Nike Marketing Strategy Analysis

This assignment delves into the intricate world of Nike's global marketing strategy. It examines various aspects such as market segmentation within the sportswear industry, effective brand development strategies, and Nike's unique approach to achieving a competitive advantage. The analysis draws upon relevant academic literature and real-world examples to provide a comprehensive understanding of Nike's successful global marketing endeavors.

Marketing Strategy

EXECUTIVE SUMMARY
In current scenario, every business requires a smart marketing plans to attract investors
and money. If there are no right cash flow, then it affects to business and their owners and
constantly they feel stress to operate their function in competitive market. So, it become essential
for organisation to make proper marketing strategy which will help them in attaining their goals
and generate profits. Nike, Inc. is world leading designer, marketer and distributer of athletic
footwear, accessories and offering variety of products in sports and fitness activities. Nike is
continually working upon their strategies because they believe that they will achieve continue
growth in their business.

Table of Contents
EXECUTIVE SUMMARY.............................................................................................................2
INTRODUCTION...........................................................................................................................1
PART 1............................................................................................................................................1
Situation analysis.........................................................................................................................1
Competitive Advantage (Unique selling price)...........................................................................4
Evaluation of current marketing strategy....................................................................................4
PART 2............................................................................................................................................5
Segmentation, Targeting and Positioning....................................................................................5
Recommendations and goals and objectives (SMART)..............................................................6
Recommend Marketing Strategies...............................................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................11

INTRODUCTION
Marketing strategy explain that how marketing function of company fits to overall
strategy for their business. It is responsibility of higher authorities to identified that what
strategies can be adopted by them and once these strategies have been find out, it become
organisation should develop an action which will turn the strategy into reality. This report is
based on Nike Inc. who is world’s largest company in sportswear. This company is offering
wider range of products and focusing on athletic footwear which is designed for specific-sport.
The marketing strategy of Nike is completely relay upon the product image and allow to
organisation to develop their business at multinational level (Douglas and Craig, 2011). Further,
macro and micro factors of Nike has been discussed in detail which is influencing their business
in both positive and negative aspects. Further, recommendations have also been provided to
organisation where they can improve their existing performance with the help of adopting new
strategies.
PART 1
Situation analysis
Nike Inc. growth is partly depending upon the external factors which is affecting to their
functions. As the mission of this company is “to bring inspiration and innovation to every athlete
in world”. To achieve this mission, entity needs to identify those factors which are becoming
hurdle for them, it may be macro or micro factors. Macro factor are consisting with PESTLE
which is Political, Economic, Social, Technological, Legal and Environmental. These are
enumerated as below:
Political factors - Government and politics are seeming like forces outside the realms of
business. An open minded government and stable government will giver better opportunities to
business and help in growth their brand in competitive market. However, business environment
is differing from market to market and nation to nation. With the help of this factor, it helps to
Nike’s in maintaining their strategies. Stability of political condition will give opportunity to
organisation in growing their business in different sectors. Also expanding of free trade policies
will facilitates in better market penetration (Shih, Chen and Chen, 2013). Apart from this, if there
is an improvement and support from government in infrastructure, especially in developing
countries will give chance to Nike to expand its operation in competitive market.
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Economic factor – The business performance of company is also liable on the state of
economies where they can sell their athletic footwear, apparel to customers. Developed markets
of some country like US are relatively stable so it provides opportunity to Nike Inc. to continue
their business. An economic of country will also decide the performance of organisation that
how their brand will be going to perform. If there is decline in economic performance, then
purchasing power of customer will also fall and through this company cannot expect to generate
more profits when customers are at cutting cost. The profit of this company in 2014 was $27.7
billion and in 2015 $30.6 billion and it was due to there is an improvement in economic
condition of country.
Social factor – Social forces are equally important for organisation which is trying to
develop their business in international market (Borland and Lindgreen, 2013). With the
increasing in demand of fitness among people it will opportunity to organisation to satisfy their
needs by offering several products. People are more conscious about brand and accordingly their
preferences and demand are diversified. At this situation, Nike is satisfying the need of
customers while providing quality of products. It can also be said that Nike is a global benefactor
and having social responsibility when it comes to health and fitness. Further, new strategies can
be adopted by company such as product development to address the needs of athlete.
Technological factor - Nowadays, there is rapidly increase in technologies which is
giving both negative and positive impact to organisation. The use of advanced technology makes
easy for organisation to target the customers. Along with this, it gives opportunity to company to
innovate their products in different ways. For attracting different customers, Nike need to design
their products in creative and attractive manner. Besides this, valuable information will be
receiving by organisation which is based on metrics and allowing them to optimise targeting and
production.
