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Nike: It's Not A Shoe, It's A Community


Few companies define 20th century marketing better than Nike (NKE). The athletic shoemaker's famous swoosh emblem and a string of ad campaigns, starting with its iconic "Just Do It" series, set the gold standard for getting a clear message to a mass audience. But when Nike crafted its World Cup strategy, it decided to try something new: online communities. The centerpiece is Joga.com, a social networking site for soccer fans it quietly launched in February with Google. (GOOG)Members in 140 countries can blog, create fan communities around their favorite teams or players, such as Brazilian superstar Ronaldinho, organize pickup games, download videos, and rant against the encroaching commercialism of the game. And though the program was launched during the World Cup, it continues beyond the tournament.

It's a huge U-turn for the mighty marketer -- and a recognition that it needs to get consumers' attention in entirely new ways beyond blasting top-down mass messages. Nike was forced to be innovative after rival Adidas Group (ADDDY) got a World Cup exclusive deal to broadcast ads in the U.S. But by monitoring conversations on social networking sites and blogs, where people already are shaping Nike's brand, the sneaker giant knew this was an opportunity to try something different. Says Trevor Edwards, Nike's vice-president for global brand management: "Gone are the days of the one big ad, the one big shoe, and the hope that when we put it all together it makes a big impact."

JOGA BONITO

The Joga.com social networking site, one of the biggest by a large consumer company, is just one piece of a $100 million multilayered campaign known as Joga Bonito (Portuguese for "play beautiful"). Last fall, Nike started feeding video clips that spotlight Nike-sponsored soccer players onto popular video sharing sites, including YouTube and Google. It created JogaTV, a virtual soccer TV station, where it releases a new video clip every few days and fans can upload their own clips.

Is it working? Nike officials say they reached their World Cup goal of signing up 1 million members by mid-July, when the tournament ended. "By enrolling consumers in shaping the marketing, Nike is figuring out what kind of microcontent audiences want and nurturing deeper bonds of loyalty and advocacy," says Pete Blackshaw, chief marketing officer at Nielsen BuzzMetrics, which tracks online conversations for companies.

Yet like a lot of companies trying to build online communities, Nike doesn't know if this will filter down to the bottom line. The company says sales of its soccer gear are booming but admits it's too early to credit that directly to its community bear hug. What's more, this kind of marketing can be tricky. One of Nike's top soccer videos, for instance, shows Ronaldinho slipping on a pair of new white Nike soccer cleats and booting a soccer ball four times off the goal crossbar -- the equivalent of a baseball hitting off the left field foul pole into foul territory. It has been viewed by 7.5 million people, making it one of the most popular clips online, but also the most controversial because it was digitally altered. Nike executives, who won't say whether they did the editing, are clearly amused by the controversy. But the flap could hurt its credibility.

Still, Nike considers the results promising. Says CEO Mark G. Parker: "A strong relationship is created when someone joins a Nike community or invites Nike into their community." Which is the point of brand marketing, isn't it? (Read on for the next installment, "Efficient Frontier: Hacking Madison Avenue.")

By Stanley Holmes in Seattle


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