Alot has been on my mind lately as my heart goes out to the victims of the California wildfires. I can't feel the pain, but it's almost as if I can feel the heat. Not long before that, the terror attack on New Orleans shook me as the man had run down innocent people on Bourbon Street; the same place I would walk to and from work many nights a week, many years ago. Additionally, my mind tried to wrap itself around the Cybertruck explosion in front of the Trump Hotel in Las Vegas and the seemingly martyrish decisions of Luigi Mangione in New York. It's as though the world was inside a Birkin, and a third party seller on Walmart.com decided to flip it upside down and introduce the "Firkin" world to what it means to be "Wirkin" class. If you haven't heard about the Hermes drama, look it up. Collectively, this brought my mind back to a discussion assignment I had written last semester for Intro to Business on the topic, "What is killing our business?" Furthermore, what is killing America? Does it take a rocket scientist to figure that out?
I'm going to ask that you listen to the following songs prior to reading the article I wrote describing the mistakes of FootLocker, Inc.
Tom Ford - Jay Z https://www.youtube.com/watch?v=aPyKiog0vio
Lee Greenwood - God Bless The U.S.A. https://www.youtube.com/watch?v=-KoXt9pZLGM&list=RD-KoXt9pZLGM&start_radio=1
Intro to Business - Discussion 1 - What Is Killing Our Business?
It wasn’t long ago when shopping malls across America were bustling with shoulder-to-shoulder foot traffic, and Foot Locker was no exception. As DeAnn Campbell, head of strategy and insights for AAG Consulting, commented, “They have been king of the mall” (Lee, 2023). However, with the rise of e-commerce mixed with a combination of internal and external factors, Foot Locker’s popularity shrank into surfacing bankruptcy watch lists by 2024. According to retail analyst and consultant, Neil Saunders, Foot locker is the “most at risk of extinction of its peers” within a 50 year forecast (Fonrouge, 2024).
The most obvious external factor for previously popular stores plummeting has been the emergence of Amazon, categorically taking first place in sales. Foundationally, Amazon’s business structure is similar to Foot Locker. Both businesses are essentially a middle-man marketplace where various brands are sold under one roof. Unfortunately, the internal factor of Foot Locker’s failure to digitally adapt has increased company susceptibility to more damaging external factors than Amazon alone. Frank Bracken, Foot Locker’s chief commercial officer, admits, “As the 2020’s neared, the company got complacent and began taking its position as the market leader in sneakers for granted” (Fonrouge, 2024).
Foot Locker faced a wave of more serious decline beginning with the COVID-19 pandemic in 2020 which further cemented the public’s commitment to online shopping. What accelerated that devastation for the company in March 2022 was Nike’s decision to remove Foot Locker’s access to their most popular sneaker drops as part of their new e-commerce strategy. Foot Locker’s CEO Richard Johnson announced, “We’ll still have access, we’ll just see fewer units of those SKUs” (Jones-Gorman, 2022). Problematically, Nike branded products accounted for 70% of the business’s sales the previous year.
In a desperate attempt to protect Foot Locker’s integrity amidst potential humiliation, the company faced another brand breakup in October 2022 with their second largest partner. Similar to Nike, Adidas was not pulled from the company inventory entirely. However, following Kanye West’s shocking social media posts including statements such as he would go, “death con 3 on Jewish people” and accusations towards Sean “Diddy” Combs stating he is “controlled by Jewish people” Foot Locker made the decision to align with Adidas in relation to Yeezy. The company stated they would, “not be supporting any future Yeezy product drops, and have instructed our retail operators to pull any existing product from our shelves and digital sites” (Dellatto, 2022).
Conclusively, dependance on brand partners creates a vulnerable atmosphere for wholesalers such as Foot Locker in today’s economic environment. Similarly, reliance on big names such as Michael Jordan, LeBron James, and Kanye West to boost shoe sales and bring in revenue should not be the entire business plan of a company. The question remains, why do we as consumers need Foot Locker? Maybe they should create their own shoe that locks.
Works Cited
Dellatto, M. (2022, October 26). Foot Locker Drops Yeezy—Here Are The Companies Cutting Ties With Kanye West After His Antisemitic Comments. Retrieved from Forbes: https://www.forbes.com/sites/marisadellatto/2022/10/26/foot-locker-drops-yeezy-here-are-the--companies-cutting-ties-with-kanye-west-after-his-antisemitic-comments/
Fonrouge, G. (2024, September 23). How Foot Locker is waging a comeback after its breakup with Nike. Retrieved from CNBC: https://www.cnbc.com/2024/09/23/how-foot-locker-is-waging-a-comeback-after-its-breakup-with-nike.html
Jones-Gorman, J. (2022, March 2). Nike cuts ties with Foot Locker. Here’s where you can still buy the elusive sneakers on Staten Island. Retrieved from Silive: https://www.silive.com/business/2022/03/nike-cuts-ties-with-foot-locker-heres-where-you-can-still-buy-the-elusive-sneakers-on-staten-island.html#:~:text=The%20breakup%20announcement%20was%20made,brand%20and%20category%20diversification%20efforts.%E2%80%9D
Kavilanz, P. (2023, March 20). Foot Locker is closing 400 stores by 2026. Retrieved from CNN: https://www.cnn.com/2023/03/20/business/foot-locker-shutting-400-stores/index.html
Lee, T. (2023, May 24). Foot Locker Must Fix a Huge Hole Before Amazon Sinks the Retailer. Retrieved from The Street: https://www.thestreet.com/retail/the-shocking-reason-why-consumers-are-getting-cold-feet-at-foot-locker
Legal, L. (2004, December 16). Lambda Legal. Retrieved from Lambda Legal Reaches Settlement Agreement With Foot Locker in Antigay Discrimination Case: https://legacy.lambdalegal.org/news/sc_20041216_lambda-reaches-settlement-with-foot-locker
Roush, T. (2023, August 23). Foot Locker Shares Plummet 33% After Sales Decline. Retrieved from Forbes: https://www.forbes.com/sites/tylerroush/2023/08/23/foot-locker-shares-plummet-33-after-sales-decline/#:~:text=Shares%20of%20Foot%20Locker%20dropped,consumer%20demand%20and%20increases%20in
Xoxo, Yetti
P.S. Did Kanye actually mean Jewish people or Crip gang members? The Star of David is one of the symbols used by some Crip cliques, along with the pitchfork with the number 6.
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