Market Daily

Market Daily

Nike finds new strategy through Gen Z consumers in China

Nike finds new strategy through Gen Z consumers in China
Nike CEO alludes to Gen Z consumers for the company's progress

Image source: New York Post

Nike: The youngest consumers in the market are Gen Z, sometimes known as “digital natives,” who were born between 1997 and 2012.

They have had a massive influence on consumer behavior, being the first generation to have grown up with technology being a part of everyday life.

Gen Z is known for its proficiency in technology, social media, and e-commerce.

In addition, they have a strong sense of their individuality and respect integrity and transparency.

They are also more diverse and socially engaged than prior generations.

As a result, companies and marketers have to restructure their strategies to better attract this demographic.

According to Nike’s CEO, John Donahoe, the company should concentrate on Gen Z consumers, particularly in China.

Nike & Gen Z

Nike, one of the most well-known sporting brands in the world, had to revamp its marketing tactics in order to appeal to Gen Z consumers.

Gen Z is known as a generation for its strong sense of individualism and advocates honesty and openness.

They also place a high priority on social responsibility and sustainability, which leads many to favor doing business with these types of values.

Appealing to a generation

Nike has focussed on developing transparent, sustainable supply chains and actively promoted social subjects like diversity and inclusion to cater to Gen Z consumers.

The company has focused on creating things that clients could personalize to showcase their individuality.

One case is the Nike By You program, which lets consumers make customized sneakers using various colors and materials.

Social media use

Nike has also been investing in digital marketing and e-commerce to draw in Gen Z customers, who are known for their computer savvy and acumen in social media.

Additionally, the firm has been active on social media platforms like Instagram and Facebook.

On TikTok, it has been able to interact with Gen Z users and advertise its products and its brand message.

Nike has thrived in attracting Gen Z consumers with its emphasis on diversity, sustainability, and personalization in merchandise and marketing.

Owing to its robust digital presence and marketing, the company has been successful with its reach and engagement.

Read also: Tax credit rules for next year not entirely clear

China consumers

On Thursday, John Donahoe talked about the sizable demand for athletic clothing in China despite Covid disruptions.

“We’re still the number one cool and favorite brand in Shanghai and in Beijing,” said Donahoe.

“We’re really focused on the Gen Z consumer in China, we saw a very good response from the Gen Z consumer who wants the most innovative products and wants brands that are globally relevant.”

“We saw good response in Q2, and we have the same focus and outlook going forward.”


China’s “zero Covid policy” was still in place since around November 30, the conclusion of Nike’s second fiscal quarter.

A 3% decline in revenue was caused by the closure of 1,500 Nike shops across the country.

In 2021, Covid disruptions declined in frequency, which resulted in a 22% decrease in the company’s China revenue from the past quarter.

China is still a significant market, according to John Donahoe, but he overlooked how spending surged when the country abandoned its zero Covid policy.

“We factored in some disruption in our outlook, but we view that as transitory, we still believe in the fundamentals of China,” he said.

“We invested in building hyperlocal products where we take an iconic franchise like Air Force One, or Dunk, and we localize it so it’s relevant for the Chinese consumer – and the Chinese consumer really responded to that.”


Despite the fact that Nike has had problems with inventories over the past few quarters, Donahoe argued that the issue solely existed in North America.

He claimed that by May, the company hopes to be operating at normal levels.

“The consumer is still paying list price for the Nike products that they know and love,” said Donahoe.

“In the areas where we have excess inventory, which is primarily in North America, we are working through it. We’re discounting and working through it.”

Nike has been using a direct-to-consumer marketing strategy instead of wholesalers.

However, overall revenue climbed by 19% as a result of the company’s inventory being offered for sale to partners during the most recent fiscal quarter.

Donahoe asserted that despite investing in its new technique, Nike still significantly relies on wholesalers.

“Consumers in this day and age want to get what they want, when they want it, how they want it, and in our industry, they’ve been very clear they want a premium and consistent shopping experience regardless of channel,” said Donahoe.


Nike CEO touts strength in Gen Z China shopper as Covid disruptions dent regional sales

Opinions expressed by Market Daily contributors are their own.