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Research Case Study Report on Nike Inc.


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Table of Contents
Introduction ..................................................................................................................................... 3

Company Overview of Nike, Inc. ................................................................................................... 4

Identifying and analysing the market for Air Max 1 ...................................................................... 6

Explaining and justifying how Nike was developed and for what market ..................................... 8

The significance of creativity and innovation ............................................................................... 11

The initiatives that Nike takes....................................................................................................... 12

Critically assessing the marketing plan of Nike ........................................................................... 15

SWOT Analysis of Nike ........................................................................................................... 15

PESTLE ANALYSIS OF NIKE ............................................................................................... 16

COMMERCIAL AWARENESS OF PRODUCTS .................................................................. 19

Marketing purposes ................................................................................................................... 20

Main strategies .......................................................................................................................... 21

Control ...................................................................................................................................... 21

Budget ....................................................................................................................................... 21

Market Trend and Implementation ............................................................................................... 22

STP (Segments, Targeting and Positioning) ............................................................................. 22

BCG Matrix .............................................................................................................................. 22

The Grand Strategy Matrix ....................................................................................................... 24

Marketing mix and 4P’s ............................................................................................................ 25

Recommendation .......................................................................................................................... 27

References ..................................................................................................................................... 28
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Introduction

Marketing research refers to the course of analysing the viability of an afresh product by a research
run directly with the consumers that authorizes a business-company to realize the target market
and record thoughts and other inputs from the consumers concerning their interests in the
product(Nair, 2009). It may be run by the company itself or a 3rd party. The objective of it is to
assess the market linked to a certain product to determine how the consumers will accept it. This
can contain info accumulating for the objective of the market segmentation and product
differentiation that can be applied to modify publicizing efforts or determine that aspects are
observed as a prior to the consumers.

Here, our group will run a market research based on Nike related to its operations, products,
marketing strategies and other factors that influence the company.
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Company Overview of Nike, Inc.

It is recognized as an American Multinational Corporation. It is involved in the design,


improvement, manufacturing, global marketing and auctions of sports products (Hays, 2000). It is
one of the leading merchants of athletic shoes with apparel and a prime producer of sports gears.
It has total revenue of US$24.1 billion in 2012. A total of 44000 individuals work for the company
globally. The brand value of the company was $19 billion in 2014. It was built in 1964 by Bill
Bowerman and Phil Knight (Hays, 2000). It was official become Nike in 1971.The company
functions retail stores under the name of Nike town. It has sponsored many high profile athletes
and teams such as Cristiano Ronaldo as an athlete and FC Barcelona as football club.

Vision Statement

“To Bring Inspiration and innovation to every athlete in the world” Nike Inc

If you have a body, you are an Athlete - add by the Bill Bowerman Co-Founder of Nike,

Mission Statement

To lead in corporate citizenship through proactive program that reflects for the world family of
Nike, our teammates, our consumers and those who provide service to Nike.

Main Goal of theses vision and mission is Nike want to deliver a quality produce, which is
dependable, and fulfil all the purpose of their consumer as in every athlete.
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The trademark of it is “Just Do It”. The most famous products of the company’s are Air Max 1,
Air Force 1, Air Jordan III, Air Max 95, Foamposite One, Air Max 2017, Free RN 2017 and others.
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Identifying and analysing the market for Air Max

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In 1987 Nike was introduced their 1st product. Nike’s eventual success bought by the Nike Air
Max and stands as one of the maximum prosperous in such case of verbalizing operations in history
of sneaker (Russ Bengtson et al., 2017). As this augmented bigger, the designer of it, Tinker
Hatfield was met with an obstacle related to the superior to fit Air into the traditional foam
midsole? A trip to Paris and an observation at the Centre Georges Pmpidou, provided him a
concept. Why not cut the foam away to uncover the air? The Centre Georges Pmpidou uncovered
all of what was typically concealed, so would the Air Max Runner. The signature technology of
the company occurred noticeable as well as nothing in the sneaker history would ever be the similar
again.

