Nike’s Magic Man

I’m sitting inside the cupola dining room atop the Nomad Hotel in New York. A group of 10 has gathered for a private dinner. Among those at the table is a Wall Street Journal reporter, the celebrity magician David Blaine, and Mark Parker, the CEO of Nike. (Jared Leto shows up with two models during dessert.) Much to the amusement of everyone there, Blaine does rounds of tricks during the meal. Parker is noticeably observant, watching Blaine closely. The illusionist caps his routine by biting into a wine glass, chewing the shards to bits, and swallowing. We’re all awestruck.

About two months later, when I arrive on Nike’s 40-plus-building campus in Beaverton, Oregon, that evening still sticks in my mind. I quickly realize, though, why Parker was so taken with Blaine. It’s because, in a way, Parker is a magician, too. Through his own brand of magic, Parker continues to keep raising the bar for Nike.

When I mention Parker’s engrossment with Blaine’s sleights of hand at that dinner to Hannah Jones, Nike’s chief sustainability officer, she shows little surprise. That’s because Parker is the rare designer-turned-CEO whose background has led him to creating a similar sensation across Nike’s many orbits. Without him, the company wouldn’t operate the way it does. “There’s an interesting thing that happens here,” Jones says. “It’s slightly alchemy and magic. I can’t quite put my finger on it.”

It’s not easy to start a successful company, but some might say it’s even harder to keep up the momentum after it’s become established. That was the situation Parker faced upon becoming Nike’s CEO in 2006. In the decade since, the 60-year-old has excelled at taking on this challenge. Since cofounder and chairman Phil Knight passed the torch to him 10 years ago—and even well before that—Parker has been a vanguard. Under Parker’s reign, Nike has seen its sales more than double, and as of last spring, it now controls an astounding 62 percent of the athletic-shoe market, according to research firm NPD Group, compared to 5 percent for both Skechers and Adidas. The brand’s e-commerce platform, which currently surpasses $1 billion in annual sales, is expected to hit $7 billion come 2020. Almost 70,000 employees worldwide are now on the company’s payroll.

Nike’s campus, which opened in 1990, continues to expand in order to accommodate this bursting-at-the-seams growth. The company recently announced it’s adding 3.2 million square feet of office and mixed-use spaces. The expansion, scheduled for completion in 2018, is indicative of Parker’s ambition, though he insists “not crazy irresponsible” plans to generate $50 billion in sales within the next five years. That’s legacy enough for any CEO, but Parker continues into the fray with a focus on design innovation.

Roughly 700 designers now work at Nike. A little more than a year ago, it opened Blue Ribbon Studios (BRS), a small experimental design lab on its campus where I saw young whizzes creating everything from graphic screen prints to 3D-printed busts. What BRS actually does wasn’t clear to me—like most things involving production at Nike, its projects are kept under wraps—but it’s clearly an operation that’s meant to activate and inspire designers.

BRS is also a space helping generate ambitious projects, such as the one Nike plans to present at April’s Salone del Mobile design and furniture fair in Milan. Under the stewardship of John Hoke, vice president of Nike Global Design, the exhibition, called “The Nature of Motion,” will present 10 external designers, each of them creating work around the idea of natural motion and how that could be realized in an object or piece of furniture. Among the collaborators are Lindsey Adelman, Max Lamb, and Greg Lynn. Says Hoke: “We’ve been speaking about this for years: What if we were to explore abstractions of natural motion with several brilliant minds, showcase our exploration, and begin a dialogue about the body itself?”

It’s a question that could be applied toward much of Nike’s current thinking. These days, technology and digital are significantly impacting the design side, with data from athletes helping the company continually push the limits when it comes to materials, manufacturing, knitting, and more.

Perhaps no Nike innovation over the past decade has embodied this ethos more than the Flyknit shoe, first released in 2012 following the 2008 launch of the Flywire. In the four years that have passed since its launch, the shoe has become ubiquitous. Nike’s running apparel and footwear, in large part due to the Flyknit, is slated to reach $7.5 billion in sales by the start of the next decade.

Increased efficiency and organization is another reason for the momentum. The company’s Global Running Footwear department—which its vice president, Phil McCartney, says is working on as many as 25 projects at any one time—now operates on a single, recently redesigned floor, bringing its marketing, engineering, development, wear-testing, and materials teams together in one place for the first time. “The idea of creative collaboration is big for us,” says McCartney, who has worked at Nike for 18 years. “We’re trying to not make things discreet from each other.”

