Nike Inc Analysis of Marketing

Nike Inc epitome of MarketingNike Inc. was founded in1962 by Bill Bower man and Philip H. sawhorse as apartnership under thename, bluing palm Sports.Since Germany conqueredthe domestic market in America, Nike came with outset-cost and broad(prenominal) quality crops for the American people. Today, Nike manufactures and distributes athletic shoes in the globular market and 40% ofits gross sales come from athletic app arl, sports equipment, and subsidiary ventures and they havetraditionalaswellasnon-traditionaldistributionchannelsinto a greater extentthan100countries globally. Nike has attained a postmortem examination position in the market but in 1998, the company has to face the issue of exploiting overoceans workers and the altering consumerneeds negatively pretentious the sales of Nike. In this report, I have discussed the case history of Nike that majorly covers the child laborproblem and the problem of change in consumers preferences after which I have done the prep are analysis and have come up with strategic objectives, market driven strategy Objectives. Furthermore, the marketing strategy is discussed that covers the segmentation strategy, targeting, positioning and channel distribution of Nike and the product, worth and promotional strategy it must approve.In theend, Ihave given aboutrecommendations to Nikes management to force it towards success.ContentsINTRODUCTIONThe company still come out of the closet just an airplane built-up in arranges to make happy path job at Stanford University. Mr. Phil knight a adapt student at Stanford University and a worldwide space messenger firm that he would create small price disposal shoes in Japan and then advertise them in USA. Knight solicits the help of a history teacher Bill Bower man to help him in his big strain project. Knight called his first shoe tiger and began allocation at path meet. Blue Ribbon in 1971 earned its Swoosh and knight introduces the or so important Nike smirch line. In 1 978 the Blue Ribbon turn overs Nike and both years their earnings grow steadily. Due to Nike attention in informal shoes in the 1980, they missed the leaning to aerobic shoe and separatrix d make after allowing Reebok to manage the marketplace.MISSION AND VISIONNike states in its mission declaration that it entail responsibility commerce in a guilty way, most important to sustainable monetary increase. With the advance in knowledge, Human resource places, the healthy knowledgeable and skilled employment power, here is extremely small subscript to distinguish nerve. Living be seen to go added than the lowest amount necessary on community issue can draw and keep patrons. This bottle sea green modification attracts concentration to the association they are view as thoughtful and public liable (Mullins, L. 2005).A speech, on the construction put into practice of Nike during its make obtainable sequence accuse the association of individual concerned in limited operational circumst ances, defiance of hard work civil rights, low salary and pestering of its labor force. Nike takes this information seriously. On the basis of the learning answer the business has make stronger the check of its surgeer (Hummels, H and Timmer, D.2004)OBJECTIVE OF THE readThe SWOT examination aim to suggest the participate government of the Sderkping growth with an instrument to charge their past giving in the Sderkping procedure as fit as to appraise the choice for the modus operandi to bear on after the conclusion of the in progress development in February 2009.SWOT ANALYSISStrengthsNike is a very competitive organization. Phil Knight (Founder and CEO) is frequently quoted as saying that Business is war without bullets. Nike has a healthy aversion of is competitors. At the Atlanta Olympics, Reebok went to the outlay of sponsoring the games. Nike did non. However Nike sponsored the top athletes and gained valuable reporting.Nike has no factories. It does not tie up cash in buildin gs and manufacturing workers. This makes a very lean organization. Nike is punk rocker at look for and development, as is evidenced by its evolving and innovative product range. They then manufacture wherever they can produce high quality product at the lowest possible price. If prices rise, and products can be made more cheaply elsewhere (to the same or better specification), Nike will move production. (ynkamat, 2009)Nike is a global brand. It is the number one sports brand in the World. Its famous Swoosh is instantly familiar, and Phil Knight til now has it tattooed on his ankle Nike is rather strong regarding its research and development quite marked regarding its evolving and innovative product choice.They manufacture high quality at the lowest potential price, if prices rise due to price boost then the production process is made cheaper by changing the place of production. It belongs to theFortune 500 companies. Nike employs about more than 30.000 people worldwide.It has a strong wiz of marketing promotion by sponsoring top athletes. It uses linarite foam and flies wire materials in order to make the construct shoes lighter and more convenient. (Adam, 2009)Its rest for high quality and innovative footwear .Nike is also known for its innovative marketing .Nike ads are part of the pop culture an impressive achievement. Famous campaigns stimulate bo Jackson, Michael Jordon, and Tiger Woods the Nikes swoosh is highly recognizable world wide .Nikes recent comeback has been greatly helped by increased sales of Nikes apparel. (Robert N. Lussier, 2009)Political Analysis According to PEST analysis the political enviourment can be taken as strengthThe government must create economic policies that will surrogate the growth of businesses. Nike, fortunately, has been helped by the US policies