Nike pins hopes on Olympics in race to take back market share

NIKE is set to unveil new kits for the Olympic national teams it sponsors including the United States and Kenya, seeking to bolster its credentials as a performance gear brand for top athletes as well as everyday consumers.

After a long stretch of lacklustre sales, this summer’s Olympic Games in Paris offer a fresh chance for Nike, the official outfitter of Team USA, to direct the world’s attention to its so-called performance products such as running shoes.

The high-end shoes Nike will spotlight at the Olympics serve a relatively limited audience of amateur runners willing to spend US$285 for the latest Nike Alphafly 3 model. That compares to US$250 for rival Adidas’ equivalent Adizero Adios Pro 3.

Brands such as On Running, Hoka, and Lululemon are taking market share from Nike, while a trend away from chunky basketball sneakers and towards low-profile “terrace” shoes such as the Adidas Samba is also hurting the sportswear giant.

Nike warned three weeks ago that its revenue in the first half of its 2025 financial year would shrink and said it would cut back on orders of established shoes such as the Air Force 1 as it tries to focus on new, innovative products.

While Nike, with an annual revenue of US$51.2 billion in the year to May 31, 2023, is much bigger than Adidas and Lululemon, analysts at HSBC expect its annual sales growth to lag those brands in 2024, 2025 and 2026.

“They haven’t had a ton of exciting product innovation recently,” said Tom Nikic, analyst at Wedbush in New York.

Seeing Olympians break records in Nike gear could push more shoppers to the brand. “It will remain to be seen whether Nike has the strong product to capitalise on the attention it will get,” said Nikic.

Nike executives said late last year they would focus more on running shoes, an area where Nike has lagged behind the competition. Among other things, Nike aims to sell more entry-level running shoes, which tend to run between US$100 and US$150 a pair. REUTERS