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Nike Offers Free Digital Exercise Service

By Daniel B. Kline - Apr 6, 2020 at 8:43AM

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The company has chosen helping people stay in shape over profits.

Nike (NKE -0.88%) has seen its business slow to a trickle as its retail stores and most retailers that sell its products have closed due to the coronavirus pandemic. People may need some workout gear -- and they can still buy that online -- but it's pretty likely that very few people are buying new sneakers.

The athletic apparel and shoe company does have one product that's attractive to people forced to stay at home -- its library of online exercise classes. Usually, Nike charges a subscription fee for this content. It might have seen a spike in sales as a result of increased interest, but the company has chosen to go in a different direction.

A woman is exercising on a mat.

Nike has made its subscription service free. Image source: Nike.

What is Nike doing?

Nike has decided to make its online library free for anyone who wants to access it. It's a move the company says was inspired by the ways "people make sport a daily habit, even in the most challenging of times," according to a web post.

"To help encourage that further, programming from NTC Premium, a subscription-based service available in the U.S. that includes studio-style streaming workouts, progressive training programs (including bodyweight-only) and expert tips from our elite Nike Master Trainers, is now accessible at no charge," the company posted.

NTC offers a library of over 185 workouts that range from 15 to 60 minutes.

Why is Nike doing this?

While Nike may have been able to sell more subscriptions to NTC Premium, the revenue would likely not be all that significant. By making the service free, the company earns goodwill, tightens its bond with its customers, and earns more sales when the current situation passes.

Daniel B. Kline has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Nike. The Motley Fool has a disclosure policy.

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