Executive Summary:This report looks into a famous company Nike, well famous for its sportswear products. Nikebeing a Fast ...
Background of Nike:Nike is a universal brand, highly idolized by teenager groups and leading sports brand andsupplier. Ini...
All the problems mentioned above, have been discussed and linked together andsolutions have been given at the end to overc...
People: People can turn out to be a great asset or a great weakness for businesses.    The impact of variables highlighted...
football      tournaments.•     Emerging Asian      economies: China      and India    Source: Kotler et al (2005)    Stre...
www.nike.comWeaknesses:Nike promotes and sells diverse range of products. However, their income of businessis heavily depe...
several retailers stopped purchasing products from Nike, as it broke the internationalcode of conduct and there was a risk...
Legal:Different countries have different legal requirements. In UK, there is a basic minimumwage of £5.74 to be paid by co...
Political:High taxes and minimum wage criteria in United Kingdom forces companies to recruitsensibly. So companies prefer ...
lines and promote them in the best possible way. Organizations are believed to spendmore on their promotional methods like...
www.sportsdirect.comwww.nike.comwww.adidas.comRivalry among the existing players:Though Nike is leading in sportswear indu...
Consumers in developed markets are becoming increasingly obsessed with theirappearance and personal well-being. They are p...
different policy approaches to pricing. Prices reflect corporate objectives and policiesand are important in the marketing...
Organizations need to do a portfolio analysis of itself and its competitors in order tocreate a benchmark. Organizations k...
A competitive market views its customers as the ultimate success at the expense ofrivals. Organizations attempt to capital...
•   H0: Nike’s promotional budget is at its least.Research findings and AnalysisQuestionnaire findings1. Have you heard ab...
4. How often do you purchase Nike products?   Every week    once a month     once in a year   never buy   Survey showed th...
9. How much would you rate the brand, out of 5?   Most people with the most ratings were 4. Followed by 3 and 5. This is h...
Everyone in Nike should play their individual roles in promoting their brandirrespective of their hierarchy level, ranging...
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Nike分析英文

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Nike分析英文

  1. 1. Executive Summary:This report looks into a famous company Nike, well famous for its sportswear products. Nikebeing a Fast Moving Consumer Good (FMCG) is ranked number one globally and Britishmarket holds a great repute for Nike products. In this report, I looked at different aspectsabout the company which led to its success in British market.The report also includes a literature review with explanatory reviews and in-depth details intodifferent scholarly journals, books and academic resources.A mixed methodology was prepared for research findings, combining both qualitative andquantitative research.The market of Nike was segmented by discussing the promotional techniques, its marketstrength, differentiation and its target audience. Several factors including, price,advertisements are also included in the report and discussion has been made as to how itaffects Nike brand and its customers and competitors.Researches have been carried out to examine and to create a clear image about my project.Analysing them through the help of graphs and questionnaires will help to conclude Nike’smarket analysis and where it is going right now.AcknowledgementsI would like to thank ‘ALLAH ALL MIGHTY’ first of all who gave me the courage and strengthand foremost an opportunity to study abroad. Then i would like to thank my family who hasbeen a great support throughout. Many thanks to my tutor Chris Evans, whose guidelineshave helped me prepare my dissertation. Thank you all for being there and being a source ofinspiration and motivation.Topic: Strategic marketing analysis of Nike in British marketand its critical success factors
  2. 2. Background of Nike:Nike is a universal brand, highly idolized by teenager groups and leading sports brand andsupplier. Initially the company was founded with the name of Blue ribbon by Bill Bowerman in1964 and the name was changed to Nike in 1970. Pronounced also as NI-KEY, Nike is aGreek word meaning ‘Goddess of victory’ and kicked off with an investment of just $500. Nikestarts to sell the first ever football shoe in 1971, named Nike. In 1980’s after hard work anddedication, Nike market share increased by 50% and started to appear in TV commercialswith the famous slogan; ‘Just Do It’. In 1986, Nike had one billion sales showing its financialstrength since it started off. With time Nike, progressed through market segmentation,differentiation, promotion until it made blunders such as Sweat shops in Asia. With thecompetitors active and accusations proving right Nike gave its own statement, and told all itscontractors strictly to abide by the code of conduct; which worked to some extent. Nike hasbeen successful till today and stays number sports brand, competing with famous brands likeAdidas and Reebok. Nike is operating a large market in United Kingdom, with an area of244,755 km2 and a population density of 249.9 people/km2 (GMID 2009).Nike stocks and sells a variety of products ranging from footwear to t-shirts and sportsgoods.Problem definition:Nike is number one sports brand and faces internal and external threats. Nike facesinternal threats from its employees, product, consumers, which may not be loyal attimes. External threats are linked with internal threats and can turn your assests intoloss. Nike fears of losing its customers to its competitors, which are part of an externalthreat. Competitors are active in this fast consuming world and dangerously active indeveloping new strategies, differentiating their products, innovating new products,advancing in technology and manufacturing their products at a large scale. In thishighly competitive and sensitive market Nike can not afford to make mistakes such asSweat shops in Asia and repeat child labor issues. Market shares were seen stumblingdown due to Nike’s policies in Asian countries. Hatred for the brand developed whichthen again forces consumers to switch towards other brands. Due to this competitiveadvantage Competitors like Adidas and Reebok, promote their product to a greaterextent; taking full advantage of Nike’s weaknesses.
