It seems like Nike doesn’t want anyone to know it is going green. The sole of Nike’s new Air Jordan XX3 is made of ground-up pieces of old Nike sneakers. You would think it’s more cost-efficient, right? Not at all. The suggested retail price of the Nike Air Jordan XX3 ranges from $180 to $230. Even though its eco-friendly shoes are cheaper to make, the company perceives its consumers are more interested in design and performance than sustainability. This strategy can make or break the brand, especially among its urban and socially responsible consumers.
Nike knows going green has various advantages. Surely there are environmental benefits, but going green offers a more cost effective approach in manufacturing of top performance athletic sneakers. It expects to reduce the amount of material it wastes by 17% over the next decade. While companies like Seventh Generation and American Apparel pride themselves over innovation in the eco-conscious changes they are making, Nike is down playing sustainability initiatives. In its latest digital campaign called Nike +/Running, sensors track physical data, find useful tools to train for the marathon, and connect with others in a friend or foe user experience. Nike is all about innovation and hip athletic gear. How is sustainability relevant to the brand? The brand has always been about winning.
Nike came to the same conclusion after a less-than-successful experiment a few years ago. The company launched its first line of environmentally friendly shoes, the Nike Considered, in 2005. Innovative at the time, the walking boot was made of brown hemp fibers that looked obviously earthy. Critics called the $110 shoes “Air Hobbits” because of their forest-dweller look and feel. It really challenged Nike’s design integrity because it detracted from its high-tech image. The boots didn’t sell well, and within a year were taken off the shelves.
Did Nike learn anything from this experience? Green innovations should continue in my opinion. Like the world around us, consumers’ expectations are constantly changing. With a brand like Nike, experimentation with different markets is key. You shouldn’t abandon a strategy simply because it didn’t work three years ago. “We want to do more and say less,” is the way Laurie Vogel, at Nike, puts it. Overcome with ongoing exposure of sweatshop labor in Asian factories, the Nike also has to tread carefully about promoting itself as socially responsible.
Innovation is still key in Nike’s brand strategy. In 2008 Nike debuted the Air Jordan XX3, which was designed so that all the pieces of the shoe fit together like a jigsaw puzzle. The design eliminates any excess plastic. The company also invented a sewing machine that speeds up assembly time thus saving electricity. With a legendary line of 24-years, Nike plugged in the XX3 as the next generation of Air Jordan. The latest edition debuted in January 2009 and has continued with sustainable manufacturing of sneakers.
What are the results? The Air Jordan achieved double-digit growth during the company’s most recent quarter according to Charles D. Denson, Nike’s Brand Chief. This suggests consumers are happy with the shoe’s performance. Sustainability is increasingly playing a key factor in consumers’ purchases, from apparel to spirits and foods, to household products. Nike’s lineup now includes eco-friendly basketball, football, soccer, tennis, and running shoes.
Nike Quietly Goes Green [Businessweek]
photo credit: Nike and Francesco Bongiorni