Executive Briefing

Is Nike actually good at digital? Or is it just lucky to be Nike?

Nike Run Club is a half-hearted disappointment that should be so much more. Also: Updates on Shopify, Airbnb, Beyond Meat, and Delta.

Nike Run Club

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It’s extraordinarily rare for a perfectionist, iconic company like Nike or Apple to admit that it’s not doing something well.

So I was surprised when, on Nike’s last earnings call, CEO John Donahoe proactively started talking about areas of the business where “we expect more of ourselves.”

Donahoe was talking, first, about Nike’s Running business — specifically, that the company needs “to drive more meaningful consumer connections among everyday runners.”

It’s true.

Nike has done more than any brand to popularize running as a mainstream pursuit over the past few decades. But today, it’s hardly the only obvious choice for running gear or guidance.

And while the company has impressively innovated in shoe technology for the world’s top runners, competitors like Hoka, On, Tracksmith, and Vuori have taken “everyday runner” consumer share in footwear and apparel.

Nike is also letting its Running customers down in digital, too — something I think about a lot as an “everyday runner” who still uses the Nike Run Club app a few times a week.

This frustration, I was recently reminded, is hardly just mine: Dennis Crowley, the tech and sports entrepreneur, got a bunch of replies to his Threads post asking for suitable replacements for Nike’s app; “it’s clear no one is maintaining it anymore,” he said. A recent, apparently buggy update has also driven a surge in bad ratings and reviews.

Nike, especially under Donahoe — the former CEO of eBay — talks up its digital strength constantly; the word shows up 31 times in last quarter’s earnings call transcript alone.

(It also loves to talk about its “Membership” — really, people with a Nike account — and its supposed ability to personalize its experiences for them across channels. This is not readily apparent as a longtime customer who is recommended mostly random stuff that’s nothing like the products I’ve purchased, used, or search for.)

And, yes, the company generates billions of dollars per year from its e-commerce site and apps. These have been key parts of its “Consumer Direct Offense,” during which the company has significantly increased the direct-to-consumer portion of its business from 28% in fiscal 2017 to 44% in fiscal 2023. It is objectively successful here.

Chart of the Day

Chart: Nike annual direct to consumer revenue by fiscal year

But after spending any time with its digital tools, the truth is that Nike could really be a lot better.

Nike Run Club is the perfect example of this underwhelming execution, both in what it’s currently shipping and what it could be shipping instead. As a run-tracking utility, when it works, it is fine. But Apple already includes a better-than-fine run-tracking utility built in to the Watch.

Nike’s mission should be to build the best running app, with content, community, and features to make running easier and more fun.

In addition to a rock-solid run tracker, the best running app would help users with:

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Dan Frommer

Hi, I’m Dan Frommer and this is The New Consumer, a publication about how and why people spend their time and money.

I’m a longtime tech and business journalist, and I’m excited to focus my attention on how technology continues to profoundly change how things are created, experienced, bought, and sold. The New Consumer is supported by your membership — join now to receive my reporting, analysis, and commentary directly in your inbox, via my member-exclusive newsletter. Thanks in advance.

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