Nike Advertising: Ethical Dilemmas and Marketing Strategies Case Study

This case study examines the ethical dimensions of Nike's advertising campaigns, specifically focusing on the criticism surrounding the NikeLAB NRG Beryllium Balaclava x MMW product. The report begins with an introduction to marketing and Nike, followed by a detailed analysis of a report to...Read More

Nike And Advertising - Case
study

Table of Contents
INTRODUCTION...........................................................................................................................1
PART 1............................................................................................................................................1
a) Report to senior manager at Nike...........................................................................................1
b) Ethical Theories......................................................................................................................3
PART 2............................................................................................................................................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8
.........................................................................................................................................................8

INTRODUCTION
Marketing is a one of the essential activity which is adopted by the company in order to
promote and selling of the products or services so as to increase the sales and profitability in a
speculated time frame (Altstiel and Grow, 2015). Every company has its own marketing strategy
through which they try to pull attention of maximum number of customers. Nike is a American
multinational company that develops and manufacture products related to sports gear such as
footwear, apparel, equipment, accessories and services. This report will focus on criticism faced
by Nike company for the product NikeLAB NRG Beryllium Balaclava x MMW on 12 July. This
product had to face a lot of criticism not for the product but for the marketing strategy they have
used. Therefore, ethical dimensions is mentioned which can be faced by companies.
PART 1
a) Report to senior manager at Nike
Nike is one of the renowned brand that manufactures shoes and sports apparel and
according to the Fortune 500 list company was listed and ranked 89 in 2018 in terms of total
revenues. Company was founded in the year around 1964 and since then they are delivering best
quality products and services and products. Racial discrimination and ethnically diverse
population is a debate and had a dark history. This has created a stereotype mindset against
Black people that they are inferior than White people. Although Nike is a popular brand and
goods that are sold by them are loved by most of the people but according to the case scenario of
Nike, company was under fire for marketing of “menacing balaclava” due to the use of black as
their model (Campbell and Marks, 2015). As per the perception of most of the individual thinks
that black are more violent in nature as compared to white people. Thus, according to the
marketing the young individual is wearing a garment which is similar to military wear.
Therefore, as per the viewpoints of some people this can be analysed that by marketing this Nike
is aiming for a gang-inspired look for the black people. Later the product was removed from
sales but it faced many ethical dimensions and this issue was raised because of the black people
involved in it for the promotional purpose. Here ethical dimensions plays a crucial role because
people can have different perspectives related to a similar topic.
Image of black person wearing the gear was supported by some of the people but was
criticised by most of the individual. The image was compared with creating a own army but the
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spokesperson of Nike commented in favour of Nike brand i.e. product that manufacture was for
the purpose of training collection so that product can be available to maximum number of
customers at global level (Carrillat and d'Astous, 2012). The purpose of using this marketing is
not to encourage any kind of serious issues related to criminal or gang culture. Some of them are
criticising the same because young people are attracted to whatever things that are portrait and
which is trendy in nature. Furthermore, instead of black people as their model company might
have chosen the whiter person but this can have a different perceptive as black people might
have thought that they are being discriminated and this product is mainly manufactured for
whites. For example: as blacks are discriminated thus, through this image there might be a
possibility that they develop their own army which can be somewhat harmful for the society.
This issue of black person wearing this gear might have been taken in a simple manner or
managers of the company should have provided better clarification related to the product they
manufactured.
Business plays a crucial role in the society as they develop an insight if they are portrayed
in a positive manner. Main role of business is to manufacture goods and services so that it can be
delivered to its end customers. Other than this, company has some Customer Social
Responsibility (CSR) towards the society so that it can be developed and benefits can be gained
from the same. Thus, in relation with Nike it is their prime responsibility that they spread
positive image but because of their wrong concept the product came under one of the
controversial product (Chen and Hsieh, 2012). While operating a business it is not possible that
company always follow the right path for some instances they might be in ethical dilemma about
the what path they can choose in order to increase the sales and profitability in a speculated time
frame. In relation with this, there are different stakeholders who perform their activity for
providing benefits to the company. For Nike their Key Stakeholders are Government: who might
have face consequences if this image should have taken into a serious issue or problem. Other
than this, customers are one of their key stakeholders who purchase their products in order to
increase the sales and profitability in a speculated time frame.
