Documente Academic
Documente Profesional
Documente Cultură
Strategy of
NIKE
Published by : www.studymarketing.org
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Nike is the leading and renowned world supplier of athletic apparel
and shoes. The brand is in control of over 47% of the market for
athletic shoes. The company begun way back in 1962 and it was
founded by Phil Knight and Bill Bower. It was originally known as Blue
Ribbon Support and only in 1978 did it change its name to the
The legendary position that Nike enjoys today has been achieved
strategies that the company has put in place to make sure that its
strategy has done very well mainly due to the fact that it has been
very easy for it to get a large number of athletes. In the event that an
Another strategy that Nike has chosen to use to market its products
certain brand of shoes, that brand will be associated with success This
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psychological effect is often reinforced using advertisements that
mainly customers who have more concern for the quality and utility
of the product than they have for the price at which the product is
being sold. This helps to ensure that pricing never has to be adjusted
that it has put in place, it has to ensure that its strategy is flexible
in every possible way. Nike chose to take this into deep consideration
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it spent almost $800 million on non-traditional methods of
advertising.
research has shown that the 17 years olds spend 20% more on
one hit
techniques and this can be clearly seen from what is given below.
For the first time since it was founded, Nike is not fully relying
Digital Sport
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To add onto all that, Nike launched the Nike+ platform in
were strife are nothing but memories today. In the world that we live
aware of this fact and this is the reason as to why it has decided to do
what it takes for it to survive in this world. One of the things that it is
use, energy, land and water; solid waste, wastewater discharge and
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shoes has. The manufacturing process on the other hand is
Take leather for instance. Nike designs for product performance and
flexible and strong. Taking into account the fact that it is a natural
energy is required.
In the entire Nike footwear value chain, leather cutting scrap holds
the second position as far as the biggest waste streams go. A large
that there are a number of customers who prefer leather to all other
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The materials that it uses including introduced choices for
leather, a large number of the natural materials that Nike uses have
synthetics.
very easy to understand the tough time that Nike might experience
be sued to design a certain product. Over the past ten years, Nike has
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come up with a method of evaluating the environmental impacts that
the materials that it uses have. It has used the same method to
assess the more than 80,000 materials that could be used in the
The materials that are used in the production of the Nike apparel and
footwear are supplied by more than 900 suppliers. Nike does not
specifications
A good number of the decisions that are made during the product
impacts that the product will have. Nike chooses to design products
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To ensure that this sea actually achieved, Nike introduced the
short time.
constituting 355 of the total score and materials for apparel making
60% of the total score. This makes it very clear to the design teams
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that concentrating on the materials to be used is a sure way of
Despite the fact that the Considered indexes have been primarily
implemented by the Nike brand, the affiliate brands have also started
using them to evaluate the designs for their products and have made
end.
Next-Generation Tools
level. It has been on a journey for very many years to refine the
be launched soon and there are also indexes for various products
To add onto that, it has to a very significant level upgraded the tool
used to rate materials embedded in the indexes and this new tool is
MSI for short. The designing of this new tool was completed in 2011
One of the major upgrades that have been included in the Nike MSI
is the rating of the material vendors apart from just rating the
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materials themselves. This serves as a major incentive to encourage
received the ISO 14001 certification, whether they run from buildings
score that the vendor will get on the Nike MSI score. It is Nikes hope
that this new tool will encourage vendors into becoming more
indexes.
become familiar with this new tool. By the close of 2011, it had
Considered Indexs baseline level. This simply means that they will be
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in line with Nikes baseline sustainability criteria. Nike has done so
well as far as meeting this goal is concerned. It has been able to have
2015. It is also doing quite well as far as achieving this particular goal
a bit difficult to define a clear way of measuring that. Nike has thus
finished products.
ways that can be used to measure its success. For instance, over the
past five years it has achieved a 19% decrease in waste linked to the
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Manufacturing process optimization, considered design and a
Over the past couple of years, Nike has put in every effort in the
enhanced its use of EPMs with time with the increase from 2005 to
2009 standing at 77%. Its current average stands at 8 EPMs for every
It assesses its use of EPMs based on the production volume for every
does not have any direct insight into the materials volume purchased
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A number of the variables include the amount of waste that is
manufacturing.
This is despite the fact that a good amount of the waste that comes
bit complicated due to the fact that the current systems do not keep
specific styles which are usually different for every season. Due to this
to be a proxy.
Below are a number of the EPMs that are most frequently used by
Nike.
Organic Cotton
increased from 47% in the year 2004 to 905 in 2011. Nike makes used
of the total amount of organic cotton that the company used that
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year. Despite the fact that Nike is fully committed to increase the
cotton that is grown according to the standards that have been set
Nike signed onto the BCI - program in the year 2011 and it made the
BCI puts in place standards for the management of inputs like water,
The BCI also seeks to enhance the stability and livelihood of farmers.
