eCommerce helps NIKE through the corona crisis
Nike reports online sales growth of 75% amid the corona pandemic, closing Q4 2019 with revenues of US$6.3bn
Like many other retailers, NIKE Inc. suffered a sharp and painful decline in company revenues following lockdowns and store closures that were imposed on the brand by governments worldwide in the fight against the spread of COVID-19. As the company reported in their latest financial statement, NIKE Inc.’s overall revenues amounted to US$6.3 billion in the 2019 fiscal fourth quarter, which ended May 31, 2020, and therefore already takes into account the impact of the economic downturn of the first half of 2020 caused by the coronavirus pandemic. Compared to Q4 2018, this corresponds to a decline of 38% year-on-year in overall revenues for NIKE Inc., and it also means that the sports equipment retailer fell well short of what analysts had expected. Like most retailers, however, NIKE did not remain idle for long and took the opportunity to strengthen their digital sales channels – with success. NIKE’s digital sales increased by an amazing 75% in its fiscal quarter ending May 31, 2020, and ended up contributing about 30% to the total company revenue. In other words, the corona effect accelerated nike.com’s constant net sales growth of the past years:
Net sales via nike.com have constantly grown by substantial two-digit percentage rates over the past years. Between 2015 and 2018, the company was able to increase its eCommerce sales on nike.com by around one-fourth to one-third each year, ending up with net sales of US$3.5 billion in 2018, following a year-on-year increase of 34%. In 20191, net sales took a huge leap and reached US$5.2 billion – thanks to the company’s increased engagement in online sales activities as a response to brick-and-mortar store closures during the corona peak phase, nike.com increased its net sales by 48% year-on-year. As far as 2020 is concerned, ecommerceDB.com expects nike.com to grow further, yet not as sharply as in the previous year. According to current forecasts, net sales are expected to grow by 18% and reach US$6.1 billion.
1: NIKE Inc.’s fiscal year 2019 ended May 31, 2020, and therefore already takes into account the corona effect of the first half of 2020
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