Going off the Rails
Good Trouble for the Week of 7.19.24
This week
Nike’s downturn
Another week, another mass shooting… you’re likely to already forgetting about
"Not everybody is comfortable with the idea that politics is a guilty addiction. But it is. They are addicts, and they are guilty and they do lie and cheat and steal — like all junkies. And when they get in a frenzy, they will sacrifice anything and anybody to feed their cruel and stupid habit, and there is no cure for it."
~ Hunter S. Thompson
Can gambling predict our election? This WSJ profiles Polymarket, an online gambling platform for ‘odd-wagers’, which has become the go-to for assessing where public sentiment lies to getting ‘clear signals through even the most deafening noise.
Maybe the way to get Americans to go EV is to go used. Used EV prices are below their gas equivalents.
To protect mangroves from illegal logging in Kenya, they’re hiding beehives (I’d think the mosquitoes would be enough)
And I would have gotten away with it, if it hadn’t been for those damn meddling kids. Man skipped work for six years – and was only found out when he was nominated for an award -
You could hike up Everest yourself (and possibly contribute to the massive trash pile along the way) OR watch this 4-minute video of a drone fly up to the top for you.
Happy, well-adjusted people are all different. The traumatized are exactly alike. Trauma is trauma
This NY Times story The Kidnapping I Can’t Escape is an incredible story of how trauma unmasks itself
How quickly may we forget this weekend’s mass shooting and assassination attempt? You may be forgetting already:
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Enable 3rd party cookies or use another browserWhile there was plenty of us to talk about, there wasn’t much for us to argue. Without outrage, there’s no engagement. With no engagement, there’s no ad revenue. So it disappears from the radar.
There are riches in the niches
If you haven’t noticed all of the sales ads, the Swoosh has been hurting. Nike is still the leader in the segment with $51B in revenue. However, a sales decline (4-6 percent) when it projected an increase resulting in a 20 percent decline in its stock price and wiping out $28B in shareholder value has many wondering…
What’s going on in Beaverton?
DTC hasn’t paid off
During the pandemic, Nike (under a new CEO John Donaghue) made the bet that people would switch to online shopping for good. Thus, Nike pulled out of some major wholesalers (Macy’s, DSW, and Footlocker) as well as Amazon to focus on its own direct-to-consumer. That bet hasn’t paid off (not even in DTC which is down 8% in the last quarter), and the new shelf space has helped open the door to:
New upstarts
On Cloud and Hoka, while still small, have successfully stolen a lot of Nike’s magic. Particularly with runners.
On’s, with its distinctive look, puts the innovation on the outside for everyone to see (like Nike Air back in the day), and is known for both performance and comfort. The brand has been able to translate running success over to other sports, including tennis, featured prominently in the movie Challengers (and an ad with Zendaya and On’s investor Roger Federer). On’s sales grew to $2.14B in 2023, up 38% from the year prior.
Hoka has been able to expand beyond the ‘ugly dad shoe trend’ with deep roots in the running community, particularly as a trail running shoe in France. Hoka’s sales grew to $1.8B in 2023, nearly +28% from the year prior.
But I think this could be the biggest factor.
Reorganization
In 2017 and 2020, Nike announced reorganizations that, along with an emphasis on direct-to-consumer, also shifted the company from sport-centric to a more traditional organization around men’s, women’s and kids.
While NIKE proclaims its purpose is to move the world through sport through its belief that If you have a body, you’re an athlete, the true secret sauce to its success is design through The Voice of the Athlete.
The success of NIKE has always been closely linked to the goals and dreams of athletes.
We’re incredibly lucky, because we work with athletes who have big ambitions, and when you combine that without passion and obsession, it creates the future…Athletes push us here” - John Hoke, NIKE Chief Design Officer.
A perfect example, Breaking2. The moonshot public project to work with top marathon runners to design and perfect a shoe to break the elusive 2-hour mark. While the project didn’t quite make it, that technology has become available to everyone else. Democratizing those insights and helping millions of runners break their own barriers.
It’s been nearly a decade since that moonshot project, and we don’t necessarily feel this from NIKE today. Perhaps missteps like this year’s MLB jerseys are the ‘canary in the coal mine’ for an organization that has taken its eye off the ball. However, even enthusiasts are noticing serious declines in quality and technology.
Comparatively, it’s the upstarts who are taking the moonshots. For example, On’s new innovation Lightspray, is a one-step production process that sprays on the material rather than building. Resulting in much lighter weight, no laces, and much less CO2 emissions (75% less than other On’s shoes).
The result of all of this is another 700+ have been let go by NIKE in yet another reorganization, many within its senior leadership. This brain drain is already making its way to the competition, all while the ones at the top who made the decisions in the first place remain, for now.
The worst thing that could possibly happen as we get big and we get a little more influence in the world is if we change our core values and start letting it slide. I can’t do that. I’d rather quit. I don’t see why you have to change if you get big” - Steve Jobs, Apple*
* As quoted in Burn Book: A Tech Love Story by Kara Swisher
Will the Swoosh right the ship? Well, that remains to be seen. Digital has a way of flattening brand, which has been its moat. The move back to wholesale may help, however, it may be too late as that opening has already introduced more people to new options. At the same time, NIKE has become THE establishment brand. Whereas before NIKE thrived on hijacking traditional environments, now it dominates those same spaces.
Bandit Running’s (a small running apparel company) hijacking of the US Olympic trials in NIKE’s birthplace, the University of Oregon has to be a major embarrassment to the brand. While also a sore reminder of what the chances they used to take.
