Nike Inc. this week begins selling a pricey sneaker with self-tying laces, a high-stakes test of the company’s technology investments and efforts to sell more products directly to consumers.
Since its founding, Nike has predominantly been a wholesaler. But as shopping shifts online, Nike is moving to lessen its reliance on retailers. It wants to double its direct sales to consumers to $16 billion by 2020, particularly as rivals Adidas AG and Under Armour Inc. have become more competitive in recent years.
That is where the self-lacing $720 Hyper Adapt sneakers play a role. The company is offering the shoes exclusively on its relaunched Nike+ app and at a new retail store in New York City, beginning on Thursday. The idea is to hook consumers into buying via its app or visiting Nike stores for limited-edition sneaker releases, which to date has been a near-weekly phenomenon at Foot Locker and other retailers.
The move could put the squeeze on an already consolidating sporting goods retail industry, analysts say. Nike currently is the single-largest vendor to big chains like Dick’s Sporting Goods Inc., Foot Locker Inc. and Finish Line Inc., accounting for 20%, 72%, and 73% of merchandise purchased, respectively, according to regulatory filings.
The Hyper Adapt release comes after a decade of changes within Nike to expand into technology and consumer services.