Nike focuses on emerging markets

Sporting goods giant Nike is set to target emerging markets in China, Brazil, Mexico and India, chief executive Bill Perez announced on Tuesday. Since he took over from Nike founder Phil Knight, he has undertaken and concluded an "exhaustive" review of the company. He told Wall Street analysts that "for the most part we have the right game plan". He went on to say: "You won't see radical change; you'll see improvements in how we are managing our business."

Among the changes, Perez indicated that the company would aggressively target emerging markets. "To put it simply we want to own these markets," he said. He added that Nike was working on producing a more consistent global strategy for use of the internet and its Nike brand stores. He pointed out that the firm remained committed to its retail trading partners "where possible". Furthermore, Perez said that Nike wanted to improve its lower cost shoe and clothing division. The Starter shoe brand is part of this, and is currently sold at Wal-Mart.

Perez chose to make these statements at the release of the company's second quarter earnings. Nike reported a quarterly rise in profits of 15 percent to $301.1 million (£171.9 million), thanks to a strong growth in US athletic shoe sales. Overall sales jumped 10 percent to $3.5 billion. US athletic footwear sales rose 19 percent to $811.5 million. Jordan brand shoes performed particularly well, with an estimated 6 percent of the US footwear market in the year ended November.

Despite "better than expected earnings, the future growth looks a little less robust than analysts had been expecting," McAdams Wright Ragen analyst Jamelah Leddy told Reuters. Although future orders in the US grew 9 percent, future global orders rose only 2.5 percent, a figure that did not satisfy analysts. Retail sales in Europe and Japan suffered and the strengthening of the dollar against the euro and the yen did not help matters.