Due to the fact that the BCI is also looking to truly turn cotton into a
Recycled Polyester
energy, have lower raw materials extraction and produce less waste
the equivalent of getting rid of over 280 million plastic bottles from
the waste stream. The amount of garments made by Nike that have
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some recycled polyester increased from 3000 in 2004 to 31.5 million
in 2011.
rubber.
Leather
Nike has been working towards ensuring that the leather that it uses
Working Group or LWG for short. The LWG came up with a protocol
for assessing the environment that was launched in the year 2007
of the LWG and that have ensured their processing facilities are
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certified according to the LWG protocol. By 2011, all the tanneries
that were providing Nike with leather had been certified by the LWG
and good progress is being made as far as the affiliate brands are
concerned.
Synthetic Leather
Synthetic leather has a large number of qualities but each and every
solvents to be used. Nike has been working for more than ten years
Nike has made a large number of the scoring tools that it uses
of materials beyond its own value chain. For example, it shared its
apparel index that will be used by the entire industry. Nike has also
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SAC reviewed it and launched a public version of the same that could
very easily be used by the entire industry. Nike also made public,
has the ability to help any designer shorted the time that he or she
entire industry. This is a vision that Nike shares with SAC. The whole
industry recognizes how complex this vision is and this is the reason
Moving forward, Nike believes that all the indexes that it will release
in the future will increase the rate at which progress is being realized
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products in its entire value chain, especially the Nike MSI, which will
Nikes vision is that using these efforts, all of its material vendors will
The R&D teams at Nike are also working to increase the rate at which
palette of available EPMs across all of the brands that are owned by
Nike.
For instance, Nike has come up with definitions for best, better and
good EPMs for its strategic materials Increased research will have to
be conducted before the best and better versions are brought into
the market but they will eventually be brought into the market. Using
The entire Nike marketing strategy was based upon a product image
that was favorable and let it develop into one of the biggest multi-
national companies today. The favorable product icon from Nike has
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also remained optimistic due to the strong relation with the company
logo that is both unique and distinct. The product slogan is also a
good one and has been displayed on commercials for a very long
time now.
segmentation.
Nike chose to reach out to this target market through the use of
Through these avenues, Nike was able to reach out to a large number
This is not to say that it is only sportsmen who can buy what Nike is
producing. Nike also targets teenagers who are in love with the hip
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hop custom and other individuals but it mostly targets the sportsmen
due to the fact that it is well aware that there is a huge market or it
there.
owing to the fact that it was easy for it to get to a large number of
athletes.
wanted to become a big company and enjoy good profits. This was
From the get go, Nike sought to go after customers that were not
would love the product for its utility and not anything else. It wanted
to go for customers who once they used the product, could not go
afford its product when the world underwent the most serious
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economic recession. It would help it to ensure that it had profitable
the prices of its products without having to worry that its competitors
will outdo it. It could very easily set high prices for its products and
be sure that it will still make sales and maintain a good profit margin.
These are all characteristics that will definitely attract the top layer of
the market segments; people with a lot of disposable income that has
These strategies that Nike has chosen to use are known as value
based pricing and price leadership strategies. These are all two very
different strategies but Nike has without doubt been able to combine
them in such a way that has brought great success for it in the
industry.
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When we talk of value-based pricing, we talk of pricing that is done
product.
As was said before, Nike chose to go with high price points as it knew
that these price points would be associated with durability and high
quality.
high-end [products.
that is set for the product. To them, a low price automatically means
low quality and a high price automatically means high quality. Owing
to the fact that this was the segment that Nike was out to reach for
It was sure that with this strategy it would be able to quickly reel in its
target market and also make sales that would allow it to sustain a
the leading position that it holds in the market to set the bar at which
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prices will be made in the market. Nike is a very strong company, it
has been in business for quite some time now and it has invested
the world. This is what has allowed it to gain a very high bargaining
strategy.
Customers choose to go out and buy the Nike products because they
have the symbol of the Nike brand and the brand is recognized all
over the world. They are not really looking at how much it will cost
them; they just want to be associated with the brand because all
through its marketing and advertising, Nike has made it clear that it
A pair of Nike shows will usually cost you anything rom between $80
and $400 but they are still bought in large numbers Nike clothes will
also cost you between $20 and $100 but they are still also bought in
large numbers.
what is being offered by its rivals in the industry. Truth be told, Nike
is able to set such prices for its products and still earn good profits
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due to the simple fact that it carved out a niche for itself early
enough.
Long gone are the days when the idea of brand was simply confined
progressive company.
played a very huge part. The Nike brand has a number of rhetoric
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The Nike Logo- Swoosh
signature.
Whether or not the word Nike has been put it below it, anytime the
with Nike.
