Sporting goods strategy: three days in Dallas stores, then a plan for five accounts

What it is

The first issue named in the strategy deck was that Nike Basketball was too heavily invested in one sporting goods account. From fiscal 2012 to fiscal 2015 its business with Dick's Sporting Goods grew 35% a year, while the rest of the channel, which Nike called strategic sporting goods, grew 15% a year. Across footwear, apparel and equipment, Nike Basketball's sales in those strategic accounts ran $62M, $75M, $87M and $95M over the four years. Basketball was 7.7% of Nike's sales in the channel. Running was 19%.

The trip to Dallas set its goals against fall 2016: dominate from that season, build the best sporting goods footwear wall in the world, and hold the line plan accountable through to sell-through.

The deck named the other problems. Sixty-seven percent of the sporting goods footwear assortment was shared with department and family footwear stores. Basketball got attention in store only during the October and November gear up season, and 75% of footwear orders from these accounts fell in fall and holiday. Talking points in the deck record Under Armour's share in the channel moving from 1.1% to 3.4% in the three months to February 2015, and doubling at $60 to $70 and at $70 to $80.

What Khounlavong did

• Served as footwear captain on the Dallas market trip of January 14 to 16, 2015, named "Sporting Goods Attack". Fifteen people attended. Each captain was responsible for the photographs and the recap for a business unit.
• Walked Dick's, Hibbett, Sports Authority, Academy, Famous Footwear and the Nike Factory Store, and recorded what each footwear wall showed. At one account the price ceiling was $70 and Under Armour was absent. At another the main competitor was the Under Armour Jet at $70. One store was noted as the only sporting goods account with a footwear wall.
• Wrote the strategy deck in April 2015. Two versions carry his initials, dated April 13 and April 30. The apparel and equipment pages were marked for those merchants to confirm.
• Chose five accounts to focus on: Sports Authority, Hibbett, Academy, Modell's and Scheels. Notes in the deck record that half of the channel's consumers shopped at those five. Dick's would continue to be resourced for growth.
• Asked for a new footwear model near $70 to $75 sold only in sporting goods, a re-established $110 mid cut model for fall and holiday 2016, and core signature models for LeBron James and Kevin Durant.
• Proposed moving new product to the moments when players buy: the start of the season, and March 1 when the college tournament, the NBA playoffs and the summer club season begin.
• Set a target for the core style mix, from 60% shared, 5% sporting goods only and 35% department and family only, to 40%, 30% and 30%.

Results

• The plan projected strategic sporting goods growing 20% a year from fiscal 2016 to fiscal 2018, to $165M across footwear, apparel and equipment. That was a plan figure.
• The final deck sized the $75 footwear request at $20.4M and 550,000 pairs, with door counts by account.
• His fiscal 2015 review lists the sporting goods strategy, written to accelerate growth beyond signature footwear, among the year's goals, and the core growth strategy for sporting goods, department stores and family footwear among his leadership work.
• The footwear requests were carried into Conquer the Core three months later.
• The final deck was still a working document. One comment on the $110 request reads: "Can we validate these numbers?" The documents do not record what was adopted after he left the category in September 2015.

At a glance