On January 13, tech executive John Donahoe will assume the reins of the largest sports brand in the world, Nike. Donahoe will replace Mark Parker, who has served as Nike’s CEO for 13 years. The transition will usher in a new phase of existence for the longstanding apparel company.
The announcement may not surprise those who have followed Nike closely in recent years. The company hasn’t been shy about its vision of boosting direct-to-consumer sales and deploying tech-enabled stores. Additionally, the change comes at a time when retailers are searching for answers to declining foot traffic and online shopping growth.
Donahoe is currently the CEO of ServiceNow, a California-based cloud computing firm that provides tech management support to large companies. Between 2008-2015, he served as CEO of eBay after spending 20 years with Bain & Company. Donahoe has served on Nike’s board since 2014.
The tech executive represents a dramatic change from Parker, who began working as a footwear designer for Nike back in 1979. Donahoe brings a level of tech expertise that will prove valuable in the coming years.
“His expertise in digital commerce, technology, global strategy and leadership combined with his strong relationships with the brand, make him ideally suited to accelerate our digital transformation,” says Parker, who will stay on with Nike as executive chairman. “I am delighted John will join our team.”
So Where is Nike Going Next?
Nike has made several big moves recently to prepare for a future world driven by data and predictive analytics. In May 2018, the company acquired Zodiac, a consumer data analytics firm, to further strengthen its digital capabilities. In August, Nike acquired Boston-based Celect for its predictive analytics and demand sensing capabilities.
The underlying motivation here is Nike’s Consumer Direct Offense strategy, which describes the company’s goal to deliver consumer personalization at scale. The brand aims to serve customers more intimately on a one-to-one basis. Given his tech experience, Donahoe is well-positioned to lead this charge.
“The future of sport will be decided by the company that obsesses the needs of the evolving consumer,” says Parker. “Through the Consumer Direct Offense, we’re getting even more aggressive in the digital marketplace, targeting key markets and delivering product faster than ever.”
The Rise of Experiential Retail
On top of bolstering its tech capabilities, Nike hopes to create immersive in-store experiences for customers. As retail foot traffic has slowed, brands have moved towards designing experience-driven locations. In these settings, consumers can engage more intimately with brands and products.
Companies like Nissan and Starbucks have led the way in experiential store design. The auto manufacturer launched the Nissan City Hub in a Paris mall, which functions like a futuristic showroom loaded with TV screens and electric vehicles. In New York City, the mattress manufacturer, Casper, lets people take naps in private sleeping pods for $25.
As eCommerce continues to grow, expect to see more and more retailers create innovative in-store experiences that are hard to replicate through smartphones and computers. Nike is preparing for the future. Who’s next?