Nike Company

Nike is the world’s leading manufacturer and supplier of sportswear and equipment. The company’s headquarters are in Oregon, United States. The company employs more than 30,000 people to carry out its global operations.

4 Points of Marketing

Products

Nike produces a wide range of sports shoes and apparel for people of all ages and gender. The products include truck running shoes, jerseys, shoes, base layers and shorts for such kind of sports as football, track and field, tennis, hockey, baseball, cricket and basketball. The first line of shoes produced by Nike was Nike Air Max. Recently, Nike has released other product lines such as Nike NYX and SB for skateboarding. The most recent products are Air Zoom Yorker and Air Jordan, which are 30 percent lighter than those of its competitors being at the same time environmentally friendly (Park and Kincade 190).

Nike is a popular brand of the youth culture and hip hop due to its supply of fashionable urban clothing. Nike collaborated with Apple Inc. to produce the Nike+ shoes that contain a radio device linked to the iPod Nano. The shoe monitors the performance of the runner through the radio device. Nike’s most recent shoes are made from Lunarlite Foam, which helped to produce lighter shoes (“Brand 2.0: What Could This Mean for Adidas, Nike, Puma and Levi’s?: Brand Value and Young Consumers in 2015” 5). Nike also distributes skate blades, protective gear, ice skates and other accessories.

Price

The price of a product is greatly affected by the type of product that a company sells. Nike employs the vertical integration pricing strategy where it engages in different channels of operation. The strategy helps Nike to control costs and influence prices. Nike has competitive prices based on the premium segment of the main target group. The Nike brand remains a leader because of the high quality of its products compared to its competitors (Park and Kincade 185)

Place

Nike distributes its products through multi-brand stores and exclusive Nike stores in the global market. The company has retail accounts in 200 countries worldwide in addition to the over 20,000 retail accounts in the United States. In its international operations, Nike sells its products through its subsidiaries and independent distributors. Nike has its offices in more than 45 countries and has already signed contracts with more than 700 stores worldwide. Most of Nike’s factories are located in the rich markets of Malaysia, China, India, and Pakistan (Angeles 5).

Promotion

Nike conducts product promotion through establishing their stores in accessible locations. It also creates strategic alliances and advertizes its products to its target audience through newspapers. It has been a top retailer for a long time because of the high quality of its products, exceptional marketing techniques and customer loyalty. A great number of famous sportsmen who exclusively use Nike-branded products facilitate great attention to Nike products (Chung, Derdenger and Srinivasan 280). Nike has signed contracts with a wide range of famous sportsmen in soccer, cycling, golf and athletics as their brand ambassadors (Lebron 5). Nike sponsorship events are a part of a significant promotional campaign. When sponsoring the events, Nike creates personalized websites for these events such as the nikefootball.com. Nike also has a distinctive slogan ‘Just do it’ and a good brand image.

Advertising

In the 1980s, Nike largely advertised its products through print media. One of the publications was track and field news. The ancient advertising focused on popularizing the tennis, basketball and running shoes by emphasizing the importance of these activities. In the late 1970s, Nike hired an outside advertising agency that carried out Nike’s brand promotion. The agency created an ad tagline that featured an athlete in a rural road. The ad was successful, making Nike launch a poster business. In the New York marathon of 1982, Nike aired its first television ad. Nike was named the advertiser of the year according to a survey conducted by Cannes Advertising Festival in 2003 (Chung, Derdenger and Srinivasan 275). Nike is also extensively involved in e-commerce. The consumers have shifted to making most of their purchases through the internet. Nike occupies a leading position among its three competitors in terms of online dominance. This makes Nike maintain its position as a leader in the industry.

International and World Market Operation

Nike originated in Oregon and expanded its operations over 200 countries. Nike is one of the best known providers of global marketing services. Nike has shown an ability to adapt to changing tendencies, which makes it a global powerhouse of sportswear. In 2014, Nike earned revenue of about $21.7 billion from its international operations (Angeles 12). The success of its global operations is mainly driven by the web strategy. Nike has a great web presence, making it a distinct, connected and authentic brand.  Nike has a tweeter feed that responds to inquiries directly from global customers. The direct contact with customers turns them into brand advocates. A vast global presence indicates that Nike’s international expansion has been a success.

