#JustDoIt: Colin Kaepernick ads inject bitter political debate into Nike’s sales

While customers angered by the campaign posted videos of themselves setting fire to Nike shoes and T-shirts on Tuesday, liberals countered with promises to buy more — and suggestions that Nike critics donate unwanted apparel to needy veterans rather than destroy it.

Nike shares slid 2.9 percent to $79.83 at the close of New York trading, but they’ve still gained 28 percent in 2018, and the impact of the Kaepernick ads on sales — whether positive or negative — won’t be apparent for months.

Investors who witnessed the impact of Republican fury on Dick’s Sporting Goods — which banned the sale of assault weapons after a mass shooting at a Florida high school in February and raised the minimum age for weapons purchases to 21 — will likely be watching closely. Dick’s Chief Executive Officer Ed Stack had said he believed the policy change would bring in new customers, but sales at the Pittsburgh-based sporting goods retailer grew just 1 percent in the most recent quarter.

Nike, which has long experience employing headline-making athletes as spokespersons, may prove a different story.

Colin Kaepernick is “a controversial choice, and they did it for this very reason: so that we’d all be talking about it,” said Eric Yaverbaum, who heads New York-based Ericho Communications and has 35 years of experience in marketing and public relations.

Not only did the announcement of Kaepernick’s selection take advantage of the start of the NFL’s 2018 season, with the opening game between the Atlanta Falcons and the Philadelphia Eagles slated for Thursday, it represents a bet on the more liberal tendencies of younger voters.

Millennials, whose population of 92 million makes them the largest generation in U.S. history, are likely to be potential customers far longer than their older, more conservative predecessors, Yaverbaum said. And with the media attention on the NFL’s decision to keep players who don’t want to stand for the national anthem in locker rooms until games begin, some of them were already eager to see how events play out.

“As a PR practitioner, I will counsel my clients about the exposure that they want, and one of the things you need to do is show up where the story is already happening,” Yaverbaum said. “If you’re really good, you show up a day before it happens.”

In this case, Nike showed up a full four days early. And the company — which draws about 40 percent of its $36.4 billion in annual sales from North America, where the Kaepernick-ad controversy would have the most effect — appears confident in its campaign for now.

“We believe Colin is one of the most inspirational athletes of this generation, who has leveraged the power of sport to help move the world forward,” Gino Fisanotti, Nike’s vice president of brand for North America, told ESPN.

It’s not the first time a Nike ad has sparked controversy. A 2013 campaign with Tiger Woods, who was then rebounding after a 2010 divorce from Swedish model Elina Nordegren and intense media coverage of extramarital affairs, used the slogan, “Winning takes care of everything.”

This year, when the French Open banned catsuits like the Nike garment that tennis star Serena Williams wore in May, the company responded with a Twitter post. “You can take the superhero out of her costume, but you can never take away her superpowers,” the company said, a reference to Williams’ statement that wearing the suit made her feel like a superhero.

“Nike plays the long game,” said Simeon Siegel, an analyst with Nomura Instinet who has a buy rating on the stock. “They are, I would argue, one of the best product companies in the world but I would argue they are also one of best marketing companies in the world. They are critically focused and very aware that every shoe they sell is tied to perception of the brand.”

The apparel-maker retains a roster of athlete endorsers who present varying degrees of risk, and each marketing decision is “made with a lot of calculus and precision,” Siegel said. “They’ve always been ones to take risks rather than toe the line.”

While Nike’s North American sales slipped 2 percent last year, dragging total sales growth to 6 percent, they began to tick upward in the last quarter. Footwear sales alone grew 3 percent to $2.5 billion in the region in the three months through May.

The business is a crucial one for Nike, and now that they’re back, the priority will be ensuring that they “can continue to dominate that market,” Siegel said.

A Nike spokesperson didn’t immediately respond to a request for comment on Tuesday.

President Trump and other top conservative political leaders have seized on Kaepernick’s protest — which spread to other NFL teams — as anti-American, a message that resonated with much of the GOP political base.

In a May poll from Morning Consult/POLITICO, 83 percent of Republicans and 47 percent of independents said they oppose NFL players protesting during the national anthem, and Trump has suggested those who do should be fired.

“First the @NFL forces me to choose between my favorite sport and my country. I chose country. Then @Nike forces me to choose between my favorite shoes and my country. Since when did the American Flag and the National Anthem become offensive?,” one Nike critic wrote below a video of a pair of burning shoes with the trademark swoosh logo.

Pam Keith, a Democratic Congressional candidate from south Florida, suggested that the company probably analyzed the costs and benefits beforehand and realized that “doing the right thing is also the profitable thing,” while pro-tennis player Serena Williams posted on Twitter that she’s “especially proud to be part of the Nike family.”