Analysis of Nike's Global Marketing Strategies and Impact

This report provides a comprehensive analysis of Nike's global marketing strategy. It begins with a company profile, highlighting Nike's business strategy of brand development through emotional marketing, technological innovation, and acquisitions. The report then delves into the environmental as...Read More

GLOBAL Marketing plan
Nike Corp.
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Report on Nike
Table of content
Table of content..........................................................................................................................1
Purpose of the report..................................................................................................................2
Company profile:.......................................................................................................................2
Nike Business Strategy..............................................................................................................2
Environmental Aspects..............................................................................................................3
PESTLE Analysis of Nike.........................................................................................................3
Challenges in External Analysis of Nike...................................................................................7
Global Marketing strategies impact on business strategies of Nike..........................................8
Critique on different global marketing strategies.......................................................................9
Recommendations....................................................................................................................10
Conclusions..............................................................................................................................10
References:...............................................................................................................................11
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Report on Nike
Purpose of the report
This business report is intended to present Nike, the sportswear innovation leader's Marketing
Strategy. The first section deals with the overview of the company. In the first section, the
study will examine the environmental aspects of the CompanyCompany. Further study
analyses the environmental, the positive and negative impacts of the PESTLE environmental
factors on the organization via PESTLE Analysis. In the second section, the study focuses on
the challenges regarding the External Analysis of Nike. Afterward, the study examines how
these challenges affect business strategy. In the third section, the study examines the
Company'sCompany's global marketing strategies. To conclude the study, conclusion, and
recommendations are also presented.
Company profile:
Nike is a U.S. multinational Beaverton, Oregon-based corporation that is the world's biggest
sportswear manufacturer. It is well known as one of the "world's top athletic shoemakers" and
a worldwide producer and manufacturer of sports equipment. The CompanyCompany is
engaged in designing, manufacturing, marketing, and selling athletic footwear, apparel,
appliances, accessories, and services. There are 56,500 employees in 52 countries. Nike
products are manufactured in 45 countries. In 190 countries, products are supplied via
supermarkets, Nike stores, and online. Separate vendors manufacture the
Company'sCompany's products. Nike advertised its brands, tactics, and ideas as part of its
"guerrilla marketing" strategy when it overtook Reebok and became the business leader. The
CompanyCompany had to change the entire environment and "organized" a little. Nike has
excelled and distanced its competitors by acquiring and dominating new segments: women's
and outdoor marketplaces (Nike). As of 2018, the Company'sCompany's total revenues were
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$36,397B, a 5.96 percent raise over the 2017 period and a 12.4 percent increase over the 2016
period (Nike).
Nike Business Strategy
Nike's business strategy is to invest in brand development via emotional marketing and
athlete endorsements, create goods with market-leading technology, and acquire rival sports
companies (Bush, 2016).
Environmental Aspects
Nike maintains a formal positive stance on green (i.e., environmental) problems. Nike
established its first sustainability strategy in the early 1990s, appointing 100'sustainable
champions' to supervise experimental initiatives in different aspects of the business, including
carbon emissions reduction and waste elimination. Externalized costs, such as those
associated with human resources, must be considered if the market's "invisible hand" resolves
the fundamental conflict between making decisions solely for short-term profit and making
decisions based on social and environmental responsibility, as Willard (2002, p.80) explains.
In terms of human resource management, it is estimated that including workers in operational
aspects of environmental policy has a beneficial impact on both productivity and the
psychological empowerment of employees (Alsaffar, 2020).
PESTLE Analysis of Nike
Nike Inc.'s growth is dependent on external factors. These conditions are addressed in the
Company'sCompany's PESTLE Analysis. PESTLE Analysis examines external factors that
provide opportunities and threats in the global environment. The PESTLE Analysis of Nike
Inc. identifies external factors that can affect the Company'sCompany's strategic decision-
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making processes. As a significant player in the global sports shoes, clothing, and equipment
market, must handle these external factors in business to maintain industry dominance,
particularly in light of the existence of competitors such as Adidas (Bush, 2016).
A PESTLE Analysis of Nike Inc. indicates fundamental challenges that the
Company'sCompany's strategy formulation must address. Nike Inc. must handle opportunities
and challenges based on external factors that can affect the dynamics of its global
environment to retain its position in the sports shoe industry (Cluley, 2019).
