The Evolution of Nike: A Deep Dive into its History and Growth

Nike, Inc. is an American multinational corporation that has grown to become the world’s largest supplier and manufacturer of athletic shoes and apparel(clothes). It is also a major supplier of sports equipment. Founded in 1964 as Blue Ribbon Sports, the company rebranded as Nike, Inc. in 1971. The name Nike was inspired by the Greek goddess of victory.

Nike’s iconic Swoosh logo, designed by Carolyn Davidson, a graphic design student, has become globally recognized and is a core part of Nike’s international brand identity. This logo, along with their tagline “Just Do It”, has helped Nike establish a strong brand presence worldwide

Over the years, Nike has expanded its product line beyond sportswear to include streetwear and sports equipment. It operates its own retail stores and supplies stores and distributors worldwide. Furthermore, Nike sponsors various sports teams and top athletes, enhancing its global brand visibility.

Nike's statement innovate people at global scale. Adapting from their origins of supplying trainers to athletes, they’ve evolved to focus on everyone, all across the gross. the brand focus on improving the world, and target audience around them.

In the early years, Nike faced several challenges. One of the major issues was allegations of using child labor, providing unfair wages, and poor working conditions. In response to these allegations, Nike decided to change their business strategy to distance themselves from these practices. They shifted from a reactive mode to a proactive one following protests in the late 1990s over unsafe working conditions, low wage rates, excessive overtime, restrictions on employee organizing, and negative environmental impacts.

Another challenge was the competition in the active category and the possibility of increased markdowns. To overcome this, Nike focused on improving its marketing strategies and product innovations. They also adapted to changes in consumer shopping patterns due to global lockdowns leading to a rise in online sales.

The Waffle Sole Design: This innovative design was conceived by Nike co-founder Bill Bowerman in the early 1970s. The idea came to him over breakfast when he noticed the pattern of the waffle iron his wife was using. He realized that the inverted pattern could provide excellent traction for a running shoe. After several tests, a flexible, elastic, and lightweight rubber material was created with a raised grid pattern. This design, known as the Waffle sole, was introduced through the Nike Waffle Trainer. It provided more traction and flexibility on multiple surfaces, which was a significant improvement over existing running shoe designs. The Waffle sole design was a major factor in Nike’s growth, as it set the company apart from competitors and established its reputation for innovation.

Introduction of Clothing Line: While Nike initially started as a footwear company, it expanded its product line to include clothing in 1979. This move allowed Nike to cater to a broader range of customer needs and preferences, further driving its growth. The clothing line included various sports apparel that maintained the brand’s focus on performance and innovation. Over time, Nike’s clothing line has grown to include not just sportswear but also street fashion, thereby reaching an even wider audience.

Nike’s initial public offering (IPO) was a significant milestone in the company’s history, marking its transition from a private company to a publicly traded one. This event took place on December 2, 198012.

The IPO process was in full swing by September of that year. Nike filed to create 20 million shares of Class A stock and 30 million of Class B. 30 million shares were held in reserve, and 2 million Class B shares were sold to the public, somewhere between $18 and $22 per share.

56% of the Class A shares would be held by the early team – Bowerman, their earliest investors, the Buttfaces, and Phil, who would personally own 46%. The stock was first sold to the public at $22 per share and traded in the over-the-counter (OTC) market on the NASDAQ.

The IPO was a strategic move to solve their cash flow problem. It also allowed Nike to raise capital for expansion, invest in new technologies, and continue its growth trajectory. However, Phil Knight was initially concerned about losing control of Nike through an IPO. Their solution was to issue two classes of stock – ordinary Class B shares with one vote, and preferred Class A shares for the current team that would let them name ¾ of the board

In 1984, Nike signed a five-year endorsement contract with Michael Jordan, a rookie in the NBA at the time. Despite Jordan’s preference for Adidas, Nike offered a deal worth $500,000 per year, which was an unprecedented amount for an athlete endorsement deal at the time. This move was part of Nike’s strategy to boost its profile in the basketball market.

The partnership led to the creation of the Air Jordan line of sneakers, which debuted in 1985. The first model, known as the Air Jordan I, was produced in multiple colorways, including the iconic “Bred” colorway that violated the NBA’s uniform policy at the time. This resulted in a fine for Jordan each time he wore them on court, which Nike covered, further boosting the shoe’s popularity.

The Air Jordan sneakers quickly permeated popular culture, becoming symbols of urban America. They were not just seen as sports equipment, but as fashionable streetwear. The sneakers have been referenced in numerous songs and music videos, and are collected and cherished by sneaker enthusiasts around the world.

The financial impact of the Air Jordan series on Nike has been substantial. The sneakers were an instant commercial success, with revenues reaching $100 million in their first year. Today, the Jordan Brand, which became a subsidiary of Nike in 1997, generates over $3 billion in annual revenue for Nike.

Today, Nike’s contracted factories employ 1.02 million workers in 42 countries to produce all its products, with 29% of product made in China and 44% in Vietnam.

 Nike faces competition from several other brands in the athletic footwear and apparel industry.

Allegations of forced labor in the Nike supply chain have been made. Gender discrimination towards female athletes and parents has also been reported. There have been claims that the company fails to ensure all employees receive a living wage. Moreover, the company is spending high amounts of money on political lobbying each year.

Nike has been pushing the boundaries of sustainable innovation for decades. They have a journey called “Move to Zero” which is aimed at achieving zero carbon and zero waste. They are reusing existing plastics, yarns, and textiles, and inventing entirely new materials. They are also focusing on carbon, waste, water, and chemistry, aiming to hit targets by 2025

Nike partnered with organizations like Fair Labor Association (FLA), Better Work, Social Labor Convergence Program, PeacePlayers International, Girls Inc., and Mentor to improve working conditions in factories around the world and to develop a simple, unified and effective industry-wide way to assess labor, health and safety conditions in factories Nike has introduced several sustainable products. The Flyknit shoe line uses recycled polyester instead of traditional materials to reduce waste by 80%. They have also launched Nike Refurbished, an initiative where they refurbish gently worn, like-new or slightly imperfect footwear. The inaugural collection of Nike Forward is made with an average of 75% less carbon compared to their traditional knit fleece.

Nike has made significant strides innovating in materials, manufacturing and supply chain operations. They have used AI and machine learning technologies to predict and order the products that will be popular among consumers, and to deliver products faster and more accurately. They have also incorporated over 1,000 “cobots” – collaborative robots – within distribution centres.