Just Do It! Analysis of Nike's Web3 Marketing Strategy

Published on 9/29/2022   257 views   0 Comments  

Original title: Marketing Series 08: Just Do It! Analysis of Nike Web3 Marketing Strategy

By Chris Sotraidis

Compiled by: Misaki, WhoKnows DAO

TL; DR

  • Nike focuses on web3 and has released a large number of well-known collections;
  • NIKELAND is the best case of the brand moving towards the meta universe, which is low-key and modest;
  • Compared with the sales volume of Nike NFT, other brands seem to have never tried this method at all;
  • Omni channel marketing is crucial in 2022, and Nike has made remarkable achievements in this regard;
  • AR enhanced clothing may become a part of the space network in the future;

In Web3, Nike has left a positive, bold and ambitious impression. Its dominant position in online shoe sales is comparable to that of Adidas, a competitor, and it has surpassed the latter in many aspects. Digitalization is integrated into every aspect of Nike. Nike operates by interacting with its fans and expanding its business landscape. Nike has realized that people spend a lot of time online, and they have begun to step up efforts to turn their business to D2C sales. Brand emotional marketing is the core of Nike's marketing strategy, which inspires customer loyalty through hero archetypes. You are a hero, and your laziness is a villain. Sometimes a voice in your mind tells you to open the APP SNKRS and bid for a pair of Air Jordan 5 Retro T23 Toyos.

We may easily find an article detailing Nike's R&D strategy, including the impact of shoe innovation or Nike's sportswear style 30 years ago, but this time we will focus on web3. We will review the timeline of Nike's activities in the web3 field, deeply study recent Nike initiatives, talk about surrounding air drops, and finally end with brand analysis. If you want to know all Nike's actions in web3 in one place, you've come to the right place.


Nike web3 Activity Timeline


  • In September 1999, Nike By You (Nike ID) played on Nike Com website to launch customized service for sneakers;
  • In December 2019, Nike applied for a patent for CryptoKicks (blockchain digital pairing system);
  • In January 2020, RTFKT was established;
  • In November 2021, Roblox, based on NIKELAND Metauniverse, made its debut;
  • In December 2021, Nike acquired RTFKT;
  • In February 2022, MNLTH NFT will be released;
  • In April 2022, Nike announced the internal composition of MNLTH;
  • In April 2022, CryptoKicks will be auctioned on Opensea;

Event Details

Nike App (Overview) - To say the least, Nike's digital ecosystem is very extensive and impressive. Users can directly scan a QR QR code on the page of the main website to open the app, learn about the latest equipment, read brand stories, and interact with communities around the world. Although Nike has turned more attention to the D2C track, its global presence has greatly accelerated Nike's development. Nike's D2C transformation and app development go hand in hand. With this in mind, please understand the following events:

  • Nike Apps such as Nike App, Run Club, Training Club, and SNKRS bring great value. Its CEO John Donahoe pointed out that the lifetime value of consumers who interact with us on two or more platforms is three times more than that of those who have no contact with us.
  • Nike's APPs are very famous. Since Nike became a global player, many of them have been downloaded more than 500 million times;
  • In 2020 and 2021, Nike's digital sales increased by 80% for three consecutive quarters;
  • In 2018, Nike set a goal to increase its digital marketing volume by 30% by 2023. They are updating their goals again and again, because these goals are constantly reached in advance;

All programs help Nike plan to become a stronger D2C brand. Why go to the store when you can try a pair of shoes with AR technology on the app? If you knew that Why go to a physical store to buy shoes when you can enjoy a free return and exchange service on www. com?

Nike App - This is the main Nike App. Use it as your personal guide. With this app, you can learn the latest product information, thought-provoking stories and visit Nike's global community. Free shipping and returns within 60 days are a big advantage. Consumers can access many online stores through APP to enjoy more convenient online shopping.

