How Nike uses benefits to deliver on its business goals

Benefits are a core part of any membership, they deliver value to members and expand their experience. By increasing the perceived value of the membership they can be used to drive acquisition, whilst at the same time specific benefits can be used to drive ongoing engagement and reduce churn. Nike has reorganized its entire company over the past decade, shifting from linear retailer to a digital membership business. In doing so the brand has built a deep bench of benefits available to each member, whilst moving beyond the typical discount approach taken by many retailers.

The first thing it’s important to recognize in this transition is that for Nike access to apps is a benefit of being a member. This was an important strategic decision to make, whilst many companies allow any customer to access an app experience and bolt on a layer of membership, Nike rightly took the opposite view. By establishing their apps as being a part of the membership ecosystem they are able to do two key things; firstly immediately use the app as an acquisition tool for membership, and secondly tie any product updates delivered in their apps directly to an increase in the value of the membership experience for current members.

The apps themselves are strategically chosen, whilst the brand has its own e-commerce app they’ve also developed three other apps each designed to drive acquisition and engagement with a new audience. The SNKRS app is for those looking the land the latest sneaker drop, whereas Nike Training Club and Run Club appeal to those looking to train or get out and get the miles in. As a strategy this enables Nike to develop features that appeal to these specific communities, whilst also creating an acquisition funnel for each - growing their user base at an exponential rate to that which would be achieved with a single one size fits all product. Each develops different data points on the customer depending on the relevant in app features they use.

Outside of their apps Nike has developed a range of benefits including exclusive releases, free shipping, customizations and access to events. A good membership framework should include a range of functional benefits, such as shipping, features, products and access and Nike ticks all the boxes. Whilst Nike uses the Window Theory to communicate these benefits to non members, they also use their CRM and in app experience to message current members about benefits that may resonate with them to drive engagement. Each benefit is developed to either learn more about their customers or directly drive an incremental product sale. Through this approach Nike is able to ensure all benefits are adding value to their business. In fact they have so many exclusive member products an entire section of their e-comm store is dedicated to it.

Through developing these core aspects of their membership experience Nike is then able to just continue to add further benefits as they build out each program. This constant innovation and ecosystem expansion adds to their ability to directly reduce churn.

THE TAKEAWAY

• Consider how elements within your Ecosystem Approach can add to the Membership Experience.

• Access to features or exclusive content can be a strong benefit for members

• Develop benefits designed to drive specific business goals, don’t add benefits for benefits sake

GO DEEPER

• Explore the Nike Membership benefits further here.