Sports retailers were moving Wednesday morning following channel checks from Goldman Sachs analyst Lindsay Drucker Mann that suggest Nike Inc NKE could begin selling directly through Amazon.com, Inc. AMZN.
NPD Group analyst Matt Powell also tweeted about the potential move.
What Nike Could Win
The athletic apparel giant already has a presence on Amazon-subsidiary Zappos, but sells only through unlicensed, third-party resellers on Amazon itself.
Nike could see a 100 basis points rise in global sales by selling direct on Amazon, according to Mann, amounting to $0.6-1 billion in retail sales.
This growth would be driven by increased control over how it appears on the site, citing Under Armour Inc UAA’s business on Amazon as a baseline.
Under Armour already sells directly under it’s own, customized page on Amazon. It also has licensed third-party sellers on Amazon Marketplace. This setup allows Under Armour’s newest styles to appear sooner than Nike’s and encourages more customer reviews.
A cleaner, less fragmented landing page for consumers on Amazon would also appeal to millennials who prefer shopping online.
The Movers
The following retailers were moving in Wednesday’s pre-market session on the speculation:
- Foot Locker, Inc. FL down 6 percent.
- Dicks Sporting Goods Inc DKS down 5.9 percent.
- Finish Line Inc FINL down 4.8 percent.
Nike shares also rose as much as 1.9 percent on the report.
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