This Omni Talk Retail Fast Five segment, sponsored by the A&M Consumer and Retail Group, Mirakl, Ocampo Capital, Infios, Quorso, and Veloq, examines Converse employees being instructed to work from home ahead of anticipated layoffs as Nike continues its broader restructuring efforts.

Chris Walton and Anne Mezzenga, joined by Jenn Hahn of J Recruiting Services, unpack what this signals about Nike’s long-term brand strategy, workforce management, and competitive positioning.

⏩ Tune in for the full episode here.

#Nike #Converse #RetailLayoffs #RetailWorkforce #RetailStrategy #OmniTalk

Converse employees have been instructed to work from home ahead of layoffs and restructuring at the struggling Nike Inc.

Brand.

According to Bloomberg, Converse CEO Aaron Cain announced that the company, quote, had had to make difficult decisions, end quote, which will include, quote, saying goodbye to friends and teammates, end quote.

With multiple senior executives departing, converse revenue plunged 30% in the last quarter and sales are headed towards a 15 year low, making it one of the biggest pain points at Nike right now.

Alongside the greater China region, the brand has remained heavily reliant on its Chuck Taylor shoe, while forays into other styles haven't quite taken hold.

Nike CEO Elliot Hill told analysts in December, quote, we're resetting the marketplace for Converse under new leadership, end quote.

Jen, we're going to you here to get your unique approach to this.

You really have, I think, the best, you're the best person we could be asking about this.

Is Nike taking the right approach here, asking Converse employees to work from home ahead of layoffs?

Tell us your thoughts about this approach.

I'm missing some information, right?

So I don't understand entirely.

Is it the, the entire Converse leadership team that was sent home while they're deciding who's going to be laid off, is it a select group like hey, here's 20% of our leadership team to go work from home?

Because that makes it pretty clear who's, who's getting cut.

Um, but with what we have, I would say it depends.

It depends on their long term intent here.

Um, some, the people making these decisions that they didn't invite us to the executive meetings.

Right.

They should have.

Um, but since they didn't, they know things that we don't.

Right.

So if the plan is everyone is getting cut, then I actually like the idea of saying, hey, go ahead and work from home.

While you have the opportunity to explore your next career path.

Talk to the recruiters from the comfort of your living room or your home office.

It's sort of a signaling and a grace, if you will, to those.

Now if the plan is 80% of these people are going to be asked to come back to the office.

If only 20% of these executives.

I mean that's just bizarre.

In my, in my mind, I think they might unintentionally lose some of the talent they, they plan to bring back after saying, hey, go ahead and go home, probably search for jobs.

We're not sure which friends and team members are going to be let go.

So I would say, I hate to give you a gray answer here, Ann, but it depends on some of the details.

I don't have.

If most of these people are going to end up back in office, I think it could present some odd cultural and just weird vibes when they come back.

Yeah, right.

Well, that's.

That's what I was wondering.

I mean, obviously you are.

We defer to you.

You're the expert on this.

But I feel like there's also a lot of fear and toxicity.

I think that happens when you're.

When you are in person during this environment.

Like, are people actually getting work done?

When there's, when you get this news and it's like we're just looming for the next few weeks, waiting for this to hit us.

So I wonder if I was thinking the same thing where you were saying, like, you know, can you be looking for jobs, for other jobs from comfort of your own home?

Not, like, trying to focus on doing work in the office and then also trying to search for other, you know, whatever your next.

Your next role might be.

So, yeah, I think.

I think what you're saying there makes a lot of sense.

Chris, I'm curious from your perspective, one, how do you feel about how they're handling these layoffs by asking people to work from home?

But also, I mean, what do you think this says about the future of the Converse brand and where Nike can take this if.

If anywhere?

Yeah, I think those are.

I think those are both great questions.

I think.

I think.

I think I disagree with how you guys are positioning this, although it feels like you're kind of both a little bit, like, you know, kind of still questioning it, too.

But, like, I think, you know, from my perspective, I think it's a very drastic move and it could be very culturally demoralizing, as you both said, like, if they have to return to office, that's not going to work.

So I'm kind of like, well, yeah, it might be nice for the employees to go home and have that free time, but, like, but you lose that option of bringing them back.

And that's where I worry about the cultural impact here.

But, you know, so to answer your second question, Ann, about the brand, I mean, what this tells me, and we haven't brought this up yet, is I think it sounds like they are trying to ready the table to divest the brand and sell it off.

And they've probably been trying to do that already.

My guess is they haven't had any takers.

Either they haven't had any takers thus far, or they are very close to closing the deal, because we've seen this before.

Like, I think about it, like, when you know, Spartan Nash and cns, you know, did their thing together.

A lot of the Spartan Ash executives were, you know, you know, transitioned, you know, ahead of that deal.

So it makes me think something like that is in play.

So to Jen, the point I agree with is like, if, if that's what's in play here, then it probably is the right move.

But unfortunately we just don't have enough information.

But that is the typical pattern we've seen on this show.

Doing it for eight years when this sort of thing starts to happen.

Right.

Yeah.

I mean, I question some of the things that we're seeing Converse do.

They just started a relationship, a wholesale partnership with Target not too long ago.

So that's another question that I have is like, how, how wide are you spreading your retailer partners and what does that mean for the cachet of the brand?

I mean, especially Shay Gil just Alexander, he's like the rep for Converse.

If he can't save the brand right now, he's like top of the top right now in NBA.

And if he's not, if it's not working for them with a, a rep like Shay, I don't, I just don't know, you know, how they continue to stay in, in this, this consideration set for the next generation of brands that they're going to want to be purchasing and getting involved with.

So that's, that's a big concern and, and hopefully somebody can come in through this restructuring and figure out what the next best move is for the brand.

But more importantly for the people who are, have been working on that brand too.

Yeah, and you're right, I mean, when you did the read too, when Chuck Taylor is one of the first things that gets announced, that's what always worries me because that's a very trend cyclical brand.

Like it's going to go up for periods of years and it's going to go down.

And they're in a period right now probably where it's down and to your point, they're not able to enliven it anywhere else.