Nike has decided to focus on its D2C (direct-to-customer) tactics in order to make transactions feel more personal and bespoke.
Back in 2017, Nike made a big decision. They opted – much later than most of their competitors – to embrace Amazon and sell some of their apparel directly through the online store.
As reported on econsultancy.com, it was a controversial call:
Arguably a capitulation to Amazon on the part of one of the world’s most iconic brands. If anyone needed more evidence of Amazon’s ascendance, this is it. To repeat: one of the world’s most powerful and valuable consumer brands, despite its long-standing concerns, felt it could no longer avoid giving in to Amazon.
But two years later, Nike has decided to reverse its decision and revert back to dealing with customers exclusively on a more personal level, calling the Amazon experiment a “pilot”.
So, what are Nike concentrating on instead?
What Nike has instead decided to do is focus on its D2C (direct-to-customer) tactics in order to make transactions feel more personal and bespoke. Recently, they’ve implemented a few different ideas, offered to members of their NikePlus membership program:
- Early access to new products;
- Free 30-day returns;
- Member-only products.
They’ve also built a huge new flagship store in New York, allowing for an immersive experience that doesn’t just take place online.
Nike has prioritised the personal touch as a direct response to what many feel is Amazon’s weakness – a lack of hands-on customer relationship-building. When companies sell through Amazon, they are completely unable to build any meaningful relationships with their customers, leaving all transactions feeling cold.
This also leaves little room for innovation.
Where does this leave Amazon?
Although Amazon continues to grow, some companies are deciding to ditch large-scale selling platforms and instead offer their products to customers directly.
So although this doesn’t have any huge implications for Amazon yet, it might perhaps be a sign of things to come.
For many companies, these D2C customer approaches are paying off, with many companies selling successfully without Amazon’s help. That said, very few companies are willing to completely ditch third-party distribution channels. Indeed, even a Nike spokeswomen said:
We will continue to invest in strong, distinctive partnerships for Nike with other retailers and platforms to seamlessly serve our consumers globally.
What’s worth noting though is that these partnerships don’t necessarily have to include Amazon. Partnerships in business are many and varied, and perhaps Amazon isn’t now the go-to partner it once was. Businesses may now begin to look for partnerships that offer a more bespoke, personalised, customer-focused experience.
As noted by econsultancy.com:
To date, because of its dominant position, Amazon has shown limited willingness to provide significant accommodations for even the biggest of brands.
So, although Amazon’s pulling power brings millions of customers to its site every single day, it’s no surprise that brands who want to focus on customer experience might be against using the platform.
The future for Amazon
Where this leaves Amazon is a curious question. If more brands look to emulate Nike’s departure, Amazon may have to rethink its strategies and provide a more bespoke platform for companies to reach their customers.