Nike Inc. (NKE ) is one of the most famous sports and apparel companies in the world. It has left its mark on some of the most famous athletes of all time, including Michael Jordan, Tiger Woods, and Derek Jeter among a number of other blockbuster names. Nike’s stock (NKE) is a member of the Dow Jones Industrial Average, putting it among the most popular stocks in the world. But for all of the attention that the company has got over the years, there are still many things about Nike that are not common knowledge.
Below, we present seven interesting facts about Nike Inc. that you probably did not know:
1. Nike’s Slogan Originated From a Convicted Killer
“Just do it” has been a famous slogan that Nike has been using for many years now. But most people probably did not know that its origins stemmed from Gary Gilmore, who was executed for two murders in 1977. When asked for any final words prior to his execution, Gilmore simple replied, “Let’s do it.” Dan Wieden, the founder of Wieden+Kennedy advertising agency, used this quote as inspiration to launch the “Just do it” campaign in 1988. Utilizing that campaign, Nike was able to greatly increase its market share in North America over the next decade [see also What Are Dividends].
2. Footwear Revenues Account for 58.3% of Total Revenues
Though Nike makes a wide variety of products that include everything from shirts and socks to basketballs and footballs, footwear is still the core of its revenue. In fiscal 2014, footwear sales accounted for 58.3% of total revenues, leaving some other sectors in the dust:
3. The Nike Swoosh Was Designed for $35
The Nike swoosh (picture right) is easily one of the most recognizable logos in the world. But the design of this famed symbol was commissioned in 1971 for a paltry $35. That paycheck would be worth approximately $200 in today’s dollars It was designed by a graphic design student named Carolyn Davidson who attended Portland State University. Initially, Phil Knight (Nike founder) was not emphatic about the design, but guessed that it would grow on him with time.
Knight eventually realized the value that the logo helped create and in 1983 he gave Davidson a golden swoosh ring with an embedded diamond. He also presented her with an envelope with an undisclosed amount of NKE stock in an effort to repay her for her efforts on what was now a world-famous logo.
4. Revenues from “Men’s Training” are more than double that of “Women’s Training”
Apparently, Nike resonates much better with the male population than it does with females. On its most recent 10-K report, the company had two line items titled “Men’s training” and “Women’s training.” As a percentage of Nike Brand wholesale equivalent revenues, Men’s Training accounts for 11.4% while Women’s Training accounts for just 5.1% [see also Dividends in Focus: The Dow 30].
5. Nike Owns Converse and Hurley International
Converse is perhaps most famous for its Chuck Taylor shoes, which have been around since 1917. But what many investors may not know or remember is that Nike acquired the company in 2003 for just over $300 million. See more facts about Nike shoes here. This was after Converse fell on hard times and was forced to file for bankruptcy. Hurley International is another popular brand that focuses on the surfing and skateboarding community. The company was acquired by Nike in 2002 for an undisclosed amount, though it has been able to maintain a relatively strong separation from its parent company over the years.
6. Nearly 15% of Revenues Come from Emerging Markets
By now, most investors are familiar with the explosive growth that many emerging markets are enjoying. Along with economic expansion comes a powerful and ever-growing consumer class. Nike has been able to take advantage of this demographic shift, and now derives nearly 15% of its revenues from the emerging world. Here is a breakdown of Nike’s revenues by region:
7. No Single Customer Accounted for more than 10% of 2014 Net Sales
The company made it a point to mention this fact in its 10-K. The reason this is significant is because it means that no one customer is the driving force behind Nike’s business, and it is not overly reliant on a particular account. While a large account can help bolster a company, it can spell trouble when that account disappears and evaporates revenues with it. Nike has done a good job of diversifying its sales to ensure that its income stream is derived from a wide variety of customers.
The Bottom Line
As we have stated before, learning interesting facts about a particular company may not always have a direct impact on your investment, but they can help illustrate an important lesson. Always look under the hood of what you are investing in, and be sure that you know how a security or company functions.
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