Nike “Betsy Ross” Air Max 1 USA Shoe

Marketing Mistake or Marketing Magic

July 11, 2019

Well, now that the dust has settled on this Nike shoe issue, I thought I would take another look at it. My perspective is from the product launch viewpoint where I have significant experience. Essentially, I wanted to look at the experience in two ways: Nike Marketing Mistake or Nike Marketing Magic. My intent here is strictly business and I’m avoiding the socio-political finger-pointing about this product release. I’ve been involved in 13 product launches from inception to fully out the door for release. That includes both B2B (high tech products and software) as well as B2C product launch of a paint & coatings brand for a 32-store home center chain.

I’ve created my own Product Launch Checklist and I wanted to check the Nike experience against my checklist. I’d also like to thank a former instructor, Jason McDonald who did a video clip piece on LinkedIn about this Nike situation. Jason runs SEO, Google Adwords, and Social Media Marketing classes through his website JM Internet Group. He piqued my interest to further think about the ramifications from this incident.

Believe it or not, I spoke to a LinkedIn Connection this morning who didn’t know much about the Nike situation. So, you can find out how it was initially reported by NBC News here. The first thing you need to know is that the shoe was never called the “Betsy Ross” shoe. The actual name was the Nike Air Max 1 USA.

Photo Credit: Nike via NBC News

Nike Marketing Mistake:

When I look at my Product Launch Checklist here is the first item I see. I would have to say that this may have been a miss in the Nike scenario.

Product Launch Agreement

  • Buy-In from Senior Management
  • Buy-in from the Product Management Director
  • Buy-in from the assigned Product Manager
  • Buy-in from Strategic Partners

It just strikes me as very odd that a product launch could have gotten this far along before someone questioned the product. I did not realize but as NBC News pointed out in their article,

“…In recent years, the Betsy Ross flag has been appropriated by the white nationalist group Identity Evropa and the Ku Klux Klan, who use it to represent a time when slavery was legal in the United States…”

Even without knowing that info, I first ran a Google search on “Betsy Ross flag.”

Unfortunately, there are now added news stories that directly or indirectly relate to the Nike Betsy Ross situation. I would have loved to see the same search before the Nike situation. Then I ran search of Wikipedia for Betsy Ross. Surprisingly, there is a school of thought that she did not make the famous flag. That her grandson brought up the episode about 100 years later for the First Centennial celebration of the USA. 

In any event there should have been more discussion and review among senior managers about using the flag symbol. If NBC News knew about Identify Evropa and Ku Klux Klan usurping the flag symbol, then Nike should have known there might be a red flag.

When you’re doing a product launch of this scale there are probably dozens or hundreds of staff at Nike that are involved in the process. Again, strange that no one reported a problem early on with the logic of launching the Max 1 USA. Moreover, there should have been an internal focus group early on in the project. The right time might have been when a design was completed by graphic artists and could be viewed.

At that point the question of go or no-go might have been raised by people of color (POC) in the room. Apparently, all along the process toward design, production, and release no one brought up the Betsy Ross issue – especially people of color (POC).

Lastly, the “buy-in from Strategic Partners” comes into play. Here there just flat out seems like a hole in the entire launch process. I can’t believe that a major retail partner of Nike did NOT see the design during the launch process. Usually, that happens fairly early in the process. Nike can’t say, “Oh by the way, we’re dropping 50,000 pairs of new shoes into your inventory.”

It doesn’t work like that.

Now I’m going to pass by and gloss over other points that you would need to do in a real product launch. Some are:

  • Who is the target audience?
  • Create a Value Proposition for the product:
    • Target Audience
    • Frame of Reference to the target audience
    • Key differentiators for the product
    • Reason to believe & Proof Points
  • Create key messages

In defense of Nike, sometimes even the best product launches can go wrong after careful planning.

Proctor & Gamble (P&G) had done market research on creating a new version of their standout product Tide laundry detergent. Seems that lots of people were living in apartment complexes that had laundry rooms. In order to satisfy customers needs for a better way to use Tide – rather than carry the 10 lb. box – to the laundry room, Tide Pods were created. I believe that P&G did around $10 Million of research and over 400 beta products before launching. They launched and disaster struck the first week.

