By Aishwarya Venugopal and Ananya Mariam Rajesh
(Reuters) -Nike will roll out new sneakers priced at $100 and under in countries around the world, its chief financial officer said on Thursday, as the sportswear giant adjusts its product range in a plan aimed at getting sales back on track.
Nike (NYSE:) has significantly increased the list price of its flagship Air Jordan 1 sneakers in recent years. The shoes are currently selling for as much as $200 at some retailers, including Nordstrom (NYSE:) on Nike.com.
The best Air Force 1 sneakers, meanwhile, sell for around $150 on Nike’s website. For comparison, Adidas (OTC :)’s three striped white and black Samba and multicolored Gazelle sneakers cost $100 and $120 respectively.
Shares of Nike fell on Friday, ending the day down 19.98%, the largest single-day percentage drop in the stock’s history. The company reported a surprising decline in sales in the last quarter on Thursday. Nike has seen slow sales growth as it battles competition from Adidas and On and Deckers’ Hoka brand.
Executives also noted weaker traffic at factory stores selling discount shoes and apparel, highlighting the increasing pressure felt by the value consumer.
“This is probably an attempt to bring in some more price-sensitive consumers,” GlobalData analyst Neil Saunders said, referring to the new limit of $100 and under. Nike CFO Matthew Friend told investors on Thursday: “Our teams are also attacking opportunities at different price points.” .”
Americans are cautious about their spending, especially when it comes to fun or non-essential merchandise like trendy sneakers. However, the rival Cloudflow 4 and Hoka’s Clifton 9 running shoes, which retail for $159.99 and $145 respectively, have been the hit with many shoppers lately.
Nike’s competitors in the affordable category include Hoka and Roger Federer, who leaned on On, analysts said. “That’s an area where they can compete better in the near term,” said Truist Securities analyst Joseph Civello.
Nike’s introduction of a new line could be a risky move for the company as its sales decline continues to worsen.
“It might work to some extent, but it doesn’t solve the broader problem of a lack of innovation” at Nike, a sponsor of the Paris Olympics, Saunders said.
Some key Nike styles have recently lost their value on the resale market, where the resale price of the Air Jordan 1 Retro High OG is about 32% off as of May, according to Altan Insights, which studies the collectible sneaker market.