  3. 3. All the problems mentioned above, have been discussed and linked together andsolutions have been given at the end to overcome weaknesses and turn them intostrengths for the company chosen (Nike). (Mintel 2009)Literature Review:Brand image:For every business uniqueness is important to distinguish themselves from theircompetitors. This is important because when a brand is unique, people associatethemselves with the brand. Therefore it allows them to value your brand (Heaston,2002). Awareness about the brand comes through different range of ideas, advertising,word of mouth, company portfolio, personal experience with that particular brand, andmany more (Armstrong and Kotler, 2004). Nowadays, the trend is to follow and adaptsomething that sounds cool and looks cool, even if its meaningless to theaudience (Pesce 2002) Strong brand image pulls a customer to buy the company’sproduct, even if they are paying more (Sims 2001) and success of a brand depends onhow well a brands image and meaning is maintained over long term (Michell, King andReast, 2001)Companies must manage their brands by creating awareness so the brand’spositioning must be continuously communicated to the consumers. Positioning is howyou want to be perceived in the marketplace, and branding is a further modification ofthat positioning (Moran, 2008)Marketing Mix:Product: According to Jobber (2006), ‘Product decision’ is the type of service orproduct that should be offered. If a company has a strong brand image customers willbuy company’s product even if they have to pay more for it (Sims, 2001). Productprototype should be sampled before launching their products like Nike. As (Lury2001) states that managing the product is therefore vital to a brand’s success. For acompany to succeed it needs to improve its services, revise its market position, and itsimage besides managing it.Promotion: Promotion covers the communication areas which include, salespromotion, advertisement, public relations, internet marketing etc (Sims, 2001). Thesehelp enhance the awareness of the products benefits among the consumers. All of thecommunication areas mentioned have their own strengths and weaknesses (Jobber,2006).
  4. 4. People: People can turn out to be a great asset or a great weakness for businesses. The impact of variables highlighted as attached in appendice during market research help in critically analyzing the market research factors and opting for best tools of pricing of Niche products. Lury 2001, mentions that brand interaction is important with customers to create awareness of the brand. Likewise, for a company to overcome its weaknesses the targeted audience (people) plays a pivotal role and helps a company, like Nike to shift from a bracket of threats to opportunities. Timely understanding and market research of a company’s weaknesses will prove helpful in overcoming the threats and shift towards opportunities in short and long run. Place: Place is like a key of branding strategy, because if customers do not have a guide as to where to find the product how will they buy the brand (Lury 2001). Businesses have to Target their audience and then setup their shops according to the demand of their products. Nike has been promoting its products globally and has targeted every country according to their market demand. Customers expect that a company delivers them high quality products in shortest time available. Access is improved through multi site locations (like McDonalds, KFC, Pizza Hut), where customers dont have to wait for long for their product delivery. Nike synchronises supply in almost every major countries in Europe, Asia, Middle East and Africa and productivity problems are solved through its Multisite chains. SWOT analysis: WeaknessesStrengths• Swoosh logo • Diverse Range• Number one global brand • Price margins• Sponsors squeezed• Joint ventures/ alliances Opportunities Threats• Teens desire • Child labor and sweat shops• Strengthen brand: IPL (Indian • Competition: Rivals; Premier League), Reebok and Adidas Olympic Games,
  5. 5. football tournaments.• Emerging Asian economies: China and India Source: Kotler et al (2005) Strengths: Nike is leading the sports wear market with its innovative products and customer services. Biggest strength that ‘Nike’ has over its competitors is its percentage of market share within the footwear industry. The revenues recorded of the company were $16,325.9 million in the financial year (FY) ended May 2007, up by 9.2% over 2006. Nike operates in more than 160 countries, covering America, Europe, Asia Pacific, Middle East and Africa. `In 2007 Nike launched a hat phone, hat with built in controls for iPod nano . At the Atlanta Olympics, Nike also sponsored the top athletes and gained valuable publicity and coverage. At different stages Nike allied itself with celebrities and stars. In 2006, Nike unveiled its new