Legal factor – These terms are influencing business like Nike. It became essential for
organisation to comply with important laws which are related to their sector and be ethical
(Mullin, Hardy and Sutton, 2014). In past, Nike had faced many issues related to law suits
regarding labour abuse or wages. If proper laws and regulation will follow by organisation, then
it will not become difficult for entity to regulate their business at international level.
Environmental factor - These issues are ever-growing for organisation. As there are
few number of factors which will affect to Nike strategy such as; production factories of
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company are harming to environment. The whatever resources which are using by organisation
should be utilised in appropriate manner and does not cause any impact on environment
protection. Along with this, they have to maintain emission gap while producing any goods and
services.
Apart from this, manager has also analysed SWOT on regular basis which gives
opportunities to convert their threats into opportunities. Here strength and weakness are related
with internal factor. On other side opportunities and threats are related with external factor. For
adopting proper marketing strategy, it is essential for organisation to analyse these so that proper
decision can be taken by them in achieving their goals and objectives.
Strength – Nike is world’s number one company in shoemaker. It is strong in research
and development because every time they are launching new products in stylish manner (Chung,
Derdenger and Srinivasan, 2013). Further, company effective marketing campaigns is also
making their sturdy position in market. The market leadership of company is very strong where
organisation is having capability to retain in market for a long period of time. This company is
also listed in among 50 corporates worldwide. It also associates with itself to lead in international
sports team. Besides this, advertising and branding campaign are very strong which attracts the
customer towards it to purchase their products.
Weaknesses – This can disrupt Nike growth strategy in competitive market in sport
shoes. Else the income or profit of this company is heavily dependent upon the share of footwear
market. Moreover, company is also suffering from limited presence of their products in
developing markets and partly this is impacting on the price of products which are offering by
entity (Nike Inc. SWOT Analysis & Recommendations, 2016). Besides this, there is use of child
labour in factories which make people boycott. Apart from this, if there is constant competition
in market, then it creates difficult for company to capture large market share.
Opportunities – Product development gives an opportunity to organisation to introduce
new stuff in other sectors. Expansion of product in sunglasses or other accessories can give
advantage to organisation to generate high profit (Piskorski and Johnson, 2012). As this
company is working in fashion brand so it can own opportunities through differentiating their
products from others. Further, business could develop internationally and build strong position in
competitive market. As there are many global marketing events which can be utilised by them to
increase the brand awareness such as World Cup and The Olympic. This company can also open
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their stores in other countries by tiring two emerging economies. Apart from this provide online
services to customers so that they can reach out with their targeted customers.
Threats - As this company is facing tough competition while considering others as
major players such as Reebok, Adidas. Moreover, increase in technological innovation may
create competitive pressure if company do not innovate products on immediate basis (Bhatti and
et. al., 2011). Apart from this, revivals of company are developing alternatives brands in order to
beat Nike and offering same products and services at lower price as compare with this entity.
Competitive Advantage (Unique selling price)
Competitive advantage and unique selling point of company is providing benefit to both
customer and organisation. There are many customers who are rely on brand of organisation,
rather than feature of products. When customers are buying any product and investing funds in
brand, this way it makes feel them good because they are also the part it. With the help of
unique selling position, it provides competitive advantage to firm in generating large amount of
profits and make place in mind of customers. Along with this, it also considered as marketing
statement of organisation where they can promote the areas of superiority in selling their
business products and services (Ko and et. al., 2012). Unique Selling Position of this company is
that “Nike shoes are made for professional athletes across the global”. Through this they are
attracting people who are interest in sports. In modern era, to achieve competitive advantage,
company has to differentiate their products from their competitors and have to set the price of
products in such a manner where customers can easily attract towards. Some of the strategy
which can be used by organisation price skimming, cost leadership where it become easy for
them to beat their revivals in competitive market.
Evaluation of current marketing strategy
Nike is dealing in footwear market and it is highly competitive by nature as there are so many
rivalry firms who are dealing in same business. Thus business have to frame plans and policies
so that they can easily achieve strong positions at market places. They have to adopt various
plans and policies like they can easily reduce cost of their products in order to attract large group
of customers who can buy their products (Torelli and et. al., 2011). They are focusing on
exporting their products outside the domestic boundaries in order to increase their sales ratios
and they are not having any capital gains of machinery, factory outlets or equipment’s. It simple
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state that selected firms are not having any types of expenditure on maintenance of any types of
products which are stated above.
Differentiation strategy
They are focusing on adopting differentiation strategy in order to make innovative and
comfortable foot wares so that people can easily purchase them and it results in increase their
loyal customers who will buy products from them. They are mainly focusing on sports shoes and
their quality aspects in order to provide comfort to every athlete who is playing games. This is
beneficial for all runners as they can easily win the games and become champions. They are
selling their products at very economical prices so that customers can easily purchase them. They
have developed different range of foot-wares from low to high rates so that every income group
can use their products which are comfortable and person can do any type of work like playing
spots, gym, walking etc.