Political Factors Affecting Nike’s Business
Nike's sports shoe business is affected by the political environment. This component of the
pestle analysis framework examines the impact of government on the global environment in
which companies operate. The following political external factors determine some of Nike’s
business strategies:
1. The political environment is stable in the majority of large markets
2. Increasing the scope of free trade policies
3. Increasing the government's commitment to infrastructure
Nike can expand its business in these countries due to the stable political environment in
most significant markets. Additionally, increasing free trade policies enables greater market
penetration abroad. Additionally, increased government funding for infrastructure,
particularly in developing nations, provides Nike with additional possibilities to grow in these
areas. Nike Inc. sees opportunities to expand its market presence and worldwide growth in
the sports footwear, clothing, and equipment industry due to the external political variables
included in this component of the PESTLE Analysis.
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Economic Factors Important to Nike Inc.
Nike's business success depends on the business of the economies in which it sells sports
footwear, equipment, and clothing (Depaul.edu, 2021). This component of the PESTLE
Analysis model highlights economic issues affecting the business's distant or macro-
environment. The following economic external factors influence Nike's success:
1. Stability of developed markets' economies (opportunity)
2. The rapid development of emerging markets (opportunity and risk)
3. China's economy is slowing (threat)
Because developed markets such as the United States are generally stable, Nike Inc. can
continue its gradual but steady development in these nations. Additionally, the business has
the potential to expand quickly by expanding its operations in high-growth emerging
countries. However, the fast growth of emerging markets poses a danger to Nike by driving
up labor costs across the Company'sCompany's supply chain and manufacturing sites.
Additionally, the Chinese economy's slowing growth affects Nike's performance, as the
CompanyCompany has become increasingly reliant on the Chinese market for sports shoes,
clothing, and equipment. The external economic variables identified in this component of the
PESTLE Analysis indicate that Nike Inc. must prioritize global expansion plans while also
creating new revenue streams in emerging nations (Gonzalez, 2016).
Social Factors Influencing Nike’s Business Environment
Social issues affect Nike's sports shoes, clothing, and equipment's appeal. This PESTLE
Analysis model component examines the impact of social circumstances on the firm's distant
or macro-environment. In the case of Nike, the following sociocultural external elements are
critical:
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1. Individual wealth accumulation in underdeveloped nations (opportunity)
2. Improving product safety (opportunity)
3. Enhancing favorable attitudes toward leisure (opportunity)
Nike has opportunities in emerging nations to reach customers with growing individual
income. Additionally, the business can create safer goods and promote the safety of its sports
shoes, equipment, and clothing via marketing efforts. Nike may also pursue new product
development methods to meet consumer demand for goods designed for recreational
activities. Nike Inc. offers significant possibilities for product development and company
expansion based on the external variables identified in this component of the PESTLE
Analysis.
Technological Factors in Nike’s Business
Nike's business model evolves in response to advancements in business processes and sports
footwear, clothing, and equipment (Institut, 2016). This component of the PESTLE Analysis
model analyses the technical factors contributing to a substantial change in a company's
distant or macro-environment. The following technical external factors impact Nike Inc.:
1. Increasing R&D investment among firms (threat)
2. Rapid technological obsolescence (opportunity & threat)
3. Widespread use of mobile technology (opportunity)
The growing investment in research and development by companies poses a challenge to
Nike, as these firms strive to create more technologically advanced sports shoes, equipment,
and clothing. Rapid technology obsolescence also poses a danger to Nike, placing the
corporation under pressure to ramp up its product development efforts. Nonetheless, this
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external element presents Nike with chances to incorporate cutting-edge technology into their
goods. In this regard, the business has an opportunity to include mobile technologies into its
goods to attract customers who often use mobile technologies such as mobile applications
and online tools. Nike confronts significant risks and opportunities as a result of new and
evolving technology, as shown by the external variables in this component of the PESTLE
Analysis.
Environmental Factors that Impact Nike Inc.
Ecological concerns affect Nike's remote or macro-environment. This PESTLE Analysis
model component examines the impact of environmental problems on business performance
(Guerguis, 2018). The following environmental external factors are noteworthy in the case of
Nike and its sports shoes, clothing, and equipment:
1. Expanding environmental law (opportunity)
2. Climate change (opportunity)
3. Increasing sustainability strategies among firms (threat & opportunity)
Expanding environmental law allows Nike to enhance its environmental and sustainability
initiatives, which are already among the finest in the business. Additionally, the company
may utilize these initiatives to address climate change, which impacts supply chains and the
suitability of Nike sports shoes and clothing in specific areas. The growing sustainability
initiatives of businesses pose a danger to Nike by raising the pressure on the whole sector to
improve its sustainability efforts. Nonetheless, this external issue presents Nike with a chance
to enhance its sustainability performance further. This component of the PESTLE Analysis
identifies Nike's opportunities to reduce its business's environmental effect (Guerguis, 2018).
