In One Chart - September 20, 2018
In One Chart: Nike Swooshes On Controversial Ad
In the first week of September, Nike (NKE) announced the 30th anniversary of their “Just Do It” slogan in a polarizing way. The sports footwear and apparel giant’s new ad campaign featured Colin Kaepernick, the former San Francisco 49ers quarterback who garnered attention in 2016 for protesting racial injustice by kneeling during the National Anthem.
Nike’s market cap has reached record-highs this week, perhaps not in spite of, but because of, its willingness to be controversial. Supporting social issues has become a popular way to appeal to younger consumers who prefer outspoken brands. See how Nike is fairing against competitors in the chart below.
After the advertisement launched, Nike shares took a hit and slipped by as much as 3.2%. #NikeBoycott was trending on social media and even President Trump offered his negative reaction to Nike’s choice of Kaepernick as spokesperson.
However, in the time since, Nike has been reaping the benefits. Since the ad debuted, 61% more Nike products have sold-out than before the ad aired. Among the sell-outs is Nike’s Kaepernick women’s jersey.
A new survey from Canaccord Genuity of 1000 respondents showed that 36% of non-Nike consumers have moved to “extremely likely” to purchase Nike gear after watching the Kaepernick ad featuring the tagline, “Believe in something. Even if it means sacrificing everything.”
Nike reports fiscal Q1 earnings on September 25th, and while the sales boost from the Kaepernick ad will not be included in that report, perhaps Nike will offer higher guidance for future quarters.