunity for every athlete* to immerse themselves into the Nike lifestyle allowing for a full Ocho System and Nike experience through the apparel sold.
WOMENS APPAREL
MENS APPAREL
SNEAKERS
EQUIPTMENT
TARGET OCHO CUSTOMER
DEMOGRAPHICS:
• 25-38 • With or without out kids • Renters • $100,000/year
PSYCHOGRAPHICS:
• Listens to rap and jazz • Flies Jet Blue • Drinks Iced Lattes • Uses Yelp • Brunch • Enjoys healthy foods • Works out 2-3 times a week/ active lifestyle
“The Meatpacking District is a melting pot of art, fashion, nightlife and culture. Bordered by Chelsea and the West Village. Travelling through the district’s cobbled streets, you’ll find high end designer brands and flagship stores, trendy bars, high street retailers and ultra cool hangouts.”
PESTLE ANALYSIS POLITICAL
ECONOMIC
SOCIAL
• The US remains to be a profitable country that promotes entrepreneurship; strong business initiatives • Current Challenges: Tax reformation under Trump administration; foreign
• The Meatpacking District thrives
• Strength: Became the new home of the Whitney Museum, which brings a lot of tourism and social activity in the area • Current Challenges: Remaining and ensuring inclusivity and diversity is presented amidst the activist era
and domestic political strife/division
economically with a median household income of $96,634 • Current Challenges: Globally, the USD is deteriorating in value; increasing amount of the homeless
TECH
LEGAL
ENVIRONMENTAL
• The Meatpacking District is a prime location for technology, as it has become the cultural hub of New York City’s most tech0savvy individuals and businesses; overall global improvements in overall eComm and Banking
• Business license • Negotiating lease • Hiring employees • Zoning Laws and attaining permits • Taxes: clothing sold for less than $110 exempt from 4% sales tax
• Polution caused by businesses • Global warming and how it can/will affect people’s shopping habits and items purchased
MEATPACKING DISTRICT AMENITIES Fitness Studios: Equinox High Line, Exhale Meatpacking, Y7 studios, GLAM+GO, KORE Stores: Alice + Olivia, AllSaints, Apple, Columbia Sportswear, Intermix, Kiehl’s, Levi’s, Lululemon Food: Catch, By Chloe., Dos Caminos, Fig + Olive, Hale and Hearty, Le Bain, Serafina, STK Downtown, Sweetgreen, Tao Downtown Attractions: Whitney Museum of American Art, The High Line, Blank Space, Rubin Museum Average foot traffic: 2M/week
PEOPLE IN THE MEATPACKING DISTRICT DEMOGRAPHICS:
• Mainly white • Mostly 21-34 • 1-2 person households • Without kids • Make over $75,000 per year
PSYCHOGRAPHICS:
• *Creative Class 81%, ranked top 10 in New York • Personality: Sincere, youthful, health-conscience • Social status: Lower-Upper/Upper Class • Interests: Nightlife, Tech, • Lifestyle: Exercises to destress, friend-oriented, primary source of transit is metro
Approximately 81,000 people live in Meatpacking District according to point2homes report..
OUR LOCATION
345 W 13th and Hudson St. $30,000/month 750 sq ft
Trade laws: clothing sold for less than $110 exempt from 4% tax
Street and private entrance On site bathroom
Adjacent retailers: Marni, Drybar, Soho House
MARKETING Joe Holder is no stranger to having billboards in Times Square. This is why for our primary marketing asset, we’ll be promoting the launch of The Ocho Collection with Karlie Kloss as the face. We will utilize few magazine advertisements to cut costs, as the billboard takes up the majority of our marketing budget. Social media will also play a vital role in promoting and marketing the collaboration digitally, alongside our website.