Back in 1987, the Air Max 1 was dissimilar to anything else on the existing market. At the period,
the mainstream of shoes were tame in their designs. Sneakers from the mid 1980’ and previous
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were practiced in integrating dull shades of suede and mesh and serving grownup white guys,
something that would not destroy their feet during a work (Welty, 2017). However, the Air max 1
with its colours were obvious from afar, whether the shoe had an obvious, observe through segment
of its midsole. However, what creates the Air Max 1 the show, it is nowadays and something that
stands the examination of time is not just that it broke by a dull, dry market but it was the beginning
of running sneakers as a lifestyle culture.

Following the instance, the Air Max 1 occurred one of the company’s maximum significant
canvases for collaboration and a driving force in the ever-developing sneaker history (Welty,
2017). The product has encouraged some truthfully clever associations with stores and artists
globally.
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Explaining and justifying how Nike was

developed and for what market

Very few brands have accomplished to occur synonymous with pop culture in the 2000 century.
However, Nike has developed a giant of the sporting globe and a part of the daily lives of millions
of individuals globally. Adidas and Puma lead the international market on each level and in each
sport. Phil Knight was persuaded that the pathway to compete with Adidas and Puma was to initiate
cheaper but high-superior shoes from Japan. Still he possessed a better concept but he did not own
the capital to get his purposes covered. Phil Knight managed to create an appointment with
Onitsuka in Japan. Tiger Shoes was interested in vending sneakers in to American runners and
offered Phil Knight samples, which he sent to Bill Bowerman. However, when producers did not
take his advices, he went to his garage and modified the current models to make the lightest and
furthermost comfortable shoe for his runner (II, T. 2017). Bill Bowerman was overwhelmed by
the samples and they act together to market those in the US. After deciding a deal with Onitsuka,
they trembled on the particulars of an association in 19645, making Blue Ribbon Sports with the
capital of $500 each. The titan (Nike) was started as a dwarf back then. In 1970, Phil Knight
discontinued partnership with Onitsuka to make the financial expansion (Businesstoday.in, 2017).
Besides, their acting association between BRS and Onitsuka was failing. In 1971, Blue Ribbon
Sports initiated its own line of footwear. They called the line “Nike”. They uses swoosh logo and
the “Just Do It” slogan are among the globe’s utmost and furthermost identifiable trademarks. It
dominates the international sports footwear market by 38% with the sales of $21 billion in a
financial year. The brand born just a comparatively short while ago with a total of $1000 capital
and a handclasp is today valued more than 17 billion and become the richest sports company in
the world.
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Source: (NIKE website)


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Source: (NIKE website)

Analysing the significance of creativity and initiative undertaken to develop Nike a competitive
company
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The significance of creativity and innovation


Innovation refers to the course of generating and executing an afresh concept where it takes useful
ideas and turns those into convenient methods of activities (Randall, 2005). Those convenient ideas
are the outcome of creativity that is the precondition for innovation. Creativity in the aptitudes to
conglomerate ideas in an exclusive path or to create convenient link among the ideas. Creativity
offers fresh ideas for superior development in Nike and innovation puts those ideas into actions.
Nike understands that both innovation and change are needed to content the stakeholders.
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The initiatives that Nike takes


There is a saying that, “Innovation at the heart of Nike” (Eoi.es, 2017). The company is always
one step ahead. It attempts at pushing the envelope concerning sustainability by innovation.
Significance of these two pillars is entrenched by the maintainable company and innovation team
handling the lifecycle of the products and its compliance along with environmental
accountabilities. Over 160000 materials are utilized in the manufacturing step in Nike. A pair of
shoes can practice more than 30 ingredients (Eoi.es, 2017). Following track of the merchandises
from their resources till their fabrication step creates the effect appraisal a manageable duty.
Innovative mechanism are being generated to handle sustainability. The products formation team
practice the Nike ingredients index to choose eco-friendly ingredients by the innovation project
placement tracking 04 steps such as exploration, development, piloting and scaling, the level of
receptiveness of a project to these key pillars must be a pointer of its sustainability potentials. Each
material’s effects are evaluated in the zones of water, energy and others to follow each step
autonomously and how it collaborates with the ecosystem displaying the value chain of Nike.
Involving the complete corporate from the contractors, factories to farmers augmenting the organic
cotton, the prime is to offer products and services that conglomerate a higher level of performance,
apparel and footwear. The sustainability trip for Nike and its triumph is powerfully reliant on the
innovation dynamic that Nike feels powerfully about creating its culture and prime driver of its
corporate by forming Nike apart from its rivals. The company trusts that innovation comes in
varied colours and forms. Correspondingly significant they offer as a feedback and prime
mechanisms to variety challenges by augmenting the likelihood of the impossible occurring
conceivable by innovative ideas.
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Source: (NIKE website)


