{"id":2308765,"date":"2024-08-05T06:00:00","date_gmt":"2024-08-05T10:00:00","guid":{"rendered":"https:\/\/monetizemail.com\/magatoon\/?p=2308765"},"modified":"2024-08-05T10:03:23","modified_gmt":"2024-08-05T14:03:23","slug":"nike-takes-its-eye-off-the-ball","status":"publish","type":"post","link":"https:\/\/monetizemail.com\/magatoon\/2024\/08\/05\/nike-takes-its-eye-off-the-ball\/","title":{"rendered":"Nike Takes Its Eye Off the Ball"},"content":{"rendered":"<\/p>\n

Paris, city of love and many rats<\/a>, has the honor of hosting the Olympic Games this year. The spectacle will draw roughly five million people<\/a> to the heart of France. Athletes from across the globe represent their nations performing feats of incredible strength, speed, and skill. American athletes will be presenting their talents in Nike sponsored apparel<\/a>. America indeed has the most Olympic gold medals<\/a>, and is anticipated to take home the lion\u2019s share this year.<\/p>\n

Nike, named after the Greek goddess of victory, swooshes in and garners attention in Paris. Back in New York City, however, Nike stock has been taking a beating. Just last week the NYSE posted Nike having its 52-week low<\/a> at $71.23. Just three years prior, in 2021, the stock was at a peak<\/a> of roughly $170. Forbes writes<\/a>, \u201cNike stock is down 48 percent over the last three years, including dividends, far worse than the S&P 500\u2019s 34-percent return.\u201d<\/p>\n

Current CEO John Donahoe has been leading Nike since 2020. According to CNBC<\/a>: \u201cSince Donahoe took over as Nike\u2019s top executive, its stock is down more than 25 percent as of Friday\u2019s close, significantly underperforming both the S&P 500 and the XRT \u2014 the retail-focused ETF \u2014 which saw gains of around 67 percent and 66 percent in that time period, respectively.\u201d Additionally, the June 27 unofficial earning call transcripts<\/a> confirm Nike\u2019s rather negative outlook: \u201cNike Direct was down 7 percent. Nike Stores were down 2 percent, and Nike Digital was down 10 percent\u2026. We expect first-quarter revenue to be down approximately 10 percent.\u201d The range of speculation for Nike\u2019s losses span from intense new competition<\/a> to lack of innovation<\/a> from the winged Greek goddess. But Nike\u2019s spectacular blunder may run deeper.<\/p>\n

Recall the tumultuous times of 2020, a devastating concoction between the COVID-19 shutdowns and the rioting after the tragic death<\/a> of George Floyd. Nike, within four days of George Floyd\u2019s death, launched a \u201cDon\u2019t Do It<\/a>\u201d message linking the firm to matters of social justice. This was not a new campaign for Nike. Just two years prior, the shoe conglomerate promoted a controversial figure, Colin Kaepernick<\/a>, the football player who knelt during the national anthem. That campaign generated backlash that saw consumers burning Nike products<\/a>. Unfortunately, the summer of 2020 saw more than products burn; entire stores and streets were lit a flame.<\/p>\n

The summer of 2020 saw rioting and looting across the country, with damages estimated up to $1 billion dollars, per Axios<\/a>. Nike stores were targeted in just about all American metropolitan areas including Los Angeles<\/a> and Chicago<\/a>. Chicago Black Lives Matter organizer BLM, Ariel Atkins, stated<\/a> that such lootings were justified as reparations. The Black Lives Matter hashtag can be found linked to the \u201cDon\u2019t Do it\u201d message as well. Nike associated itself with the organization that cheered the burglary of its very own stores that same year.<\/p>\n

Nike wanted to make an impact in the community, venturing beyond selling shoes and sports apparel. The results include a current 2-percent reduction<\/a> in labor force, the latest of which included 740 personnel<\/a> from its HQ in Oregon. Pledging support in turbulent times did not go far enough in 2020. In 2021, Nike set objectives<\/a> for attaining more equity and fairer wages amongst all employees. These goals were also attached to management salary determinations for 2025. The 5 year road map stated<\/a> \u201cFor the first time, Nike said, it will also be tying its executive compensation to the company making progress in deepening diversity and inclusion throughout its workforce, protecting the planet, and advancing ethical manufacturing.\u201d Given the stock\u2019s current bearish behavior on Wall Street, that is indeed \u2018bad news bears<\/a>\u2019 for everyone seeking a raise.<\/p>\n

Economist Milton Friedman, in the 1970s, reflected<\/a> on the perils of businesses attempting to broaden their scope beyond providing profits to shareholders. His essay \u201cSocial Responsibility of Business is to Increase Its Profits\u201d straightforwardly explains<\/a>, \u201cThere is one and only one social responsibility of business \u2014 to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game.\u201d Nike has promoted athletes when consumers would rather burn their merchandise, and associated itself with organizations which burglarized their stores. Nike may not be out of the game just yet, but she has fallen from Olympus.<\/p>\n

The post Nike Takes Its Eye Off the Ball<\/a> was first published by the American Institute for Economic Research (AIER)<\/a>, and is republished here with permission. Please support their efforts.<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

“Nike wanted to make an impact in the community, venturing beyond selling shoes and sports apparel. The results include a current 2-percent reduction in labor force.” ~Stefan Bartl<\/p>\n","protected":false},"author":213,"featured_media":2308767,"comment_status":"close","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[59],"tags":[],"class_list":["post-2308765","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economics"],"_links":{"self":[{"href":"https:\/\/monetizemail.com\/magatoon\/wp-json\/wp\/v2\/posts\/2308765","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/monetizemail.com\/magatoon\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/monetizemail.com\/magatoon\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/monetizemail.com\/magatoon\/wp-json\/wp\/v2\/users\/213"}],"replies":[{"embeddable":true,"href":"https:\/\/monetizemail.com\/magatoon\/wp-json\/wp\/v2\/comments?post=2308765"}],"version-history":[{"count":1,"href":"https:\/\/monetizemail.com\/magatoon\/wp-json\/wp\/v2\/posts\/2308765\/revisions"}],"predecessor-version":[{"id":2308766,"href":"https:\/\/monetizemail.com\/magatoon\/wp-json\/wp\/v2\/posts\/2308765\/revisions\/2308766"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/monetizemail.com\/magatoon\/wp-json\/wp\/v2\/media\/2308767"}],"wp:attachment":[{"href":"https:\/\/monetizemail.com\/magatoon\/wp-json\/wp\/v2\/media?parent=2308765"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/monetizemail.com\/magatoon\/wp-json\/wp\/v2\/categories?post=2308765"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/monetizemail.com\/magatoon\/wp-json\/wp\/v2\/tags?post=2308765"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}