Search

Contact Us

Slide # 2 Far far away, behind the word mountains, far from the countries Vokalia and Consonantia, there live the blind texts Read More

Slide # 3 Far far away, behind the word mountains, far from the countries Vokalia and Consonantia, there live the blind texts Read More
12345

Home Banks Business Finance Jobs Marketing Money Seo

Search

Recent Posts

The Advantages Of Internet Marketing Vs. Traditional Marketing Nikes Marketing Strategy Business Marketing Use Of Web Agency For Your Business Marketing Whats The Difference Between A Business Mentor And A Business Coach?

Categories
Banks Business Finance Jobs Marketing Money Seo

Meta

Log in Entries RSS Comments RSS WordPress.org

Partner Sites
Hosted PBX drying flood Auckland wholesaler of feature/smart mobile phone, Tablet and accessories wholesaler of feature/smart mobile phone, Tablet and accessories Global Affiliate Programs all about calling cards web design london marketing consultancy finger buffet in London Computer Repair In Thanet , Margate , Broadstairs and Ramsgate Intruso & Associates (Bookkeeping and Accounting Services) Self employment ideas Latest Mobile Prices in Saudi Arabia China electronis Aluminum case for iphone 5 360searchbuy Free Intraday tips, Nse Share tips, Day Trading, Stock Market UK Tech Blogger

Nikes Marketing Strategy

May 21, 2013, Banks, Business, Finance, Jobs, Marketing, Money, Seo No comments

Nikes marketing strategy rested entirely upon a brand image which is favourable and has evolved into a great multinational enterprise over time. The favourable brand image has been kept afloat due to the strong association with the Nikes logo which is quite distinctive and the slogan Just Do It which has been used in advertisement for quite some time. The company has been known to invest heavily in advertisements and brand promotion (Fill C, 2005 p.54). Market Segmentation Most of the consumers of Nikes products are mainly sportsmen. This is so because of the utility that comes with the products. An athlete is more likely to go a sports shoe designed and marketed by Nike more than a person who detests sporting and exercises. Nike targets these consumers by agreements between Nike and athletic teams, colleges athletic teams1 etc for product sponsorship and eventual promotion to the members of these teams. In this way, Nike is able to reach a wide number of consumers and consumers who are more likely to buy. Even though others are likely to buy the products, Nike pays specific emphatic targeting to the athlete more than any group of individuals even though it also targets the youth who have embraced the hip hop culture (Mercer David, 1996, pp 171). Targeting strategies Nike lays a number of strategies to target their immediate consumers; athletes and other sportsmen. The targeting strategies include among others the sponsorship of products by professional athletic teams, celebrity athletes and college athletic teams. This strategy is specifically successful because of its ability to reach a large number of athletes. If the athletic team manager prescribes a specific type of track shoes made by Nike, the trainees have no option other than to buy them. The teams can as well buy the track shoes in bulky and supply them to the team members. The second strategy that Nike applies is the designing of product destination. It does this by associating

