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Nike's direct sales play pays off Nike 'proud' of Kaepernick campaign
(about 1 hour later)
Nike's efforts to sell its shoes and clothing directly to consumers are starting to pay off. Nike's controversial ad campaign featuring Colin Kaepernick has sparked "record" engagement and is driving sales, chief executive Mark Parker told financial analysts.
The firm, which has faced controversy over its Colin Kaepernick ad campaign, said revenue rose by 10% year-on-year in the three months to the end of August, reaching $9.9bn (£7.5bn). He made the remarks on a conference call after the release of the firm's quarterly results on Tuesday.
Profits jumped by 15% to more than $1tn in the quarter, lifted in part by direct sales, which allow the firm to command higher prices. Early analysis suggested the Kaepernick campaign has been a success for Nike.
Product launches also fuelled sales. But the firm had yet to offer its own description of the response since the ads launched this month.
Nike shares have climbed over the last year, as growth in the important North America division returned. "It's resonated... quite strongly with consumers, obviously here in North America, but also around the world," Mr Parker told analysts.
Sales in North America increased by 6% in the quarter, accounting for about 40% of overall revenue. "Like many campaigns, it's driving a real uptick in traffic and engagement, both socially as well as commercially."
Sales rose by 24% in Greater China and 11% in the company's Europe, Middle East and Africa region.
This month, the US sportswear giant attracted attention when it unveiled an advertising campaign featuring the athlete Colin Kaepernick.
Mr Kaepernick, a former quarterback for the American football team, the San Francisco 49ers, is known for his refusal to stand during the national anthem in protest of police brutality and racism.Mr Kaepernick, a former quarterback for the American football team, the San Francisco 49ers, is known for his refusal to stand during the national anthem in protest of police brutality and racism.
His action inspired other players to follow suit, but was attacked by Donald Trump and other conservatives, leading to heated debate in the US.His action inspired other players to follow suit, but was attacked by Donald Trump and other conservatives, leading to heated debate in the US.
Early sales suggested the Kaepernick campaign has been a success for Nike. Mr Parker said the firm feels "very good and very proud" of the ad campaign.
The firm got further publicity when actress Jenifer Lewis, who has a leading role in the television show Black-ish, wore a Nike sweatshirt to the Emmy Awards. His positive tone extended into the discussion of the firm's quarterly results, which pre-dated the launch of the campaign.
However, the quarterly results reported Tuesday pre-date the launch of that campaign. Nike said revenues in the period increased 10% year-on-year to $9.9bn (£7.5bn).
Profits jumped by 15% to more than $1bn, lifted in part by the firm's focus on direct sales, which allow it to cut out middlemen and command higher prices.
Sales in North America rose 6% in the quarter, accounting for about 40% of overall revenue.
Sales climbed by 24% in Greater China and 11% in the company's Europe, Middle East and Africa region.
Nike shares have gained over the last year, as sales growth in its important North America division returned.
"We are thrilled with our momentum," said Andy Campion, the firm's chief financial officer.