{"id":4397,"date":"2015-12-09T01:22:00","date_gmt":"2015-12-09T06:22:00","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/oiselle-fighting-nike-to-become-nike-or-forging-a-different-path\/"},"modified":"2015-12-09T12:47:08","modified_gmt":"2015-12-09T17:47:08","slug":"beating-nike-to-become-nike-check-out-oiselle","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/beating-nike-to-become-nike-check-out-oiselle\/","title":{"rendered":"Beating Nike to Become Nike? Check out Oiselle"},"content":{"rendered":"

\"\"<\/a>
Olympian, US and NCAA Champion Kara Goucher is sponsored by Oiselle[1]<\/figcaption><\/figure>When\u00a0Oiselle (WA-ZELL) signed two-time Olympian Kara Goucher away from Nike in 2014, it\u00a0sent a\u00a0loud signal that the women\u2019s running apparel company was hungry for a bigger slice of the multi-billion-dollar activewear industry.[2]<\/a><\/p>\n

Oiselle, founded in 2007, has seen annual revenue growth exceed 100% since 2011.[3]<\/a>\u00a0Their trajectory is promising, but the\u00a0questions the brand faces in\u00a02015 are different and perhaps more challenging than\u00a0what they\u00a0were in 2007 (Is there a big enough market that cares about women\u2019s running? Can we compete on cost and quality with Nike and Lululemon?).<\/p>\n

The question for Oiselle in 2015 is how they will\u00a0continue continue delivering customer value through quality products and perceived authenticity while expanding operations to accommodate rapid growth.<\/p>\n

 <\/p>\n

 <\/p>\n

Creating Value<\/strong><\/p>\n

Oiselle designs and sells women\u2019s running apparel. Oiselle practices deep engagement with female athletes and shows a willingness to design exclusively for their lives. The brand has harnessed social media tools and superior inbound marketing content to become the cornerstone of a large community of athletes passionate about supporting women athletes, elite and casual both, in training and in life. The company, including the\u00a0CEO and many employees, use social media, race events and Oiselle-sponsored meet-ups to\u00a0speak directly with\u00a0customers about their professional and personal challenges. The company is built on a sense of authenticity that other brands, like Nike and Under Armour, strive for.<\/p>\n

Operational Strategies<\/strong><\/p>\n

Oiselle\u00a0sells\u00a0well-designed garments and a sense of community. Their communication delivery methods are always changing to optimize their consumer connection, while their\u00a0supply chain operations follow\u00a0a more traditional path.<\/p>\n

    \n
  1. Manufacturing and Product Development:<\/em>\u00a0<\/strong>Fabric sourcing and garment manufacturing happen primarily in China. Designs are developed in-house. Unlike competitors like Nike, Under Armour and Lululemon, Oiselle does not rely on technical materials R&D\u00a0but rather on simple\u00a0design improvements (pockets and zippers in the right places, for example) to add value. Many pieces are named after the athlete or employee who inspired the design.\n

    \"Among<\/a>
    In the\u00a0signature shorts collection are “Mac Rogas” (left) named after Marketing Director Sarah Mackay.<\/figcaption><\/figure><\/li>\n
  2. E-commerce and Retail Channels:\u00a0<\/strong><\/em>Since 2007 customers have been able to find Oiselle online at Oiselle.com and at retailers both online and in-store. Each of these channels accounts for about 50% of total revenue.[4]<\/a> Their current retail partners include\u00a0hundreds of\u00a0local running stores, Nordstrom and Amazon. Their e-commerce and social media presence provides a fantastic platform for reaching customers across the country and for connecting Oiselle fans with one another.<\/li>\n
  3. Flagship Store:<\/em>\u00a0<\/strong>Although the company has been tremendously successful at converting online followers into customers, they are now investing in traditional retail spaces (not unlike e-commerce players Bonobos, Warby Parker and Amazon).[5]<\/a> The company opened a Flagship Store in Seattle in 2015.[6]<\/a>\u00a0The store serves as a community event space and is helping\u00a0build strong consumer connections to the brand.<\/li>\n
  4. \u201cThe Flock:”\u00a0<\/em>Customers feel so connected to the brand that they are willing to pay $100 for a singlet and the privilege of being\u00a0Oiselle-branded\u00a0during races. The company and its fans\u00a0call\u00a0this privilege\u00a0joining\u00a0the Oiselle<\/em> Flock<\/em>.[7]<\/a> Because Oiselle capped Flock membership at 250, the company had to send away\u00a0hundreds of fans who were willing to pay to wear \u201cOiselle.\u201d CEO Sally Bergesen is currently developing a\u00a0vision of\u00a0what the Flock will look like in the future.<\/li>\n
  5. Elite Athletes\u00a0and a touch of rebellion:\u00a0<\/strong><\/em>Oiselle has equity agreements\u00a0with professional athletes Kara Goucher (previously with Nike) and Lauren Fleshman.[8]<\/a> They also sponsor a number of less-visible women who are training to compete on the world stage. Their heavy investment in athletes, despite their relatively small size, is\u00a0as a strong signal that the brand is\u00a0committed to helping women\u2019s running grow. Similarly, they are outspoken\u00a0critics of what they perceive as\u00a0opaque and arbitrary\u00a0national and international sport governance that are hampering the growth of the sport.<\/li>\n<\/ol>\n

    What’s Next<\/strong><\/p>\n

    Ultimately, Oiselle makes products that women runners love. They have built a successful brand in a highly competitive space by harnessing\u00a0their e-commerce and social media presence, and have show flexibility in operational design by developing\u00a0new customer contact points like the Flagship Store and The Flock, and by aligning\u00a0with admired female athletes. However, their\u00a0method of value delivery to customers will be challenged by inevitable operational expansion. When a flagship store that hosts Oiselle events is supplanted by tens or hundreds of stores across the country, will those stores mean as much to the female running\u00a0community? Will customers still feel personally connected to the brand if the CEO is too busy to\u00a0respond to their tweets and cheer\u00a0at their races? The\u00a0current operating model has supported eight years of strong\u00a0growth, but it may need to adapt to make the next eighty\u00a0possible.<\/p>\n