success with the product. For example, when a celebrity athlete sponsors a specific brand of athletic shoes, the brand will be associated with success. This psychological effect is reinforced with advertisements that affirm this position. Finally, Nike targets the consumers who are likely to develop product intimacy; those who care more about the utility and quality of the product than the price. In this way, the pricing is not affected too much in a bid to accommodate a large number of consumers. However, price has also been factored in Nikes marketing strategies as shall be seen later in this paper (Frank, 2004, p.173) Pricing Strategies As stated in the foregoing section, Nike targets the consumers who embrace product intimacy and thus care less about the product. This has enables Nike to set relatively higher prices than its competitors. This is a strategy that calls for higher pricing points so as to push the perceived product value. It has been established that consumers who consider a product to be of high quality are likely to pay the high price more often and consistently. Once consumers develop product intimacy, they come to associate their person with the product and will pay whatever price quoted on the product provided it has the Nike logo on it. Another very important thing to note is the fact that Nike uses the vertical integration pricing strategy in which they take ownership of the participants at channel levels that differ and they also engage in multifarious channel level operations both in a bid to control costs and thus influence pricing function (Goldman S, 2000, pp154) Distribution Strategies Distribution strategies embraced by an organization can either give them an edge in market or make them lag behind the winners in the market. The more efficient the product distribution is the more sales and thus more profits. The delivery of the right product and at the right time to the consumer not only effects utility but also leads to high degree of consumer satisfaction and loyalty. Nike distributes its products on level basis. The high priced premium products are given to certain distributors while leaving the low priced to be sold at highly discounted prices at mega retail stores such as Wal-Mart. Whereas Reebok embraced a limited distribution strategy Nike ventured more into a global3 market capitalization (Jeannet J, 2000, pp 44). Promotional and Communication Strategies Apart from Nike selling quality products which have lead to a high degree of customer loyalty, the promotional strategies that the company employs are simply superb. Nike has contracted a number of professional and celebrity athletes which have managed to draw a considerable attention to their products. Some of the sportsmen signed by Nike include soccer stars such as Ronaldinho, Ronaldo and Roberto Carlos, Basketballers such as Jermaine ONeal and Lebron James2, triathlete Lance Armstrong and golf superstar Tiger Woods. This has created a relatively high degree of Nike products awareness. Besides the signing of celebrity sportsmen to promote their products, Nike has also employed a great deal of advertisements through the mass media. Nike employs a selective- demand advertisement focused on the high priced shoes used for traditional sports (Goldman S, 2000, pp154). Conclusion Nike has remained and continues to remain at the top of production and distribution of sports gear and equipment. However, it should be noted that competitive pressure cannot allow Nike to sleep at the top. The recent Reebok- Adidas merger poses a great challenge to devise new marketing strategies to continue leading or recede to oblivion. The following recommendations are suggested in a situation where

marketing management is competent. These include: Increased market share through a new product development, competent pricing strategies, advertisement and other sound promotional activities. Restructure market dominance by driving away competitors mainly through fierce promotional strategy coupled by pricing function that will make the market quite unattractive for the competitors. Increased social responsibility to strengthen the image of the company Diversification of market through factoring the Asians and Black Americans in their product promotion besides doing a research to establish the tastes of these groups. Venture into new distribution channels especially in international markets Different pricing strategy so as to open up a new market segments. All the above show a competent marketing management can hoist organizations top become market leaders and making the market leaders maintain their competitive edge in the market through adherence to marketing ethics, marketing plans and well thought out and formulated marketing strategies.

NEW YORK (May 5, 2010) Today NIKE, Inc. (NYSE: NKE) unveiled its strategy and key initiatives to achieve sustainable, long-term growth across its global portfolio of brands and businesses. During its investor meeting in New York, the Company announced a revenue target of $27 billion by the end of fiscal 2015 based on growth expectations across its portfolio, which includes the NIKE Brand, Cole Haan, Converse, Hurley, Jordan Brand, NIKE Golf and Umbro. Additionally, the Company believes it can generate over $12 billion of cumulative free cash flow from operations through 2015. Both goals extend NIKE, Inc.s long-term financial model of high single-digit revenue growth, mid-teens earnings per share growth, and expanding returns on capital.* Weve never been more inspired, innovative and aligned to achieve our goals, said NIKE, Inc. President and CEO Mark Parker. We have powerful competitive advantages in our portfolio innovative and compelling products, brands that are distinct and relevant to their consumers, and the worlds greatest athletes and teams. Our focus is to build, fuel and accelerate the power of our portfolio.* The NIKE Brand is the most powerful asset in the NIKE, Inc. portfolio, accounting for approximately 85 percent of total revenue. NIKE, Inc.s Other Brands continue to increase their contribution to the Companys overall growth strategy. With our acquisition of Umbro, NIKE has extended its position as the biggest football Company in the world, Parker said. Hurley continues to outperform everyone in its market; Cole Haan has tremendous opportunity for growth; and Converse, nearly a $1 billion business, has developed strategies to double its revenue by 2015.* NIKE Brand Overview NIKE Brand President Charlie Denson provided an overview of how NIKEs consumer -focused category strategy is driving growth through increased market place capacity and penetration, NIKE is the most connected, authentic and distinctive brand in the industry. Denson continued, Our consumer focused