which enable it to advance its products. The support accorded to Nike by the US government, specially in the general macroeconomic stability, low interest rates, stable currency conditions and the international competitiveness of the tax system, form the foundation critical to Nikes growth. (Cuizon, 2009)Society Analysis According to PEST analysis the social enviourment can be taken as strengthPeople are more health conscious currently. Diet and health are getting more prominence. Consequently, more and more people are joining fitness clubs. There is an accompanying demand for fitness products particularly exercise apparel, shoes and equipment. Nike is at the front position of this mickle in demand as people are looking for sports shoes, apparel and equipment. (Cuizon, 2009)Technology Analysis Political Analysis According to PEST analysis the proficient enviourment can be taken as strengthNike uses IT in its marketing information systems very effectively. Nike applies marketing information systems to the economics of improvement, segmentation and differentiation for tight all of its businesses.Nikes leadership status owes in large part to the u se of extremely valuable Information Technology, and applying it to every aspect of the product from development to distribution.Nike, being the world leader in the athletic footwear industriousness, is able to effectively harness its environment to boost its marketing efforts. This strategy has translated into robust sales of Nikes products. (Cuizon, 2009)WeaknessesThe organization does have a diversified range of sports products. However, the income of the business is still heavily dependent upon its share of the footwear market. This may leave it vulnerable if for any undercoat its market share erodes.The retail sector is very price sensitive. Nike does have its own retailer in Nike Town. However, most of its income is derived from selling into retailers. Retailers tend to offer a very similar experience to the consumer. Can you tell one sports retailer from another? So margins tend to get squeezed as retailers try to pass some of the low price competition pressure onto Nike.Nik e was for quite some time unwilling to disclose any type of information concerning its partnering companies. It was charged with the violation of overtime andminimum wagerates in Vietnam, 1996, that was seen as having poor working conditions, and that it was also charged for exploiting cheap workforce overseas. (ynkamat, 2009)Nike was also reported to have utilize child labor in Pakistan and Cambodia to producesoccer balls. It was positioned as a subject of criticism by anti-globalization groups due to its unruly and exploited manner that was quite a disaster for its reputation. (Adam, 2009)In late 2005 founder phil knight resigned from the CEO position at Nike. Since that time Nike has had two CEO s. Nike brand co death chair mark parker is the companies new president and chief executive officer following the resignation of William D. Perez will Nike ever be able to replace the larger than animateness founder Phil knight? Another question on the area concerning is that global s ales, such as Europe and Asia ,have instead at a much instant(prenominal) pace than domestic sales in the United States. (Robert N. Lussier, 2009)Economic Analysis According to PEST analysis the economic enviourment can be taken as weaknessIn economy, the biggest threat for Nike would be economic recess. During recession, Nikes growth will be adversely affected. The US economy is experiencing a downturn right now. Consumer purchases are slowing down. Currently, Nikes feeling the pinch of the economic recession. The Asian economic crisis also affects Nike since its goods are manufactured in Asia. The labor costs and material prices are discharge up.Nikes growth is not just affected by the local economy but also in the international economy. A weak Euro and an Asian recession could mean weak sales for Nike. The overall results in the sales generated by Nike in athletic footwear, however, remained stable. The global market makes up for the variances in sales particularly between pea k and lean seasons. (Cuizon, 2009)Society Analysis According to PEST analysis the social enviourment can be taken as weaknessNike, however, failed to prognosticate problems brought about by a sweatshop expose pertaining to labor and factory conditions at production locations in Asia. This caused bad publicity and declining sales as society and consumersOpportunitiesintersection development offers Nike many opportunities. The brand is fiercely defended by its owners whom truly believe that Nike is not a fashion brand. However, like it or not, consumers that wear Nike product do not always buy it to participate in sport. Some would argue that in youth culture especially, Nike is a fashion brand. This creates its own opportunities, since product could become unfashionable before it wears out i.e. consumers need to replace shoes.There is also the opportunity to develop products such as sport wear, sunglasses and jewellery. Such high cling to items do tend to have associated with them, high profits.The business could also be developed internationally, building upon its strong global brand recognition. There are many markets that have the disposable income to spend on high value sports goods. For example, emerging markets such as China and India have a new richer genesis of consumers. There are also global marketing events that can be utilized to support the brand such as the World Cup (soccer) and The Olympics. (ynkamat, 2009)The brand is sternly defended by its owners who believe that Nike is not a fashion brand, however, a large number of consumers wear Nike product because they derive a fashion cut offrather than to participate in a sport. It