SNKRS - The web2 app developed by Nike offers many additional discounts on sneakers for users in the US/China/Japan. The live broadcast is also generally carried out on the app. A notable example is the Air Jordan 4 PSG shoe (which was robbed in 2 minutes). If products are sold live on the app, general products will be sold out. According to Nike data, sales reached $4 million in less than 30 seconds (Nike's record), an unprecedented number.

RTFKT - Nike acquired this innovative brand in 2021. In 2020, Benoit Pagotto, Chris Le and Steven Vasilev jointly created RTFKT. It uses new technology, integrates culture and game elements, and creates the next generation of digital collections. The core of RTFKT team is blockchain technology (including NFT), the next generation built-in game engine and augmented reality technology. We can think of RTFKT as a native project of web3. The famous RTFKT collections (3D wearables) include Clone X, Jeff Staple, Ferocious, Space Drip, and RTFKT Creators. The design and development speed of RTFKT can help Nike realize its CRYPTOKICKS vision in 2019.

CloneX owners have commercial rights to their avatars. Through token gated, the owners are also allowed to download 3D documents. This means that the holder can re create the avatar and create any content they can imagine. It took Nike a long time to adapt to this open-source mentality, but it paid off tremendously. RTFKT and other content creators are also working on a tutorial on how to download and customize CloneX avatars. The file types supported by RTFKT include Blender, Maya, Unreal, Unity, and GLTF (just a few examples).

RTFKT plans to make a digital product authentication in the future, which requires NFC physical chips and digital NFT.

RTFKT x Nike Dunk Genesis CRYPTOKICKS - Customized shoes on the blockchain. Consumers can purchase "skin medicine bottle" to change the color of their shoes, including the classic Nike shoes Swoosh, tongue, heel series and more. You can imagine the possibility of increasing customization. By allowing third-party creators to freely purchase "skin bottles" to color Nike shoes at will, the number of customized shoes will continue to increase. Creative partners are likely to be endless.

RTFKT x Nike AR Genesis hoodie - Open only to the owners of CloneX and CryptoKicks collections, this digital hoodie is co branded with Nike and features NFC chips that allow AR location tracking. AR tracking allows you to add interesting virtual effects to your AR space. For example, the virtual wing option. CloneX avatars can also wear this hoodie. The physical and digital versions of hoodies have the same AR effect.

AR Genesis hoodie, wings included

RTFKT Snapchat Lens - It is worth noting that RTFKT Studio has developed and released many Snapchat AR glasses, which paves the way for the "AR trial" business in the industry. Although this technology is not perfect at present, it is clear that the clothing industry supporting AR and taking AR as the core will develop rapidly and become popular in the future. As Snapchat and Apple and other companies develop AR glasses with UI coverage, the difference between the digital world and the real world will become more and more blurred. With the adoption of AR wearable devices in the whole decade, the social signals with technology as the core are changing.

This will be more popular in a decade, trust me

The first formal cooperation between MNLTH - Nike and RTFKT was in the form of a blind box on Opensea. As described on Opensea: "Did you see that mysterious MNLTH? It's marked with Nike& RTFKT. It's vivid. What does it do?" MNLTH NFTs will be given to the people who hold CloneX NFTs. At present, the floor price is about 3.4 ETHs (5400 dollars at the time of writing), and 20000 MNLTH NFTs include the task mechanism finally revealed. In April 2022, a website revealed that MNLTH holders burned NFT in exchange for a Nike Dunk Genesis CryptoKicks, a skin lotion Evo and one MNLTH 2. Liquid medicine can be used to upgrade sneakers with limited edition skin. The first vial of liquid medicine kit Evil X was developed based on CloneX, including 8 CloneX DNA skins.

NIKELAND (Nike x Roblox) - Nike's first meta space was created using the Roblox platform, allowing fans to participate in free promotional activities and relevant brand experiences. Since the launch of the platform in 2021, 7 million people have had a good time on NIKELAND, including some celebrities (LeBron James is the best example). Any product used and purchased in NIKELAND can be transferred to the Roblox platform. Just like in "Forest of Animals", every user visiting NIKELAND can customize their own "yard", which provides them with a space to display in game assets and collections. The games in NIKELAND include football, swimming in Nike Lake, various Easter eggs, skateboarding, and finding various interesting bouncing pads on the map.