women fitness dance with music videos featuring some famous stars like Rihanna and artist def Jam, celebrity director Jamie king. This Nike rock star work out and its stylish moves show that Nike shoes are not just stylish but flexible and allow for maximum performance. The workouts are available for viewing at nikewomen.com for fitness conscious women. http://www.pocket-lint.co.uk/news/news.phtml/6514/7538/nike-hatphone-ipod-nano- clothing.phtml In 2006, UK contributed the largest to overall sales of footwear and clothing in Western Europe with a volume sales share of 27%. (GMID 2009) Nike is the leading sports footwear brand in the region, placed ninth overall among footwear manufacturers. In Spain, Converse has done very well, with 2006 sales growing 37% over prior year (GMID 2009). In response to the price-led competition brought on by less expensive Asian imports, many important players will continue to shift their production facilities to countries where labour costs are substantially lower (GMID 2009). Casual footwear was estimated to account for 56% of all footwear sold in 2006, up from 49% in 2004. (GMID 2009)However, the market is growing because of price discounting and promotions.
  6. 6. www.nike.comWeaknesses:Nike promotes and sells diverse range of products. However, their income of businessis heavily dependant on footwear sales. Nike targets its customers through itsbranches and different retailers which sell Nike products to gain their shares as well.This results in price differences, less stock and price margins being squashed due totheir demand.Adidas on the other hand Segments its market with a different approach likeintroducing gift cards for shopping online or in store. These gift cards are onlyredeemable at Adidas originals and its outlets and factories. Nike fails to introducesuch gift cards till now, showing that Adidas differentiates its products, and has arealistic approach when it comes to promotions.Opportunities:Nike is a fashion brand among youngsters especially teens, also seen in appendix.Youngsters get easily influenced by fashion, style, price and design. Youngstersespecially Teens tend to purchase more and are sometimes claimed as shopaholics,compared to the normal population. Teens get easily influenced by stars andcelebrities and consider their brands as up to date and Fashion oriented. Nike spendsa lot of money on celebrities to endorse their product; and if they spend more, this willhelp increase their revenues. These revenues can be used by Nike to focus on theirexisting product lines such as jewellery, sunglasses and sportswear and at the sametime introduce new ones.Nike can focus on new emerging markets such as China and India, two developingeconomies, to build up strong brand recognition. China is a large market rich ofconsumers and Nike can promote their products by indulging in their sports activities.Global events in sports like football tournaments and events such as IPL (IndianPremier League) are opportunities to promote and market Nike’s brand. Other sportsevents such as rugby tournaments, boxing events can also be utilized especially theupcoming Olympic Games to build up and strengthen Nike’s global brand recognition.Threats:Nike has been accused several times for child labor policies in some underdevelopedand developing countries, mostly Asian countries such as Pakistan, China, India,Bangladesh and Indonesia. The result was a devasted market when consumers and
  7. 7. several retailers stopped purchasing products from Nike, as it broke the internationalcode of conduct and there was a risk that Nike’s assets might collapse at some stage.Nike faces both internal and external threats from some of its great competitors likeAdidas, new balance and Reebok. Like Nike, Adidas and Reebok also manufacture theirproducts from abroad as the manufacturing cost and production is cheapest. Adidas isa major sponsor of kits to famous Cricket teams like England and Australia. It is activein supporting top football clubs like Chelsea, AC Milan and Liverpool and others. Notonly this, it also sponsors London Marathon.Nike trades internationally and faces threats of stumbling international markets andlow exchange rates. Pound sterling recently faces threats from the rising Euro andDollar. Recent Global recession which lead to the collapse of some major companieslike Woolworths can also have its after affects on the company.Slept factors:Slept factors include Social, legal, economic and technological factors influencing abusiness. These factors are part of external environment. (Lancaster 2002)Social:Nike has been engaged in social activities and seen as a much responsible brand. Inaugust 2008, Nike organized a one day running event in London and New York with livemusic performances in designated race cities.Developed economies were once traditionally strong markets for children’s footwear.There is a current decline in the population of target segment: children and a risingproportion of people over 45 years old in European countries. (Jobber 2007) This is anemerging market and can be target segmented. In 2004, Nike denoted $37.3 million insincere services to charity. Nike has also been active in major sponsor events such asage concern big band concert and Rhos y Ghalian Outdoor Education Centre in Walesfor the use of local community and children studying at school.http://www.bumpershine.com/2008/08/28/nike-human-race-lots-of-concerts-on-aug-31.htmlhttp://www.nikegroup.co.uk/community.php