The new Lunar Epic running shoe, featuring a mid-height collar, exemplifies the innovation coming from McCartney and his team. Pushing the Flyknit technology even further, it implements “laser siping”—which facilitates midsole cushioning and flexibility—for the first time in a Nike shoe. “In the same way that Flyknit was brand-new to the footwear space,” McCartney tells me, “laser siping is the latest for us to explore.”

Sustainability is another commonly used buzzword in the Nike-verse. It’s something Parker takes seriously. In 2014, his appointment of Hannah Jones as the company’s first-ever chief sustainability officer may not have made headlines, but in the two years since it has created a ripple effect within the company. Since arriving at the Oregon campus in 2004, Jones has been making change at all levels. “Sustainability and innovation are both the most abused and misused words in the universe,” she says. “They’re completely interchangeable.” Through her constant asking of “What if…?” Jones has proven herself to be an instigator for fresh thinking.

A key example of Nike’s latest sustainability efforts is the Flyknit, which the company claims has saved more than 3.5 million pounds in waste over the past four years. Another is its partnership with Dyecoo, a Dutch startup developing methods for dying materials without the use of water. Parker has proven to be a supportive leader of Jones’s ambitious mission. “There’s no other company that has a CEO who comes at problem solving through the lens of design and innovation,” she says, “and is so tactile in his approach and understands the actual reality.”

Parker grew up in Stamford, Connecticut, the son of an IBM engineer father and a psychiatric nurse mother, one of seven siblings. From the start, he was creative and an explorer. “We lived near an estate that was 500 acres of nothing other than woods and lakes,” Parker says. “I spent a lot of time just wandering around.” On long walks he would collect things—rocks, shells, bugs. His grandmother, who he cites as one of his greatest influences, was deeply knowledgeable about nature, and shared that passion with him.

His father also instilled an inquisitive nature in him. “Growing up,” Parker says, “whenever I asked my father ‘What do you think I should do?’ he’d say, ‘Well, what do you think you should do?’” At Nike, it’s Parker’s way to ask employs what they think, not necessarily giving them his thoughts outright.

Parker attended Penn State, where he studied political science and was on the track and cross-country teams. There, designing shoes quickly became a part of his life. “I would modify my shoes to try to make them better,” he tells me. To achieve this, he’d do things like altering the outsoles for more traction, fixing the uppers for more support, and changing the sock liners. Only later did Parker realize this shoe-tweaking practice was rather unusual, or at least for the time it was. To him, doing so simply felt intuitive.

The transition to working at Nike was natural. “Mark isn’t really a trained designer in the sense there is a shoe-design school,” Phil Knight says. “He just always had a bent for this, and was there in the beginning when we set up a design and development department.” (Knight recently recommended Parker to replace him in the chairman role after Knight steps down later this year.)

Early on, even while designing shoes, Parker was tasked with starting up other areas of the company. “I’d see a need or something that could help the company be better, and I had the freedom to go and create it,” he says.

Today Parker continues to bring startling results. Nike has been growing steadily at a rate of 10.5 percent since 2010, and its profits in 2015 were more than $3 billion—nearly 11 percent of revenues. In the 10 years since he became CEO, the company has made incredibly large strides. “One of the big phases we went through, in 2009, was the creation of the category structure: Basketball, Running, Tennis, Soccer, and so on,” Parker says. “It used to be that we were more organized by function, so sales would sit in one place, marketing in another, and product in another. They were all disconnected.” It’s just one of the many big moves—a large portion of them inward facing and not obvious on the surface—to go into effect under Parker’s watch.

“Nike’s gains and profits have been relentless and consistent [during Parker’s tenure as CEO],” says Allan Brettman, a reporter at The Oregonian, of Nike’s growth over the past five years. Brettman, who handled the paper’s sports-apparel market coverage from 2010 to 2015, continues, “Parker often says Nike is a ‘growth company.’ The stock analysts chuckle at that in that it’s quite a mature company, but having grown so much since 2010, for Parker to come back last year and say the company is going to grow another $20 billion by 2020 is pretty aggressive for a so-called ‘mature company.’”

Says Robert Burke, a fashion consultant in New York: “Nike has changed or penetrated the day-to-day life of the customer, and it’s not just a product anymore. The only brand that I can liken that to is Apple.”

