Nike, one of the world’s most popular athletic brands, is going to cut about 1,400 jobs and reduce the number of product lines it sells by about 25 percent.
It’s part of a new strategy Nike calls the “consumer direct offense,” and the company -- which has about 71,000 worldwide employees -- will focus more on selling direct to consumers online. For years, Nike has used big-box retail and sporting good stores to push its shoes and gear, but with more people shopping online, Nike plans to increase its presence there.
In the last quarter, Nike revenue went up five percent but it’s facing more competition from other big brands plus new smaller brands and premium labels. According to research from the NPD Group, sales of classic sneakers went up more than 25 percent last year, and sales of performance running shoes stayed the same and sales of performance basketball shoes dropped. Nike, which sponsors high profile athletes from LeBron James to Kevin Durant to Serena Williams, is heavily invested in performance running and basketball shoes.
According to Business Insider, Nike shares dropped after the announcement.