4p’s of Nike

• INTRODUCTION:

Nike Inc. is a major publicly traded sportswear and equipment supplier based in the United
States. The company is headquartered near Beaverton, Oregon, which is part of the Portland
metropolitan area. It is the world's leading supplier of athletic shoes and apparel and a major
manufacturer of sports equipment with revenue in excess of $18.6 billion USD in its fiscal year 2008
(ending May 31, 2008). As of 2008, it employed more than 30,000 people worldwide. Nike and
Precision Castparts are the only Fortune 500 companies headquartered in the state of Oregon,
according to The Oregonian.

The company was founded on January 25, 1964 as Blue Ribbon Sports by Bill Bowerman and Philip
Knight, and officially became Nike, Inc. in 1978. The company takes its name from Nike (Greek
Νίκη pronounced [ní kː ɛː]), the Greek goddess of victory. Nike markets its products under its own
brand as well as Nike Golf, Nike Pro, Nike+, Air Jordan, Nike Skateboarding and subsidiaries
including Cole Haan, Hurley International, Umbro, and Converse. Nike also owned Bauer Hockey
(later renamed Nike Bauer) between 1995 and 2008.In addition to manufacturing sportswear and
equipment, the company operates retail stores under the Nike town name. Nike sponsors many high
profile athletes and sports teams around the world, with the highly recognized trademarks of "Just do
it" and the Swoosh logo.

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Following table is showing basic information’s about Nike:

Type

Founded 24 January 1968

Headquarters Near Beaverton, Oregon, United States

Area served
Worldwide

Key people
Philip H. Knight(Chairman)
Mark Parker(CEO) & (President)

Industry
Designing and Manufacturing: Sportswear
Sports equipment

Products
shoes, Apparel, equipment, Accessories

Employees
30,200 (2008)
• BACKGROUNDS:

Nike, originally known as Blue Ribbon Sports, was founded by University of Oregon track
athlete Philip Knight and his coach Bill Bowerman in January 1964. The company initially operated as
a distributor for Japanese shoe maker Onitsuka Tiger, making most sales at track meets out of Knight's
automobile.

The company's profits grew quickly, and in 1966, BRS opened its first retail store, located on

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skateboarding. Nike has recently introduced cricket shoes, called Air Zoom Yorker, designed to
be 30% lighter than their competitors. In 2008, Nike introduced the Air Jordan XX3, a high
performance basketball shoe designed with the environment in mind.

Nike sells an assortment of products, including shoes and apparel for sports activities like
association football, basketball, running, combat sports, tennis, American football, athletics, golf
and cross training for men, women, and children. Nike also sells shoes for outdoor activities such
as tennis, golf, skateboarding, association football, baseball, American football, cycling,
volleyball, wrestling, cheerleading, aquatic activities, auto racing, and other athletic and
recreational uses. Nike is well known and popular in youth culture, chav culture and hip hop
culture as they supply urban fashion clothing. Nike recently teamed up with Apple Inc. to
produce the Nike+ product which monitors a runner's performance via a radio device in the shoe
which links to the iPod nano. While the product generates useful statistics, it has been criticized
by researchers who were able to identify users' RFID devices from 60 feet (18 m) away using
small, concealable intelligence motes in a wireless sensor network.

In 2004, they launched the SPARQ Training Program/Division.

Some of Nike's newest shoes contain Flywire and Lunarlite Foam. These are materials
used to reduce the weight of many types of shoes. They also sell small amounts of plastic
products to other manufacturers through Nike IHM Inc. Bauer Nike Hockey Inc. manufactures
and distribute ice skates, skate blades, in-roller skates, protective gear, hockey sticks and hockey
jerseys and accessories.

• PRICE:

The type of good that will be marketed is going to affect the price of a product. Nike uses
vertical integration in pricing wherein they own participants at differing channel levels or
engage in more than one channel level operations. This is also an attempt to control costs and
influence pricing practices. Nike’s pricing is designed to be competitive to the other fashion
shoe retailers. The pricing is based on the basis of premium segment as target customers.
Nike as a brand commands high premiums. Nike’s pricing strategy makes use of vertical

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integration in pricing wherein they own participants at differing channel levels or take part in
more than one channel level operations. This can control costs and influence product pricing.

• PLACE:

Nike shoes are carried by multi-brand stores and the exclusive Nike stores across the globe.
Nike sells its product to about 20,000 retail accounts in the U.S. and in almost 200 countries
around the world. In the international markets, Nike sells its products through independent
distributors, licensees, and subsidiaries. Independent distributors need not adapt to local
pressures because the 4Ps of marketing are managed by distributors. Nike has contracted with
more than 700 shops around the world and has offices located in 45 countries outside the United
States. Most of the factories are located in Asia, including Indonesia, China, Taiwan, India, Thailand,
Vietnam, Pakistan, Philippines, and Malaysia. Nike is hesitant to disclose information about the
contract companies it works with. However, due to harsh criticism from some organizations like
CorpWatch, Nike has disclosed information about its contract factories in its Corporate Governance
Report.

