Amazon’s Size could be Overshadowing Nike in the New Nike-Amazon Collaboration
The new Nike-Amazon collaboration may be good news for consumers but it seems to be overshadowing the sports accessories giant, Nike by virtue (vice) of Amazon’s scale. Since Amazon is the bigger of the two entities, Nike seems to have a lesser say in the partnership, which is not very typical of Nike. Nike (NKE – 0.59%) announced on Thursday that it will issue a limited pilot assortment with its new partner Amazon. Its acceptability to Amazon is however a doubtable thing as Amazon is an out and out transactional retailer that is not much concerned with brand building of any partner, and not just Nike.
Nike wishes to eliminate the unauthorized third-party sales of Nike from Amazon in pursuit of Brand building by removing the risk of counterfeit Nike sales. A statement from Susquehanna Financial Group noted, “Removing unauthorized third-party Nike product sales would help enhance Nike’s brand presentation and prevent counterfeit sales. Removing unauthorized third-party Nike product sales would help enhance Nike’s brand presentation and prevent counterfeit sales”. In case the partnership thrives, the sales opportunity is immense, but at the risk of brand recognition of course. With the reported sales of $29.1 billion reported this April, Amazon seems to be taking a new approach to business with its increased volition to collaborate with more premium vendors. From the perspective of sales, this three times bigger entity than Nike is not likely to allow Nike any say, leave alone letting apply any pressure to make Amazon work on its presentation.