Nike posted its first decline in its Nike brand digital sales since 2015 — when it first began breaking out growth specific to that channel or Nike.com in either earnings releases or earnings calls — raising questions about the effectiveness of its direct-to-consumer strategy.
On Thursday, Nike announced that Nike brand digital sales dipped 3% year-over-year from the third quarter of fiscal 2023 to the third quarter of fiscal 2024. Still, its third-quarter revenue came in at $12.4 billion, essentially unchanged from a year ago. It’s a stark contrast from the third quarter of fiscal 2023, when Nike’s revenue was up 14% from the third quarter of fiscal 2022.
The drop in Nike’s digital business comes as Nike is trying to figure out the right balance between DTC and wholesale sales. Growing out its direct sales, both through its own stores and website, has been a big focus for Nike since announcing its Consumer Direct Offense strategy in 2017. Under this change, Nike significantly slashed its number of retail partners to better focus on DTC channels. At the time, Nike bet its brand recognition would drive customers to its website and stores. However, inflation started to rise, and many consumers cut back on discretionary spending to divert money to essentials.
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