It’s no surprise to find that there are people who don’t like Nike, or that there are people who don’t like its influence on amateur and professional sports, or that there are people who don’t like its advertising, or that there are people who don’t like its labor practices. It’s not even much of a surprise to find that there are people who don’t like its shoes. It is, however, a surprise to find their views so well represented in the company’s new annual report, which opens with a simple sentiment: “Everyone’s entitled to an opinion.”
Everyone gets to express it in Nike’s new AR, which includes excerpts from dozens of letters, telephone calls and E-mails from satisfied and dissatisfied customers. The same technique was used earlier this year by United Airlines, which used its annual report to address customer complaints about air travel. Nike seems to have gone further, however, if only because it has more material.
Says Nike director of corporate communications Lee Weinstein, “We get 765,000 phone calls, 82,000 letters, 310,000 E-mails a year. We thought they were more representative of what this company is about, what it means to people, than anything we could say about ourselves.”
The letters are set against a backdrop of newspaper headlines—“Hypocrisy is Nike’s Sole Purpose;” “Watchdog Group Slams Nike;” “Nike to End Ties With Indonesian Companies”—that make it clear what kind of year it has been for the Beaverton, Ore., footwear and apparel company. They cover every aspect of Nike’s performance, from the ethical to the financial:
“Your actions so disgust me that I will never buy one of your products again. I hope my attitude proves to be universal.”
“How dare you and your marketing jackals manipulate the world’s athletic stage for your own ends.”
“Get on the ball and get the stock price back up to where I paid for it.”
“My dad has many of your T-shirts and colerd shirts. But almost all of his shirts butins fel off.”
“I am writing to ask your permission to have a Nike swoosh tattooed on my right butt.”
The report is unlikely to satisfy Nike’s toughest critics. Every other move the company has made in the past year or two has been dismissed as “just PR” and there’s no reason to believe the annual report won’t get the same reaction. Some letters seem to have been chosen to make Nike’s critics seem ridiculous—“There are 18 people being held as political prisoners in Albania. Why haven’t you taken action to free them?”—while a couple of letters from Nike supporters present articulate, intelligent defenses of the company’s actions in Asia.
Then there’s chairman and CEO Phil Knight’s letter to shareholders, which addresses the labor practices issue in a single short paragraph that acknowledges no transgression on the company’s part: “Our friends in the media are slowly becoming more knowledgeable. This is good. It means that consumers are actually getting informed rather than just alarmed.”
Reading between the lines, however, Nike seems to have recognized that its implacable opponents can never be converted and decided to focus on the remaining 99 percent of the population. What the annual report does most effectively is let the company’s supporters—its shareholders, its customers, and not least its employees—know that Nike may be down but it is far from out.
“Nike is a company with a sense of humor,” says Weinstein. “It’s been a very tough year. It’s been a year of controversy on a number of different fronts, from our labor practices to our new ads. We don’t shy away from controversy.”
That sense of humor shines through in Knight’s letter, a masterful piece of writing that begins with refreshing honesty—“This year produced considerable pain”—and proceeds with a blunt assessment of Nike’s problems and a refusal to offer any easy solutions. Says Knight, “We’ll have good numbers again. It’s just not obvious when.”
According to Weinstein, Knight was closely involved in the production of the AR, which was put together by a team that included senior writer Bob Lambie, director of investor relations Rick Anguilla, and Nike designer Valerie Taylor-Smith. Yet little of the arrogance that has been prominent in some of Knight’s other public responses to Nike’s problems is evident here.