Growth Strategy
Nike had revealed growth strategies in order to achieve sustainability and long term
development & growth across different brands which are used by people all around the globe.
They have constantly increased in the revenues as people are highly consuming their products
while making comparison with other brand products (Mahdi and et. al., 2015). They have
adopted customer focused strategy in order to evaluate needs and demands of customers so that
products can be manufactured according to their choices which can easily satisfy them. They are
taking feedbacks from customers in order to evaluate any difficulties which are faced by them.
They have notices high increase their growth and profitability factors which results in achieving
brand images at market places. This overall results in increasing footfalls of customers which
determines success in their overall business operations.
PART 2
Segmentation, Targeting and Positioning
Nike is popular brand in sportswear which is selling assortment of products, includes
shoes and apparels for activities namely basketball, combat sports, cross training for men,
women and children. The products which are provided by them is bifurcated into men, women
and children through which it become easy for them to purchase. Sportsmen are the majority
customers of Nike’s products (Sage, 2015). This company is focusing on the needs of consumers
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by way of agreement which has been done with sports team, sponsorship who are involve in
organising Olympics etc. Through this Nike is capable of reaching with extensive number of
customers who are likely to purchase these kind of products. They are mainly focusing on to
target women to sale their sportswear. The STP of this company is explained as below:
Segmentation – Nowadays, it is essential for Nike do segmentation of their products
before they are launching in market. As it includes; geographic, behaviour, demographics. In
Geographic, manager of this company are targeting those people who are usually play sports and
providing products accordingly. In demographic, business is based on income, age, carrier so
that they can segment right market for product. Here, Nike is targeting to women through which
they can sale their products and according to that they can set the prices of goods (Hidayat and
Sriwarno, 2015). Other is behaviour, it is major responsibility of organisation to divide the
customers in different groups which must be relied on their behaviour, knowledge or thinking of
consumers. There are many women athletes who are absolutely depended upon the brand
royalty. Women segment is offering a long-term potential products of Nike which is considered
as most attractive segment in context of shoes. Nike air max product is created a safety and
comfortable shoes in such a manner user will feel satisfy for what they are paying.
Targeting – This company lays on lots of strategies where they have to target their
immediate users and all sportsmen. The targeting techniques includes product sponsorship which
are held by professional. Mainly they are targeting those women whose age is between 15-35. As
there are many teenagers and adults who love to play the sports game a lot and they need to be
active in their life.
Positioning – From last two decades Nike has become one of the famous brand in
sportswear. As it offering a high quality of products which is satisfying yearnings of customers
in proper manner. Thus, most of athlete of women are using their products and they are wishing
to purchase their goods. Thus, they have make their strong position in mind of customers
regarding the services and products which are provided by them (Yıldırım and Candan, 2015).
Along with this, they had also beat their competitors like Adidas, Puma in terms of sportswear.
Recommendations and goals and objectives (SMART)
SMART Objectives are described as:
Specific: Objectives should be specific and clear so that employees can easily follow
them and execute plans according to these in order to achieve effective results. Employees
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should be motivated in such a manner which helps to organisation in making and adopting
appropriate strategies. It includes all those factors which had to be achieved by employees, they
should be achieved in desired time frames, the location of business and which resources are most
effective in order to perform overall business operations and achieve their overall targets.
Measurable: It is very vital aspects for every firms in order to measure all their goals and
objectives so that progress of business can be easily monitored and employees should be
motivated in order to achieve good and effective results (Brohi and et. al., 2016). If measures are
adopted in order to monitor performances in effective ways then it results in achieving set goals
and targets of business. All the objectives are easily achieved in allotted time frames thus results
in achieving success for business. There is always positive feeling at work places as the set goals
are meet in effective and planned ways. The measured goals should reflect how much, how many
and when these can be effectively accomplished.
Achievable: Nike is setting objectives in such a manner which makes easy for them to
target them in efficient and effective way. For example, objectives of this company is to capture
large market share in sports by March 2018. So, for this manager has to analyse that whatever
functions they are performing are reliable or not which enables them to achieve this objective.
Realistic: While setting out the plan to accomplishing with objectives such as to increase
brand awareness or to increase the sale of sports from 5% to 10% in their target group by
December 2020. For achieving all these objectives, Nike has to analyse that whether they are
having this much resources to attempt these goals in time period. As resources includes; men,
machines, materials, funds etc.