  8. 8. Legal:Different countries have different legal requirements. In UK, there is a basic minimumwage of £5.74 to be paid by companies. Companies paying less than basic amount aresaid to be in an illegal activity. Nike . In 1997, Nike workers in Vietnam were forced towork overtime illegally and exposed to chemical toxic and other hazards.Similar type of cases were seen in Pakistan and Indonesian sweat shops, wherechildren upto 12 years of age and younger were made to work more than 70 hours aweek. Nike here violated the human rights laws and acted highly irresponsible. Nike’sbrand image was damaged at several stages like In 2006, Nike lost a case againsthackney over copying its logo.http://www.motherjones.com/news/feature/1997/11/nike.htmlEconomic:Recent credit crunch globally has almost stumbled the market shares and has broughtconsumers buying decisions to a dead end. Due to increased interest rate and lessloan availability consumers have become miser in shopping and this has resulted indeclined sales of organizations compared to credit crunch free environment. Pricereductions and price losses are beared by companies out of their budget to reachconsumers buying power. A margin squeeze is seen with companies reserves andmarket shares falling down. Organizations cannot invest in new advancement andpromotional sectors, with the delay of other projects. This means less innovation inproducts, less budget availability for new marketing campaigns, economies of scalegradually coming down. Nike and its competitor’s economic conditions have also beenaffected by the above factors.Exchange rates of currencies also affect the sale of a product. Buying and selling ishighly affected in situations where transactions are carried out between rich and poorcountries. However, the profit margins get squashed depending on the economicenvironment of that particular country. Pound sterling being a strong currency istherefore still in a beneficial position when transactions are carried out with poor anddeveloping countries in Asia or even European countries If the exchange rate is lowthis means one can exchange more sterling for foreign currency, therefore if there willbe more surplus demand of Nike in Britain from abroad, this will lead to a poor balanceof payment which is beneficial for the British footwear organisations. If in Britain,Export is greater than import this is excellent for the British economy in general. Theopposite of this would mean slump in countries exchange rate, which would correct abalance of payment deficit, and is the Marshal Lerner Condition.
  9. 9. Political:High taxes and minimum wage criteria in United Kingdom forces companies to recruitsensibly. So companies prefer to choose workers who are highly skilled, motivatedand have an experience related to the field they chose. Nike is an old company andenjoys its friendly ties with government officials, which think Nike is a surplus to theireconomy. However, Illegal practices are unlawful and are fined heavily; these includecash in hand jobs, child labor practices (like the one carried out by Nike in some Asiancountries) and tax exemptions. So far Nike has had several legal cases running againsthim, but in 2003 Nike had to face Supreme Court charges for its foreign operationswhich were considered unethical, unjust and against human law policies (Sweat shopsand Child Labor).Technological:Nike continues to be innovator in its footwear market and strives to create the best andunique sports apparel and footwear possible. Nike were one of the first company’s toimplement the idea behind Nike ID footwear, which offers customized footwear createdby the customer on the company website. Nike invented air cushioned soles thatbraught an impression in the market that Nike is more creative, price competitive thanany other brand. This was the first time Nike was recognized as being a footwearinnovator. Footwears have a huge market demand and it is crucial for Nike that itcontinues study on implementing creative ideas and designs, much faster than itscompetitors. Such Advances in technology help to build market strength positionthrough comparative analysis and should be available to the audience. Advertisementsand promotions of products require huge investments and are portrayed easilythrough the use of fast internet, television, radio and other mobile technologies.Porter’s five competitive forces:The strategic business manager seeking to get an edge over rivals uses this model tobetter understand the context of the industry in which the firm operates (Wilson A.