Dive Brief:

• Nike on Wednesday announced a new store concept, Nike Rise, with the first in Guangzhou, China. The retailer describes the concept as a store that "responds to the pulse of sport in a Member's city," according to a company press release.
• The Guangzhou store opened on Thursday, and Nike plans to introduce more of the concept to its fleet in 2021. Nike Rise joins the list of Nike's other digitally-focused store concepts, including Nike House of Innovation and Nike Live.
• The new concept is pitched as a "digitally-enabled journey" that reacts to data from members and to "real-time sports moments" in the city. It will feature a Nike By You personalization bar and a new app feature, Nike Experiences, which "turns the city into a digitally-enabled playground for members."

Dive Insight:

Building on the store strategy embodied by its other concepts, Nike Rise relies heavily on digital and experience to drive consumer interest.

The Nike Experiences feature being introduced to Nike's app connects Nike loyalty members in Guangzhou to "weekly sport-minded activations" and also gives them access to in-store workshops and events. The athletics retailer also positioned its new store close to Tianhe Sport Center, noting that members can "plug into events … with Nike experts and Master Trainers." Members will receive rewards tied to the sports they like.

The retailer is also introducing its Nike Fit shoe size technology to the store — the first time it's brought the technology to Greater China. The news comes just a couple of weeks after Nike reported fourth quarter earnings results, and with them, plans for up to 200 small-format stores, in the image of Nike Live.

Digital figured prominently in Nike's most recent earnings results, with the channel accounting for nearly 30% of total business in the quarter. While the retailer initially had a goal of hitting 30% digital penetration by 2023, executives said they expect to achieve that by 2021 thanks to acceleration by the pandemic, and now expect digital penetration to reach 50%.

Nike's store concepts also further the retailer's direct-to-consumer strategy. CEO John Donahoe on a conference call with analysts explained that the strategy will rely mostly on Nike Digital and Nike stores, with a select number of retail partners thrown into the mix. Making some in-store experiences unique to Nike members could also draw more consumers into the retailer's loyalty program, and therefore, the Nike ecosystem.

Experiential stores are swiftly becoming a defining feature of the athletics space, as retailers look to create meaningful connections with their customers instead of purely transactional ones. Lululemon is another retailer in the space that has played around with adding experiential elements to its stores, including a meditation studio in New York and two experiential megastores in Chicago and the Mall of America, which could eventually grow to be 10% of the retailer's footprint.