Time: It is important part in SMART objectives because organisation has to set the time
period for attaining their goals in specific time period (Babu, 2012). It should clearly state that
how much time will be taken by organisation or employees to increase the sales of sports or to
capture the large market share.
Recommendations:
This company is focusing on the users in understanding the needs of customers. It is
responsibility of organisation to focus on those areas where they can easily target consumers and
set price according to that. To beat their competitors, company has to expand their products in
different sectors also which gives them opportunity to make more strong position in market.
Further, whatever marketing strategies are adopted by entity i.e. differentiation and growth
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should be analysed on regular basis. So that company can time-to-time launch innovative
products in sportswear. The marketing strategy of this company is showing competitive
marketing management in which organisation can lead in market and beat their revivals.
After analysing SWOT, it shows that company has company need to address those
concerns regarding to completion, patent protection in which they can protect the rights of
everyone. Thus, it is recommended that Nike must reform their marketing strategies in these
areas so that they can overcome with their weaknesses. Further, they must also collaborate with
government units where they can address the issue regarding patent protection.
Apart from that, Nike Inc. must address those opportunities which has been address in
PESTLE. Through this it is recommended that company have to pursue with more aggressive
approach to expand their business at international level and in developing countries. Another
recommendation for this is that, company should invest more funds in research and development
through which they can tap potential demand for sports shoes and these should be integrated with
advanced computing technologies.
Recommend Marketing Strategies
Starting from humble beginning, Nike has been able to grow fast on consistently basis
and soon expanded in global market. Depending upon the marketing mix of company, Ansoff
matrix will suitable for organisation because through this company product can be divided into
existing and new market through which they can grab the opportunities which are available in
market. It is divided into four categories; market penetration, market development, product
development and diversification (Nwakanma, Ude and Unachukwu, 2015).
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Figure 1: Ansoff Matrix
(Source: Ansoff Matrix, 2017)
In market penetration, firm is looking forward to expand their existing product in current
market segment with the aim to capture large market share. On other side, in market
development, organisation is trying to introduce their current product in new market where they
can target new audience. Besides this, in product development organisation is trying to introduce
their new product in existing market. Last one is diversification, it is considered as riskier in
launching new product and new market. While this strategy, it may give profit to firm to expand
more products in new market and loss may also bear by them due to unsuccessful of their goods
(Ansoff Matrix, 2017). For Nike, product and market development will be good strategy in
which they can beat their competitors and also target new customers who are likely to use sport
shoes or appeal. As based on marketing mix of Nike, it also depends on organisation which
strategies will suitable for them. As this company has already made strong position in market in
sector of sportswear so whatever strategy will be adopted by them will give advantage to them
attaining their goals and objectives.
CONCLUSION
Nike has been creative and innovative since the beginning. It is pushing with
technological boundaries for the innovation of new products and also differentiating from its
revivals. From above report, it is comprehended that marketing strategy of company should be
analyse by higher authorities on regular basis so that effective decision can be taken by them.
Further, Nike also has to seize the opportunity which are offered by social media through this
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they can engage the wider customers and able to attract them while giving meaning full ads. The
whatever recommendations are given to mentioned company should be properly adopted by
them which will provide them opportunity to improve their existing performance.
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REFERENCES
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endorsements: Tiger Woods' impact on sales of Nike golf balls. Marketing
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marketing strategy. Journal of International Marketing. 19(1). pp.82-101.
Hidayat, R. R. and Sriwarno, A. B., 2015. Brand Development Strategy Of Micro Scale Shoe
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industry. Journal of Business Research. 65(11). pp.1565-1575.
Mahdi, A. and et. al., 2015. A comparative analysis of strategies and business models of Nike,
Inc. and Adidas Group with special reference to competitive advantage in the context of a
dynamic and competitive environment. International Journal of Business Management
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Mullin, B. J., Hardy, S. and Sutton, W., 2014. Sport Marketing 4th Edition. Human Kinetics.
Nwakanma, C., Ude, G. and Unachukwu, M. N., 2015. The Use of DNA Barcoding in
Identification of Genetic Diversity of Fish in Ugwu-Omu Nike River in Enugu. Nigerian
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Piskorski, M. J. and Johnson, R., 2012. Social strategy at Nike.
Sage, G. H., 2015. Globalizing sport: How organizations, corporations, media, and politics are
changing sport. Routledge.
Shih, B. Y., Chen, C. Y. and Chen, Z. S., 2013. Retracted: an empirical study of an internet
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Yıldırım, S. and Candan, B., 2015. Segmentation of green product buyers based on their personal
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Online
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product-market-strategy-ansoff-matrix/>. [Accessed on 6th October 2017].
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<http://panmore.com/nike-inc-swot-analysis-recommendations>. [Accessed on 6th
October 2017].
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