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Legal Factors in Nike’s Business
Legal terms influence Nike's business decisions. This component of the PESTLE Analysis
model examines the impact of laws or regulations on a business's distant or macro-
environment (Gonzalez, 2016). Nike's case demonstrates the importance of the following
legal external elements in the sports shoes, clothing, and equipment business:
1. Improving employment law in developing countries (threat & opportunity)
2. Expanding consumer law in developing countries (opportunity)
3. Growing health and safety regulations (opportunity)
An increasing number of Nike's production facilities are in emerging nations, where
improving employment laws poses concern since it increases labor expenses. On the other
hand, this external element gives the business the chance to apply better criteria to labor and
employment in the future. While marketing its sports shoes, clothes, and equipment, Nike can
enhance its brand image by emphasizing client satisfaction. It also has an opportunity to
improve its health and safety procedures to comply with growing requirements. There are
several possibilities to enhance Nike Inc.'s corporate reputation based on this PESTLE
Analysis component (Khan, 2019).
Challenges in External Analysis of Nike
Nike's business strategy may be better understood by examining the political, economic,
social, technical, legal, and environmental variables surrounding the CompanyCompany.
Nike has some intriguing political challenges. Nike's ability to meet consumer demands has
been dependent on supply networks and their efficiency. Nike's supply chain may be
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disrupted by national or local strikes, for example. Any political upheaval in the nation of
production may pose a severe danger (Collis & Montgomery, 2005).
Nike has several difficulties on the economic front. Nike's market penetration is intense in
certain nations, but it must grow into new areas owing to entry restrictions in Europe.
Premium sports brands have suffered as a result of any decline in customer confidence. A
strong market position and excellent brand awareness characterize Nike's social standing.
This trend has been noticed by Nike, which has increased its product range to match it.
Consumers are growing more brand-conscious, and Nike has been capitalizing on this trend
with vital corporate social responsibility initiatives for many years (Werther & Chandler,
2006). In the field of design technology, Nike has excelled due to its technical superiority.
Nike's market position has been secured during tough economic times by introducing new
inventive goods ahead of the competition. Concerning workers and their connection with the
business, Nike has encountered several legal challenges. Underage workers have been
particularly active in bringing legal proceedings against the companies. Nike relies heavily on
international trade deals, and its management will be critical to its overall success. Every one
of these issues has to be closely examined (Mahdi, 2015). Nike has a long and fascinating
environmental history. A significant part of the organization's goal has been to address
climate change and environmental concerns. Nike puts a high value on corporate social
responsibility, reflected in their green strategy (Human Resource Management International
(Mitchell, 2017)
Global Marketing strategies impact on business strategies of Nike
For Nike, global marketing strategies include promoting and sponsoring well-known athletes,
creating high-quality, leading technical products, and selling competing sports brands. Global
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marketing techniques at Nike, which have been successfully commercialized in the United
States, have allowed the Company to become a truly international corporation (Rizwan
Raheem Ahmed, 2016)
A combination of Nike's worldwide business strategies and promotion strategies allows the
CompanyCompany to stay one step ahead of the competition in the apparel industry, both
domestically and internationally. Global marketing is a strength for Nike since the
CompanyCompany has a thorough understanding of foreign markets and how to reach each
customer via a customized approach that considers different languages, cultures, practices,
wants, and variances. When it comes to distribution and marketing campaigns, Nike is one of
the most influential companies in the world today (Khan, 2019).
Nike's "Just do that" slogan was already a world-famous catchphrase when it first came out.
