Posted on Thursday, 17th March 2011 by kasi
Nike is the world’s renowned and leading supplier of athletic shoes and apparels. It controls more than 47% of athletic shoe market with sale of U.S dollar 3.7 Billion. This company was founded in 1962 by Bill Bower man and Phil knight as Blue Ribbon Support and later on it became Nike in 1978 (Partlow, 2003). It is supplying its high quality products in more than 100 countries with its major target areas including United States, Europe, Asia Pacific, and the Americas. Nike has attained this legendary position through innovative and attractive design, quality production and wise marketing strategies.
Nike has huge range in its target market. They have wide range of different products each targeting and appealing a specific group of people. They aim to meet the requirements of people of all ages belonging to varying categories. This strategy has made this company to gain maximum number of customers and profit.
The company initially operated as supplier for the Japanese shoe maker. The company’s profile grew quickly and soon it gained a renowned position in the market. The swoosh logo of Nike was firstly used in 1971, registered in U.S trademark office in 1974 and first product sold with Nike was a soccer (Marina, 2008). In 1980 the company gained more than 50% share in the global market. Initially the prices of the products were high then the company started focusing on providing high quality products at comparatively low prices to enlarge the circle of customers. By the end of 2009 the company generated revenue of 19.2 billion U.S dollars with operational income of 1.87 billion U.S dollars.
• Initially the goal was to distribute low-cost, high-quality Japanese athletic shoes to American consumers to break the domination of Germany in the shoe industry.
• To maintain its quality and make it easily available at every marketable place.
• To meet the requirement of all type of customers (male, female, old and Young).
• Promote the sustainable development of product design and novelty.
• To encourage the development of designs allowing the young people to cash the maximum benefits from exercising.
• To reduce the product design, Packaging waste and use of organic volatile compounds to make it environment friendly.
• To attain climate neutrality.
• The mission is to exceed from all leading athletic companies and make it widely available across the globe.
• Maintain the leading position in the market by supplying quality products and innovative designs and attract maximum number of customer belonging to all ages and lifestyle.
• Guarantee the availability of all kinds of products at all leading stores and markets.
• To meet the changing demands of customers.
• Value the laborers, stake holders and other communities in the implementation of every strategy and decision.
• Encourage the environment friendly and pollution free development by reducing the emission and waste minimizing activities with the help of various projects sponsored by WWF and other organizations.
• The company will now focus on providing quality products on low prices to have greater share in the market.
Yearly marketing Budget
• The company has invested 1 billion in the past two years for community stores.
• They plan to invest at least 315 million U.S dollars by 2011.
• More over the company also intend to work with 700 other factories that produce Nike products to enlarge the business.
Marketing Mix of Nike
• Nike’s foremost focus is athletic footwear and apparels designed for sports and every day usage with the brand name.
• The production facilities are located close to the raw material to have low labor prices.
• New product offerings under the name of brand include sport balls, timepieces, eyewear, skates, bats, and other equipment designed for sports activities.
• The most famous product categories of Nike includes: Running, Basketball, Cross-training, Outdoor activities, Tennis, Golf, Soccer, Baseball, Football, Bicycling, Volley ball, wrestling, cheerleading, Aquatic activities and other Athletic and recreational use (Todd, Sitthichok, Mottus, Mihlan, & Wing, 2008),.
• Moreover they also utilize the auxiliary bodies to sell the sports related raw materials and products including: Cole Haan Holdings Inc., Nike Team Sports, Inc., Nike IHM, Inc., and Bauer Nike Hockey Inc.
• The company has designed its pricing structure in a way to make it competitive to other shoe sellers.
• The prices of the products are variable depending on the type and the size for example a comfortable and good pair of shoes would cost from 70 to 150 dollars
•Nike has its individual stores and also available at major malls and departmental stores selling shoes all over the globe.
• They have more than 20,000 retailers in United States and also in other 200 countries.
• The companies also sell its products through individuals, auxiliaries and licensees.
• The company has its production units, customer services and operational units in all over the World.
• The company has used electronic media (commercials, official website of Nike and newspapers) to promote their brand.
• Many well known athletes have also worked for the advertisement of brand like Brazilian Soccer Team (especially Ronaldo).
• They sponsor events (e.g. Hoop It Up) for the marketing of brand.
• The Brands swoosh logo and image played an important role in its advertisement.
• Reebok has 16% share in the market with revenue of $1.28 billion
• Adidas has 6% share in market with revenue of $ 500 million
• Converse has3% share in market with revenue of $ 280 million
• New Balance has 3% share in market with revenue of $ 260 million
• A very competitive organization
• It has no factories
• It is famous for its development and research which is depicted in their wide range of new products with new designs.
• Its swoosh logo make it recognizable in all over the world.
• It promises to provide the high quality products at reasonable prices.
• Its products are globally available in all leading marketing places of World.
• Less diversity in the sport products
• The company does not have its own retailers therefore retailers are price sensitive.
• All sizes are not present in every design of shoes.
There is no monthly tactic for the marketing. However there are seasonal variations in some products like spring apparel, the back to school season and Christmas holiday season (Fass, 2000). Moreover the sale of these products also depends on the Olympic as growth has been observed in the sale of products in the Olympic season.
• "Nike Air Zoom Control II FS Futsal Shoes at Soccer Pro". Soccerpro.com. http://www.soccerpro.com/Nike-Air-Zoom-Control-II-FS-Indoor-Soccer-Shoes-c439/. Retrieved on March 16, 2011.
• Partlow, Joshua (2003). "Nike Drafts An All Star". The Washington Post. Retrieved 2008-06-02.
• Website: http://condor.depaul.edu/aalmaney/StrategicAnalysisofNike.htm: Competitive analysis, Retrieved on March 16, 2011.
• Marina Hyde in Beijing (2008). "Olympics: How does Nike feel about conspiracy theories? No comment | Sport | The Guardian". London: Blogs.guardian.co.uk.
• Todd, L. A.; Sitthichok, T. P.; Mottus, K.; Mihlan, G.; Wing, S. (2008), "Health Survey of Workers Exposed to Mixed Solvent and Ergonomic Hazards in Footwear and Equipment Factory Workers in Thailand", Annals of Occupational Hygiene 52 (3): 195–205.
• Fass, Allison (2000). "The Media Business – Advertising – Addenda – The Media Business – Advertising – Addenda – Nike Spot Wins An Emmy Award – Nytimes.Com". New York Times.