Nike's Women's Movement

Martin Lotti has a reputation inside Nike for outlandish designs inspired by pilgrimages to interesting places. Last year, after spending time in Miami's South Beach, he created a running shoe that looked like a sandal. "No one thought you could make a running shoe without a heel," he says. Lotti thought he could, and the result was the Air Max Craze, Nike's first-ever sling-back shoe.

Today, in his office in the Mia Hamm building at Nike headquarters, Lotti is holding his most radical design for 2002. Inspired by a pilgrimage to Japan, what's most striking about the shoe is its austerity. It's a slender black slip-on with a tiny "swoosh" on the heel. "This," says Lotti, "is the Air Kyoto. It's Nike's first yoga shoe."

Talk about outlandish. A Nike shoe for an activity practiced in bare feet? A Nike shoe for an activity with no SportsCenter moments? A Nike shoe for an activity practiced overwhelmingly by women? "There was such beauty in Kyoto," Lotti recalls. "I was mesmerized watching young people dressed in kimonos going to the temples." He returned to Beaverton, Oregon to design a shoe with "that same simplicity and grace."

Lotti expected a less-than-graceful reaction from his higher-ups. But when he pitched the design as a before-and-after yoga shoe to his new boss, Darcy Winslow, a 14-year company veteran who was only a few weeks into her role as global footwear director for women, she gave him the go-ahead. In fact, she insisted that the shoe be ready for the 2002 fall collection.

Why the rush? Winslow is a leading figure in Nike Goddess, a companywide grassroots team whose goal is a once-and-for-all shift in how a high-testosterone outfit sells to, designs for, and communicates with women. "This is the beginning of a larger mantra at Nike," says Winslow. "We had to wake up to the women's business and do it differently. We had run great ads and supported great women athletes. But nothing seemed to gel."

Air Kyoto was one step in a journey to transform Nike.

The Making of a Movement

In its 30-year history, Nike has become the undisputed leader in sports marketing. If boys wanted to "be like Mike," marketing executives wanted to be like Nike. But lurking beneath the company's success was an aching Achilles' heel. Nike is named after a woman -- the Greek goddess of victory -- but for most of its history, the company has been all about men. Last year, revenue from women's products hovered at a paltry $1.5 billion (less than 20% of sales), even though the market in women's sports apparel had been skyrocketing. According to the NPD Group, women's sports apparel generated sales of more than $15 billion in 2001 -- nearly $3 billion more than men's apparel.

How could Nike have failed so miserably with women? And how could it afford to keep failing, given the threats to its future? The Air Jordan phenomenon has been running out of air. Labor activists have damaged the company's reputation with the MTV crowd. And brands like Skechers have been digging into the teen market with shoes inspired by skateboarding, not basketball. What would it take for Nike to take women seriously?

That has been a huge question in Beaverton over the past few years. Nike Goddess is the makings of an answer. For much of its history, Nike's destiny was controlled by its founders, the running buddies who sold shoes out of their trunks, signed up athletes in locker rooms, and made executive decisions at retreats called "Buttfaces." But by throwing together a diverse collection of people with different backgrounds and different levels of seniority, Nike has found that it can keep many of its core attributes while adding new sources of inspiration.

Take the combination of star designer (and Nike veteran) John Hoke and newcomer Mindy Grossman, vice president of global apparel. Hoke, a 6-foot-4-inch snowboarder, designed the look and feel of the first Nike Goddess store in Newport Beach, California. Then Grossman, whose career has included helping make Ralph Lauren into a retail icon, pitched the design ideas to Nike's top retailers as stores within stores. "We need to be where women shop," says Grossman. "For too long, we've been relegated to a few racks near intimate lingerie."

Of course, radical innovation rarely follows a straight line. But there's a feeling that Nike has a chance to reach a crucial objective: double its sales to women by mid-decade. "Nike Goddess is the manifestation of us getting our act together," says Mark Parker, Nike's brand president and one of a handful of executives who report to chairman Phil Knight. "It also helped us realize that the Nike brand could be so much more. We don't want to be the number-one sports brand in the world. We want to bring innovation and inspiration to every athlete."

"It feels like we're finally in the zone," adds Cindy Trames, a footwear product director who reports to Darcy Winslow. "Nike Goddess has got that magic. You feel 'in the moment,' like this is unstoppable."