NIKE's advertising form is to display virtual goods in the NIKELAND showroom, and it is free of charge. Users can purchase virtual shoes, clothes and decorations, and more matching and good things may be online in the future.

Kahris crushing it on the Nike branded hoverboard


POS system


Nike and LS Retail work together to propose POS (Point of Sale) solutions. Nike has mastered the global marketing strategy, which you can feel when shopping in the physical retail store. The store is carefully designed and managed. No matter online experience or physical store shopping, the feeling is the same. As far as we know, this consistent shopping experience has been formed since the launch of NIKE ID in 1999. Now 20 years have passed, the marketing of online stores and physical stores has become a part of the sales process of each shoe. Many shoes displayed in physical stores can only be purchased online. The commodities displayed in the physical stores also embody the technology contained in different series of shoes (Flywire, Dri FIT and Hyperfuse are the best examples).

The Nike flagship store in New York City provides customers with other ways to interact with the brand. Play the shooting video to capture and constantly replay the climax, and use the treadmill to simulate outdoor running. There is no doubt that we will see more immersive experiences in the store, which are inseparable from Nike's efforts on web3.

At each Nike physical store, employees are equipped with a POS device for operation. This allows Nike employees to serve the customers around them, without having to stick to the traditional cash register. I encourage people who want to dig deeper into the Nike omni channel experience to see Alex Senn'sThis postใ€‚

BOPIS is becoming increasingly popular, and is a real acronym

Customers in the US can only pay in US dollars on the Nike website. Payment methods include traditional credit cards. Apple payment, Klarna credit card installment payment and paypal payment. The euro can be used overseas.

Acceptable payment methods: UnionPay, MasterCard, American Express, Discovery, Paypal, Klarna, Nike and Converse gift cards, product coupons.


Discord Community Information


Nike did not open the discord channel. This seems to be intentional, because both Roblox and RTFKT have discord channels. There are too many users of the Nike brand. I'm afraid one server can't accommodate them. If someone is interested in the secondary market of collector's shoes, there are dozens of famous discords waiting for you to join. You can track information, trade products and gossip. We know how horrible it is to manage a 250000 person server, and Nike's social media account has more fans than any other brand (except the Kardashian family). Considering that a large number of frauds are widespread on medium-sized servers, perhaps an enterprise centric discord community is more useful.


Technology stack


  • Ethereum personalized customized wallet;
  • Opensea NFT store (consumers pay with Ethereum);
  • Conventional e-commerce payment portal;
  • Active social media (instagram, twitter, Tiktok);
  • Dynamic website, using CSS, JSON and React JS;


Statistics and indicators


RTFKT x Nike Dunk Genesis CRYPTOKICKS NFT - (captured August 4, 2022)

  • ETH contract address: 0xF661D58cfE893993b11D53d11148c4650590C692
  • Blockchain: ETH
  • Token standard: ERC-721
  • Creator's royalty: 10% (higher than normal)
  • Special holder: 6571
  • CRYPTOKICKS CAST: 12621
  • Sales quantity of the day: 13
  • 7-day sales volume: 54
  • Total transaction amount in USD on that day: 12860

Price

Volume

Floor Price


Secondary market analysis


The analysis data is from Opensea: August 4, 2022

  • Sales quantity of the day: 13
  • 7-day sales volume: 54
  • Total transaction amount in USD on that day: 12860
  • Current floor price: ฮž zero point seven two
  • Maximum price: ฮž twenty-two
  • Average price: ฮž one point one nine five nine
  • 24-hour turnover: ฮž nine point three four
  • 90 day average price: ฮž one point one nine five nine
  • Total turnover in 90 days: ฮž 2221.9974 (3561861 USD)

We can view the data analysis of many Nike series, among which the data is the most active. The most normal series is the Nike Dunk Genesis. It is noteworthy that MNLTH NFT is ERC-1155 standard and CRYPTOKICKS is ERC-721 standard. The royalties of these two creators are 10%, which is relatively high. Since the launch, the floor price and average price have been consistent, and the ETH trading volume has also been normal.

