Conservatives Win? Nike's Kaepernick Campaign Is Backfiring
Nike sales are up and people are claiming that this is proof they did the right thing with hiring Colin Kaepernick. But market research data shows that ALL demographics, even democrats, view Nike less favorably following their campaign. The controversy may have resulted in a temporary sales increase but this may be due to tribalists buying products to show support. It would seem that by entering the culture war on the side of Social Justice they have only damaged their image in the long term. Even among Democrats Nike favorability has declined. They sacrificed their entire Republican base on this campaign and even Gen Z and the Democrats have pulled back.
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And a lot of people have said, Tim, the marketing people who are saying hire Colin Kaepernick are probably social justice warriors and all that stuff.
And yeah, sure, maybe.
But the point is, Nike is still not going to buy an ad campaign unless they do the research first.
And they did the research.
And there is a reason why they decided to sign Colin Kaepernick to do this ad.
However, I think it was a huge mistake.
And we have evidence to back that up.
A lot of people are sharing a story today that shows Nike sales are up 31% and they're claiming this proves Nike made the right choice.
But there is still more data to suggest they made the wrong choice.
So today, the question I have is whether or not you all think Nike was making a good decision in hiring on Colin Kaepernick, if you think conservatives are actually winning this one, but actually, Let's take a look at the data to see what's really going on, and then I'll tell you exactly what I think.
We've got this story circulating from this morning.
Nike's online sales jumped 31% after company unveiled Kaepernick campaign, Datashow.
Fears of a hit appear overblown as consumers, brand experts, and analysts cheer an edgy and risky marketing move.
After an initial dip immediately after the news broke, Nike's online sales actually grew 31% from the Sunday of Labor Day weekend through Tuesday, as compared to the 17% gain recorded for the same period of 2017, according to San Francisco-based Edison Trends.
There was speculation the Nike-Capernaut campaign would lead to a drop in sales, but our data over the last week does not support that theory, said Hetal Pandya, co-founder of Edison Trends.
Nike's stock also held up after its initial slump.
The stock was up 1% on Friday and remains in the black for the month.
It has gained 29% in 2018, while the Dow Jones Industrial Average, which since 2013 has counted Nike as a member, has gained 5%, and the S&P 500 index has risen about 8%.
The news generated plenty of online buzz with social engagement around Nike and Kaepernick rising sharply this week, according to 4C Insights, a marketing technology company.
Mentions of and comments about Nike on social media platforms rose 1,678% on Sunday and Monday, according to 4C Data.
Mentions of Kaepernick spiked 362,000% the data showed.
The article says that Nike's stock held up after its initial slump, that the stock was up 1% on Friday, and that's true, but Nike's stock is still down following the boycott.
We can just look at their stock and see it is down and it has not recovered.
It is likely that it will recover.
However, it has not, in the past several days, gone up.
Nike is still down after announcing this campaign.
Another bit that I find interesting in this article is they say fears of a hit appear overblown, as consumers, brand experts, and analysts cheer an edgy and risky marketing move, but I also believe this is actually incorrect.
Sure, Nike's sales are up 31%, but of course they are.
There's a huge buzz around what's going on, And I have seen many people on the left post that they are going to go buy shoes.
Because of the massive marketing campaign, because of the controversy, it enters people's minds, and then a lot of people for tribal reasons are going to go buy shoes.
Does this mean that Nike made the right choice?
No.
Because this sales increase is probably going to be fleeting.
I'm pretty sure in a few months, no one is going to care about this campaign, and the people who are going and buying shoes today probably won't go and buy shoes in the next few months, especially when they already have an extra pair of shoes.
But there's actually more data.
From Morning Consult, it looks like Nike's favorability drops double digits following new Just Do It campaign with Colin Kaepernick.
Real-time brand tracking data reveals a sharp drop in favorability and purchasing consideration, including among key demographic groups.
They find that Nike's favorability drops by the double digits.
Before the announcement, Nike had a net plus 69 favorable impression among consumers.
It has now declined 34 points to plus 35 favorable.
They found no boost among key demos.
Among younger generations, Nike users, African Americans, and other key demographics, Nike's favorability declined rather than improved.
Purchasing consideration is also down.
Before the announcement, 49% of Americans said they were absolutely certain or very likely to buy Nike products.
That figure is down to 39%.
The effect on the NFL seems small for now.
40% of consumers said Nike's campaign does not make them more or less likely to watch or attend NFL games.
21% said more likely and 26% said less likely.
But this next chart might be the most damning of all.
Nike's reputation takes a hit overall across key demographics.
Before Kaepernick was revealed as the face of Nike's campaign, only 2% of Americans reported hearing something negative about Nike.
After the launch, that jumped to 33%.
As the negative buzz set in, consumer sentiment followed, with favorability and purchasing consideration dropping.
And this chart to me was rather shocking.
Among all adults before the campaign, it's down.
Nike customers, it's down.
Republicans has gone negative.
Democrats is down.
Generation Z is down.
Millennials, Gen X, Boomers, Blacks and Whites across the board.
Nike's favorability has dropped, and this data says to me that Nike's data might actually be incorrect, and they may have made a huge mistake.
There is one big reason why Nike decided to enter the culture war.
They believed the younger demographic will take over, and the younger demographic is going to be social justice progressives, so they decided, you know what, let's get in the game early, support Kaepernick, and we're going to sell more shoes to the young people who will eventually take over the marketplace.
But it seems, based on their favorability, that might not have been the right call.
I have worked for companies who have said just this.
Consultants came in and said, listen, young people are overwhelmingly progressive.
You need to push this message.
And it did not work.
And now it looks like we're seeing...
Basically the exact same thing.
In a story from Gartner L2, Best and Worst Brand Moves of 2018, they state the best brand deal was Nike's announcement to hire Colin Kaepernick.