(2003). Michael Porter introduced a framework of models which shows an industry isinfluenced by five forces:Entry of new competitors is difficult in sports wear market. It’s a long way and difficultfor a new rival to enter and sustain in such a competitive environment where alreadybig brands like Nike, Adidas and Reebok are competing with each other to get on top.This gives companies like Nike more chance to market segment their existing product
  10. 10. lines and promote them in the best possible way. Organizations are believed to spendmore on their promotional methods like advertisements rather than launch of theproduct or any other method. Nike has so far been successful in giving its rivals acompetitive edge.Threat of substitutes:Nike sportswears are best in quality, design and comfort. It’s quiet hard for othercompanies to produce the same product line, with the same quality and at cheap rates.However other companies can copy the same product and design and display in themarket with a cheaper price. This price war starts when a company fails to differentiateits products from its competitors. Nike and Adidas are seen to have an head oncollision with each other.www.adidas.comwww.nike.comBargaining power of buyers:Nike’s actual buyers are customers, supply chains like JD sports, Sports Direct andstars/celebrities. The most willing shoppers are youngsters which take Nike as afashion brand. Youngsters all over the globe follow stars and celebrities to approachtheir product. Brand loyalists are permanent asset for a company and it is impossiblefor them to switch over to other companies even if they are offered cheap products.www.nike.comwww.sportsirect.comBargaining power of suppliers:Nike has a number of suppliers which promote and sell its product, like JD sports,Sports Direct, Footlocker. These suppliers are big chains present in almost every bigtown centers in London and its outskirts. One of the main benefits to sportswearcompanies like Nike are that these retailers are globally diversified, meaning they havelinks in several markets globally. These retailers aim at gaining popularity, profits andappreciation about their chain through promotion and selling of new product lines ofthese big brands. However these chains are not Brand loyalists to one specificcompany and aim at gaining profits from other businesses as well like Adidas,Converse, Puma, Lacoste and others.
  11. 11. www.sportsdirect.comwww.nike.comwww.adidas.comRivalry among the existing players:Though Nike is leading in sportswear industry, this does not mean that it retains itsposition as a leader in future as well. Nike is competing with one major rival which hasbeen fighting for years to get on top; Adidas. Adidas and Nike watch each other’s movevery closely. Sometimes new ideas and thoughts are copied by the competitor creatingan air of rivalry. We have seen this in several advertisement campaigns made by thetwo. A company which is seeking success in short and long term never overlook thestrengths of its rival. The main aim of a company, like Nike, is to consider everyopportunity of its rival as a threat for itself and a point to signify the problems what itmight face in near future.Children footwearChildren’s footwear holds an important position in the market as a subsector, resultingin one-quarter of overall footwear volume sales in 2006. Volume sales witnessed aCAGR of upto 5% globally during its review period. As children grow, there is a need tokeep replacing shoes and this drives the steady demand for children’s footwear. But interms of value sales, this subsector is relatively small, accounting for only 15% ofoverall footwear sales in 2006.Among the countries under study; Japan is forecast tohave the lowest proportion of population (14%) below 15 years of age by 2011. BothEastern and Western Europe will also see a decline, with lower population ofyoungsters.China, which has declared officially that there will be one-child policy, will also witnessa decline in its younger population. However, even with the 12% decline projected overthe forecast period, the country will still have 16% of its population aged 0-14 years. InIndia, nearly 30-31% of the population will be under the age of 14 groups and is hopedby 2011.Countries, like Germany, Hungary, Japan, Italy, and most European countrieshave already begun to see declines in children’s footwear sales. These decreasingbirth rates are going to affect the markets all over the globe; however some countrieslike China and India will still have a mass market due to its huge size and consumption.