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Source: (NIKE website)


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Critically assessing the marketing plan of Nike


The prime aim around which the marketing strategy of Nike spins is to guide the globe’s sports
industry and to be pilot manufacturer of fitness merchandises around the world.

SWOT Analysis of Nike


Strengths Weaknesses
Nike possesses praiseworthy competitive Nike while speaking the sports products as its
propensities prime concentration is unable to connect
The broad range of merchandises designs with variety its products
broad inventions being initiated at a regular Nike’s retailers are nor quantified creating that
basis retailers sensitive about the pricing matter
Nike’s logo is attractive Dimensions are restricted based on those
The quality standards are associated with dimension ranges that experiences highest
reasonable prices auctions
Nike’s leading articles are presented in every
foremost markets globally
Brand ambassador is Cristiano Ronaldo
Opportunities Threats
US’s economic background will positively US economical set back that has outcome from
impact Nike’s industry-broad development as inflation might impact the outlay % of the
per auctions of sports products consumers contrariwise
The world-wide trends of sports contribution The lack in invention may guide the
and practicing have augmented the trend of determined consumers to roam about the
creating the casual apparels segment of the markets for the eccentric products
wardrobe
Accessibility of leather at cut expense creates
the price modification competitive

The competitors
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Adidas, Reebok, Puma are the major Competitor of Nike. All those Company has the similar
product of Athletic footwear and apparels. By the different Brand identity and brand awareness
Nike has the place to consumers.

Source: (Google)

The Chart showing the Nike has the 31% of Market among their Competitors.

PESTLE ANALYSIS OF NIKE


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Nike, Inc even being one of the top most rated organization among sports, apparels and accessories
execute PESTLE analysis to remain in the market. PESTLE analysis includes political,
environmental, social, technological, legal and environmental factors which has impact on the
working of organization.

P {POLITICAL}

Political factors form the backbone of the company. It determines the path of survival of the
organization. Such factors which induce the working of organization are as follows:

The native country of NIKE, UNITED STATES has provided the tremendous platform to the
success of company by low-interest rates accompanied with well-organized international market.

Being a manufacturing concern, taxation and manufacturing plays a vital role in the working of
company. Political factors include taxation and manufacturing laws.

Political sound country facilitates exports and imports.

E {Economic}
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Economic variables do not exert much pressure on the company due to reputated products dealt
by NIKE. However, some of them are enlisted below;

Haphazard in the economy can bring forth many negative repercussions for the well-known
companies even for Nike. In the off period, consumers can divert towards quite cheap products as
they can become less expensive due to depression in economy. Thus, economy is also significant
part for the firm.

Nike’s mostly earn through low cost of labour from eastern countries. Consequently, less
economically developed countries channelize towards the growth of Nike revenue.

S {Social}

Social status is eminent for the long term success of the organization. It mostly confers towards
public relations. Variables determining about the sociability are as follows:

“HEALTH CONSCIOUSNESS” is attracting the attention of modern generation. This has made
public more anxious about their lifestyle. They have started splurging more on sports apparel
which ultimately, increase the gain of company like NIKE.

Contrary to this, dubious manufacturing has also brought negative feedback for NIKE.’ The issue
of Nike sweatshops is prominent among them.

