Now CONVERSE Has Become Nike'S "Secret Weapon".

Nike released its latest quarterly report.

Excluding the impact of foreign exchange rate, as of February 28, 2015, Nike's revenue grew by 13% over the same period, of which Nike's revenue increased to $6 billion 900 million, an increase of 11% over the same period last year.

Obviously, the overall growth rate of Nike is faster than that of Nike brand, and the reason for this difference is CONVERSE.

As of February 28th, CONVERSE's revenue in the last quarter reached $538 million, an increase of 28% over the same period last year.

Therefore, TheMotleyFool, a well-known US investment website, describes CONVERSE as a driving radar that lurks inside Nike.

For the substantial growth in CONVERSE's performance in the last quarter, Nike chief financial officer DonBlair said, "an objective reason is that some shipments in the fourth quarter are just ahead of this quarter. Of course, the key is to benefit from the rapid growth of North American performance.

In some parts of the European market, we have launched more direct channels, which are directly oriented.

The way is going strong. "

In addition, CONVERSE celebrates the 98 year marketing campaign of ChuckTaylorAllStar series, which has brought an important growth point for it.

"We have invested a lot in infrastructure and marketing costs, and CONVERSE has gained huge market demand."

DonBlair explains that these inputs are more effective from data.

Not only that, CONVERSE's recent growth is also related to brand litigation.

Over the years, a variety of plagiarism of CONVERSE canvas shoes has been seen in the market. CONVERSE, which has endured for a long time, finally made its own attitude clear last year.

In October 2014, CONVERSE filed a trademark infringement lawsuit against 31 competitors, including H&M, WAL-MART, FILA and other well-known brands.

CONVERSE said that they illegally use the core design elements of ChuckTaylor classic sports shoes and produce, sell or sell these Shanzhai products in batches.

In the face of large-scale plagiarism, Nike has tried to avoid lawsuits in the past few years, sending out warning letters only.

However, the more than 180 warning letters sent out in the past did not bring any effect. Nike and CONVERSE had to file a lawsuit against the federal court of New York.

Facts have proved that CONVERSE's legal proceedings are correct.

According to the February lawsuit report, some defendants have voluntarily reconciled with CONVERSE and stopped infringement, including H&M, ToryBurch, Zulily and RalphLauren4 famous brands.

Among them, the US fashion RalphLauren not only agrees to make economic compensation, but also destroys all the sports shoes, production template tools and related marketing information related to infringement.

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This progress will inevitably lead to the growth of CONVERSE's demand and the enhancement of brand influence.

More importantly, this tort lawsuit will solve the major problems that plagued CONVERSE for more than ten years, and enhance confidence in the brand can not be ignored.

Of course, up to 31 cases have not been completely ended, and there are many complicated and intractable cases.

It is hard to tell how much the litigation result will bring positive impact on CONVERSE.

However, one thing is certain that CONVERSE, which continues to increase its revenue, is more popular with Nike shareholders than ever before.

In 2003, when Nike decided to buy CONVERSE at a price of $305 million, most people were not optimistic about the prospect of CONVERSE's acquisition.

But everyone knows that Nike's acquisition of CONVERSE focuses on the resources and channels of basketball players.

Before 1980s, because of the lack of competition in the basketball market, CONVERSE was once the dominant NBA player in the United States, and CONVERSE basketball shoes on the playing field can be seen everywhere.

But not long after, brands such as Nike, Adidas and Reebok were rising. The old CONVERSE, who had known for a long time, had not enough time to react, and was thrown away in product technology and design.

The decline of basketball products has led to CONVERSE's failure.

In the year of, the annual sales of CONVERSE were only $205 million.

But after the acquisition of Nike, it first merged the remaining resources of CONVERSE basketball series.

Then CONVERSE's basketball shoes with low technology and relatively low price are taken as Nike's low-end products to attract young consumers.

In terms of players' endorsement, Nike will let CONVERSE sign some young players who are strong enough, and the business value of these players will be improved.

In short, CONVERSE is regarded as the "pitional board" of Nike on the basketball court.

In the end, smart Nike relied on CONVERSE's resources and brand's original technological strength to make it stand firm in NBA.

The CONVERSE brand has become a marginalized sports brand after its resources have been diluted.

In the years after the acquisition, CONVERSE could not find its way for the time being.

At that time, the situation of CONVERSE was quite similar to that of Reebok today.

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In 2006, Adidas acquired the lead in the US market in order to fight Nike in the US basketball and rugby fields.

Reebok.

There is no doubt that a strong purchaser takes the lead in capturing Reebok's resources on products such as basketball and rugby. Reebok's series of endorsements in the NBA arena have been replaced by Adidas.

Subsequently, in the brand building, Reebok gradually lost its characteristics, its business performance deteriorated, and lost the sponsorship contract of the American Professional Football League NFL in 2010.

So in the past two years, Adidas has pformed Reebok into fitness brand to help companies attract female consumers.

However, the persistent results show that Nike, Adidas and NewBalance brands are hard to turn around before Reebok's fitness field.

At the end of last year, there was news that Adidas would sell Reebok brand.

Although the company denies this, Adidas will not endure too long in the face of Reebok. It is likely to abandon the brand at any time.

CONVERSE is much more fortunate than Reebok.

After being weakened by the advantages and sports attributes of CONVERSE, Nike pformed it into a leisure fashion brand.

It relies on the brand superiority and beyond the hundred years of history.

Design, CONVERSE soon set off a craze among young people.

In fact, CONVERSE's acquisition of Nike also made up for a short board.

Prior to this, CONVERSE did not talk about technology and talked about canvas shoes. This strategy not only kept the product cost low, but also felt the highest value.

And the spirit of literature captured the hearts of girls in North America, Japan and Korea.

The classic canvas shoes 98th anniversary marketing campaign mentioned above is the embodiment of this strategy, creating many market demands for CONVERSE in the last quarter.

With the increasingly clear positioning and strategy, CONVERSE's growth momentum has been very strong in recent years. Its revenues in fiscal 2012 and fiscal year 2013 were $1 billion 324 million and $1 billion 449 million respectively. By 2014, its revenue rose to 1 billion 684 million US dollars, up 16.22% from the same period last year.

Now it seems that Nike has completed a successful investment.

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The revenue created for Nike in one year has almost doubled 6 on the basis of the purchase price.

It is foreseeable that in the long run, Nike will make more resources into CONVERSE.

At least, Nike will no longer "neglect" its secret weapon as it did 12 years ago.