🗞️🌇 Nike's Reboot, Cancer Labels on Alcohol, What's Next in the Saks-Neiman Merger, and The New York Knicks are on 🔥 👀

Good evening. It’s Friday, January 3 and our first newsletter of 2025! Thank you all again for signing up and sharing with your friends. I’ve also enjoyed hearing your feedback—please keep it coming! You can send feedback directly to me at [email protected].

Today, we are covering Nike’s future roadmap, the Surgeon General’s push for cancer labels on alcohol, the ins and outs of Kering’s business, the New York Knicks’ historic winning streak, and much more.

Best,

Rashad Drakeford

Co-Founder & Publisher, Good Diet

Nike’s Pivot

Nike’s new CEO, Elliott Hill, has unveiled an ambitious turnaround strategy focused on restoring the brand’s dominance in the sportswear market. With revenues down across all major regions and digital sales struggling, Hill’s approach emphasizes a return to sport-led innovation, stronger wholesale partnerships, and deeper community engagement. Despite short-term financial pressures, Hill is betting on a long-term transformation to revive Nike’s brand and business.

• Sport-Centric Strategy: Hill identified a key issue in Nike’s recent performance: the company lost its "obsession with sport." His strategy centers on reigniting this focus, putting athletes at the heart of every decision. Nike will reorganize its product development around "fields of play" (men’s, women’s, and kids), aiming for faster innovation driven by athlete insights. High-growth areas like running, training, and the Jordan brand are prioritized for near-term product launches.

• Rebuilding Wholesale Relationships: Nike’s shift toward direct-to-consumer sales caused friction with wholesale partners, leading to softened traffic and over-reliance on markdowns. Hill plans to rebuild trust with key partners like Foot Locker, JD Sports, and Dick’s by offering premium product assortments and creating a more integrated marketplace. Running and football specialty stores are earmarked for increased support to drive localized growth.

• Localized Market Investments: Drawing from his experience leading Nike’s geographic divisions, Hill plans to strengthen the company’s presence in its 12 key cities across 10 countries. While details remain sparse, Nike will initially focus on three countries and five cities to boost consumer engagement, strengthen partnerships, and build local brand affinity. This targeted investment is aimed at unlocking incremental growth.

• Near-Term Financial Impact and Long-Term Vision: Hill and CFO Matt Friend acknowledged that the immediate steps, including clearing excess inventory and reducing discounts, will pressure short-term revenues and margins. Q3 revenues are projected to decline by double digits, with Q4 also facing headwinds from foreign exchange issues. Despite these challenges, Hill remains optimistic, stressing that the strategy is about long-term brand health and sustainable growth.

Surgeon General Calls for Cancer Warnings on Alcohol

In a bold public health announcement, U.S. Surgeon General Dr. Vivek Murthy is calling for mandatory cancer warning labels on alcoholic beverages, highlighting increasing evidence that links even moderate alcohol consumption to several types of cancer. This push aligns with global trends toward greater transparency about alcohol’s risks and comes amid rising cancer rates linked to lifestyle factors. While Murthy's stance is supported by health experts, it faces fierce resistance from the alcohol industry, which fears the impact on sales and consumer perception.

• Surgeon General’s Focus on Public Awareness: Dr. Murthy’s proposal stems from findings that few Americans are aware of the cancer risks associated with alcohol. Current U.S. labels only warn about pregnancy-related risks and impaired driving, but do not address long-term health effects. Murthy argues that providing clear, science-based warnings is a critical step in reducing preventable cancers.

• Growing Scientific Consensus on Alcohol-Cancer Link: Health agencies, including the World Health Organization and the American Cancer Society, have emphasized that alcohol is a Group 1 carcinogen, placing it alongside tobacco and asbestos. Studies show that alcohol consumption increases the risk of mouth, throat, liver, breast, and colon cancer. Notably, experts say there is no “safe” level of alcohol when it comes to cancer risk.

• Lessons from International Efforts: Countries like Canada and Ireland have already moved toward stronger alcohol warnings. Canada introduced labels warning of cancer risks in 2017 but faced pushback from the alcohol industry, which led to a temporary halt. However, similar policies in Europe have gained momentum, with public health advocates urging governments to follow suit.

• Industry Opposition and Regulatory Challenges: The alcohol industry has criticized the proposal, warning that it could lead to economic fallout and job losses. They argue that current labels already inform consumers about key risks. Lobbying groups are expected to push back hard, possibly delaying or diluting any final regulations. Despite this, advocates note that earlier opposition to cigarette warnings eventually gave way to widespread acceptance as awareness grew.

Saks Fifth Ave-Neiman Marcus Merger: What’s Next?

The luxury retail landscape is set to undergo a seismic shift with the official merger of Saks Fifth Avenue and Neiman Marcus under the newly formed Saks Global company. While both brands will maintain their distinct identities, they’ll now share operations, logistics, and some backend resources. This merger signals a strategic move to navigate the volatile high-end retail market by leveraging scale and synergies while attempting to preserve their individual brand cachet. However, with the luxury market evolving rapidly, questions remain about whether this consolidation will strengthen both brands or dilute their exclusivity.

