Nike FY 1Q14 Earnings Call Notes

This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. Full transcripts can be found at Seeking Alpha

several trends driving sales

“I think about the evolving consumer landscape, there are a number of trends that play to Nike’s strengths. The middle class is growing around the world. Interest in sport continues to grow, and consumers are investing more and more in their own health and fitness. Apparel and footwear styles are becoming increasingly athletic. Because we know the consumer better than anyone else, we’re able to leverage these developments to accelerate our growth.”

Investments in DTC business are paying off

“A key component of this offense is our own DTC business, which is an important complement to the wholesale business around the globe. As I said, we delivered impressive growth in the quarter, with expansion in all three DTC concepts, in line, factory stores, and Nike.com.

Our investments in DTC as a strategic driver are clearly paying off, and we continue to see even greater potential ahead. And we’re investing to create compelling presentations with our wholesale partners around the world, as we expand the potential of the Nike brand in a holistic and integrated marketplace.”

Increased drive in sneaker culture in Europe

“we’re also seeing a really increased drive around sneaker culture, building around women in Western Europe.”

Online is a top priority

“We’re very bullish on our ecommerce opportunity. We’ve invested quite heavily in improving our operational capabilities or supply chain. We’re seeing, again, the category offense really resonate through dotcom. Obviously, the preferred channel, where a lot of consumers are shifting and moving.

Women’s business is up significantly in that mix. Our customization, or Nike ID, up significantly. Running, sportswear, really across the main key categories, we’re seeing tremendous resonance in that channel.

This will continue to be a major growth opportunity for Nike, and definitely a source of further investment. We think that the return on this investment will be as strong, frankly, as anywhere we have in the company. Very bullish. Top, top priority for the company, and continued opportunity for growth and profitability.”

Being a better retailer has helped us be a better wholesaler

“The other piece that we’ve talked about is the idea of us being a better retailer ourselves, so we can be a better wholesale partner. And that is actually working, so we’re able to transfer a lot of the learnings that we have done in our own stores, working with our retail partners around the world to accelerate their businesses too.”

Consumer is definitely trending towards premium products

“we’ve seen it really in every market around the world where the consumer is definitely trending towards premium products. Well made with great innovation is certainly resonating with the consumers.”

We let the merchants drive the pricing strategy

“In our organization, the people who are really on the front lines from a pricing and a consumer value standpoint are the merchants. So this is a set of decisions that the people who are at the marketplace are really driving that strategy.”