Nike acquired Boston-based retail predictive analytics and demand sensing firm Celect to help the retailer predict consumer needs.
“As demand for our product grows, we must be insight-driven, data-optimized, and hyper-focused on consumer behavior. This is how we serve consumers more personally at scale,” said Eric Sprunk, Nike chief operating officer.
Celect’s cloud-based analytics platform will be integrated into Nike’s apps and website to enable quick optimization of inventory across its omnichannel business, using hyper-local demand forecasts.
“Our goal is to serve consumers more personally at scale,” Nike Chief Operating Officer Eric Sprunk said in an interview. “We have to anticipate demand. We don’t have six months to do it. We have 30 minutes.”
Sprunk said Nike could have spent two to three years trying to develop its own predictive analytics platform but decided to invest in Celect instead.
Traditionally, the company made inventory plans based on demand signals that came from wholesaler orders, but that paradigm is changing.
“It’s really difficult work…predicting the retail shopping patterns and behavior,” he said. “This [acquisition] gets us much more accelerated.”
As part of the deal, Celect personnel will join Nike’s global operations team. Celect’s co-founders will continue to work at the Massachusetts Institute of Technology while consulting for Nike.
The terms of the deal were not disclosed.
Nike has invested more than $1 billion in fiscal 2019, including investments in its sneaker app, new store concepts, its NIKE Plus membership platform, and enterprise-wide data and analytics projects.
In 2016, Nike bought the digital design studio Virgin MEGA. Then last year it bought Zodiac, a consumer data analytics firm, as part of its plan to accelerate a shift to online, digital sales.
The company said nearly 50% of incremental revenue growth this fiscal year has from NIKE Direct, the company’s direct-to-consumer division.
Nike said direct revenue makes up about 30% of its total brand revenue, and direct sales were up 12% in 2018.
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