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IS NIKE EXPERIENCING SOME GROWING PAIN IN EQUIPMENT MARKET?
Published January 6, 1998
Nike's entry into the sports-equipment business is profiled in a front-page story by Bill Richards of the WALL STREET JOURNAL. Nike has been "pondering the physics of equipment such as baseball gloves and bats, hockey sticks, footballs, golf balls and snow boards," with its "mission ... to design something new and then throw Nike's awesome marketing muscle into convincing the world of its technical superiority." Nike equipment division head Andrew Mooney said the unit "will be Nike's fastest-growing division," and other Nike execs say equipment sales "will become its 'third engine,' powering the flagging sneaker and apparel sales." But Richards adds that Nike "is playing catch-up" against its rivals in the $40B-a-year equipment market as development of its lines has "been relatively modest so far compared with the big bucks being shelled out by competitors." For example, Nike will spend less than $500,000 to design a baseball glove (WSJ, 1/6). HOCKEY HANG UPS? Nike's "assault on the equipment business" began with hockey in '96, when the company designed a lightweight skate and a stick. But Richards reports that hockey "hasn't turned out to be the easy slap shot Nike expected. Retailers ... say customers have been returning Nike's new hockey sticks, complaining the blades split because of poor glue." Richards adds that "several high-profile [NHL] players have complained" that Nike's skates "are poorly designed," including Jeremy Roenick who "passed up a six-figure endorsement deal with Nike after he tried on six pairs of its skates and none fit right." But Nike's Mooney "brushes off the early flops" in the equipment business as "growing pains." Mooney: "Wait till you see our equipment in five years" (WALL STREET JOURNAL, 1/6).