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BRIEF HISTORY OF NIKE

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BRIEF HISTORY OF NIKE

In September 1962 young Stanford graduate Phil Knight decided it was his time to see the world and with some money from his father and selling his car set about a global travel adventure. After some time living and working in Hawaii selling Dreyfus Investment Funds he headed off to Japan, armed with a bold agenda to talk a Japanese shoe manufacturer into a US distribution deal. It was a plan that Knight had incubated for a while, ever since making his graduate thesis presentation on his idea for a sport shoe business. Against high odds Knight’s precocious ambition got him to the table in Kobe with executives from manufacturer Onitsuka. Making up a fictitious company on the spot called Blue Ribbon (inspired by the blue ribbons hanging from his athletics trophies) he was able to broker a deal for a preliminary order of 12 pairs Tiger shoes for $50.

Knight’s precocious ambition got him to the table

On returning to Portland Oregon from his world trip he picked up his shoe order, setup his company Blue Ribbon Sports and started selling Onitsuka shoes from his parent’s basement, employing his sister to look after incoming and outgoing mail for $1/hour. One of Knight’s first recipients of shoes from the original order was his old University of Oregon track coach Bill Bowerman. Knowing that Bowerman was constantly obsessing over the shoes his runners wore, Knight knew he would be very interested in testing the Japanese products. Bowerman’s interest didn’t take long to ignite with him asking for a share of Blue Ribbon in January 1964. Not wanting operational control Bowerman asked for 49% of the company and effectively assumed the role of endorsing coach, shoe designer, innovator and de facto head of R&D.

Blue Ribbon grew and grew, with increasing sales and increasing orders, forcing Knight out of his basement HQ and into a run-down Portland commercial space. He progressively hired more and more staff, mostly from his connections in running and opened stores first in Santa Monica and then in Boston and Eugene. Time and time again the business operated on the fine edge between survival and bankruptcy with Knight having to work in parallel jobs as an accountant as well as teaching an accounting course at Portland State. Even with never ending cash flow issues, equity issues, banking issues and late shoe deliveries Knight and his ‘motley crew’ of die-hards never gave up finding solution after solution to keep the business dream alive.

Knight and his ‘motley crew’ of die-hards never gave up

In 1972 after issues with shoe supplier Onitsuka and worries of losing the distribution rights to the US, Knight and his Blue Ribbon Sports company decided to start building their own brand, with new designs and new factories to produce them. After bumping into a young artist in the corridors of Portland State and paying her $35 to do graphic design for Blue Ribbon, Knight let Caroline Davidson loose on a logo for the new brand. Something that would reflect an essence of motion, speed and being overtaken by someone very fast. And so the famous swoosh was born and refined from the sketches of Davidson’s sketch paper. Meanwhile under pressure to commit to a name for the new brand to be stitched into the tongues of shoe samples, Knight decided to go with Nike. Meaning victory in ancient Greek, it had inspired him whilst on his world tour in 1962-3 during a leg of his trip in Greece.

Nike. Meaning victory in ancient Greek

Nike was officially incorporated in 1976 by which time the new brand was already flourishing and growing rapidly. Knight and his colleagues at Blue Ribbon had beaten off a law suit with Onitsuka, had fended off an investigation by the FBI and had survived being thrown out by their long term bank, The Bank of California. With help from financing experts Nissho they had opened new factories, switched production from Japan (Nippon Rubber) to Taiwan and brought innovative new running shoe designs to the competitive running community and then to the public at large.

With the support of figures like Bill Bowerman, track star Steve Prefontaine and tennis star Ilie Nastase the name Nike had evolved into a US icon. Bowerman’s creativity in using his wife’s home waffle iron to produce a better outsole tread pattern along with his ideas on cushioned midsole design had triggered a new wave of running shoe innovation that consumers were desperately clambering for. And the rest as they say is history. An ageing and retiring Bowerman greatly affected like many by the untimely death of Prefontaine, drastically reduced his stake in the company. And eventually after years of deliberation over pro’s and con’s Nike became a fully-fledged publicly trading company in 1980.

[All quoted dates and specific events are taken from Phil Knight’s published memoirs available online or in his recent book]

M.Sc, MSci, B.Sc, CSCS, NSCA-CPT, XPS, CGS. Malc Kent is a professional coach, internationally respected applied scientist and former world class athlete. His services include sports coaching and mentoring, workplace coaching and biomechanics coaching.

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