T {Technological}

Technology forms the basis of innovation. Technology is in the veins of the company.
Communicating with customers, forming the product, packaging and many more all are part of
technology. Technological proponents are as follows;

Social media today, plays progressive role in increasing prosperity of the company. Nike online
publicity and official website is remarkable and eye catching.

Technology acts as a boon in completing the targets and production according to customer demand,
eventually increasing revenue.

L {Legal}
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In PESTEL, politics and legal components are sometimes correlated. Rather, they are separate.
Political and legal are separate terms. There are not plethoras of legal terms affecting NIKE, which
are as follows:

Paying taxes is a legal requirement. But, as compared to other corporations, NIKE also adhere to
tax evasion. IT is a significant point in the PESTLE analysis.

Nike also adheres towards false discounting techniques to cover up legal requirements.

Counterfeit commodities.

Legal collision with ADIDAS and other companies.

E {Environmental}

As the name suggests, Environmental is related to nature. Environmental problems are


skyrocketing day-by-day which also needs to be taken care of:

Production on the mass scale skeptically destroys the environment. Nike production activities
mostly pollute rivers along with creating aerial pollution.

Apart of it, Nike policies always enlighten towards safe environment by minimizing the pollution
level.

COMMERCIAL AWARENESS OF PRODUCTS

Several marketing strategies are utilized by Nike to help it to become a global brand.

In 1973, Nike was recognized as Greek goddess of victory. At that time, a logo worth of 35$ was
created by a student known as Swoosh logo. Afterwards, BRS signed a professional athlete and
ATP tennis star. Today the total worth of Nike Company is 410.7 billion dollars due to excessive
marketing techniques, which amplify the customer level.

In 2008, Face book account of Nike was created where excessive promotion of products and its
features was carried on rampant basis. It also generates information on latest athletes, which act as
a bait for sports freak.
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Afterwards Nike paired with Apple Inc, company profound for innovative designs. It helps a lot
to increase the brand value of the company. Recently; Nike celebrated 25thanniverversary of its
successful campaigns which truly marked a remarkable change in the awareness of products.

There are total 25 ads ‘TITLE’ which increases the consumer awareness which are as follows:

1} JUST DO IT and {1988}

2} Michael Jordan teams up with Spike lee’s Mars Blackmon {1988}

3} Bo knows {1989}

4} Rock and roll Tennis {1991}

5} Charles Barkley ad

6} Dennis Hopper Sees Barry Sanders in his sleep {1994}

7} Guerrilla Tennis {195}

8} if you let me play {1995}

9} LilPenny {1995}

10} Junior for president {1996}

11} Hello world {1996}

12} Failure {1997}

13} Chicks dig the long ball {1998}

14} Tiger woods shows off {1999}

15} Hip-Hop Hits Main stream in Nike freestyle {2001}

Marketing purposes
Nike’s marketing purposes are determined over two segments that are short and long term
purposes. Long term encompasses improvement of market-share among the growing economics
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with a special concentration to Asia in the span of five years with yearly share grow between 25
to 30%. The short term concentrates on up to 275 of growing in market-share for the current year.

Overall purpose

The prime aims that Nike aims is to be the foremost producer of the sports products by
dissemination the Japanese produced brand in USA globally.

Strategic objectives

Creating the products accessibility in all markets

To concentrate all categories of consumers’ encompassing grownups, young and children

Provision of bets superiority and balanced priced shoes range to the consumers around the globe
with a singular concentration on USA

Main strategies
Market penetration: it is designed by the international development and creating the accessibility
of its inventive products globally.

Market development: Nike was supplier for the Japanese entrepreneur. Key shares were achieved
in 1980’. It has now $27 billion capita in the markets (MBA Tutorials, 2017).

Diversification strategy: the products line that is possessed by the company is a factual
representation of measured diversification strategy.

Control
The control of Nike is driven in to the hand of Ngo’s that demand to handle the control of the
company. They make reports at the end of the years to measure their operations.