OUR POP-UP HUMAN RESOURCES: • Greeter: tracking incoming people • 3 Sales Associates: 1 for POS, 1 floor associate, 1 floater $15/hour all positions TECHNOLOGY: • Square • Clicker for door traffic • TVs with video of Joe playing • Wireless speakers for music • Interactive screen for cutomization
LAUNCH PARTY INVITATION Thursday, April 12, 2018. Invite only. Plant-Based catering provided by Jack’s Wife Frieda DJ Brendan Fallis Wellness talk with Joe Holder
Press Invited:
• Vogue • WWD • GQ • Goop • NY Post • Vfiles • Women’s Health
POP-UP LAUNCH: KEY GUEST LIST
Bella Hadid
Karlie Kloss
Virgil Abloh
17.1M+
7.2M+
1.5M+
Derek Blasberg 679K+
Hannah Bronfman 424K+
PROMOTIONAL PLAN INSTAGRAM
• Countdown beginning 5 days prior to launch with previews of pop-up store • Heavy stories during launch party • Influencer posts during launch party for hype • Post images from launch party and product throughout week • Joe Holder Nike Insta-story takeover during week of pop-up shop
• Event info • Article about Joe • Share features about the pop up
SNAPCHAT
• Stories during launch party • Interacting with prominent guest praising the collection to build positive identity to viewers • Sponsored Instagram-story for mass acknowledgment
• Sharing articles about the event • Sharing articles about Joe • Live updates
UNIT BREAKDOWN % TO TOTAL
Total Units
Retail per Unit
Total Retail
4%
50
$40
$2,000
U
801 Pro ls
4%
60
$40
$2,400
M
802 Medalist top
4%
60
$75
$4,500
M
803 Element halfzip
4%
60
$75
$4,500
M
804 Element halfzip
5%
70
$75
$5,250
W
805 Power tank
5%
65
$50
$3,250
W
806 Tailwind top
5%
70
$65
$4,550
W
807 Wind Pant
4%
55
$90
$4,950
M
808 Swift Pants
5%
65
$125
$8,125
M
809 Academy Pants
4%
60
$50
$3,000
M
SKU
DESCRIPTION
800 Equality tee
Windrunner 810 pant
W
5%
70
$80
$5,600
811 Redrunner pant
5%
65
$150
$9,750
W
812 Lux leggings
5%
70
$110
$7,700
W
Legend back813 pack
3%
45
$80
$3,600
814 logo hat
4%
60
$40
$2,400
U U
flatspot sun815 glasses
3%
40
$175
$7,000
816 Air Max 270
6%
80
$160
$12,800
U
817 Vapormax flynit
6%
80
$200
$16,000
U
818 Air Max 95 tt
6%
80
$200
$16,000
U
819 Air Huarache
6%
80
$120
$9,600
U
820 Cortez
6%
80
$80
$6,400
U
TOTAL
1365
$139,375
Operational Plan
SEX
Sales Volume
$ 208,818.75
Rent
$ 30,000.00
Construction
$ 10,000.00
Fixtures
$ 3,000.00
Human resources
$ 6,720.00
Launch Party
$ 2,000.00
Cost of goods
$ 83,526.50
Marketing
$ 2,000,000.00
U
Total
$ 2,135,246.50
Profit/loss
($1,926,427.75)
NIKE SALES FORECAST LOCATION FOOT TRAFFIC PER DAY PERCENTAGE OF CONVERSION TRAFFIC/FALL
175,000.00 247,000.00 296,500.00 223,000.00 200,000.00
Bottoms
7.6%
0.5%
0.5%
0.5%
Day 1
Day 2
Day 3
Day 4
Day 5
Day 6
Day 7
Footfall
875
1976
1483
1115
1000
1000
1000
8449
16897
Conv. %
5.0%
5.0%
7.0%
7.0%
8.0%
8.0%
8.0%
48.0%
96.0%
$ 185.00
$ 185.00
$ 185.00
$ 185.00
$ 185.00
$ 185.00
$ 185.00
$ 104,409.38
$ 208,818.75
$ 41,763.75
$ 83,527.50
$ 104,409.38
$ 208,818.75
TOT.REV
TOT.REV
TOT.REV
TOT.REV
$ 8,093.75 $ 18,278.00 $ 19,198.38 $ 14,439.25 $ 14,800.00 $ 3,237.50 Day 1
0.4
3.8%
0.5%
COGS
Shoes
3,083,000.00
0.5%
Sales volume
%
1,541,500.00
0.8%
TOT.REV
PRODUCT
200,000.00 200,000.00
WEEK TWO
0.5%
Avr. Basket
(MKUP 60%)
WEEK ONE
$ 3,237.50
$ 7,311.20 Day 2 $ 7,311.20
$ 7,679.35 Day 3
$ 5,775.70 Day 4
$ 5,920.00 Day 5
TOT.REV
TOT.REV
$ 14,800.00 $ 14,800.00 $ 5,920.00 Day 6
$ 5,920.00 Day 7
$ 7,679.35
$ 5,775.70
$ 5,920.00
$ 5,920.00
$ 5,920.00
0.2
$ 1,618.75 $ 3,655.60 $ 3,839.68
$ 2,887.85
$ 2,960.00
$ 2,960.00
$ 2,960.00
Tops
0.2
$ 1,618.75 $ 3,655.60 $ 3,839.68
$ 2,887.85
$ 2,960.00
$ 2,960.00
$ 2,960.00
Accessories
0.2
$ 1,618.75 $ 3,655.60 $ 3,839.68
$ 2,887.85
$ 2,960.00
$ 2,960.00
$ 2,960.00
TOT.
1
$ 8,093.75 $ 18,278.00 $ 19,198.38 $ 14,439.25 $ 14,800.00
$ 14,800.00 $ 14,800.00
THANK YOU!
Sources: Pop-up shop renderings by JOSELYN DONTFRAID Nike.com Storefront.com Joe Holder Interview, High Snobiety Joe Holder Interview, The New Jock 3 Nike Customers, Business Insider Nike Marketing Plan & Strategy Nike product images via Nike.com One Source Euromonitor Statista Claritas Youtube.com Meatpacking-district.com
General Nike images found via Nike website + archives; other images found via Google unless stated otherwise on specific slide.