Nike: Just Don’t Do It

The practice is known as “Beaverizing.” It’s a term industry insiders use for what Nike, based in Beaverton, Ore., has done to some companies it’s acquired through the years. Rather than letting the brands stand on their own, it gives them a Nike makeover. It swoosh-ified the hockey-equipment maker Bauer, for example, and boasted about Nike Air technology in its Cole Haan shoe subsidiary. Many feared the same would happen when Nike bought Converse, maker of the iconic Chuck Taylor All-Stars, a year ago. After all, the two companies seemed polar opposites. Nike made pricey, high-tech sneakers like $165 Air Jordans; Converse was known for cheap, low-tech sneakers that have been the unofficial gear of the anti-establishment for years (Kurt Cobain was wearing Cons when he committed suicide in 1994). The Wall Street Journal sounded an ominous note when the deal broke in July 2003: “The Swoosh is swallowing Chuck Taylor.”

[Editor’s Note: You have to wonder why Kurt Cobain is always used as the example when there are so many more alive people who live in their chucks — anti-establishment, establishment, musical stars and just regular people]

Surprise, surprise. With Converse, Nike seems to have flipped its own slogan on its head. Meddle? Just don’t do it. And the strategy appears to have paid off. Converse still has its retro-rebellious buzz, and its shoes are hot. Check the feet of Avril Lavigne, Blink 182, Kid Rock and the Strokes — they’re even the go-to shoe among fashion models in Paris this year. Sales, though still a sliver of the overall market, have surged the last few years (chart). “Converse is everywhere right now,” says Marshal Cohen, who tracks fashion for NPD Group, a market-research firm: younger buyers like the hip heritage of Cons. “It’s funky and it’s lasted this long — it must be good,“ said Britney Ellis, a New Jersey teenager, after buying a pair of navy Chuck Taylors.

Nike execs say they always intended to leave Converse alone. “We let the team in place run the business the way they need it to run,” says Scott Olivet, vice president of Nike Subsidiaries. (Converse executives declined to comment.) They learned their lesson from the Bauer experience. After Nike acquired Bauer in 1995, it started selling gear with its distinctive logo, tinkered with the technology and offended traditionalists when it outfitted superstar Sergei Fedorov in snow-white skates. Nike “lost sight of the DNA” of Bauer, and “consumers recognized it immediately,” says a former top Bauer exec.

Converse’s ties to Nike are still generating controversy. Adbusters, a group that fights overcommerciali-zation of culture, is selling a Chuck Taylor knockoff called the Black Spot, with a spot covering any logo. But Converse is playing offense, with a plan for winning over neo-hippies (perhaps some of the same people who might have railed against Nike when anti-sweatshop protests were in vogue). Converse declared Aug. 12 “A Day of World Peace“ to launch its Peace Collection, which includes shoes designed by Yoko Ono with artwork from John Lennon — “the visual cornerstone for the brand’s commitment to originality, artistry, unity and world peace.” Maybe Converse will suggest Nike adopt a new slogan for dealing with its subsidiaries: “Let it be.”

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