Budget
The societies stores have been one of the sink of Nike’s budget and obtained up $1 billion

They outlined to invest at $315 million by 2011

Another budget sink might be trading with 700 factories to expand the manufacturing abilities
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Market Trend and Implementation


Nike’s main Market trend is creating a market demand for athletic shoe advertise by the
professional athlete or Sports Person. They have changed their targeted market to young and
women consumers. They also introduce the e-commerce and digital sports to their consumers with
a change of new technology in trend. They have alliance with Apple Inc. for introducing the
Running sensor in the Nike+. There are continuously upgrading their technology for capturing the
more market as new trend can be introduced.

STP (Segments, Targeting and Positioning)


Market segments

Nike has demographic Market segments by the gander, which is Male female, and by the age of
15 to 55 years group.

The Sports / Athletes oriented and Active lift Oriented are two segments of psychological and
consumer behaviour market segments.

Moreover, geographically has segmented in large area in USA, Asia, and Europe Africa etc.

Targeting and Positioning

Nike is targeting the groups of consumers unconnectedly as the target market of Nike is broad.
Nike targets at covering the individuals prospects that are fitting to diverse age groups. The
separate concentration on varied groups creates it possible for Nike to create highest revenue.

BCG Matrix
Among all the brands of Nike and from the Economic benefit of scale Nike is in the now
Established market. It is in the cash cow position the Matrix category. In the cash cow position
growth is slow but it is stable in the market share condition. They have mess production with a
minimum cost for that they have 765 factory worldwide and more than 1,000,000 employees.

The picture show the cash cow category of Nike among the entire brand.
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Source: (Businesstoday.in. (2017)

Based on the Product type it can be differentiate by 3 types first is footwear second is Apparel and
third is Equipment’s. In addition, Footwear is in the Star Category of the below BCG Matrix.

(Businesstoday.in. (2017)
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The Grand Strategy Matrix


According to the Grand Strategy Matrix Nike fall into the Quadrant I. The main strategies for these
are Market development, market penetration, product development, backward integration and
forward integration and diversification. It also indicates the rapid market growth in a strong
competitive market position.

(Businesstoday.in. (2017)
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Marketing mix and 4P’s


Nike has very strong Marketing Mix and they have established a leading position in marketing. To
give a very strong competition to their competitor like Adidas, Reebok they follow the Pull market
strategy to beat them competitor and stay in the leading position. (Marketing Mix of Nike 2017)

Product The prime groupings of the products proposed by Nike contain footwear,
apparels, sports tools and others (Marketing Mix, 2017).
Price The variable products pricing are from 75 to 150$ relying on the article
bought.
Place They sell their products around in 100 nations with 20200 retailers.
Promotion They use electronic media and athletes as brand ambassadors. And
giving emphasis on social media for promotion.

Product- Nike has a very wide range of Products with lots of verity Sports shoes, apparels etc.
Sports shoes are their top selling product but their other product sells has started to rise as well. As
a sports shoe Nike has started with Running shoe. But now they produce all kind of sports shoe
like Cricket, Football, Hockey, Tennis, Soccer, Basketball etc. In this all sports they have multiple
verities as well the athletic. They also offer sports T-shirts, shorts, pants, bands etc. They also
provide the cycling, volleyball, wrestling, cheerleading etc other all kind of sports product.

In 1987 Nike NYK and Nike SB offers their 1st shoes and Basketball shoes name Nike Air Jordan
XX3 was introduce in 2008 as the environment friendly design with very high performance. Their
recent product introduces as Nike Zoom Walker and Nike Air Max 1 as the 30% less lighter the
rivals product and for the cricket. Their resent shoe has a radio chip which can be connected to the
IPod with the help of Nike+ and Apple Inc. they introduce it which can also resorted different
statistics for the for the sports person. (4Ps of Marketing)

NIKEiD has the option from their selective product that customers can customize the product from
their own comfort and choice for the footwear.