  12. 12. Consumers in developed markets are becoming increasingly obsessed with theirappearance and personal well-being. They are prepared to invest significant sums inself-improvement, in terms of looking and feeling younger, shedding weight andimproving their physique.http://www.portal.euromonitor.com/passport/GeographyTree.aspxAdvertisement:Whether advertising or promotion helps or damages a brand, has still not beenresearched (Mela, Gupta & Lehman, 1997) In the long run advertisement help brands bymaking consumer less price sensitive and loyal towards the brand. For the add to beseen it must grab the attention of its target audience. ‘Ads originality’ as definedfrom Pietes, Warlop and Wedel, (2002) were easier for customer to remember thanordinary ads by increasing attention to it. This thus increased attention to the brandbeing advertised. Liking towards the brand itself can influence liking for thebrand (Hawkins, Best and Coney, 1992). However according to study by Bichal,Stephens and Curlo (1992) whether customers hate or like an ad does not obviouslylead to brand acceptance or rejection. So even though the consumers may like the addthey see, it does not necessarily mean they will go out and buy the brand advertised(see appendix).Advertisers must remember that advertising messages are portrayed differentlybetween different genders (Maldonando, Tansuhaj and Muehling, 2003; Hogg andGarrow,2003; Putrevu, 2001)Hogg and Garrow (2003) found that women paid moreattention to the details of the character of an ad, like celebrities, when asked to analyzeadvertising messages. Advertisement can change consumer’s perception of a productin terms of attributes content and proportion and also influence consumer’s taste forattributes (Gwin & Gwin, 2003).Pricing strategy:Price is another form of attribute used by consumers to differentiate a product. Pricecan sometimes be like an indicator to judge quality; with a higher price indicatingbetter quality and lower price indicating low quality (Mowen & Minor, 1998;Siu andWong,2002) Consumers perceive that a higher price can be attributed to the highercost of quality control(Siu & Wong, 2002). Some consumers are highly price sensitive,whereby a high price may shift consumers to competitive brands (Mowen & Minor,1998). Price plays and important role on the buying behavior of customers. Price is animportant key in marketing mix that raises revenues. Organizations have their own
  13. 13. different policy approaches to pricing. Prices reflect corporate objectives and policiesand are important in the marketing mix. Price changes are made fast and are easy tocommunicate (Bradley 2003)According to Evans et al, (1995), technology has providedthe means by which consumers could be individually targeted and continues to drivegrowth and development within industries.Firstly that customers are interested in the bundles of benefits which a particular goodor individual service offers rather than just the product itself. Secondly that customersview the benefits offered by the goods or services differently within the market. (Dayet al, 1979). ‘’Effective positioning is essential for a brand’s success’’, (Marsden, 2002)Women:Nike differentiated women’s market from the rest of the audience through marketsegmentation and differentiation. By making a separate website for women, Nike targetsegmented successfully. The site offers women dresses and shoes in diverse rangesand also provides a link to other website nike.com.Sweat shops:According to William McCall, Nike battles backlash from overseas sweatshopsmarketing news, (1998).Nike public relations got affected in late 1990’s due tosweatshops. (Hapke 2004)The nineteenth century had earlier figured out that industrycould be damaging without being sweated (Hapke 2004). Workers were treated in themost inhumane way, where they were verbally abused besides beingpunished (Allendale 1992). According to Harper’s magazine, Nike employed its workersin Indonesia for $1.03 per day, compared to Nike Spokesman (Tiger woods) $55,555 perday. The same shoes that they made were sold out in USA for $80 or twice the price inBritain (Allendale 1992). Nike’s code of conduct allows maximum working hours to belimited to 60 hours per week, however workers in Indonesia, Pakistan and India wereforced to work for work than 72 hours per week. According to (Allendale1992), Nike made a profit budget of $3 billion the previous year. Nike’s products wereheavily criticized and there was a fear adidas might take over.http://www.american.edu/TED/nike.htmDeveloping new products:
  14. 14. Organizations need to do a portfolio analysis of itself and its competitors in order tocreate a benchmark. Organizations keeps a track of changing behavior of customers,demographic changes, changes in income, financial status and their distribution.Organizations acknowledge the increase in internet and media use. Concern rests withdetermining whether an organization is a technology leader or follower in regard toinnovation. Product prototype is necessary before launching a product anddifferentiates you from your competitors. Market testing of a product is important anda product should be tested before hand of launch. Nike has focused more oninnovation, designing their products, and promotions through adverts as study showsin appendix.Differentiation can be based on market approach, delivering system by which it sells,on the product, services and several other factors. According to (Porter1980) differentiation is an important marketing strategy. Porter (1980) states that a firmthat achieves differentiation and then maintains it is a successful company aboveaverage. Cost position is an important factor in differentiation and cannot be ignored.Differentiators aim at Cost parity, by reducing prices in all those areas which have noaffect on differentiation.Competition:An organization’s success is determined through strategic positioning (Porter 1985).Positioning strategy helps bring competitive advantage. A successful strategy aims todifferentiate its market and is of high value to the customers (Porter 1985).Productdifferentiation is means to obtain a cost advantage. Nike’s uniqueness is indicative ofits brand logo ‘Swoosh’.Successful companies in order to compete focus on their internal as well as externalthreats. Strengths and weaknesses are short term goals and if they are successful thenit helps to overcome the Threats and benefit from opportunities. Nike likewise focusestheir attention on both customers and internal marketing(employees).Internalmarketing is done by investing heavily on effective training and employeeperformance. Nike has successfully overcomed their internal threats by givingemployee benefits such as colleague discounts and higher salaries compared to theircompetitors (Adidas and Reebok), as shown in appendix. Superior employee selectionand mass training is provided for a high standard service and environment. Accordingto appendice Nike and its competitors push their employees to promote their productoutside work hours as shown in appendice through interactive marketing.