Despite the fact that the swoosh resembles the check of excellence
resulted in the brand being more memorable and the usage of the
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Visual rhetoric has just one purpose, to persuade visually.
The swoosh comes with just a solid brush stroke but all who see it
know what its meaning is. The swoosh resembles the wings that are
semiotics, these learned and implicit code systems are mainly used
Symbols are usually made within the confines of a certain culture and
they carry a shared meaning within the culture. Nike holds pride in
being able to develop state of the art athletic equipment from soccer
balls and running shoes and being able to use a logo that is a
It also holds pride in the fact that it has been able to visually tie its
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It has been said that publicity images are only owned by the moment.
Most of the time they speak of the future and refer to the past Nike
Associated with the Nike logo is the tag line Just do it. This tag-line
print advertisements.
Together, the tag-line and the logo bring out the significance of the
The design symbol of the logo together with the tag-line have turned
into a way of life and a motto for an entire generation. People can
they are or to openly express their sense of identity. The Nike tag-
line and logo serve to help people create the identity for excellence
and action.
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When it comes to linking this concept with visual rhetoric, one can
The same description can also play the role of written language.
These are all concepts that are fully present in the Nike brand. The
tag-line and the logo both portray a certain slogan and image that
The tag-line is also very similar. Anytime you read some words, the
words are usually describing certain content but they do not visually
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There is no denying that words serve as signs and give distinction
and identification.
Despite the fact that the tag line is fundamentally very simple, it has a
very distinct meaning. Just Do It simply tells you not to think about
it, not to ask about it, not to talk about it, not to regret the decision
you make but to just do it! The visual display that accompanies the
General athletes and sports figures are considered to have some kind
game.
Among the most effective elements of any brand is the use of print
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Nike has very well embodied this function in their decision to use
These fit women are not in any way apologetic about what they refer
to as their thunder thighs or big butt. Nike has said that the ads
attempt to illustrate that not each and every body type is equally
allowed agency; they have their identities concealed and they are
objectified. These ads display just certain body parts and they never
the perceptions that she has of herself. Nike was genius in using
woman.
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There is no denying that these ads have gone against the grain and
they are rhetorical in the way that they take on the role of persuasive
liberation. Despite the fact that these ads do not use any new format,
the way the texts have been used to change the ads meanings is a
Despite the fact that it is not really easy to pinpoint how the words
have altered the images on these ads, they definitely have. The image
If these Nike advertisements did not come with any words, they
identity.
The words function as the storyteller and explain the part of the
make the audience sympathize with the feelings of the woman and
give a context, which on the basis of our culture, are needed to fully
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The Nike Web site
the sense of cohesion where everything relates with each other and
The site also subtly and simply presents its argument Nike has
developed a very interactive website. Visitors get to view the site and
can click on any images that interest them. Clicking on the image
brings it to the center of the screen and lets the visitor play a video
The creators of the Nike website are effectively promoting the Nike
Looking at it more critically, it becomes very clear that Nike has made
story about the various aspects of the Nike brand with the emphasis
being on making it clear that Nike can provide something for each
and every one. There are a number of horizontal vectors that present
the timelines for the videos that are played on the website to explain
the images.
Nike has developed a website that effectively brand sit. The website is
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promote its products throughout the world. For the website to
develops a positive effect with each and every visitor to the website.
This website provides the Nike brand with a superiority status. The
does not only show Nikes desire to continue on the greatness trend
for a long time to come but also that it will over time coincide with
change.
sense of identification. One can very quickly associate the site with
Nike. This begs the conformity question. Nike does a perfect job of
maintaining originality.
specific to the Nike brand. This makes it much easier for customers to
within a very short time realize that this is the one place to visit on
creative and new. It tries to set itself apart from all of its competitor
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brands. Last but definitely not least, the website has done a very
The stores are full of themes media, high ceilings, dramatic lighting
museums and the Nike brand makes it very easy to interpret the
It has been said that the object placement in a museum exhibit and
identity of Nike.
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The Nike Town stores are real spaces of experience Each and every
citizen.
A visit to the NikeTown stores allows the customer to shift his or her
place the visitor within the scene and consequently within the brand.
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Nike Advertising and Emotional Branding
Nike also chose to adopt an emotional branding strategy. Nike
that Nike is enjoying is nothing but huge and this success can be
attributed to the branding strategy that Nike has used that has
customers all over the world. This is due to the fact that Nikes
branding technique.
a very old tale; the tale of a hero who is expected to fight of a great
no denying that you could label Nikes strategy as very old but it has
Nike strategy takes the frequently used hero story and completely
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enemy-our laziness. Nike is well aware of how hard human beings
Each and every morning when the alarm rings and the light has not
yet come out outside, the battle starts! When we finally decide the
inspire loyalty in its customers. They are well aware of the fact that
there are people who have to battle with external foes but there are
because apart from the internal foe being someone that can be easily
hated by everyone; the viewer gets to become the hero. In one way
Nike marketing has been well aware of this feeling for quite a long
customers.
whether or not the brand will grow the egos of the customers.
