Companies that make shoes are numerous, and most of them are basking in net worths of several millions in dollars. However, there seem to be manufacturers in the shoe and apparel industry that have mastered the art of shoemaking. If you are looking for shoes that provide you with precisely what you’re looking for, these top companies have them. Also, if you want more than just the basics; you want style, elegance, originality, technology, innovation, etc., they are also well equipped in that regard. Companies such as Nike and Skechers fall right in this category. They compete for the same market, and that’s why you see a lot of Skechers vs Nike debates these days.
If you’ve ever argued about these two companies, or have ever wondered which of their products to buy, or you just want to know what these two brands are about, then you’ve come to the right place. We have a comparative analysis of these brands. We look at them individually, and what they stand for, we compare them in light of their differences and similarities, and we’ll also check what they have to offer in terms of product. Finally, we’ll draw the line between them so that you can make informed decisions from now on.
- Skechers History—Development and Evolution Till Date
- Nike History—Development and Evolution Till Date
- Skechers vs Nike: Head-to-Head Comparison
- Significant Differences between Skechers and Nike
Skechers History—Development and Evolution Till Date
In 1992, Robert Greenberg established what we know today as the successful brand called Skechers. He saw a huge market gap and decided to bridge it. That’s because he had co-founded L.A. Gear—a tennis shoe designed to favor the female audience. L.A. Gear for many years recorded successes and was grossing over $900 million in sales annually. However, in 1992 things came tumbling down with a massive loss in market share. Then, the company let Robert and his son go—forcing them out. That wasn’t the first significant business shift and taste of unpredictability for Greenberg. He had prior experience from various retailing roles, such as importing designer jeans, selling wigs to beauty parlors, and founding a roller skate store.
The Birth of Skechers
L.A. Gear had a lock on producing women’s athletic shoes while Nike dominated the men’s athletic wear market. So, when he was forced out of L.A. Gear, it didn’t necessarily phase him, as he went on to start the company we know today as Skechers. While working for L.A. Gear, he had his eyes on the gap—the bias in the shoe industry towards casual street shoes. Greenberg designed Skechers to fit into the casual street shoe category for men and women. That was the beginning of the Skechers vs Nike war as we know it today. Though Skechers was initially supposed to be a distributing outlet for Dr. Marten’s shoes, in the span of one year, Greenberg raised money to focus on designing, developing, manufacturing, and producing his unique brand.
He partnered with other brands such as Cross Colors and Karl Kani. By 1993, Skechers introduced a shoe designed and manufactured to appear scuffed and well-worn to refine the label. That was in the likeness of the pre-tone, stone-washed jeans reigning at the time. It looked like the footwear version of those jeans, and because of its unisex look, it appealed to people of both sexes and soon became an urban street boot icon for the young and hip consumers.
What’s Skechers Today?
Today, Skechers is a global leader in footwear. It’s a two-million-dollar brand with stores scattered across various countries worldwide. It has over three-thousand styles designed, developed, manufactured, marketed, and sold. A majority of these designs focus on two broad categories, namely; Lifestyle and Performance. The brand’s focus and target market cover everyone, including children.
For lifestyle, the idea is to offer Memory Foam such that the shoe contours to the uniqueness of your foot for ultimate comfort. While for performance, Skechers divided the style into two subcategories, GOrun— the design that offers technological innovation to facilitate a midfoot strike for runners. They have to cushion for impact protection. GOwalk is the category that gives GOga Mat—the technology that boasts a high-rebound cushioning effect. They also include other materials designed specifically for athletic walking.
Nike History—Development and Evolution Till Date
Nike as a brand has not only managed to carve a niche for itself in the footwear industry at large; it has also loomed large over the industry. The brand has built itself up to this level by leveraging the power of sleek designs, high-profile endorsement, and P.R. campaigns. Nike has successfully used a combination of these marketing strategies so much that it has etched its way into pop culture and history. Today, even amid several Skechers vs Nike debates, many know Nike as celebrities such as Lebron James, Michael Jordan, or Tiger Woods endorse the brand to a significant extent. Who would have known that a brand that began as an inspiration from the story of a self-described average track runner would grow to be this big? So big that great personalities such as Lebron James and Tiger Woods would not mind associating with it.
The Birth of Nike
It all started in 1964 when Phil Knight—then at the University of Oregon—ran for the track and field team. According to Phil, his coach, Bill Bowerman, had a thing for enhancing his runner’s shoes. This incident spurred Phil’s love in shoe development. He constantly tinkered through different shoe models in line with what he had learned from a local cobbler. Knight said Bowerman tested the first shoe model on him since he’s considered a safe bet.