strategy enhances our ability to deliver great product and elevated consumer experiences which will help grow the NIKE Brand to approximately $23 billion by the end of fiscal 2015.* NIKE Brand Category Offense Action Sports comprised of NIKE 6.0 and NIKE SB, is the fastest growing category within the Nike Brand. The Company anticipates doubling its current estimated $390 million business by 2015.** Athletic Training started more than 20 years ago with the advent of NIKE cross training. This business, estimated at $1.4 billion, continues to redefine performance with key innovations like NIKE Pro base layer apparel and the Trainer1 shoe.** Basketball led by the strength of the Jordan Brand and excellent opportunities in the United States and China, NIKEs basketball business is currently at approximately $1.7 billion in revenue.** Football with NIKE Brand Football revenue of approximately $1.7 billion, the Company is launching its largest-ever presence at a World Cup including new footwear, national team kits, and NIKE Football+.** Running with approximately $2.1 billion in revenue, NIKEs original category continues to be the source for key innovations including Flywire, Lunar Cushioning, and Nike+ enabled footwear. Nikeplus.com is the worlds largest running club with close to 3 million registered members and Lunar Glide continues to expand the categorys growth opportunities.** Sportswear the Companys largest category at about $4.9 billion continues leveraging new performance ideas from the six sports categories as well as franchise products like the Air Force 1 (which sells 15 million pairs a year 25 years after its debut).** Womens Training with nearly $740 million in sales and the number one position in womens training footwear in the U.S. and the top five European markets, a new generation of NIKE Free footwear designed to strengthen the body and improve fitness by activating the core in concert with the Companys strongest ever apparel offering continues to drive growth in this category.** NIKE Brand Geographic Opportunities The Company announced plans to grow the NIKE Brand in all six of its geographies including driving mid single-digit growth through broader expansion in its developed geographies (North America, Western Europe, and Japan), targeting an additional $3.0-3.5 billion of annual revenue by the end of fiscal 2015. Additionally, NIKE plans to invest aggressively in its developing market geographies (Greater China, Central & Eastern Europe, and Emerging Markets) targeting low double-digit growth and an additional $3.0-3.5 billion of annual revenue by the end of fiscal 2015. NIKE, Inc. Direct to Consumer In discussing its Direct to Consumer business, the Company outlined plans to open approximately 250300 new NIKE-branded stores worldwide over the next five years to elevate the consumer experience and position the brand in the worlds premium shopping locations, as well as drive accelerated growth in digital commerce, leveraging the explosive growth of NIKEiD. Given these efforts, NIKE, Inc. expects mid-teens growth in its Direct to Consumer Business which should contribute an additional $2.2-2.6 billion by 2015.