Finding the smartest ways to embrace technology—and collaborate with the juggernauts of Silicon Valley—has been another focus for Parker. Admittedly, Nike has taken some missteps over the decades in trying to create proprietary technology products, from the fanny pack–like Monitor of 1987, to the forgotten MP3 player of 2002, to the Nike+ activity tracker (which morphed into the Fuelband of 2012).

“It’s interesting how the sweet story of the Fuelband’s failure to catch on hasn’t really been written,” says Brettman, the Oregonian reporter. “The fact it didn’t do what it said it would do has something to do with the product’s failure, but it also got beat out by players like Fitbit.”

Today, it’s clear to Parker that it’s not Nike’s place to compete with “the Apples, Intels, Microsofts, Googles, and Samsungs,” as he describes them. Instead, he views partnerships with those sorts of companies as the best way forward. Collaboration, whether with Apple, Michael Jordan, or the rapper Skepta, has long been a core interest of Parker’s. He has found joint efforts—including those at NikeLab, for which the company has worked with labels and designers like Stone Island, Sacai, and Riccardo Tisci—particularly effective in bringing fresh creative energy to the brand.

One collaborator Parker feels closely tied to is the New York artist Tom Sachs. In 2012, Sachs and Nike launched the NikeCraft project combining the former’s DIY aesthetic with the latter’s technical skills in the form of a shoe, trench, jacket, and tote. (The products appear in Sachs’s film A Space Program, which premiered in New York in March.) “There’s a lot of respect, and with respect there’s a lot of ribbing on both sides,” Sachs says of his relationship with Parker. The two are currently at work on their next concept, which Parker says is “something that’s close to [Sachs’s] personal passion and also relevant for Nike.”

Among Parker’s longest partnerships is the HTM shoe series, for which he works with the cultural consultant Hiroshi Fujiwara and the designer Tinker Hatfield, who’s Nike’s Innovation Design and Special Projects vice president and has been designing footwear for the company since 1985. HTM (its initials represent the first names of each design partner) launched in 2002 and remains a crucial creative outlet for Parker. More than 30 HTMs—with names like the Solar Soft Sandal (2010), the Zoom Macropus (2006), the Flyknit Racer (2012), and the Free Mercurial Superfly (2014)—have launched over the years, the latest three of which debuted in March.

Athletes and celebrities remain the most obvious and highly publicized collaborators at Nike. Some of them, like Jordan, LeBron James, and Kobe Bryant, have their own lines that bring both the company and athletes rewarding payouts. Sometimes, though, the deals can go awry. Take Kanye West’s departure to Adidas after initially launching the Air Yeezy with Nike; about a year ago on The Ellen DeGeneres Show, West said he felt “suffocated” by the partnership. In his new song “Facts,” he raps “Nike treat employees just like slaves.” When Michael Jordan recently made a public complaint about the song, West tweeted in reply, “I’m sorry Michael Jordan. I love and respect you. My beef was with Mark Parker.” (For other semi-problematic partnerships, see: the scandals involving Maria Sharapova, Tiger Woods, and Lance Armstrong, or the recent accusations involving Nike paying Kenyan running officials a $500,000 “commitment bonus.”)

The trickle-down effect of Parker’s presence across the company continues to drive Nike onward and upward. Rather than managing in an overtly top-down way, Parker has surrounded himself with a team he trusts, empowering them to do their best work, while also coming with his own big ideas. He has built things in such a way that the company’s results, much like its products, need no explanation.

“You know when you go into a museum and all the people are reading the plaque on the wall?” Sachs tells me. “A really great object doesn’t need a plaque. That idea is something that Mark is always bringing to the table.” Sachs goes on to reference a quote from William Strunk Jr. and E.B. White’s The Elements of Style: “A sentence should contain no unnecessary words, a paragraph no unnecessary sentences, for the same reason that a drawing should have no unnecessary lines and a machine no unnecessary parts.” That, Sachs believes, sums up Parker’s mantra for managing Nike.

Over the decades, no matter how messy things have gotten at Nike, Parker’s been able to figure out the tricks of the trade while also inventing new ones. That’s his magic. Just like David Blaine spends years to master various moves, making sure they’re flawlessly brought to life, so does Parker. The only difference is Blaine practices in illusions; Parker’s game is producing products. It’s why Nike continues to evolve: Parker keeps delivering surprises.