• by Sarah Mahoney , June 30, 2017

Just weeks after announcing staff cuts and a new “consumer direct offensive,” Nike confirmed a pilot project with Amazon and reported better than expected sales and profits for its fiscal fourth quarter.

The Beaverton, Ore.-based company says revenues rose 5% to $8.7 billion, with sales for the full year climbing 6% to $34.4 billion. Sales for the Nike brand increased 7%, while those at its Converse division jumped 10%. For the quarter, net income zoomed 19% to $1 billion, driven by global revenue growth and lower selling and administrative costs. For the full year, net income rose 13% to $4.2 billion. It says results were particularly strong in its Jordan brand, running and women’s division.

In a conference call for investors, Mark Parker, chairman, president and CEO, elaborated on the “direct” effort, several weeks after it announced the plan and a 2% reduction in its workforce. The intention, he said, is to “double innovation, speed and direct connections with consumers.”

He confirmed that the company, long at odds with Amazon, is testing a U.S. program with the e-commerce giant, first reported earlier this week in the Wall Street Journal. “We’re executing a new pilot with Amazon with a limited Nike product assortment,” he says. “We’re looking for ways to improve the Nike consumer experience on Amazon by elevating the way the brand is presented and increasing the quality of product storytelling. We’re in the early stages, but we look forward to evaluating the results of the pilot.”

He also says it’s combining “digital and physical experiences with a dedicated Nike and Nordstrom page on Nordstrom’s app.”

And it’s launched a new partnership with Instagram, which lets shoppers buy Nike products in the Instagram app. “Clearly, we are boosting our ability to create new ways to serve consumers … making the entire Nike+ ecosystem available to consumers where they already live,” he says.

The company’s new focus includes a shift in marketing geographies, zeroing in on New York, London, Shanghai, Beijing, Los Angeles, Tokyo, Paris, Berlin, Mexico City, Barcelona, Seoul, and Milan, the 12 cities it says will lead to 80% of its sales growth through 2020. Those moves “will add greater digital expertise and control in the markets where consumer connections happen,” he says. “And they will be the source for real-time sensing of the market to influence product creation.”