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Nike takes on Donald Trump, risks backlash, in Colin Kaepernick campaign

By JEFF MANNING • Sep 5, 2018 at 8:23 AM

PORTLAND, Oregon — The first tweets demanding a Nike boycott and sneaker burnings appeared within minutes.

Later, the president of the United States said Oregon's largest private company was sending a "terrible message."

But ultimately, Nike's new ad campaign featuring controversial former NFL quarterback Colin Kaepernick is working to perfection.

For a company known for outrageous, funny and even inspiring advertisements, the new 30th anniversary "Just Do It" campaign has put Nike in an unprecedented position: effectively picking a fight with a sitting president and his millions of supporters. Donald Trump repeatedly blasted Kaepernick after the former 49er began kneeling during the playing of the national anthem. He did so to protest social injustice and police violence against African Americans.

Camilo Lyon, a stock analyst with Canaccord Genuity, said the heated backlash was likely the exact reaction Nike hoped for, reinforcing its reputation as an iconoclastic maverick in corporate America.

"Nike's move was premeditated," Lyon said. "I give them a lot of credit. Can you recall any company taking this kind of direct stand against the administration?"

Tangling with Trump and declaring solidarity with Kaepernick may offend millions. But a majority of the young people -- who make up two-thirds of Nike's consumer base -- will probably side with the company. "My gut feel is they knew exactly what they were doing," said Matt Powell, an industry analyst with the NPD Group. "They're aligning themselves with their core."

The ad features a closeup of Kaepernick's face and two sentences: "Believe in something. Even if it means sacrificing everything." He is one of a handful of athletes featured in the ads that are celebrating the 30th anniversary of its famed "Just Do It" marketing slogan, a creation of Nike's long-time ad agency Wieden & Kennedy.

This weekend's explosive reaction helps Nike in another way: It changes the subject. Nike has had a painful 2018, complete with high-level executive changes and at least two lawsuits amid accusations of bullying, sexual harassment and pay discrimination.

"I don't believe the ad is exclusively intended to change the narrative away from their prior HR/PR issues, but clearly that's happening," Lyon said. "Regardless of your political stance, Nike will likely be seen as a supporter of rights rather than a transgressor of them."

The backlash to the ad took a toll on Nike's stock, which declined nearly 3 percent on Tuesday.

Trump supporters contend that the president's massive tax cuts have spurred the economy to new heights.

Nike rival Under Armour learned in 2017 that aligning too closely with Trump could be bad for business. Kevin Plank, the Maryland-based company's co-founder and CEO, resigned from the president's business council and backtracked from prior comments that Trump was "a real asset for the country." Critics, including Stephen Curry, Under Armour's biggest endorser, blasted Plank's comments.

Nike is taking on Trump in the midst of a trade war between the U.S. and China. Like many of its competitors, Nike pays subcontractors in China to manufacture a large percentage of its shoes and apparel.

That trade war has not extended to footwear or apparel, not yet anyway. "Trade is a concern here," Powell said. "It speaks to how bold a move this was."

It will be interesting to see what impact Nike's relationship with Kaepernick will have on the company's dealings with the National Football League. The league in March extended Nike's apparel contract with the league through 2028. The financial details of the contract were not released.

Kaepernick has sued the owners, accusing them of colluding to keep him out of the league after he began kneeling during the national anthem in September 2016. He's now a free agent who has not played a game since 2016.

Trump has repeatedly attacked Kaepernick and the other players who have joined him in the protests. He also hammered NFL owners for not taking more dramatic action to stop the protests.

The league issued a statement crediting Kaepernick for raising important issues.

"The National Football League believes in dialogue, understanding and unity. We embrace the role and responsibility of everyone involved with this game to promote meaningful, positive change in our communities," said Jocelyn Moore, the NFL's Executive Vice President of Communications and Public Affairs. "The social justice issues that Colin and other professional athletes have raised deserve our attention and action."

Late Tuesday, the National Association of Police Organizations, which claims to the country's largest coalition of police unions, joined the chorus of voices calling for a Nike boycott. By promoting Kaepernick, Nike "perpetuates the falsehood that police are racist and aiming to use force against African Americans and persons of color," the group said.

"In reality, officers across the nation risk their lives not only protecting the athletes featured in Nike's various campaigns, but also serve aspiring athletes across the country who use the Nike brand, through the thousands of Police Athletic Leagues, Boys and Girls Clubs and Big Brother/Big Sister programs."

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(c)2018 The Oregonian (Portland, Ore.)

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