When he was to write his paper at Stanford’s University M.B.A. program, he wrote on the theory that the production of running shoes should move to Japan as opposed to the current center in Germany—because labor is cheaper in Japan. He put his idea to test by traveling to Japan shortly after graduation with a group of Japanese businessmen to export Tiger shoes into the U.S. He got support from Bowerman, who believed the German shoes, which were the best at that time, were not all that special to be replicated or improved upon. So, they agreed on a 50-50 business ownership deal and began the Blue Ribbon Sports Company.
However, after a while, business tension began to set in. Phil could no longer see the possibility for expansion with the Japanese business group. That’s because, in 1965, Bowerman had designed a new shoe to provide proper support for runners—it had a cushioned innersole, a soft sponge rubber in the top of the heel, and the forefoot—called Tiger Cortez. The shoe became a success and competed with the already established brands—the Pumas and Adidas. However, business issues soon began to occur between Blue Ribbon and its Japanese partners. Eventually, the two split in 1971, and that was how Nike began as a full-fledged brand.
What’s Nike Today?
Nike—a company that started with an interest in shoemaking—today has grown and diversified into other sectors within the industry. It now produces a wide variety of footwear, apparel, and accessories and provides services. Currently, the company is worth over $30 billion with over $20 billion in total assets, with over 700 shops worldwide and offices in over forty countries beyond its country of origin—America.
With the passion and continuous commitment to development, Nike doesn’t seem to want to stop anytime soon. Since its first start on the West Coast of America, Nike has continued to expand its horizon, and as it stands, there’s no doubt that the company will continue to grow and do better in the future.
Skechers vs Nike: Head-to-Head Comparison
Skechers and Nike have always been at loggerheads. They compete mainly for the same share of the market. Nike claims to be the senior in this business, and Sketchers seeks to outshine Nike in the same market. This tussle has played out over the years and is a massive back-and-forth between both companies which sometimes includes lawsuits and literal marketing campaign wars. If we are to compare both companies in the past years, we will come up with the following:
Head-to-Head Comparison of Both Brands
- Nike has less than forty percent of its annual sales and revenue coming from North America. In comparison, Skechers seems to dominate that region, with over forty-five percent of its sales coming from the area annually.
- On the other hand, Nike has its stronghold in China—China has been one of the world’s fastest-growing markets for apparel. Skechers is also growing in China; however, things are not as smooth with Nike limiting its presence in the region.
- Nike has a substantial annual turnover and a healthy balance sheet, with the company comfortably recording over $8.8 billion in the last report as cash reserves. Skechers cannot boast that much in cash reserves with only about $1.5 million to spare.
- Sketchers is a company with a primary focus on designing, developing, manufacturing, and distributing footwear. At the same time, Nike has a more extensive coverage—its product portfolio includes footwear, apparel, eyewear, and other accessories. That contributes mainly to why Nike beats Skechers in annual revenue and cash inflow.
- Nike is big on the digital network, with an over 75% increase in the fourth quarter of 2020. That led to a double-digit rise across all locations and geographies. That accounted for about thirty percent of its total revenue annually. Skechers also does digital networking; however, Nike wins the Skechers vs Nike comparison in this regard.
- Finally, Nike’s stocks currently outperform those of Skechers. Nike’s P/E increased from 40x to about 43x in 2020, while Skechers’ P/E plummeted from 19x to 13x in the same year. Nike’s solid digital network mainly contributes to the increase. They also invested heavily in brand presence, marketing, and campaigns.
Significant Differences between Skechers and Nike
Both Nike and Skechers are great brands that have gained popularity among men and women alike. Though they operate almost the same market, they have clear-cut differences, which include;
- Nike is an American-based multinational company in the worldwide design, development, manufacturing, marketing, and sale of apparel, accessories, and other services. On the other hand, Skechers is U.S.A. based and is basically into production, marketing, and sale of lifestyle and performance footwear.
- Nike is headquartered in Oregon, Beaverton, United States, while all Skechers operations originate from Manhattan Beach, California, United States.
- Nike.com is the official website for Nike where all buying, selling, and discount giving takes place. On the other hand, Skechers conducts its buying and selling operations on its official website, which is “skechers.com”
- Skechers only deals with products such as footwear and apparel. In contrast, Nike deals with footwear and apparel products that have to do with recreation and athletics, as well as accessories and service provision.
Though Nike shoes, footwear, sneakers, etc., are bought more often because they are less expensive, Nike and Skechers are great brands. They seem to know their holdings in the business and have their fair share of the market value. However, the Skechers vs. Nike war is not only a fire the fans ignited; it’s a real one between the brands as well.