During an earnings call with investors on Thursday, Nike president and CEO John Donahoe gave new insight into the machinations behind the brand’s SNKRS app. The executive recapped the rollout of the Off-White x Nike Dunk Low, a collection of 50 different colorways that released exclusively on the app over a number of weeks in August.
The shoes were made available via “exclusive access,” a launch process that gives app users the opportunity to purchase a pair of sought-after shoes based on over 50 variables.
“This approach sends personalized purchase offers to members based on their engagement with SNKRS, past purchase attempts, and other criteria, using data science to drive digital member targeting,” Donahoe said. “For example, 90 percent of the invites for the Off-White Dunk went to members who had lost out on a prior Off-White collaboration over the past two years.”
His comments, made during Nike’s fiscal 2022 first quarter conference call, are a rare instance of the company being transparent about who gets to buy the limited shoes it sells through SNKRS. The app has been a source of great frustration for sneaker shoppers who’ve grown to anticipate failure when trying to buy product on the platform that often sells out in seconds. But Donahoe says the exclusive access model, which the brand updated this year ahead of the Off-White Dunk release, offers a better way to satisfy consumers.
“The Off-White Dunk ended up in the hands of hundreds of thousands of our most deserving members, creating what we call ‘exclusivity at scale.’ And this improved consumer experience has a positive impact on the entire business,” the Nike CEO said. “We’ve seen that those who benefit from exclusive access on SNKRS spend more, fueled by the energy of their win.”
The app came under new scrutiny from the public this year following the scandal around Ann Hebert, a former Nike VP who resigned after Bloomberg Businessweek published a report about her son’s sneaker reselling business. That Hebert’s purview at Nike included the SNKRS app fueled conspiracy theories that the company’s release systems were unfair and that its most coveted product was being funneled to a privileged few.
Following her resignation, Donahoe said in an internal Nike meeting in March that the brand would audit its launch processes and work to regain consumer trust. Nike Direct, the company’s division concerned with selling directly to consumers, has since instated a global fairness mandate to “ensure 80 percent perceived member fairness through the lens of access, bot mitigation, inclusion, clarity, and accountability.” The mandate was mentioned in an August meeting at Nike.
During this week’s earnings call, Nike’s CEO described his own experience with SNKRS. In response to a question at the end of the call about the Nocta golf collection from Nike, the latest in a series of collaborative releases with Drake, Donahoe said that he managed to buy an item from the line on the app.
“I had a SNKRS win this morning on the Nocta line, the vest. I’m excited,” he said. “It’s a great collection. Any time you win on SNKRS, it’s a jolt. I was in the middle of my workout in one of our gyms here on campus. I stopped the workout at 7 a.m. to see if I won, and I won. So I’m pumped up about that.”
Donahoe likened his success on SNKRS to that enjoyed by what he described as millions and millions of users on the app. His review?
“What a great experience.”