Phil Knight is speaking up about the executive scandal that has rocked the company he founded more than 50 years ago.
The pioneering business executive who launched Nike — using a $50 loan from his father to create what has become the most successful athletic brand in the world — said he was shocked by recent allegations of widespread misconduct in the brand’s upper ranks.
“It was a shock to me personally and to a lot of the upper management, and it’s disappointing,” Knight told hosts on “CBS This Morning” about the recent departures of 10-plus executives, all of whom were allegedly doers or enablers of misbehavior at the firm. “But I’m proud of the company [and] the way it responded to the problems that it saw. It’s basically cleaning house.”
Knight — who helmed the Swoosh for 40-plus years — in 2015 handed over the chairmanship to Mark Parker, Nike’s president and CEO since 2006.
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The company has been on a blockbuster run for decades — unveiling in 2015 an ambitious five-year revenue target of $50 billion.
But more recently, amid heightened competition in the U.S. from Adidas and streetwear brands such as Vans and Supreme, the company has scaled back its goals. For example, Knight pointed out on the morning television show that the brand has extended the timeline for the revenue target to 2022.
Competitive pressures, some insiders have noted, may be further heightened as the brand shoulders a potential public relations fallout from the recent string of executive exits (although some experts have also suggested overall backlash has remained fairly soft).
A report by YouGov BrandIndex this month indicated Nike’s consumer perception has largely held steady over the past several weeks, following an initial sharp — but short-lived — drop in mid-March when stories of the brand’s internal issues first emerged.
And despite the fact that women were supposedly on the receiving end of the alleged mistreatment at the brand, YouGov found that women consistently had a more favorable view of Nike than men during the tumultuous period.
While it’s difficult to fully explain the public reaction — or lack thereof — at least one school of thought is that Nike’s relationship with women was fairly weak to begin with.
“What’s really intriguing is that Nike was a little late to the game in embracing women as a key market demographic. A lot of their early efforts seemed to miss the target in terms of bonding with women in a strong way,” explained Deb Gabor, CEO of Sol Marketing. “To some extent, they’re coming from a deficiency in terms of their commitment to women.”
In other words, since Nike is only beginning to build a meaningful relationship with women, there wasn’t much to lose in the first place and the brand could be better positioned to start over with this group.
The Swoosh has been stepping on the gas to target women recently, unveiling in February “Nike Unlaced” — a digital-first retail concept to bring female shoppers a dramatically expanded offering.
Knight also called out the brand’s efforts to get closer to women during his CBS appearance today.
“The female market has been extremely important to us for a long time,” he said. “As I pointed out in the intro [of my memoir, “Shoe Dog,” Nike athlete] Serena Williams is a role model for all of us.”
Nike expects to bring in about $34 billion in revenues this year.