Nike recently announced that it would no longer be selling its products via Amazon. The announcement came on Nov. 12, and Bloomberg was the first to report it.

Nike and Amazon Previously Had a Deal

The decision by Nike to stop selling its products on Amazon replaces the previous agreement between the two companies. Nike previously agreed to sell directly to Amazon, while Amazon consented to remove fake Nike products and stop third-party sellers without authorization from selling Nike products on its site.

That deal was first announced about two years ago. From the start, however, it had issues as Nike was unable to assess the third-party marketplace accurately. It was clear throughout that this was simply a pilot, not a long-term arrangement.

The Reasons

A Nike spokesperson talked to Bloomberg about the decision to pull the brand’s products from Amazon. Nike hopes to instead focus on its business of a direct-to-consumer nature. This has been a vital part of the brand for two years.

What Nike Said

When discussing its plans for direct-to-consumer marketing, Nike told Bloomberg that this is part of elevating the experience of customers via personal relationships. Nike will continue looking into and creating other strong partnerships, including with other platforms and retailers. Nike’s statement indicated that the goal of these partnerships would be to serve consumers globally.

Previously, Nike had indicated it would focus on a list of 40 retail partners but did not specify which retailers made the cut. It also announced plans to stop working with “mediocre” retailers.

Questions About the Pilot and Amazon Third-party Sellers

Given that Nike has chosen to leave the pilot partnership with Amazon, many experts now wonder how successful that pilot was. Nike was supposed to end up with enhanced control of the Nike products sold on the online retailer, as well as how they were listed, removing fake items and only letting authorized suppliers to sell the products. Experts assume that Nike was likely unsatisfied with this, although other factors were also likely at play.

The departure of Nike also brings up questions regarding Amazon’s ability to regulate third-party sellers on the marketplace. In the most recent of the company’s annual reports, it acknowledged that counterfeit product sales are an issue.

For now, Nike’s major plan is to improve its digital marketplace for personalization of its direct-to-consumer sales and to focus on the most reliable retail partners.

Sources:

https://www.fastcompany.com/90430332/nike-tried-playing-nice-with-amazon-heres-why-it-didnt-work

https://www.businessinsider.com/nike-stops-selling-amazon-2019-11

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