Nike pulled back on its DSW partnership a couple of years ago as part of a larger direct-to-consumer sales push that also saw it exiting Macy\u2019s and Urban Outfitters. Nike did not immediately respond to questions about why it is returning to DSW and how this impacts its DTC strategy.<\/li>\n<\/ul>\nDive Insight:<\/h3>\n
In an otherwise challenged quarter, where net sales fell nearly 11%, comps were down 10.4% and full-year guidance was lowered, Designer Brands\u2019 announcement of a new partnership with Nike was a bright spot.<\/p>\n
\u201cObviously we\u2019re very excited about the changes that the teams are making in the overall product portfolio \u2014 elevating our relationship with Nike is obviously among them,\u201d Howe said. \u201cWe’ve had ongoing dialogue for the past several months and we’re super excited to be able to bring that back across men’s, women’s and kids.\u201d<\/p>\n
The executive noted that the assortment will include both stores and digital and will likely be available to customers in November. As to how much of DSW\u2019s sales Nike will make up \u2014 UBS analyst Jay Sole noted Nike used to be 6% or 7% of DSW\u2019s business \u2014 Howe did not get into specifics.<\/p>\n
\u201cWe’ll thoughtfully, with their partnership, build that business back,\u201d Howe said. \u201cBig opportunity, I think, for both of us, just given our No. 3 market share penetration in women’s \u2014 and the customer will vote. But we\u2019ll continue to evolve our portfolio with them and other partners as well.\u201d<\/p>\n
In addition to strengthening ties with national brands like Nike, Designer Brands has also focused on building out its portfolio of owned brands, which recently has included the acquisition of Keds, Le Tigre and Topo Athletic.<\/p>\n
For Nike, the new relationship with DSW marks something of a reversal, since the athletics retailer pivoted to a DTC-led strategy a few years ago that included paring back on its wholesale partners. As part of that strategy, Foot Locker last year said it expected the amount of Nike product it received to \u201cdecline meaningfully,\u201d from a high of 75% in 2020 to about 55% going forward. But in March this year, new CEO Mary Dillon said the retailer had revitalized its partnership with Nike.<\/p>\n
Nike itself emphasized in May that it values both wholesale and DTC channels, and is looking for more ways to connect those channels, including through efforts like connecting its loyalty program with wholesale partner Dick\u2019s Sporting Goods.\u00a0<\/p>\n
Some analysts have questioned whether Nike\u2019s shift away from wholesale was the correct approach, with BMO Capital Markets analyst Simeon Siegel saying last year that the focus on direct has not lifted margins. Wholesale can offer benefits to brands like sales volume and raising brand awareness.<\/p>\n<\/p><\/div>\n
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