  15. 15. A competitive market views its customers as the ultimate success at the expense ofrivals. Organizations attempt to capitalize on the weaknesses of vulnerablecompetitors to win market position and customers from them, which as a resultproduce profits in the long-run. The organization attempts to seek those activities inwhich it performs better than that of its competitors. (Bradley 2003)In the highly competitive sport shoe market, Nike stayed ahead of the competition andenjoyed retail sales growth of nearly 10% in 2006 among the countries researched. Theumbrella brand has become well-known through brand awareness efforts, highlightedby celebrity advertising and store merchandising. At the same time, Nike has used thenewly acquired Converse brand to good effect, particularly in markets like Spain andAustralia where the brand has seen high growthThe Nike brand, on the other hand, has forged ahead and it is doing especially well inthe developing economies of China, India and Russia. In Western Europe, the brandhas overtaken Adidas in the football market. (EuroMonitor 2009)Technological Advancement: (Davies, 2001) believes organizations in order toincrease production efficiency and effective communication operations rely ontechnology. (Heiko 1989) suggests that technology implementation is also influencedby cultural factors, technological advances being one of them. Also(Dougherty[1995]) suggests that the exchange of technology across foreign borders is essential.The exchange of technology and expertise among people from around the globeincreases the key mass in R&D and hence organisations are able to attract morepeople. For organisations must learn how to adapt to changing markets, competitionand technologies (Dougherty [1996])(Cox, [1991] suggests that because employee’s come from different ethnicbackgrounds, wide perspectives are achieved, such as creative ideas and innovativethoughts .www.nike.comNull Hypothesis:• H0: No brand loyalty towards Nike products.• H0: Nike does not give any significance to its competitors when it comes to market analysis and portfolio analysis.
  16. 16. • H0: Nike’s promotional budget is at its least.Research findings and AnalysisQuestionnaire findings1. Have you heard about Nike? Yes No The aim of this question is to figure out how many people are aware about Nike brand. This research aims to identify the locals and students in Uxbridge, mostly from Brunel University. According to my research 98% students were aware of the brand, 2% were not aware of this brand name. One of the reasons why people were not aware could be communication and writing problems as some international students are still learning the basic language English. It could be that different people come from different backgrounds and cultures where different languages are spoken and understood. Majority of people answered ‘Yes’ which shows that they recognize the Nike brand. Nike is seen to be successful here in advertising their product. By creating the Swoosh logo Nike has made itself quiet popular by its simple yet extravagant style. If yes, where did you hear the name? TV, friends, internet, stores, other Most people answered adverts, which clearly shows advertisements such as TV as the fore most success factor. Followed by this was friends influence upon purchase decision. This shows that keeping personal relations with customers is an important factor in Nike’s success. Customers are the main market for an organization, without customers, companies can not sell their product.2. Are you brand conscious? Yes No Majority of respondents stated that they are loyalists towards Nike brand. Those who answered No were shoppers that looked for anything cheap or were either brand loyalists towards adidas or Reebok. Brand loyalitists towards Adidas were not impressed This proves my Null Hypothesis part A as wrong and shows that there is maximum Brand loyalty towards Nike products.3. Do you buy this product due to friends influence? Yes NO Sometimes Majority of people answered yes. This shows that most people are brand followers. Second highest responses were ‘Sometimes’ showing that still people are interested in buying Nike products but not always.
