Go Woke, Stock Gets Smoked

Back in 1990, a North Carolina Democrat running for Senate sought an endorsement from Michael Jordan.

Jordan declined, famously stating, “Republicans buy sneakers too.”

Wise words. Through clever marketing and innovative designs, Nike and Jordan generated billions of dollars together, crafting an iconic American success story.

However, over the years, Nike strayed from its top partner’s pragmatic outlook. Starting in the 2010s, the company steadily embraced political causes.

A defining moment came in 2018 when Nike signed Colin Kaepernick for a high-profile advertising campaign. Kaepernick had become a divisive figure after his national anthem protests.

One of Nike’s Colin Kaepernick ad campaigns

Initially, the campaign seemed effective. It sparked widespread media attention, boosted online sales briefly, and the stock price climbed.

Yet trouble lurked beneath the surface. Although Nike generated significant buzz, it also alienated a substantial segment of their customers.

A brand survey released after the ads exposed notable harm. Axios reported:

A new poll from Morning Consult shows that Nike’s brand favorability has dropped 34 points from a net +69 favorable impression (76% favorable, 7% unfavorable) among consumers to a net +35 favorable impression (60% favorable, 24% unfavorable).

Despite the backlash, Nike pressed forward. Amid the George Floyd protests, the firm intensified its use of overt woke messaging.

Then in April 2023, Nike made a controversial move akin to Bud Light’s by partnering with transgender influencer Dylan Mulvaney, who had recently triggered a collapse in Bud Light sales. Many female athletes, frustrated by men competing in women’s sports, expressed anger.

Next, Nike released an ad celebrating the U.S. National Women’s Basketball team’s unprecedented seventh straight gold medal. No doubt, seven consecutive titles are extraordinary.

Nike’s Greatest Dynasty ad – Youtube

Still, the ad’s tone was heavily political. Here’s a snippet:

Today I have a presentation on dynasties, but I refuse to talk about the ancient Greeks and Romans. That’s just the patriarchy.

Instead I’m going to talk about a dynasty that I actually respect. An all-women dynasty. Women of color. Gay women. Women who fight for social justice. Women with a jump shot.

A dynasty that makes your favorite man’s basketball, football, and baseball teams look like amateurs. A dynasty with fire braids. A dynasty with sick style. A dynasty with crazy dimes. A dynasty that makes Alexander the Great look like Alexander the okay.

Why introduce a lecture on the patriarchy during an NFL game? Watching a brand unravel itself like this is tough.

This is a corporation once built on Michael Jordan’s alpha male image now reduced to pushing social justice narratives.

Regardless of risking alienation of half their audience.

Fruits of Political Advertising

What results when a top global brand prioritizes social activism over quality products? Large swaths of customers abandon the brand, sales plummet, and stock prices collapse.

Below is a 5-year graph tracking Nike (NKE) shares.

Source: Google Finance

Over five years, the stock has fallen nearly 76%. Yikes.

I personally stopped purchasing Nike footwear. The quality dipped, and Asics is now my preferred brand.

Interestingly, Asics—a Japanese company—has avoided woke campaigns. Instead, their advertising highlights product quality and the mental health benefits of exercise. They steer clear of politics, which is a smart approach.

Let’s examine Asics’ share performance with a 5-year chart:

Source: Google Finance

Surprisingly, Asics stock has surged 687% over the last five years. This clearly isn’t a sector-wide downturn—this is a Nike problem.

While Asics focuses on producing excellent athletic gear paired with shrewd marketing, Nike seems to be spiraling downward by focusing on divisive politics.

Nike would do well to heed Michael Jordan’s advice:

“Republicans buy shoes, too.”