Nike has put its global media account into review according to sources.
The sports shoe and athletic wear giant spent an estimated $245 million on media in 2021 according to agency research firm COMvergence. That includes about $120 million in the Asia Pacific region and $95 million in North America. The rest is spread throughout Europe, The Middle East, Africa and Latin America.
COMvergence estimates that close to 80% of the company’s ad expenditure is now digital.
And the company is making further investments in the digital domain as customers spend more time there. Earlier this week the company confirmed acquiring RTFKT, which makes non-fungible tokens (NFTs) and other virtual collectibles and experiences.
“This acquisition is another step that accelerates Nike’s digital transformation and allows us to serve athletes and creators at the intersection of sport, creativity, gaming and culture,” said Nike CEO John Donahoe. “Our plan is to invest in the RTFKT brand, serve and grow their innovative and creative community and extend Nike’s digital footprint and capabilities.”
In its fiscal 2021 annual report Nike said total ad and promotional expenses, which it collectively calls “demand creation expenses” totaled $3.1 billion, down 13% due in part to reduced advertising costs during the pandemic. Promotional costs include product giveaways, endorsements and events.
Incumbents on the business include Wieden + Kennedy (also its long-time creative agency), WPP’s Mindshare, Stagwell’s Assembly and others. W+K and the major holding companies are expected to participate in the review which could take six months or more, per sources.
Consultant R3 has been retained to assist in the review, per sources.
Nike officials couldn’t be immediately reached for comment.