Nike, in terms of ethical choices its manager said that they were not having any intention
of hurting the sentiments of people they just wanted to promote their products just to enhance its
sales and profitability. But now company is in ethical dimensions that if they remove the black
person and in place of this use white person as their model than it can portray a negative image
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for black people that they “Yes”, these particular group is violent in nature that is why company
have chosen the same for promoting their product. Both the ethical dimension can have a
positive and a negative impact on the business of the firm (De Mooij, 2018). Therefore,
company's bad choice of choosing black person for the product was their bad choice because of
which it gave rise to various criticism and ultimately closure of the products from the market.
Nike might have thought of taking a other sources for promoting their activities. As a result, it
putted a negative impact on the image of the company and impacted the minds of people who are
purchasing their commodity.
Whatever choices are made it have an impact on other brands as well because people may
develop a stereotype thinking towards the other brand who are dealing in the same sector. Sales
and profitability of other companies can get decreased. As Nike is a sports brand know for its
unique thinking of promoting their products without caring about the sentiments of people of the
society. Other than this, other companies has to think twice before selecting any kind of model of
their promotional activities. For suppose Adidas for promoting its white shoes, if they are using a
white model than it can directly questioned the image of black people that they are not
appropriate and are being discriminated. Thus, for future company should focus on not using
element which can impact the sentiments of people who are living in the society with regards to
anything. As a result, it will not only increase the sales and profitability of the company but will
also create a good brand image in front of its customers (Gomez, 2012).
b) Ethical Theories
Operating a business is not an easy task as there are many things that are to be considered
so that activities can be done in an effective manner and benefits can be gained in return. Most of
the companies establish its business just to gain maximum benefits and promote their activities
without concerning the sentiments whether an individual or community will be hurt or not. Thus,
main motive is to generate more and more revenues so as to sustain in the market for a longer
period of time. Therefore, ethics and morale are the two factors that must be considered by the
firm so that activities can be performed in an ethical manner. This will not only enhance the
popularity of the company but also assist them in sustaining their loyal customers for a longer
period of time (Grau and Zotos, 2016). Ethics are considered as a moral philosophy that comes
under the branch of philosophies and includes the right or wrong conduct of activities. It defines
the morality of a person whether whatever task is being performed are right for the company or
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vice-versa. According to the current market scenario, major ethics that are considered and
recognised are meta-ethics: this is a branch of philosophical ethics states that whatever a person
says determines whether he/she is saying is right or wrong. Normative ethics: this is a study of
ethical action that helps in examine the standards of rightness and wrongness of he action that are
performed. This theory is also known as moral theory which assist in understanding what makes
an action right or wrong. Applied ethics: This denotes what an individual is permitted to do in a
specific situation or in a specific circumstances. Every individual have their own point of view
regarding any kind of activity for instance: for some person doing anything for increasing
business activities is not unethical. But for some people if they are using unethical way of getting
success than it comes under the action of unethical factor (Grow, 2016). Rest while discussing
about ethical theories there are basically, three types and these are explained below for better
understanding:
An ethical theory is determined as a systematic approach through which researcher try to
find out a way from ethical questions therefore, theories that are commonly used and further can
be used by Nike are explained below:
Utilitarianism: This is a normative ethical theory that majorly focuses on what is right or
wrong after analysing the outcomes and consequences. For this, it is required to choose the
action and policies that are being used so that an individual can be ready for the circumstances
which can be faced. Utilitarianism theory of ethics was developed by Bentham in which he states
that the consequences determines whether the action which is done is ethical or unethical in
nature. Therefore, the effectiveness of the ethics can be determined on the basis of how many
stakeholders are being influenced by the policy makers and what benefits have been gained in
overall process. Basically, the fundamental idea of Utilitarianism is that the effectiveness of
taking decision depends upon the perception of stakeholders and consequences as well whether it
is providing better outcomes or not.