They said Wednesday also brought it an inspired move.
Nike announced the spokesperson for the 30th anniversary, Colin Kaepernick, in a word, genius.
It's a very bold and a risk, but a good risk.
History judges people not on their inner beliefs, but their outward conviction and sacrifice.
Mr. Kaepernick, distinct of the merit of his views and actions, has paid a price.
Muhammad Ali, a man who was stripped of his wealth and Olympic medals for refusing to enlist in the draft.
30 years later, we asked him to light the flame at the Atlanta Olympics. In my view, the most meaningful moment in
sport.
Mr. Kaepernick, distinct of the merit of his views and actions, has paid a price.
He's not in the same league as Ali, but would likely be a backup QB had he not taken a knee.
Reviewing history when civil rights comes up against flag statues or a traditional view of patriotism, civil rights,
is Ali to the flags wetner.
History evidence is on Mr. Kaepernick's side and Nike had the backbone to capture this for shareholders.
Now before I go on and show you their argument, I find it interesting that he's claiming Nike captured something for their shareholders when the stock has already taken a hit.
Yes, stocks are going to go up over time, and the increase in sales will help that.
Nike is expected to announce their sales around September 25th, I believe.
But their stock would have gone up either way, assuming their sales are good, and it looks like their sales would have been good either way.
So all this campaign did was it did generate buzz, which is good.
But their stock took a hit.
The shareholders are feeling some pain right now.
And not only that, every single demographic views them less favorably because of what they've done.
But let's take a look at this website's argument.
They say two-thirds of Nike consumers are under the age of 35.
A younger consumer who can afford $150 Flyknit racers likely has substantial disposable income and lives in a city.
The term for this cohort?
Progressive.
Of the 20 billion international customer base, how many believe the U.S.
is currently a beacon on a hill, and is handling race issues well?
I'll speculate none.
Nike has raised $1-3 billion in business to strengthen their relationship with consumers, who account for $32-34 billion of their franchise.
The math?
Nike just did it.
And they show this graphic.
Their revenue, the fact that under $35 is a larger portion of their demo, and their estimated risk is small.
In the culture war, you're going to have people on the left and the right claiming their side is correct because of these stats and your side is wrong because of these stats, but both sides selectively choose statistics and focus on issues they think are important.
So naturally, there's going to be a lot of people on the left saying, wow, their sales are up.
Oh, they're planning for the future, and they're going to argue that's why they're correct.
However, If we look at brand favorability and see that even desire to purchase is down among Gen Z, the argument that young people are progressive living in cities and want to buy your shoes is incorrect.
You've actually made Gen Z like you less by doing this because they decided to enter the culture war.
And this goes back to my personal stance.
Look, I do like diversity.
Actual diversity.
I don't like equality of outcome, I like equal opportunity, and I like the idea that we can take different people of different perspectives from around the world and come together and try and pool ideas together.
Not every idea is good.
Certainly many ideas are better than others, and that's what we want to find.
Homogenization of ideas is not going to help us do that.
A diversity of ideas and perspectives and peoples will help us do that.
But when companies enter the culture war, they're not actually doing that.
They're virtue signaling.
I don't believe Nike actually cares about social justice.
They did a law enforcement ad not that long ago.
What they're doing here is trying to capture sentiment from the left to sell shoes.
And it seems like it worked, at least for now.
But we'll see what happens.
Whenever a company decides to get involved in politics, I say count me out.
You know why?
Because right now, if you go and buy shoes, you're doing it for a tribal reason.
If you destroy your shoes, it's for a tribal reason.
And I don't want to be in a situation where I do something and someone assumes it's for a political reason.
I'm not going to watch your show, I'm not going to buy your video game, and I'm not going to buy your shoes because you're in the culture war.
I'm just going to go somewhere else.
I'm certainly not gonna light shoes on fire.
I do think that's silly.
But you're not gonna see me going to a store and saying, I'm gonna buy shoes for political reasons.
But it isn't just me.
Because the Washington Post also has an op-ed.
Nike bet that politics would sell.
Looks like it was wrong.
The story talks a bit about what I've mentioned so far, but it ends with this.
Yet, how many of us would turn down that advertising contract if it was offered?
How many brands will resist the drive to color their products red or blue if customers reward them for it?
That's why the Morning Consult survey is such an encouraging sign.
Maybe Americans aren't divided on this one.
Maybe they agree on what they want, a marketplace that's above politics and a politics that's above crass market imperatives.
And maybe companies will take the cue and focus instead on making good products, leaving the politics to the politicians and the voters.
And once again, I want to show you this graph.
Nike's favorability dropped across the board.
If they're claiming that young progressives Gen Z and Millennials are their market who believe in social justice.
But among Gen Z, the drop was substantially larger than among Millennials.
I have to wonder what they were thinking.
Even Democrats do not like Nike as much as they used to following this campaign.
If even the left says they do not like you following this campaign, you made a mistake.
Look at Republicans.
They have sacrificed their entire Republican market, and even lost among Democrats.
It was a political move that was a mistake, and the data shows it.
No amount of sales over one weekend is going to make up for that, and I think the data is clear.
The hit to their reputation was not worth it.
They screwed this one up, plain and simple.
But let me know what you think in the comments below, and we'll keep the conversation going.
Because obviously, there's still going to be a lot of people saying, history will tell.
Just like that article I showed you, they claim that in the decades to come, people are going to wish they sponsored Colin Kaepernick.
But as for right now, this may be damaging to Nike's brand, their reputation, and their sales in the long term.
So again, comment below.
We'll keep the conversation going.
Stay tuned.
New videos every day at 4 p.m.
New videos coming up on my second channel, youtube.com slash TimCastNews at 6 p.m.