is mostly argued that in youth culture, Nike is a fashion brand which also createsopportunitiesfor Nike since its products would become outdated before even the product wears out i.e. consumers will feel the need to replace the product with a newertrend.There are many international regions that still need tapping and in that location is need for sportswear and with Nikes strong global brand recognition, it can initiate in many markets that have the disposable income to spend on high value sports goods.Nike gives a lot of effort on its corporate marketing mainly through thepromotion ofcorporate brandand sponsorship agreements. (Adam, 2009)Nike has an opportunity to capitalize on its own Nike Technology. This is a sensor placed in Nike footwear that interacts with Apples iPod to record the distance a runner has completed and the calories that have been burned. Another opportunity will be to capitalize on an endorsement deal with LeBorn James after his NBA playoffs and championship series appearances. Additionally, Tiger woods yearly attempt to win all quadruple major Golf Tourments automatically allows Nike to build product campaigns around the Tournaments. (Robert N. Lussier, 2009)ThreatsNike is exposed to the international nature of trade. It buys and sells in different currencies and so costs an d margins are not stable over long periods of time. Such an exposure could mean that Nike may be manufacturing and/or selling at a loss. This is an issue that faces all global brands.The market for sports shoes and garments is very competitive. The model developed by Phil Knight in his Stamford Business School days (high value branded product manufactured at a low cost) is now commonly used and to an extent is no longer a basis for sustainable competitive advantage. Competitors are growing alternative brands to take away Nikes market share.As discussed above in weaknesses, the retail sector is becoming price competitive. This ultimately means that consumers are shop around for a better deal. So if one store charges a price for a pair of sports shoes, the consumer could go to the store along the street to match prices for the exactly the same item, and buy the cheaper of the two. Such consumer price sensitivity is a potential external threat to Nike. (ynkamat, 2009)Consumers are co nstantly shopping around for a better deal that conveys a good quality and if one store charges a higher price for the products, the consumer would try to seek a better deal of the same product in the premises that delivers the same value but cheaper of the two, this type of price sensitivity among the consumers is a potential threat to Nike.The textile industry unpleasantly upsets the atmosphere, and therefore the organization is constantly struggling to retain its eco-friendly reputation. A recession may lead to job shortages in most of Nikes worldwide branches. The organization has experienced many adverse publicity feedbacks due to its widespread advertisingIf you have a body, you are an athlete Bill Bower man state this couple of decades ago. The guy was right. It defines how he viewed the world, and it defines how Nike pursues its destiny. Ours is a language of sports, a universally understood lexicon of passion and competition. A lot has happened at Nike in the 30 years (Adam , 2009)Specific threat is the contracts that Reebok (now part of Adidas) signed with the NBA and NFL for its apparel businesses. Another threat is the ongoing public relationship s problem pertaining to working environments in the factories producing Nike sneakers. Nike has striven to defeat images of sweatshop conditions, but the problem has been difficult to solve. (Robert N. Lussier, 2009)Porters five forcesSourcehttp//www.google.co.in/images?hl=enq=porters+5+diagramum=1ie=UTF-8source=univei=8UhZTfaOCoXJrQfarcnuBwsa=Xoi=image_result_groupct=titleresnum=1ved=0CCIQsAQwAAbiw=1366bih=643Potential Entrants beginningBargaining power of buyersHighBargaining power of suppliersLowThreats of substitutesLowIndustries rivalryHighRefer to appendix 1CONCLUSIONSWOT analysis should always be measured by all companies as it helps show companies all their weaknesses and threats. At the same time it also shows what the companies strengths and opportunities.Using this analysis companies can spotlig ht on their good part of the business and focus more on the bad part to make it good. Also a company can see what factors are external or internal which helps the business in a long run to be more capableREFERENCESAdam, 2009. Nike SWOT Analysis. Online Available at HYPERLINK http//www.mba-tutorials.com/marketing/240-nike-swot-analysis.html http//www.mba-tutorials.com/marketing/240-nike-swot-analysis.html Accessed February 2011.angeletti3, 2005. Nike versus Adidas Case Study and war-ridden Analysis. Online Available at HYPERLINK http//www.echeat.com/essay.php?t=27606 http//www.echeat.com/essay.php?t=27606 Accessed February 2011.Cuizon, G., 2009. Marketing Audit of Nikes Strategies. Online Available at HYPERLINK http//www.suite101.com/content/marketing-audit-of-nikes-strategies-a94402 http//www.suite101.com/content/marketing-audit-of-nikes-strategies-a94402 Accessed February 2011.E, P.M., 1998. In Competitive Strategy Techniques for Analyzing Industries and Competitors. Free Press.G erry Johnson, K.S.W., 2008. In P. Education, ed. Exploring Corporate Strategy. 7th ed.Phil Knight, 2011. Company History. Online Available at HYPERLINK http//www.nike.com/nikeihm/about/history.shtml http//www.nike.com/nikeihm/about/history.shtml .Robert N. Lussier, D.K., 2009. Applied Sport Management Skills. Human Kinetics.ynkamat, 2009. SWOT of Nike. Online Available at HYPERLINK http//www.scribd.com/ physician/13163456/swot-of-nike http//www.scribd.com/doc/13163456/swot-of-nike Accessed February 2011.