In relation with the case study of Nike, decision taken by the company for using black
model was not accepted by the society and it created a sense of discrimination amongst white
and black people (Jackson, 2013). Because it has been evaluated from the past that there was
race discrimination because of which normal people have a negative thinking towards black
regarding their nature and behaviour such as they are violent in nature and behaviour. Company
using the image of a black person wearing “menacing balaclava” is somewhat portraying the
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black making their own army. Therefore, if company instead of choosing this sensual topic must
have focussed on other actions for promoting its activities and making people aware of the
products they want to deliver to its end customers. This would have ultimately increased the
sales and profitability of the company.
Deontology: This is an approach that focusses in the rightness or wrongness of action
itself. In this, right or wrong is determined on the basis of action or situations. In other terms if
consequences are not appropriate but an individual has worked according to the principle what
he/she feels is right than it is not determined unethical action according to them. This includes
key ethical principles such as trustfulness, honesty, respecting, justice and so on (Jewell and
Saenger, 2014). Deontology can be determined on the basis of two factors and these are duty-
based and obligation based because according to them ethical rules sometimes bind people with
duties. In relation with Nike, managers must be bind with duty of promoting their new product so
that they can be in reach to maximum number of people. They were just performing their duty
and following principles of doing their action so as to influence customers without any
considering the consequences of the action.
Therefore, both the theories that are mentioned above related to the ethics is somewhat
playing a crucial role in business operations. Because this is the element that create an insight of
what is right and what is wrong for the organisation.
PART 2
Ethical leaders- Those individuals that have respect for ethical beliefs and values.
Ethical leaders mainly focus on trust, honesty, communication, charisma and fairness. Their
choices are also influenced by their moral development. Ethical leadership exhibits morals and
values in a management position. They focuses on needs and rights of their employees. Ethical
leaders take decisions in context to ethical values and beliefs.
Characteristics of ethical leaders
 Justice- An ethical leaders is always fair and just. They should treat all the employees
with equal justice there should be no biased treatment on the basis of gender, ethnicity
and nationality (Kilbourne, 2012).
 Honesty- Honesty is important to be an effective leader. In Nike leaders should convey
facts like transparency in every information which makes the followers motivated in
performing work.
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 Value driven decision making- In Nike Ethical leaders must ensure that the decisions
taken are in accordance with the overall organisational values to meet and achieve the
goals.
 Encourages initiative- Under ethical leadership employees thrive. They should be
awarded for innovative ideas and encouraged to do tasks efficiently which motivates
employees to work with great dedication.
 Value awareness- An effective leader in Nike should regularly discuss high values and
expectations with the employees. By regularly communicating and discussing values they
ensure there is proper understanding in Nike.
 Fosters Team building- Ethical leaders in Nike should should foster team spirit within
the organisation to divide work among employees to achieve goals that benefit the entire
organisation. It help employees to work with others effectively and collaboratively with
others and achieve high morale in its business operations (King, 2013).
 Humane- It is most important trait of leader who is ethical and moral. These leaders
always place importance to being kind and act in manner that is always beneficial to the
team.
 No tolerance for ethical violations- Ethical leaders expects employees to do the right
things at all the time. The do not expect employees to violate ethical behaviour nad
performs task.
These are the essential traits of being an effective ethical leader which helps nike to perform its
business operations ethically and achieve business objectives.
Manage business and/or others to a high ethical standard
Nike place a considerable amount of trust in their management. Managers have the
responsibility in ensuring that subordinates behave ethically and in interest for both the
organisation and stakeholders.
 As an manager, they should set examples of appropriate behaviour for subordinates to
minimise the risk that often comes along with the practice of ethics.
 They should understand codes of conduct, codes of ethics or any other official set of rules
to keep records of related documentation for meeting ethical behaviour (Klein, 2016).
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 They should have proper understanding of Nike expectation in terms of profit and
productivity to achieve the objective.
