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Nike exits the S&P 100 after 18 years and a $200B market-cap wipeout

fortune.com

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Re: Nike exits the S&P 100 after 18 years and a $200B market-cap wipeout

#11

Post by nemothekid »

Nike's destruction over the past 5 years was really surprised and until I read up about the whole "direct to consumer" fiasco it really helped me understand another trend I was a bit confused about.

About 2-3 years, it felt like, out of nowhere everyone was wearing Hoka and On brand sneakers. In my entire life it felt like the Nike/Adidas duopoly was unbreakable, and then it felt suddenly that Hoka was everywhere.

While Hoka probably executed extremely well, I imagine it was an incredibly lucky position Hoka found themselves in when all those retailers had to replace Nike with something. Maybe even allbirds would be in a better position today had they launched 3-4 years later.

Edit: I just looked it up and it seems both Hoka and On were founded before Allbirds. Seems allbirds imploded (~2021), just as Nike was ceding all their retail space (also around 2021). Had they had another year, maybe they wouldn't have had to pivot into an AI datacenter company.

Re: Nike exits the S&P 100 after 18 years and a $200B market-cap wipeout

#12

Post by epsteingpt »

ronsor wrote: post #4
epsteingpt wrote: post #2

Sneakerbots killed it for everyone. Priced out the demand IMO too early. But also, people only have 2 feet.

> Sneakerbots killed it for everyone Ultimately I think artificial scarcity/limited production for products offered online is a futile and erroneous venture. The bots exist because the product is valuable. The product is valuable because it's artificially limited.

Slightly different take IMO.

There's a niche market for certain player's sneakers. If Nike services them at a price point (e.g. $200 base) then people can keep buying from Nike and will buy the next version.

If instead some sneakerbot takes ALL the consumer surplus (buys for $200, resells for $1000) yes that is the actual demand curve but it hurts NIKE'S business and the consumer.

Re: Nike exits the S&P 100 after 18 years and a $200B market-cap wipeout

#13

Post by morkalork »

andsoitis wrote: post #3
epsteingpt wrote: post #2

Sneakerbots killed it for everyone. Priced out the demand IMO too early. But also, people only have 2 feet.

> But also, people only have 2 feet. There's more to athletic wear than shoes. Competition like Lululemon, Vuori, Athleta, etc. suggest to me that Nike didn't expand their business broadly enough.

Lululemon is crashing out too tho, methinks consumers are having a hard time justifying the brand name markups for SEA clothing-slop these days.

Re: Nike exits the S&P 100 after 18 years and a $200B market-cap wipeout

#15

Post by cadamsdotcom »

Personal anecdote I treated myself last year to some Nikes (Vaporflys) because they looked suave on a friend's feet..

Did 180km of training, maybe 5 weeks worth, and the soles utterly shredded. Couldn't put my foot down level, corners of the soles completely gone.

Shoe store said that's what they're designed to do, no refund.

Cost me about $2AUD per km. But it'll cost Nike a bit more than that.

Re: Nike exits the S&P 100 after 18 years and a $200B market-cap wipeout

#16

Post by sh-run »

As a trail runner it’s been weird to watch. Nike ACG has been putting out some seriously good, cutting edge equipment. Ultrafly is a great shoe, as is the Pegasus trail for road-to-trail they’ve also got some neat cooling tech that I don’t have personal experience with.

Project Oregon left a bad taste in a lot of people’s mouth. It feels like right when they recovered their image with runners they are losing mass appeal.

Re: Nike exits the S&P 100 after 18 years and a $200B market-cap wipeout

#18

Post by bawolff »

epsteingpt wrote: post #12
ronsor wrote: post #4

Earlier quoted context omitted.

> Sneakerbots killed it for everyone Ultimately I think artificial scarcity/limited production for products offered online is a futile and erroneous venture. The bots exist because the product is valuable. The product is valuable because it's artificially limited.

Slightly different take IMO. There's a niche market for certain player's sneakers. If Nike services them at a price point (e.g. $200 base) then people can keep buying from Nike and will buy the next version. If instead some sneakerbot takes ALL the consumer surplus (buys for $200, resells for $1000) yes that is the actual demand curve but it hurts NIKE'S business and the consumer.

>then people can keep buying from Nike and will buy the next version.

But in this scenario people can't because if they are worth $1000 but selling for $200 then they will instantly sell out.

why does it hurt consumers more to not be able to purchase due to the price point instead of due to being instantly sold out?

Re: Nike exits the S&P 100 after 18 years and a $200B market-cap wipeout

#19

Post by bawolff »

ronsor wrote: post #4
epsteingpt wrote: post #2

Sneakerbots killed it for everyone. Priced out the demand IMO too early. But also, people only have 2 feet.

> Sneakerbots killed it for everyone Ultimately I think artificial scarcity/limited production for products offered online is a futile and erroneous venture. The bots exist because the product is valuable. The product is valuable because it's artificially limited.

Its fine if you are targeting rich people. It doesn't work if you are targeting (relatively) poor people. You can't have both scarsity and low prices, something has to give.

Re: Nike exits the S&P 100 after 18 years and a $200B market-cap wipeout

#20

Post by [deleted] »

cadamsdotcom wrote: post #15

Personal anecdote I treated myself last year to some Nikes (Vaporflys) because they looked suave on a friend's feet.. Did 180km of training, maybe 5 weeks worth, and the soles utterly shredded. Couldn't put my foot down level, corners of the soles completely gone. Shoe store said that's what they're designed to do, no refund. Cost me about $2AUD per km. But it'll cost Nike a bit more than that.

[deleted]
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