NIKE is cutting its royalties. It is expected that these NFTs will continue to be popular in the future. As long as Ethereum continues to operate, anything related to CloneX will be collected and praised. With more and more Nike partners, these NFTs may appear in the meta universe in the next few years, when the floor price may be higher. In view of the current market situation, Nike's performance is comparable to that of other major brands in the market. It is hard to imagine how it can do better. The brand is ready for the next cycle. There is no doubt that Nike will continue to launch more successful series by integrating the meta universe and AR functions into the future NFT.


Brand analysis


Advantages:

  • Nike is one of the largest brand names of sneakers in the world, with a logo and brand awareness that can leave an instant memory;
  • Acquired and cooperated with RTFKT, keeping its unique position and design at the forefront, and targeting the Internet, games and creators;
  • Quickly enter the market through NIKELAND meta universe, and embrace the NFT market more openly than other competitors;
  • It often appears in the headlines and has become the leader of well-known web3 brands;
  • Nike AR clothing and shoes are in a leading position, and other big brands are also trying to focus on this;

Insufficient:

  • Although sneakers are the mainstream of fashion, shoe collectors still account for a minority;
  • The success of the future meta universe may depend on the development of virtual goods with reasonable prices. At present, most consumers are still unable to reach NFT;
  • Nike has not held a noteworthy web3 online party;
  • The number of programs for most Nike apps and loyalty is hard to understand;
  • The future roadmap issued by some current NFTs is unclear;
  • Roblox based NIKELAND is mainly for children, but people who buy Nike shoes don't think so. We need a more mature meta universe or a scheme similar to Adidas;
  • AR technology and screenshots using Snapchat filters are not yet mature, making the screen slightly rough;

opportunity:

  • Nike may be the first wholly-owned brand to successfully own the Metauniverse;
  • Cooperation with local web3 designers and game animators may be win-win for brands;
  • NFT and high-value footwear sales go hand in hand. Nike is likely to play a leading role in the development direction of web2 brand and the verification of item ownership on the chain;
  • Combine the Roblox platform with NIKELAND to let young people join the brand. Number first, then sneakers;
  • The name Nike comes to mind when people mention AR clothing. No other brand has such attention. AR clothing may become the next big market;

Threats:

  • Other shoe companies, such as Adidas, realized the potential of cooperation between the game industry and the meta universe and wanted to open the gap with Nike's recently released NFT, a cool looking sneaker.
  • Adidas's meta universe layout is aimed at more mature users, who are more able to attract groups willing to pay high prices to buy shoes;
  • If the market continues to decline or NFT is further demonized, Nike's bullish bet on NFT is likely to backfire;
  • The DAO of sneakers with web3 as the core may try to annex some cool exclusive markets, but considering the shortage of reserves and the complexity of funds, this plan is far away;
  • From a technical perspective, some junk NFT may disappoint customers. Nike needs to be cautious and agile in every step;
  • Compared with Adidas, which openly accepts the culture of the District community, Nike lacks a place to focus on discussion, which puts him at a disadvantage;


summary


Nike has transformed itself again and again in its 58 year history. It has successfully entered web3 to show other brands in the footwear industry the face of participating in interaction in this world. Nike already has many popular web2 apps that are widely used, and the brand has mastered the method of global marketing. With the development of SNKRS and the addition of RTFKT, we see that Nike is gradually adapting to this network oriented world, which is full of fashion and vitality. Nike's entry into the AR apparel industry may be a watershed, and it will become a typical case of the development of the technology centered fashion industry. MNLTH takes an interesting and unique way to interact with fans, and NIKELAND will continue to develop itself and hold events in the web3 world. Nike's web3 community will continue to grow until all of the brand's online experiences are integrated and cannot be separated. If there is a brand that can jump into web3 and the meta universe with an elegant attitude, it is Nike.

Just Do It.


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