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When it comes to the building of a great brand, all sings show that
Nike has worked really hard to create a brand that resonates with
customers all over the world and that people want to be identified
with and there is no denying that they have successful achieved that.
All advertising that Nike has put out there concentrates more on
ego of the customer and positioning the brand as one that is used by
The product itself hardly features in this entire branding strategy. This
something that goes beyond the brand. The branding strategy is not
designed to make the customer think that they need Nike apparel to
success but that they want the Nike apparel because they do
succeed.
boost their customers egos This is one branding strategy that Nike
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become one of the most powerful and effective brands the world
over.
In the event that you are asking yourself any of the above questions,
business world and become like the successful companies that are
recognized all over the world, it is important that you develop a good
brand.
Nike was well aware of this fact and from the get go, it decided to
strived to create a brand identity that would set it apart in the market
visibility; all these are factors pertaining to branding that are very
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There is no denying that the 'swoosh', the Nike Logo, is recognized
itself as fitness and athletic company and not just an ordinary shoe
company.
Truth be told, Nike itself is just shy of being defined as the sports
whole world. If you are looking for the perfect example of how a
something that they can identify with and also provide the product
If you are still not sure about this, just look at Nike. Its dominance
and success in the world of sports has all come from its ability to
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develop the visibility and image of its brand which has in turn
Nike has been able to develop superior value for its brand by making
of its brand.
The concept behind this is that the image of the celebrity will be
embedded in the mind of the customer and this will in turn cause the
This will ultimately result in the Nike brand being valuable and
desirable. The sports celebrities put across the idea of athleticism and
turn into this almost iconic and heroic symbol that the ordinary
people strive to also turn into. Every time the customers translate
Jordans iconic stance and all these other ideologies into the swoosh
There are three major ways in which Nike has worked very hard to
selling parts of its brand as if it were the Berlin Wall, destroying all of
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the notion that the Nike brand is a high end one that provides
athleticism and every other aspect that is sports correlated. This from
based animals which in turn means that we have the ability to make
The swoosh has been turned into the cultural dissemination that
stands for fitness, power, athleticism and each and every aspect that
Through its advertising, Nike has been able to establish the 'swoosh'
athletic excellence.
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In 1997, approximately $978 million was spent by Nike on promotion,
operating in.
has really worked hard to enhance the visibility of its brand. It has
been able to re-define the power that a brand image holds and is
aspects that people all over strive to have in their daily lives.
these ideologies lets the Nike customers identify with Nike for the
image that is embodied by its brand and not for the products that it
produces.
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Nikes Brand Positioning
Nike has been able to develop a brand that is appealing to each and
Nike has been able to build a universal brand It has strived to come
one is located, Nike has a brand that can suit them. It does not
matter whether you are in the United States and you would like to
get a pair of cleats or you are in Belgium and you would like to get a
pair of childrens soccer shorts, Nike can be able to meet your needs.
television advertisements.
Nike has managed to make its brand into something that is truly
ubiquitous. It has been able to successfully turn its product focus into
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significant number of the large international companies are doing
today to position their brands. Bigger brands also have to adapt into
this practice if they have a desire to become known all over the
competitive in the United States and also all over the world.
and apparel such as Puma and Adidas, leisure and athletic shoe
apparel companies.
Nike is the biggest seller of athletic apparel and athletic footwear the
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promotion and marketing, price and new product development are
and athletes to endorse its brands and utilize its products. It is also
Nike holds firm the belief that it is competitive in all these aspects.
The biggest threat that Nike faces is the inevitable stiff competition
that it continually faces from other sports brands like Adidas. Nike
continually develop new products that have higher quality than what
The dynamic demands and needs that customers have also pose a
of market share that Nike enjoys. They compete with Nike in various
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Nikes Five Forces Analysis
competitive pressure. This is a very simple yet powerful tool that can
situation.
stay away from taking the wrong steps, grab all the opportunities
This is what makes this tool a very important tool when it comes to
the development of a strategy for any company. The tool can also
profitable.
Threat of Entry
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Threat of entry simply refers to the possibility that newer and better
firms will get into the market and force Nike out. Nikes threat of
Threat of Substitute
using Nikes products and opt for substitutes instead. Nikes threat of
Substitute is low.
Supplier Power
Supplier power takes into account whether or not the suppliers can
have a higher bargaining power than Nike and Nikes supplier power
is low.
Buyer Power
Rivalry
Rivalry refers to the amount and level of competition that Nike faces
power that it has, the supplier power that it has and the threat of
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substitutes and threat of entry that it faces can definitely help Nike to
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