• The Merger Structure and Strategy: Saks Global will oversee the joint operations of both Saks and Neiman Marcus, allowing the two iconic brands to share supply chain management, backend systems, and digital infrastructure. While they will continue to operate as separate retail brands, the merger aims to streamline costs and increase efficiency in response to industry pressures and changing consumer behavior.

• Addressing Market Challenges in Luxury Retail: Both Saks and Neiman Marcus have faced significant headwinds in recent years, including shifting consumer preferences toward online shopping, a crowded luxury marketplace, and the lingering impact of the pandemic. By joining forces, they aim to scale operations, reduce redundancies, and better compete with luxury e-commerce giants like Net-a-Porter and Farfetch.

• Impact on Consumer Experience and Brand Identity: While the merger is largely operational, there are concerns about how it might impact the unique identities of each brand. Neiman Marcus, known for its personalized in-store service, and Saks, famous for its fashion-forward curation, will need to maintain their distinct appeals to avoid alienating loyal customers who value exclusivity and brand differentiation.

• Broader Implications for the Luxury Industry: This merger highlights a growing trend of consolidation in the luxury sector, where smaller or struggling players are being absorbed into larger entities to survive. It also raises the stakes for other high-end department stores and specialty retailers, who may feel pressure to adapt or partner up to remain competitive. Analysts will be watching closely to see if this move inspires more consolidation or sparks new innovations across the luxury retail space.

Israel Moves to Ban UNRWA

Israel’s recent legislative move to ban the United Nations Relief and Works Agency (UNRWA) could lead to a humanitarian crisis in Gaza and parts of the West Bank. The UN agency has long been a critical provider of education, healthcare, and basic services to millions of Palestinian refugees, but Israel accuses it of harboring militants. The uncertainty surrounding the ban has sparked international concern, with the U.S. and U.N. warning of severe consequences for Palestinian civilians if UNRWA operations cease.

• UNRWA’s Critical Role in Palestinian Communities: Established in 1949, UNRWA serves over six million Palestinian refugees across Gaza, Jordan, Lebanon, Syria, and the West Bank. In Gaza alone, it runs 288 schools for nearly half of the region’s school-age children and operates 22 medical clinics, handling millions of patient visits annually. Shutting down its operations could severely undermine education, healthcare, and basic aid delivery in Palestinian territories.

• Israel’s Criticism and Legislative Action: Israel’s long-standing tension with UNRWA stems from accusations that the agency perpetuates the refugee issue by allowing generational refugee status and that its facilities have been exploited by militant groups. Despite UNRWA firing several employees after investigations into their links with Hamas, Israel passed legislation to ban the agency, potentially halting its ability to coordinate aid in Gaza and the West Bank.

• U.S. Involvement and International Response: The United States, historically the largest donor to UNRWA, suspended funding in January following Israel’s accusations. However, U.S. officials have expressed concerns that banning the agency would cripple humanitarian efforts. Diplomatic pressure from Washington and other global powers aims to convince Israel to reconsider enforcement of the ban to avoid exacerbating the crisis.

• Impact on Refugee Camps and Local Communities: In Gaza and the West Bank, many communities rely entirely on UNRWA’s services. Without the agency, refugee camps face an uncertain future, with overcrowded public schools already struggling to accommodate students and medical clinics stretched beyond capacity. Residents fear losing their lifeline, with one camp resident stating, “Without UNRWA, I don’t know how we’d survive.”

My Knicks are on a run!

I’m going to take some editorial liberties today and highlight my New York Knicks (24-10) who are on fire, riding a nine-game win streak and winning 14 of their last 16 games, putting them within striking distance of the No. 2 seed in the East. With one of the NBA’s top offenses and significant defensive improvement, this is a New York team worthy of respect — and perhaps belief as a true contender. Tonight’s matchup against the league-leading Oklahoma City Thunder (28-5) will test just how real my Knicks are.

• Elite Offensive Firepower: The Knicks rank second in the NBA in effective field goal percentage, true shooting percentage, and offensive rating. They’re also top-five in field goal percentage, 3-point percentage, and free-throw percentage. With two top scorers in Jalen Brunson (25.2 PPG) and Karl-Anthony Towns (24.9 PPG), New York’s offense has been nearly unstoppable — they’re 14-2 when shooting over 40% from three.

• Defensive Turnaround: While their offense was always a strength, their defense has made remarkable progress. Over the past 16 games, the Knicks rank third in defensive rating, fourth in effective field goal percentage allowed, and second in opponent free-throw rate. This shift in defensive intensity has complemented their high-powered offense and elevated them to legitimate contender status.

• Thibodeau’s Defensive Revival: Known for his defensive prowess, Tom Thibodeau’s Knicks struggled defensively early in the season, ranking 24th in defensive rating through their first 18 games. However, Thibodeau’s system is starting to click, and the team’s defensive metrics have improved across the board, except for rebounding. If this balance holds, the Knicks could prove dangerous deep into the playoffs.

• A Streak Worth Watching: The current nine-game win streak is tied for the seventh-longest in franchise history. The stretch reflects consistency and dominance, with 17 of their 24 victories this season coming by double digits. If they beat OKC tonight, they’ll extend the streak to 10 and have a shot at tying the franchise record of 14 straight wins.

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