In many ways, there’s no going back. Every rebel brand eventually becomes the ‘man’ once they get big enough (ex: Apple, Levis).
But I do believe NIKE’s success runs through the athlete. My advice is to reorg back into ‘by sport’ and start from there.
Resources:
The Daily Upside Can Nike Regain its Legendary Standing?
The Drum How Hoka and On gave Nike a run for its money
Footwear News Amid a Reset, Nike Is Leaving Market Share on the Table: Here’s How Brands Like Adidas, Hoka and On Can Move In
Front Office Sports Nike’s Worst Stock Plunge Forces Big Changes to Win Back Consumers
Global Treasurer Nike Faces Unprecedented Stock Plunge Amid Strategic Missteps
WearTesters Why NIKE Sucks Now
RetailDrive How innovation is driving On’s meteoric rise
Also,
Abercrombie is cool again? The mall brand has successfully ‘un-branded’ itself back to relevancy
AI is increasing search volume, but also leading to killing the click-through, per this study of Google. “Every single website is going to feel the pain.”
Some useful references for referencing Cannes awarded entries:
Love the Work More is my default for viewing case study films. They have updated 2024, and there are cases going all the way back to 1954(!).
But what if I want to see the board entries? This Google folder has all of the entries by category and medal
Adaily has gone the extra mile and created a GPT to help you search by use case. Say you want to find an award-worthy Tik Tok campaign from the US. Look no further.
This appears to be a story less about fanatical partisanship than about the crisis of lonely and disconnected young men being radicalized into pure nihilism.
For Our Collective Insanity
This last week has to have aged us all. Starting with the attempted assassination of President Trump, resulting in two others being severely injured and the death of a father as well as the shooter.
And then the immediate aftershock of conspiracy theories, and blame. Calls to turn down the temperature on both sides. Quickly forgotten as the carnival that is the Republican National Convention kicked off.
I’m following all of this on social media to find out who did it, because it’s this pattern when we hear about a horrific event. You’re on pins and needles in this sort of reverse demographic lottery to make sure the psychopathic shooter doesn’t belong to one of your teams. - Jon Stewart
Perhaps the least surprising thing this week is the profile of the shooter.
Male, young, white, loner, disenfranchised.
That he doesn’t seem to match the political agenda of either side doesn’t matter. He fits the cliche of the mass shooter here in the U.S.
For Guns and Boys
According to the non-profit The Violence Prevention Project which compiles and studies mass shootings here in the U.S. going back to 1966
97% of shooters are male
53% are white or caucasian (vs 60% of US pop), however, that % goes up when the location is highly public
81% in schools
73% in houses of worship
63% outdoors and restaurants
Most (70%) show no signs of psychotic behavior, however, most (67%) do exhibit increased levels of agitation leading up
71% of were suicidal, suggesting these are public spectacles of violence intended as final acts.
Further, while it’s well documented we have a loneliness epidemic in this country - it’s particularly high among young men who report having fewer friends than young women and 15 percent having ‘none at all’.
Young men are falling behind on almost every level to young women, in education, college graduation, and employment (still a bit of a pay gap but closing). And then moving ahead in rates of depression, suicide,
Add to this mix the easy availability of firearms and it’s no wonder gun violence is the most common cause of death for young men.
“We are starting to see some of the key markers we see in individuals that have committed acts of targeted violence,” - Elizabeth Neumann, former Homeland Security assistant secretary for counterterrorism and threat prevention under Pres. Trump
Good Trouble for our Collective Blind Spot
Bringing up the ‘plight of young men’ tends to get you a shrug at best to a ‘what do they have to worry about?”. There is a collective indifference to boys as our society has (rightfully) focused on female empowerment, fighting the patriarchy, and the issues that feed it.
Why should we care about boys? Because this vacuum we’ve left is being filled by those who will manipulate it. It’s not a coincidence we’re seeing mental health declines, less IRL social engagement, dating, marriage, and birth rate declines. At the same time, we see ideological divides between the sexes, and the rise of the Far Right here and across the developed countries. As boys fall behind educationally and socially, their prospects for earning and mating decline. Leaving them isolated and aggrieved, and ultimately online where they find others isolated and aggrieved.
Maybe the best analogy is rowing crew. It doesn’t work if one side is pulling just as hard as the other.
Otherwise, I fear we’ll continue this pattern jasongparkin points out in his breakdown above. A young (likely white) male, isolated and aggrieved will take his life in massive displays of violence killing and hurting many others. And because it fits a pattern we’ve become all too accustomed to, it’ll be a blip in our news cycle before returning to business as usual.
Gender equality is not a zero sum game. We can do more for boys and men without doing less for women and girls. We can be passionate about women’s rights, and compassionate towards the struggles of boys and men. - Richard Reeves, AIBM
Resources:
NY Times The Trump Shooter and the Growing Nihilism of Young Men
WSJ A Portrait Emerges of Trump’s Shooter: Quiet, Withdrawn, With Little Political Footprint
The Violence Project
The New Yorker What’s the Matter with Men?
The Ink FREE FOR ALL: Dr. Vivek Murthy on why American men are in crisis
American Institute of Boys and Men
Psychology Today Why So Many Men Feel Lonely Today
Child Trends Data Point: Gun violence is the most common cause of death for young men
Survey on American Life Men’s Social Circles are Shrinking
“Too many of us still believe our differences define us.” – John Lewis