Just Do It… with a Smaller Carbon Footprint: How Nike Uses Big Data

Big data collection has immense power to help large corporations predict how consumer behavior will shape the future, even in the face of various economic climates. But what about the actual climate? Nike is using its business intelligence to collect and use big data to help the environment while also selling more product.

By looking back at things like consumer loyalty, efficiency of supply chain, and how profitable collaborative relationships have been with manufacturers, distributors, and merchandisers, Nike can offer a better product for their fans and the planet alike. So how do they “just do it”?

big-dataBy better utilizing the raw materials they use to manufacture products, Nike is able to turn their “waste product” into something that can be used to produce other products, can be recycled, or sold to other vendors at a lower cost to them. In an age when being able to tell Millennials and Gen Y consumers how we’ve greened up, Nike has struck gold using data mining and by organizing its data history into an open source for managing inventory and all entities on their supply chain. That means less waste, more profit, and happier consumers who want to know they’re making the eco-friendly choice.

The fact that Nike’s materials sustainability index (MSI) is open source is a whole other giant step in the right direction. While it fosters a reputation of transparency for the company, it also allows licensed users to access information to create data sets of their own, enhancing the profitability of the little guy—which means Nike looks less like Walmart and more like Small Business Saturday.

Shockingly, Walmart was among the first in a line of other companies to add themselves to the roster of those now using The Sustainable Apparel Coalition—the entity that handles Nike’s big data for a sustainable supply chain. While it’s purely speculative to suggest, it’s a better bet that Walmart is greenwashing their in-house brand (Great Value) and other brands they carry, not going deep green. Nonetheless, if it helps the planet while helping lower the cost to consumers, it’s a win-win well worth the effort.

human-footprintBut with all these predictors in place, big data doesn’t just work at random to help Nike and others lower their carbon footprint. Now when designing a new product, those developing designs for shoes and apparel can make wiser choices that create less environmental impact based on what Nike has on hand, and how each of these materials will individually lower cost of production will also being greener. It doesn’t make them Tom’s shoes quite yet, but it does mean one step in the right direction that wouldn’t have been possible without the use of business intelligence and data harvesting.

What’s more, the open source tools implemented by Nike, Walmart and others also allows developers, designers, and project managers to see what other companies are up to when it comes to production. In the words of Nike’s vice president of sustainable business and innovation, Hannah Jones, “If someone has spent the last year working on ways to make a shoe-box more eco-friendly, I’d think that was stupid if I’d also spent the last year doing the same thing.”

The future shaped by big data on an open source network means big business can make better choices and limit their margin of error when it comes to sustainability. By helping each other through inventory and design transparency, companies who are a part of The Sustainable Apparel Coalition are changing how business is done and shaping a method for production that will hopefully soon be knocking on the door of small and medium-size ventures as well.