Shares of Nike are rising after former Colin Kaepernick convinced the company to pull its “Air Max 1 USA” sneakers from store shelves. His concern over the shoe’s “Betsy Ross Flag” designs connection to an era of slavery resonated with investors, and added nearly $3 billion in market value.
Share to twitterFormer NFL football quarterback Colin Kaepernick is seated on stage during W.E.B. Du Bois Medal ceremonies, Thursday, Oct. 11, 2018, at Harvard University, in Cambridge, Mass. Kaepernick is among eight recipients of Harvard University's W.E.B. Du Bois Medals in 2018. Harvard has awarded the medal since 2000 to people whose work has contributed to African and African-American culture.
Playing the long game with Kaepernick seems to be fruitful for the company amidst earlier short term stock market painreported. Let’s look at the big picture, Kaepernick has been on Nike’s endorsement roster since 2011, but hadn’t been featured in one of their ads in two years before appearing in September 2018. The company received more than $43 million worth of media exposure from the ad, according to Apex Marketing Group.
If we dig deeper into how the sportswear brand has performed, Nike boosted revenues by 4% to just over $10 billion. but missed analyst estimates for earnings. However, the maker of Air Force 1 sneakers missed analyst estimates for earnings in its fiscal Q4.2000% premium , on the stock market for shoes known as StockX, before they dropped the sneakers from its site. Also, Arizona Governor Doug Ducey ordered the state’s Commerce Authority to withdraw financial incentives of around $2 million that were to be awarded to Nike for a new manufacturing plant since they pulled the shoes. It actually seems like the governor is only hurting Arizona residents in the state by doing this, considering the plant was supposed to create nearly 500 jobs.
I am the CEO of CultureBanx covering the intersection of business, technology and innovation for minorities. I was raised in investment banking while working at UBS inte...
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