  17. 17. 4. How often do you purchase Nike products? Every week once a month once in a year never buy Survey showed that 15% students purchase Nike brands every week, 35% buy the product once a month and 10% buy once every year and 0% never buy. This again shows that brand loyal customers not only shop at their respective shops but also avoid switching to another brand even if there are cheap sale offers.5. What do you like about Nike? Logo, design, color, other Respondents Like the logo ‘Swoosh’ in majority, followed by design, color and others. It shows successful promotional marketing by Nike. Swoosh designs success lies in its unique promotions, its market strength and its brand position.6. What attracts you towards this brand? Famous, fashion brand, logo, price, other Most respondents answered that they are attracted towards this brand as it is famous. Followed by Price, logo and others. Pupil who answered Nike as a famous brand were teenagers and young males and females. Nike could be witnessed also as a street brand when seen in highstreet corners, wheres street thugs and street boys were wearing Nike trainers, and long t-shirts. The second most important factor was price. Some teens expressed their positive feelings about the brand but expressed that as they were not given enough pocket money from their parents they could not afford it.7. Do you think Nike is a fashion brand? Yes NO Most respondents that answered ‘Yes’ were young age people from LIBT. Youngsters are fashion followers and most influenced by fashion brands. This is because of Celebrity endorsement that youngsters get influenced to a great extent. Young males and females stars expressed their happy feelings about stars like Beckham endorsing Nike products.8. Which one would you chose Nike or Adidas? Nike Adidas Most respondents answered Nike. This was also visible from their dressing. This also shows my appendice study as correct where most respondents answered they like Nike compared to Adidas. Adidas though has a good market share and is just close to Nike, but respondents were too lazy to talk about adidas.
  18. 18. 9. How much would you rate the brand, out of 5? Most people with the most ratings were 4. Followed by 3 and 5. This is how I made a market review of Nike and proved some factors that make Nike successful by proving my appendices right and null hypothesis wrong.Focus Group Findings:The aim of the focus group findings was to figure out the consumers buyingbehaviours and their perceptions towards the brand Nike compared to its competitorAdidas.Appendix shows an advert about my research where different people were asked tocomment and show their liking for the product. As it was not easy to get an audience tofill these forms i gave away 5 pounds to everyone interested in filling away theseforms.Brands (Nike or Adidas):According to the research findings, Adidas has not showed strength in its marketingstrategies especially advertising. Though the market looks weak, there are still loyalcustomers who do not want to shift towards other companies, whether its theirpersonal experience with the brand or their taste. Majority of the students, taken fromleisure sports centre and Brunel University were students active in sport activities orsomehow related to sports. When facts were shown that Nike is number one sportsbrand, I was able to convince one Adidas customer towards trying Nike (as seen inappendix, Q3). However two respondents refused to swift from their brand (Adidas),showing that brand loyalty is another important key to success for a company.Nike Sports wear and athletic shoesNike’s sportswear market was seen to have the most positive responses compared toathletic shoes, which were believed to have a strong market hold. Respondentsthought Nike Sportswear’s were on good offers, trendy, sexy and some considered itas a fashion brand. Athletic shoes also had some good acceptance from the audiencebut it was too less compared to Nike Sportswear. The most famous source ofadvertisement found out was TV, followed by internet and others.Conclusion & Recommendations:
  19. 19. Everyone in Nike should play their individual roles in promoting their brandirrespective of their hierarchy level, ranging from Top CEO’s of the company to thestaff and from manufacturing sites till it reaches its customer covering all marketingteam and expertise’s in between.A thorough check and understanding of the International code of conduct regardingchild labor and sweat shops needs to be maintained and stress should be on teamwork rather than pushing it on a single person. Mistakes made in these sweat shopsshould not be forgiven in future.Carrying out our previous researches and surveys and as the appendices show, Nike isdoing well due to its promotional methods, like adverts, and has saved huge reservesto be used for future of the company. Celebrities/ stars and adverts should also try tofocus older generation, rather than just focusing on youth and sportsmen. Nike shouldbe introduced as a casual brand which can be worn at any time, anywhere and withoutany age restriction.Nike needs to realize that inorder to benefit in the long run, it needs to overcome itsweaknesses and threats, which will automatically lead to opportunities and strengthsbeing followed.All important issues such as market segmenting, differentiation of products, priceskimming, comparative analysis and market researches and surveys are key to acompany’s success. I have linked all of them to come to a conclusion that it might be ahard time for Nike as it covers a large market sector and faces both internal andexternal threats. But it must be noticed that Nike has a competitive advantage over itscompetitors for being number one brand in sports. With more detailed online and doorto door surveys and questionnaires, Nike can benchmark and achieve a better marketanalysis resulting in a far better market strength.

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