Worldwide Nike Factories

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• PROMOTION:

Promotion is largely dependent on finding accessible store locations. It also avails of

targeted advertising in the newspaper and creating strategic alliances. Nike has been one of the
top retail industries for quite a long time. This is because they sell quality products, customer
loyalty, but most of all, its great marketing techniques. Nike has a number of famous athletes to
create a great deal of attention to their products. Nike has signed the top athletes in many
different sports such as the Brazilian Soccer Team (especially Ronaldino, Renaldo, and Roberto
Carlos), Lebron James, and Jermane O'Neal for basketball, Lance Armstrong for cycling, and
Tiger Woods for Golf. Sponsoring of events is another great promotional technique for Nike. It
brings attention Nike's products. Web sites are a great promotional tool as they cover these
events. Such events include Hoop it up and The Golden West Invitational. Nike also personalizes
websites. They make the websites exclusively for a sport such as nikebasketball.com,
nikefootball.com, and nikegolf.com.

Nike is positioned as a premium-brand, selling well-designed and expensive products.

Nike lures customers with a marketing strategy centering on a brand image which is attained by
distinctive logo and the advertising slogan: "Just do it.”

Nike promotes its products by sponsorship agreements with celebrity athletes,

professional teams, and college athletic teams. However, Nike's marketing mix contains many
elements besides promotion. These are summarized below:

Advertising:

From 1972 to 1982, Nike relied almost exclusively on print advertising in highly
vertical publications including

Track and Field News:

Most of the early advertising was focused on a new shoe release, essentially outlining
the benefits of the running, basketball, or tennis shoe. In 1976, the company hired its first
outside ad agency, John Brown and Partners, who created what many consider Nike's first
'brand advertising' in 1977. A print ad with the tagline "There is no finish line" featured a

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lone runner on a rural road and became an instant classic. The success of this simple ad
inspired Nike to create a poster version that launched the company's poster business. In 1982,
Nike aired its first national television ads, created by newly formed ad agency
Wieden+Kennedy, during the New York Marathon. The Cannes Advertising Festival has
named Nike its 'advertiser of the year' on two separate occasions, the first and only company
to receive that honor twice (1994, 2003).Nike also has earned the Emmy Award for best
commercial twice since the award was first created in the 1990s.

In addition to garnering awards, Nike advertising has generated its fair share of
controversy

E-commerce is an opportunity for every company, if they do it correctly. Consumers

are using the Internet more and more to purchase their goods and service. The marketing
mix, mission statements, marketing strategies, and “stickiness” are extremely important is
having a successful Internet marketing strategy. Mark Millman, president of Millman Search
Group Inc. a national retailing consulting recently said, “Everyone is doing it. If you don’t
do it, you’re dead in the water.” The overall ranking of the four athletic shoe companies are
Nike (1), Adidas (2), Reebok (3), and Fila (4). This large difference in the ranking between
the four companies clearly demonstrates Nike's online dominance as the leader in its industry.

Corporations should and must have a mission statement that will keep them focused and guided in
the right direction. Nike had mission statements that gave the customer some idea of what the
company is all about. By definition, a mission statement is a clear and concise statement that
explains the organization’s reason for being (Ferrell et al., 1998). There are five questions that
help clarify what a good mission statement contains:

Who are we?

Who are our customers and what do they value?
What does our organization stand for?
What makes our organization unique?

What impressions does this organization want key publics to have of us?

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 Nike’s mission statement shows what they stand for and gives the different groups that Nike
entails. Unfortunately, Nike still does not clearly reflect that they are customer-oriented. Having
a strong marketing mix (4 P's) is extremely important for an organization to be successful.
Nike.com had the top ranking when comparing the marketing mix variables. For example, their
advertisements on television and those on their web site, to their strategic alliance partnership
with UPS to deliver their packages, were all strategically designed.
• Conclusion :

Marketing mix analysis is a fundamental step towards effective strategy. Where other analysis
are more related to environment and feasibility analysis, the 4 Ps of marketing including the product
itself, pricing, placement and promotion are the four wheels of the vehicle on which the path of an
organization’s marketing success is actually dependent. Nike’s brand images, the Nike name, and the
trademark swoosh; make it one of the most recognizable brands in the world. Nike’s brand power is
one reason for its high revenues. Nike’s quality products, loyal customer base, and its great marketing
techniques all contribute to make the shoe empire a huge success.