The Fashion Retailer Fashion pivots to Technology

A “Tech” exec to replace a “design” exec as Nike CEO…

From Design to Technology

When I started this blog the aim was to explain how the creative side – Fashion – merges with the scientific side – Retail – of the business of Fashion or Apparel.

The Fashion Retailer Blog.

A merge of Fashion and Retail. Color and order. Patterns and attributes. Trends and Operations. Garments and SKUs. Visual Merchandising and Store Operations. Marketing and Sales. People and KPIs. Design and Business. Fashion Retail.

The business of fashion (but also other industries, even B2B) changed from a product-centric approach to a customer experience-centric approach. Companies are investing in configurable ecosystems to be agile and flexible enough to compete with niche players and pure players in the digital era.

By configurable, I mean non fixed-assets or vertically-integrated capabilities. The objective is having the flexibility to adapt and respond to the requirements of the business in a short period of time. In such volatile markets and risky seasonal business, to be agile is a must. It doesn’t make sense to design 1 year in advance and plan your sales with such a long-term forecast that obliges to over-stock. Technology is the enabler of this new model.

In my opinion, experience means telling the 360º story of the product to the customer. It’s not about in-store entertainment or creating a circus in a store, but merging the intangible of the product with the tangible: know the story and history of the product, touch the materials, feel part of a special community…

Mark Parker will step down from Nike CEO after 13 years leading the footwear company and John Donahoe will replace him. This apparently simple move illustrates the big change in Retail (and reinforces the idea of this blog: Design vs Science).

Mark Parker joined Nike in 1979 as a footwear designer. Following the purpose of The Fashion Retailer blog, Parker was part of the artistic side of the business. On the contrary, John Donahoe is a Tech person, former CEO of Ebay, illustrates that we are living an era of change in retail and apparel business: fashtech. They represent the creative and scientific side than I mentioned in the introduction.

Mark Parker (left) and John Donahoe (right)

Digital technology has radically changed the relation between society and business. Music, Media and Retail were the first industries to feel the impact of digitization, the long tail effect, omnichannel or phygital (e.g. Netflix, Spotify, Amazon). Today, digital technology is disrupting traditional operations and now every business is a digital business.

Nike latests acquisitions, Zodiac (software analytics platforms for forecasting), Invertex and Celect (cloud-based predictive analytics platform), shows how Nike boosts digitalization. Also, other Nike best practices worth to mention are:

Nike and Online Drops – SNKRS: a model based on scarcity and exclusivity
Nike New Digital Stores – Melrose: the community store
Nike Innovation House 000: Customer experience

The change of CEO at Nike goes beyond a simple transition: it’s a metaphore of how the industry is evolving. It’s a clear demonstration of how Nike is positioning itself as a leading apparel, luxury, Tech company.