 They should set a framework which will help in proper managerial decisions when Nike
faces any ethical dilemma. The framework consist of three methodologies human rights ,
justice and utilitarian methods.
In addition to this, personal ethics is determined as a philosophy that states about the
individual believes and related to morality and right or wrong (Kobayashi, 2012). Personal ethics
can be categorised into two factors i.e. business or legal ethics depends upon the nature and
circumstances. According to my concern, there can be some instances because of which an
individual had to adopt unethical organisational practices. For example: there might be a
possibility that marketing manager of the company was forced to promote the activities because
of which manager had used such concept in order to attract a large number of customers. As per
my point of view he might not have a thought in his mind that the issue will become so popular
that because of this brand image of the company will be affected.
CONCLUSION
From the above report it has been evaluated that marketing is done by a company in order
to get benefits and to connect with maximum number of people. But if they use ineffective tools
or technique than it can have a reverse action of this. Thus, it is crucial that whatever marketing
strategies are being used by companies it should be appropriate and should not affect the
sentiments of other people. Other than this, ethics and morale values also plays a crucial role
because for operating business in an effective manner there are some factors that are to be
considered so that company can run its business in an effective manner. In addition to this, some
of the ethical theories are mentioned so as to understand the concept in a better manner that how
ethical have to do with business activities.
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REFERENCES
Books and Journals
Altstiel, T. and Grow, J., 2015. Advertising creative: Strategy, copy, and design. Sage
Publications.
Campbell, C. and Marks, L. J., 2015. Good native advertising isn’ta secret. Business
Horizons. 58(6). pp.599-606.
Carrillat, F. A. and d'Astous, A., 2012. The sponsorship-advertising interface: is less
better for sponsors?. European Journal of Marketing. 46(3/4). pp.562-574.
Chen, P. T. and Hsieh, H. P., 2012. Personalized mobile advertising: Its key attributes,
trends, and social impact. Technological Forecasting and Social Change. 79(3).
pp.543-557.
De Mooij, M., 2018. Global marketing and advertising: Understanding cultural
paradoxes. SAGE Publications Limited.
Gomez, B., 2012. How Did Nike Get the Swoosh into Skateboarding? A Study of
Authenticity and Nike SB.
Grau, S. L. and Zotos, Y. C., 2016. Gender stereotypes in advertising: a review of current
research. International Journal of Advertising. 35(5). pp.761-770.
Grow, J. M., 2016. Stories of community: The first ten years of Nike women’s
advertising. The American Journal of Semiotics. 22(1/4). pp.167-196.
Jackson, S., 2013. Reflections on communication and sport: On advertising and
promotional culture. Communication & Sport.1(1-2). pp.100-112.
Jewell, R. D. and Saenger, C., 2014. Associative and dissociative comparative advertising
strategies in broadening brand positioning. Journal of Business Research. 67(7).
pp.1559-1566.
Kilbourne, J., 2012. Can't buy my love: How advertising changes the way we think and
feel. Simon and Schuster.
King, Y. M., 2013. The Challenges Facing Copyright Protection for Tattoos. Or. L. Rev..
92. p.129.
Klein, B., 2016. As heard on TV: Popular music in advertising. Routledge.
Kobayashi, K., 2012. Corporate nationalism and glocalization of Nike advertising in
“Asia”: Production and representation practices of cultural intermediaries.
Sociology of Sport Journal. 29(1). pp.42-61.
Kobayashi, K., 2012. Globalization, corporate nationalism and Japanese cultural
intermediaries: Representation of bukatsu through Nike advertising at the global–
local nexus. International Review for the Sociology of Sport. 47(6). pp.724-742.
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(Altstiel and Grow, 2015) (Campbell and Marks, 2015) (Carrillat and d'Astous, 2012)
(Chen and Hsieh, 2012) (De Mooij, 2018) (Gomez, 2012) (Grau and Zotos, 2016) (Grow,
2016) (Jackson, 2013) (Jewell and Saenger, 2014) (Kilbourne, 2012) (King, 2013) (Klein,
2016) (Kobayashi, 2012) (Kobayashi, 2012)
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