Acquisitions and Product Launches

Nike explores opportunities for acquisitions when it finds the appropriate institutions. Acquisitions help Nike to create economic value from the competitive advantage the acquired firm harbors. Acquisitions also help Nike to gain market power in the markets where the acquisition tendencies dominate.

Since the adoption of the acquisition strategy, Nike acquires firms that add strategic benefits to the existing markets and increase product offerings. Nike conducted the first acquisition in 1988 by acquiring Cole Haan, which facilitated Nike’s access to the wide-scale footwear market. The second acquisition was in 1994 when Nike acquired Bauer, a famous hockey products manufacturer. The next acquisition was conducted in 2002 when Nike acquired Hurley International. The firm expanded the surf apparel segment of Nike’s products. A year later, Nike acquired Converse, a former competitor in the sphere of basketball footwear production. In 2004, Nike acquired Starter and in 2008, it acquired Umbro, a soccer apparel giant. However, Nike sold Umbro in 2012 (“Brand 2.0: What Could This Mean for Adidas, Nike, Puma and Levi’s?: Brand Value and Young Consumers in 2015” 5).

The latest innovative product was the shoes that contained Lunarlite Foam, which makes footwear lighter. The shoes are suitable for sports activities and casual wear. In 2010, Nike produced Pro Combat jerseys for university student teams. The students from universities in such cities as Alabama, Pittsburg and Miami wear jerseys during football matches and athletics competitions. In 2015, the Nike Mag was introduced. It represents self-lacing shoes that will be officially released in 2016 (“Brand 2.0: What Could This Mean for Adidas, Nike, Puma and Levi’s?: Brand Value and Young Consumers in 2015” 5).

Demographics

Women

Women aged between 20 and 30 years are large consumers of athletic-leisure products. They buy leggings to wear in the gym and during errands. Nike produces a wide range of products for this segment of the population. Some of the best-selling product lines to this segment include sports tights and bras. Nike has produced new lace-trimmed jerseys and skirts specifically for this segment. In 2014, the revenue from this segment grew by 60 % and outpaced the men’s segment. The segment is projected to yield more than $2 billion to the sales revenue the following year (Angeles 7).

Runners and Youths Athletes

Nike directs most of its innovative efforts to the running customer segment. It is Nike’s largest performance category. Nike has designed running apparel and shoes specifically for this category. Among others, these include Lunar Tempo line of products. Kids are also a significant customer segment of Nike. Nike attracts young customers by sponsoring local leagues and clubs and by creating partnerships with famous sportsmen.

How It Works

Opportunities

Increased Adoption of Sporty Lifestyle

Increasing health complications caused by a sedentary lifestyle have made people engage more in sporting activities. As people continue to integrate sports into their life, the demand for sports apparel is likely to rise. When conducting sports activities, the modern population wants to look fashionable and be able to buy quality products in line with the development of modern technology. Nike can take advantage of this development to design products with the appropriate styles and performance features for the leisure-oriented purpose. The sports lifestyle market is projected to increase by 300% over the following decade (Angeles 5).

Emergence of Women‘s Segment

The women‘s sports market has tremendously increased over the last ten years. Currently, women account for more than 30% spending on football and athletic apparel (Angeles 4). Though the men’s unisex category of products accounts for a larger percentage of revenue, the women’s segment is likely to become a highly attractive market in the sports goods industry. NIKE can expand to this market by increasing investment in women-oriented products with a focus on performance, female authenticity and style.

Functional Apparel

The demand for functional apparel has risen tremendously in recent years due to the shift in tastes in terms of cotton sportswear and functional apparel. Consumers have realized that functional apparel offers better moisture management, allowing more freedom of movement and being more comfortable. Nike can take advantage of this trend by manufacturing such products to generate more revenue.

Conclusion

The analysis conducted above indicates that Nike has achieved great success in its marketing. The company has a strong brand name which makes it the most recognizable trademark in the world’s sportswear industry. Nike produces quality products and employs good marketing techniques, which has helped the company to create a large base of loyal customers. It continues to expand into new market niches by making acquisitions based on strategic benefits. As Nike uses the opportunities of meeting the demands of the growing sport-leisure industry, it is likely to build a great shoe and apparel empire.