Big Dog and Little Dog

In the last 3 years, Adidas stock is up 287%. That is massive! Nike stock over the same period is up 58%. That is a huge difference. I believe this is why Nike decided to do something radical to stop the bleeding. They decided to showcase the little dog in their marketing campaign, attempting to capture the 25-34 market, which is dumb because they have a large chunk of that already. They already have the big dog—the NFL; all NFL jerseys and other equipment are Nike. I think it can be said the NFL may be the Big Dog. The Big Dog however, lost TV revenue and advertising last year, the NFL ratings were down substantially, as were their stadium revenues as well non-stadium revenues of incidental sales. If that present trend continues this season and indications are that they will, both Nike and the NFL have a problem that may be systemic.

I think Nike has made an uneducated decision and has chosen the wrong market; they forgot the stock market—their investors. Today, Nike lost 3.16% of their stock value—that is large. It was the largest single loss in the DOW today. Their market capitalization is $127.4 Billion. In one day, their market capitalization dropped $4.02 Billion. In choosing the Big Dog and Little Dog, they forgot something very important, the Big Bull. Millennials buy shoes and shirts of course but they do not buy stock. That $4.2 Billion loss today was immediate and it was loud and clear. If you look at the demographics, Millennials do not buy season tickets, skyboxes, catered corporate clubs in stadiums, etc. Millennials work for those people. Millennials do not drive markets; they buy retail—the end markets owned by their elders, who spend the BIG BUCKS, the BULL. I guarantee you millennials did not buy $4.2 Billion of retail goods today. Ya think? J

Mess with the BULL, you get the horn.

p.s. Do yourself and the US a favor; donate your Nikes to the homeless and buy New Balance, 100% American Made.