Nike Teams Up With Kim Kardashian To Launch NikeSKIMS: Can This Celebrity Collab Alleviate Slumping Sales?

While Nike may have taken the branding crown, particularly concerning footwear, during years past, in more recent times the company has found itself struggling to retain market share against an increasing number of competitors hungry for its market share. Sales have slumped, the company has shed about 25% of its value over the course of the past year, and Nike's new CEO — Elliott Hill — is in the midst of a significant turnaround effort, as CNN detailed.

Now, the athletic company is partnering with Kim Kardashian-founded SKIMS to create a new brand and product lineup under the name NikeSKIMS.

“We’re energized by the opportunity to build a new brand and shake things up for the next generation of athletes with NikeSKIMS,” Heidi O’Neill, president of consumer, product, and brand for Nike, wrote in a press release.

“This partnership brings together the best of both brands and unlocks an incredible opportunity to disrupt the industry with our shared passion and commitment to innovation. We will invite even more athletes into sport and movement with product that makes them feel strong and sexy," she added.

For its part, SKIMS appeared centering on allowing the two brands to coexist and flourish in the activewear market.

"Over the past five years, SKIMS has redefined the intimates and casual apparel landscape, championing inclusivity and confidence,” says Jens Grede, co-founder and CEO of SKIMS.

“Now, by partnering with Nike, the undisputed leader in athletic performance and innovation, we’re poised to create a new standard in the activewear market. This partnership will empower individuals to move with confidence and express themselves authentically, merging SKIMS' focus on body confidence and self-expression with Nike’s relentless pursuit of athletic excellence," Grede continued.

The partnership with SKIMS represents a first for Nike, as the latter company had never partnered with another entity to create an entirely new brand before, per CNN. And while celebrity endorsements — famously, NBA legend Michael Jordan — are part of the brand's long-term strategy, this partnership represents a deeper commitment.

Nike and SKIMS Focused on Reinvigorating Its Women's Business

With competitors in the athleisure and athleticwear business — notably Lululemon and Alo — performing very well with women, Nike also indicated that this partnership with Kim Kardashian-backed SKIMS could signal a strengthening of its commitment to female athletes, and women more broadly.

“Nike and SKIMS share a deep commitment to innovation, inclusivity and pushing boundaries, driven by an unwavering belief in the power of women,” Kim Kardashian, co-founder and CCO for SKIMS, said.

“This partnership is the culmination of that shared vision, delivering product that is meticulously designed to sculpt and perform for every body. Every single detail has been obsessed over and carefully considered. We’re incredibly excited to unveil our first collection this spring,” the reality star and entrepreneur added.

Analysts added their own takes on the emerging collaboration, including Neil Saunders, managing director at GlobalData Retail and a member of the RetailWire BrainTrust.

“In theory, Nike should have all the skills needed to drive its own brand in womenswear, but the reality is it has lost some of its ability to story tell, innovate and wow consumers,” Saunders told CNN. “Partnering with SKIMS remedies some of those weaknesses.”

Pivoting to address market saturation issues in comments made to WWD, Saunders commented on the slowing of the broader segment. He warned that both brands must intensify their efforts to establish themselves in a market that is "already very crowded and where even brands like Lululemon are seeing slowing growth in North America because of market saturation."

As WWD underlined, SKIMS has had a long line of successes since its launch in 2019. The privately held company is currently valued at more than $4 billion, and although it began its journey as an inclusivity-focused intimates lineup, it has since expanded its offerings into swimwear and activewear. SKIMS also currently operates six stores and is rumored to be considering an IPO after reports surfaced that it had been eying one in 2024.

Nike Stock Ticks Upward on SKIMS Collaboration News, But Zacks Sees Headwinds Remaining

A Zacks Equity Research report was largely complimentary in its analysis of the NikeSKIMS news, with Zacks gesturing toward Nike's recent stock outperformance.

With the announcement fueling a stark jump in Nike's shares (9.5% over the past month, and 6.2% on Feb. 18 alone) and allowing Nike to outperform the industry's growth more broadly, it appears investor confidence is somewhat high over the prospects of the new product line.

Pointing to anticipated headwinds in the Greater China market — where Nike is heavily invested — as well as "sluggish sales across men’s, women’s and Jordan categories, prompting adjustments to inventory and product timelines," Zacks nonetheless did not adjust its sell rating.