Instead of selling a product directly, Nike's approach focuses on a client's desire or emotions
to create a connection with the brand, rather than simply selling the goods. Nike relies on
action, heroism, achievement, performance, and success to attract customers, which is a
strong strategy regardless of the sector in which the CompanyCompany operates. Nike has
used emotive marketing techniques such as advertising slogans such as "Expect greatness"
and "Your only limit is you" (Rösler, 2018)
Since its inception, Nike and its many brands have had a lot to innovate, mainly fitness and
health technologies. To create breakthrough technical products, it seems that wearable
technology is the first step. As of 2008, Nike has partnered with five contract boot
manufacturers to implement an energy-saving program. Conversely, increasing competitive
competition remains a significant issue for Nike's worldwide corporate operations
(Sagepub.com, 2011)
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Critique on different global marketing strategies
A Nike manufacturing employee's number of hours worked and the amount charged was
questioned by Michael Moore, as was the employee's age. Nike was compelled to raise the
minimum age for manufacturing employees as a result of the movie. Michael Moore's film
did not end Nike's child labor problems (Bush, 2016)
He wrote in the report that Nike's challenges with workplace standards are alarming because
of child labor. Nike was accused of exploiting workers in sweatshops. But Nike's slavery
culture and harsh labor conditions could not be changed. Nike infringes on labor laws in the
U.S. Sweatshops exist both internationally and in the United States. A significant component
of the global sweatshop system is the consumers. The sweatshops may not have thrived if
consumers refused to buy their products. Improving workers' rights is necessary to guarantee
that consumers can afford essential items and that companies desire to create jobs and
develop products that will enhance working conditions. As salaries rise and working
conditions improve, companies will be able to earn a fair profit (Cluley, 2019).
Companies based in developed nations, such as the United States, take advantage of lower
wages and weak employment laws in developing markets. By locating their factories in
industrialized countries, companies may avoid complying with labor laws and avoid
exploitation of workers (Sangha, 2019).
Recommendations
PESTLE Analysis shows Nike Inc. has a multitude of opportunities. To expand
internationally, Nike should adopt a more aggressive strategy based on free trade rules,
focusing on high-growth developing countries. As a result of this move, Nike's performance
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in the Chinese market may be at risk. Also, the corporation should invest more in R&D to
meet the future demand for sports shoes, gear, and equipment that integrate modern
computing technology into the design. Nike's sustainability and employment practices must
be improved, according to the PESTLE Analysis. Nike's brand image and corporate image
increase due to these initiatives, which address regulatory and sociocultural concerns.
Conclusions
High quality and premium branding are at the core of Nike's business approach. Nike's
success has been primarily attributed to its superior design skills and high-quality goods. In
industrialized nations, Nike has attained significant market penetration via rapid development
and cautious acquisitions. This is Nike's new endeavor, despite recent negative press about its
suppliers. Supplier connections have been tightened up as a result of this. About sports shoes,
Nike has maintained its position as the premium brand in the sports apparel industry by
staying on the cutting edge of design technology. So far, replacements and competitors have
failed to match Nike's success in the sports clothing industry due to careful management and
a well-defined strategy.
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References
Alsaffar, H. (2020). Marketing and Services Management Nike’s Marketing Mix and
PESTEL analysis in China. .
Bush, T. (2016). A PESTLE Analysis of Nike.
Cluley, R. (2019). Book Review: Advertising Revolution: The Story of a Song, from Beatles
Hit to Nike Slogan . Journal of Macromarketing.
Company, F. (n.d.). MOST INNOVATIVE COMPANIES Nike . Retrieved from Fast
Company: https://www.fastcompany.com/company/nike
Depaul.edu. (2021). Strategic Analysis of Nike, Inc. .
Gonzalez, G. G. (2016). Environmental & Strategic Analysis.
Guerguis, A. (2018). Nike’s Marketing Mix and PESTL Analysis in Vietnam.
Institut, P. (2016). Nike Inc. Organizational Culture Characteristics.
Khan, S. (2019). A Successful Marketing Strategy for Nike Inc The Story Behind and Its
Analysis.
Mahdi, H. I. (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 Competi.
Marketing, J. o. (2019). Historical Analysis of Apparel Marketer’s Strategies: Evidence from
a Nike Case. .
Mitchell, D. (2017). The Sneaker Life: A Critical Analysis of Nike and Under Armour
Marketing Strategies. Asu.edu.
Nike. (n.d.). Until we all win. Retrieved from Nike: http://equality.nike.com/
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Rizwan Raheem Ahmed, H. B. (2016). Strategic Marketing Plan of Nike.
Rösler, P. (2018, September 6). Why Nike's polarizing campaign is courageous. Retrieved
from DW: https://www.dw.com/en/why-nikes-polarizing-campaign-is-courageous/a-
45386402
Sagepub.com. (2011). Nike Becomes a Global Citizen. .
Sangha, B. (2019). Just Buy It: A Critical Analysis of Nike’s “Dream Crazy” Advertisement
Campaign.
Sportsanguilla.com. (2020). Nike international marketing strategy pdf. .
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