John Kim John Donahoe’s time at Nike has come to end. Effective October 14th, 2024, long-time Nike veteran Elliott Hill will take over as Chief Executive Officer and President of NIKE, Inc.; Donahoe will remain as an advisor with the company through January 31st, 2025 to ensure a smooth transition.
John Donahoe was named as CEO of Nike in October of 2019. With a proven track record in digital commerce, technology, and global strategy (he served as Chairman of Paypal Holdings, Inc. as well as President and CEO of eBay, Inc. among other pivotal positions), Donahoe was expected to take Nike to the next level as commerce continued its trend toward digital. He had large shoes to fill as his predecessor Mark Parker tripled the brand’s revenue during his incredible tenure that began in 2006.
Under Donahoe’s leadership, Nike’s revenue jumped up to over $39 billion annually. The problem is that while the brand saw booms in sales (much of it attributed to the increased spending habits of consumers during the COVID-19 global pandemic), things went sour as Nike focused too much on hitting numbers which eventually led to consumer exhaustion.
Through Donahoe’s strategy, Nike employed a more aggressive direct-to-consumer route that allowed the brand to increase profit while reducing inventory. Although the moves may have seemed logical simply on a numbers standpoint (cutting out the “middle-man” so to speak), shunning retailers who helped build the brand’s popularity in inner cities and under-served communities was simply seen as a money-hungry play.
As profits increased, the relationship with the consumer began a process of disintegration and Donahoe’s game plan to increase profits lacked understanding of the culture of the Nike consumer. Making more pairs of coveted sneakers and raising the prices is hardly a shrewd scheme, and the magic behind sneaker culture, which factors in product exclusivity, trendsetting, and believable partnerships were lost as sales of Panda Dunks soared.
Patterns in repeated product and lack of creativity from Nike designers/collaborators also led to sneaker fanatics and athletic-focused looking elsewhere. This led to growing awareness of competitors — both large and small — such as running shoe brands On and HOKA. Nike’s biggest competitor adidas also benefitted from the Swoosh fatigue, leading to the exploding trend of the Samba and the brand’s other low-profile, slimmer fitting archival models. All of these ingredients combined led to Nike stock plummeting as the brand outlook appeared murky at best.
Elliott Hill has worked for Nike for 32 years, holding a number of senior leadership positions across Europe and North America. Through his three-plus decades of experience, Hill’s huge advantage over Donahoe is that he knows not only the Nike brand culture, but has a far better understanding of the community that helped build the Swoosh into the biggest brand in the world. Hill retired from Nike in 2020, but is back to take on his biggest role yet.