Price- Nike pricing is depend on the target customs or target market product. They follow the
competitive pricing strategy to maintain the pricing for their product. Cost base and Value based
pricing is also followed by the Nike to ensure the quality product with a affordable price. Not like
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the other competitors Nike do not produce low price product by compromising the product quality.
Depending on the focus customer they have that king of particular product pricing for example for
upper class sports personalities they have high rang of product with the high rang of pricing ad
for the general customer they have a general range of pricing product. For the Nike brand, people
are willing to pay the reasonable price for the good product. (Nike Marketing Plan)

Place- Nike sells their product most likely 200 countries but in US, they have more than 2000
stores. They have multiple brands under Nike and distribute worldwide all verity of product. In
the international market they have many own stores as well many distributors, franchise or licensed
seller. Nike has a production unit in several countries with different distribution channel. With a
help of China they have outsources the producing as well distribution to capture the low profile
countries like Asia and others. In the Big city they have the Nike Town shops, Flagship Store,
NIKEid and Big retail Discount shops are some of the leading Nike distribution outlets.

Promotion- Nike is very Focus about their promotion of Product. they have almost all king of
promotion strategies and they have all kind of promotion media. For advertisement they printing
Media, broadcast media as well the social media. For advertisement they usaaly use the sports
person or an athletes to promote their particular product. they also use the Commercials, celebrity
billboards to get the attention from the targeted customers. They are also involve in different kind
of sponsorship to events and also in social activities for they brand promotion. They have created
a brand image in such a way that their logo and signs are the promotional symbols where ever in
seen.

They also have integrated marketing communication Strategy (IMC). Advertisement, personal
selling, direct marketing, sales promotion, public relation and most importantly social media are
the segments of the IMC.
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Recommendation

In this report, we have analyse Nike’s different objectives along with Business strategy market
strategy etc. It can be said Nike has potentially implemented all the strategy to introduce new
products. Based on our understanding and analysis of Nike’s Strategy here are some
recommendations for them: They can focus on the different parkour and aerobic product. Research
and development (R&D) needed to be more upgraded. Social media communication should be
encouraged. They can go for more alliance with Microsoft or Google for introducing more
technology as well as video tutorial sports and learning portal. Last but not the least always do the
market research and consumer behaviour for their existing product and for the new product. They
can also arrange events for health activities alone with learning opportunities etc.
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References

Businesstoday.in. (2017). How Nike's marketing strategies helped it become a global brand.
[online] Available at: http://www.businesstoday.in/magazine/lbs-case-study/nike-marketing-
strategies-global-brand/story/207237.html [Accessed 8 Jul. 2017].

Eoi.es. (2017). Innovation at the heart of Nike. [online] Available at:


http://www.eoi.es/blogs/rimaelkhoury/2014/03/06/innovation-at-the-heart-of-nike/ [Accessed 8
Jul. 2017].

Hays, S. (2000). The story of Nike. Mankato, Minn.: Smart Apple Media.

II, T. (2017). A Brief History of Nike. [online] Today I Found Out. Available at:
http://www.todayifoundout.com/index.php/2014/07/history-nike/ [Accessed 8 Jul. 2017].

Marketing Mixx. (2017). Marketing Plan of Nike. [online] Available at:


http://marketingmixx.com/marketing-plan-2/164-marketing-plan-of-nike.html [Accessed 8 Jul.
2017].

MBA Tutorials. (2017). Nike Marketing Plan. [online] Available at: http://www.mba-
tutorials.com/marketing/1409-nike-marketing-plan.html [Accessed 8 Jul. 2017].

Nair, S. (2009). Marketing Research. New Delhi: Himalaya Pub. House.

Randall, R. (2005). Innovation. Bradford, England: Emerald Group Pub.

Russ Bengtson, Gary Warnett, Nick Engvall and Schonberger, N. (2017). The 100 Best Nikes of
All Time. [online] Complex UK. Available at: http://www.complex.com/sneakers/2012/12/the-
100-best-nikes-of-all-time/ [Accessed 8 Jul. 2017].

Welty, M. (2017). Why The Nike Air Max 1 Is More Important Than The Air Jordan 1. [online]
Complex UK. Available at: http://www.complex.com/sneakers/2017/03/why-the-nike-air-max-1-
is-more-important-than-the-air-jordan-1 [Accessed 8 Jul. 2017].
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