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Traditionally the lifeblood of B2B brands, in recent years, the subscription industry has exploded in the B2C eCommerce space.

The subscription takeover has been so successful that 75% of direct-to-consumer businesses are expected to offer subscriptions by 2023, and the subscription industry could hit a whopping $478 billion by 2025.

With such a solid upward trend, it’s no surprise that sportswear megabrand Nike stepped into the ring to deliver a knockout subscription to its fans. Nike dug deep into its data and analytics to uncover a sub-niche they could serve with subscriptions to boost their revenue. It landed on kids’ shoes and the rest is history.

But it’s not just Nike that gets to have all the fun — you can follow in the sportswear giant’s footsteps too. 

To give you some solid inspo for your store’s own subscription boxes, we’ll break down all the things Nike did right in its subscription takeover, along with some actionable tips for success. 

Let’s jump in.

Nike Business Model: What We’ll Cover

  1. Go where the money is
  2. Dare to go against the grain
  3. Tap into your loyal customer base and provide an unbeatable customer experience  
  4. Build a community around your subscription(s)
  5. Use exclusivity and rewards to supercharge engagement and sales
  6. Apply personalisation to drive customer loyalty

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Why Nike Chose Subscriptions to Capture Its Audience’s Hearts and Pockets 

Nike has used a range of strategies and tactics to stay relevant over its 57-year reign —

but the most innovative addition to the Nike business model has to be its subscription boxes. 

There are lots of likely reasons Nike chose to take on this challenge (and why you should too). Let’s zoom in on a few:

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6 Key Takeaways from the Nike Business Model Switch Up

There are a million and one things eCommerce sellers can learn from a Goliath brand like Nike. It’s survived the test of time, modernising and adapting along the way with great precision. But their decision to enter the subscription market was a brave step, at a time when sneaker subscriptions weren’t common.

Fast forward to today, and just a short glance through subscription industry stats show exactly what a great idea it was. Here are just a few statistics that highlight the subscription boom:

Subscriptions are so popular they’re even native in Shopify now. The opportunity is huge, and there’s a lot to take away from Nike’s journey that can help you upgrade your eCommerce store with subscriptions:

  1. Go where the money is

One of the first things Nike did right was to choose a sub-niche with excellent growth potential. The Nike Kid’s line had been scaling at 11%, so the market already had proof of concept and success, but there was still room for improvement.

Nike made another notable move to use high-quality goods at affordable prices ($20 -$50), proving subscription boxes don’t need to be dirt cheap to get signups. This strategy undoubtedly helped Nike boost their revenue and profits. 💰

Here are some things you can do to dive into the subscription sales format: 

  1. Dare to go against the grain

‘Zig while everyone zags’ is a common phrase in the business world, yet it’s easy to get caught up in chasing the latest eCommerce trends to make a quick buck (remember Fidget Spinners? 😅). 

But Nike is the exception. The Nike business model has always had innovation at its core, and the subscription service was just one of its ground-breaking moves to solidify its title as one of the most iconic brands of all time.

Here’s how to follow in Nike’s footsteps to help your store rise above the subscription showdown:

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  1. Tap into your loyal customer base and provide an unbeatable customer experience  

There are very few places in the world where Nike isn’t a household name. The sportswear giant knows its clout and decided to capitalise on its popularity. 

Nike used the subscription model to drive stronger connections with its audience by solving their pain points and ensuring their customer experience was second to none. 

For example, in addition to the subscription service, Nike offered outdoor children’s games and guides to help parents manage kids’ technology usage. Nike’s subscription box customers liked it so much, 70% of parents said they’d pay for the guides. 

Here are a few simple ways to build an unforgettable customer experience: 

  1. Build a community around your subscription(s)

It’s one thing to build a community around your store, but it’s a whole other genius-level to build an active and engaged community around your subscriptions.

Nike did just that by making their subscriptions a right of passage for future Nike fans. Since the kids using their subscription boxes will grow up wearing Nike, their affinity with the brand will be deeper than those who only connect with the brand later in life.

Nike also tapped into another niche audience by seeking to make a positive impact with its subscriptions. They encouraged subscribers to return worn shoes to them, which would either be recycled or donated — a clever way to get signups from people who want their purchases to make a difference in the world.

Here are some action steps to activate your community:

  1. Use exclusivity and rewards to supercharge engagement and sales 

If there’s one thing the newest addition to the Nike business model has nailed, it’s rewards.

When Nike Adventure Club was still around, it was able to keep members excited and engaged through things like:

These exclusive drops and rewards feed perfectly into today’s FOMO dilemma, making this trick a marketing goldmine.

Here are some pointers for amping up exclusivity in your subscriptions: 

  1. Apply personalisation to drive customer loyalty

Nike knows its customers incredibly well and uses this information to adapt its infamous Nike business model and products — which is crucial in today’s ultra-competitive market. It’s also how Nike was able to use personalisation as a broad differentiation strategy to get their subscribers’ vote. 👌🏽

For example, Nike knew how frustrating it was for parents to constantly search for and replace shoes for their fast-growing kids, and sought to take the pain out of the experience. This detail contributed to their subscription boxes’ success as it solved a current problem.

Here are some tips to win over customers with personalised subscriptions:

Grow Like Nike with Wildly Successful Subscription Boxes

The decision to switch-up the Nike business model and take on a growing industry was a bold move, even for a giant like Nike. 

But the footwear megabrand has proved subscription boxes can work for pretty much every eCommerce business (with a little creativity). 

To make your foray into subscription boxes, explore different angles to make your boxes noteworthy. Test before you invest to get proof of concept, and tweak your subscriptions along the way using the data you collect. And don’t forget to look up other subscription boxes to see how they engage audiences and drive sales for all-important inspo.

The subscription box market is an exciting place to be right now for brands and shoppers — so seize this opportunity and reap the rewards for years to come.

Is the subscription model your store’s next big move? Discover how the right eCommerce funding can help you win.