Children were eating the pods because they looked like candy. There were numerous calls to the Poison Control Center in Atlanta, GA and P&G had to quickly regroup.

So, even though the product was the same and usage was essentially the same the product now had a different look. No one had prepared users that leaving the pods on the pantry floor, as they had done with the old box of Tide, could be a problem.

P&G used new packaging that included a safety top along with added safety warnings on the product.

Photo credit: Proctor & Gamble website

  • Plant Gift and Sales/Marketing Promotion

This is based on personal experience. I worked for a small IT equipment manufacturing company. A Marketing/Creative Director came up with an idea for a promotion. We would purchase small planters (a small tree-like item) that could be sent to senior executives at target companies. Each planter would be adorned with small hanging signs with a tag line and keywords about our products.

When we looked at a sample it seemed to be a great promotional idea. It got our message across via a small tag line then the keywords.

Shortly thereafter we planned for a full release and coordinated with the floral company for delivery.

On the first day of delivery, the office phone rang. It was the Secretary of an executive. She proceeded to tell us that she had opened the package and placed it on the executive’s desk. Now there were ants all over his desk and she was in a panic.

We quickly had to call the floral company and halt deliveries.

In my personal defense, I was not too heavily involved in that promotion. The point is that unexpected things can happen even with good planning.

Nike Marketing Magic:

There’s only one case that fits into this category in my opinion. In my mind it was the biggest marketing ploy of the 20th Century.

Coca Cola introducing “New Coke” as a replacement for their standard brand Coca Cola that had the secret formula in a vault in Atlanta, GA.

Photo credit: Coke Store
Photo Credit: Coca Cola

You can read the full context of the New Coke saga here on Wikipedia. It is a fascinating read with lots of info, I highly recommend it. Here is the condensed version from Wikipedia:

New Coke was the unofficial name for the reformulation of Coca-Cola introduced in April 1985 by the Coca-Cola Company. In 1992, it was renamed Coke II.[1]

By 1985, Coca-Cola had been losing market share to diet soft drinks and non-cola beverages for many years. Blind taste tests indicated that consumers seemed to prefer the sweeter taste of rival Pepsi-Cola, and so the Coca-Cola recipe was reformulated. However, the American public’s reaction to the change was negative, and “New Coke” was considered a major failure. The company reintroduced Coke’s original formula within three months, rebranded “Coca-Cola Classic“, resulting in a significant sales boost. This led to speculation New Coke formula had been a marketing ploy to stimulate sales of original Coca-Cola, which the company has denied.[2]

Coke II was discontinued in July 2002. It remains influential as a cautionary tale against tampering with a well-established and successful brand. In May 2019, it was announced that the 1985 formulation (bearing the name “New Coke”) would be reintroduced to promote the third season of the Netflix series Stranger Things which takes place in 1985.[3]

Now, there is also an official version of the story from Coca-Cola themselves that you can read here:

Here is a sample:

“…That firestorm ended with the return of the original formula, now called Coca-Cola Classic, a few months later. The return of original formula Coca-Cola on July 11, 1985, put the cap on 79 days that revolutionized the soft-drink industry, transformed The Coca-Cola Company and stands today as testimony to the power of taking intelligent risks, even when they don’t quite work as intended.

“We set out to change the dynamics of sugar colas in the United States, and we did exactly that — albeit not in the way we had planned,” then chairman and chief executive officer Roberto Goizueta said in 1995 at a special employee event honoring the 10-year anniversary of “new Coke.”

“But the most significant result of ‘new Coke’ by far,” Mr. Goizueta said, “was that it sent an incredibly powerful signal … a signal that we really were ready to do whatever was necessary to build value for the owners of our business.”

One of the things mentioned in the Wikipedia article was that even though taste tests has shown approval for the new taste of New Coke, customer empathy for the Old Coke outweighed the tests results.

Three months that made marketing history in the 20th Century. I’m a believer that Nike made marketing history in the 21st Century with the Nike Air Max 1 introduction.

Dom Fruges

Twitter: @DomFruges

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