Sportswear giant Nike is to start selling its products directly on Amazon and Instagram, as it looks to target younger consumers.
The move will allow Nike connect better with Millennials who cite Amazon and Instagram as prime destinations, while also combating fakes being sold online.
Instagram shopping feature
Nike chief executive Mark Parker revealed during the brand’s most recent earnings call that the company will sell goods directly Instagram, though he hasn’t shared the full details of the partnership.
The move means Nike will be placing itself front and centre of young people’s social media activity – and one step closer to their wallets too.
The brand will be engaging directly with members of the photo-sharing app who will be able to shop for Nike-branded goods without having to leave Instagram’s walls.
Speculation on Engadget suggests that Nike’s Instagram approach will see it go one-step further by joining a rareified list of companies which can make use of the app’s inbuilt ‘shopping tags’.
First introduced last year these allow users to tap on associated ads to obtain pricing information and detailed descriptions of advertised goods and even direct towards companies’ own sites or app checkouts.
Facebook has been working to try and make Instagram a legitimate platform for companies to interact with their customers and also to sell their products, so Nike’s support of the platform will no doubt be a boon to both Nike and Instagram.
This will also help to cut down on problems like counterfeit products, where having an official presence on Amazon and Instagram means that customers who are wary of third-party resellers can at least reliably shop via Nike’s official profile.
The Wall Street Journal this week reported that in exchange for selling directly, Amazon agreed to crackdown on counterfeits and restrict unofficial sales.
The deal will allow Nike better access to Millennials “who call out Amazon.com as their preferred shopping platform for fashion products, including apparel, shoes, and athletic gear.”
Nike’s partnership with Amazon is a pilot deal to sell shoes, clothing and accessories on the site straight from the source. Previously, Nike products were sold through third-party vendors and challenged the company’s earnings. For now, the famous footwear and apparel company will only sell a limited selection of its merchandise on Amazon.
“We’re looking for ways to improve the Nike consumer experience on Amazon by elevating the way the brand is presented and increasing the quality of product storytelling,” Nike CEO Mark Parker said Thursday in the call with investors. “We’re in the early stages, but we look forward to evaluating the results of the pilot.”
Despite having lacked a direct partnership, Nike is one of the top-selling brands on Amazon through third-party sellers. Experts say the decision to officially partner with Amazon comes as the third-parties weaken control of the brands pricing and distribution, and Nike wants to take back control of its products on the site.
The deal also comes as Nike has been looking at ways to sell directly to consumers through various channels including social media and e-commerce sites like Amazon. The initiative is called “consumer direct offense,” and as part of it, Nike also announced on Thursday’s call a venture to sell through the Instagram smartphone app.
Renewed growth after rocky year
Nike also posted better-than-projected earnings in the fiscal fourth quarter, which ended May 31. Profit amounted to 60 cents a share in the period, compared with a 50-cent estimate of analysts.
The company had rattled shareholders three months ago with disappointing sales, signaling that Adidas and Under Armour Inc. were grabbing market share. The latest results suggest Nike is doing a better job defending its turf — especially in overseas markets.