Also highlighted was an increased focus on working with retail partners to create more elevated and differentiated consumer experiences including execution of category-segmented concepts within key markets. NIKEs wholesale business model is expected to continue to be the primary driver of long -term growth, with retail partners still expected to account for more than 80 pe rcent of the Companys overall business by 2015. To build and strengthen its global retail presence, NIKE, Inc. announced plans to invest $500-600 million in capital over the next five years to develop the Direct to Consumer business and build capabilities to support both owned and wholesale retail productivity and performance. NIKE, Inc. Other Businesses In discussion of its Other Businesses, which includes Cole Haan, Converse Inc., Hurley International LLC, NIKE Golf, and Umbro Ltd., the Company announced a low double-digit growth target which should contribute an additional $1.5-2.0 billion of revenue by the end of fiscal 2015. NIKE, Inc. Long-term Financial Objectives Chief Financial Officer Don Blair gave an overview of the Companys performance aga inst its long-term financial model, highlighting delivery of strong performance through good and bad market environments. Our long-term financial model helps us stay focused on driving sustainable, profitable growth, powerful cash generation, and preserving a very strong balance sheet, all of which gives us tremendous flexibility to invest in our business and generate extraordinary shareholder value. Primary financial objectives through 2015 included the following: High single-digit revenue growth (average annual rate) Mid-teens Earnings Per Share growth (average annual rate) Return on Invested Capital of 25% Increasing dividends within a target calendar year payout range of 25-35% of trailing four quarter earnings per share

Meeting Presenters and Content Additional presenters from NIKE, Incs senior management included: Gary DeStefano, President of Global Operations; Trevor Edwards, Vice President of Brand and Category Management; Willem Haitink, Vice President and General Manager of NIKE China; Jeanne Jackson, President of Direct to Consumer; Eunan McLaughlin, President of NIKE Affiliates; Jan Singer, Vice President of Global Footwear; Michael Spillane, CEO of Converse; and Eric Sprunk, Vice President of Merchandising and Product. NIKE, Inc. invites investors and the media to view the replay of Web cast and slides from the event at www.nikebiz.com/investors. An archived audio replay in downloadable MP3 format will also be available within 24 hours after the event on the Company's Web site and will be accessible through midnight, August 5, 2010. About NIKE, Inc. NIKE, Inc. based near Beaverton, Oregon, is the world's leading designer, marketer and distributor of authentic athletic footwear, apparel, equipment and accessories for a wide variety of sports and fitness activities. Wholly-owned Nike subsidiaries include Cole Haan, which designs, markets and distributes

luxury shoes, handbags, accessories and coats; Converse Inc., which designs, markets and distributes athletic footwear, apparel and accessories; Hurley International LLC, which designs, markets and distributes action sports and youth lifestyle footwear, apparel and accessories; and Umbro Ltd., a leading United Kingdom-based global football (soccer) brand. For more information, visit www.nikebiz.com/investors.

* The marked paragraphs contain forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties are detailed from time to time in reports filed by NIKE, Inc. with the S.E.C., including Forms 8-K, 10-Q, and 10-K. Some forwardlooking statements in this release concern changes in futures orders that are not necessarily indicative of changes in total revenues for subsequent periods due to the mix of futures and at once orders, exchange rate fluctuations, order cancellations and discounts, which may vary significantly from quarter to quarter, and because a significant portion of the business does not report futures orders. ** Category Revenue references are approximate, based on current estimated size and wholesale revenue only. The Company has provided these numbers to provide context regarding the approximate sizes of the businesses Forward looking growth statements are made only as of the date hereof, and are subject to risks and uncertainties that could cause actual results to differ materially. The Company undertakes no obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.

//

Q4 INCOME STATEMENT REVIEW CONTINUING OPERATIONS

Revenues for NIKE, Inc. increased 7 percent to $6.7 billion, or up 9 percent on a currency neutral basis. Excluding the impact of changes in foreign currency, NIKE Brand revenues rose 8 percent with growth across each product type and in every geography except Western Europe and Greater China. For the fourth quarter, NIKE Brand revenues were higher in Running, Basketball, Mens Training, and Womens Training, offsetting slight declines in Sportswear, Action Sports and Football (Soccer), which reflects comparisons to strong sales in advance of the European Football Championships in 2012. Revenues for Other Businesses grew 10 percent, including a 1 point reduction from changes in currency exchange rates, as revenues increased for each business during the quarter. Gross margin increased 110 basis points to 43.9 percent. Gross margin benefited from pricing actions, easing materials costs and favorable comparisons to last year, when gross margin was reduced by higher investments in the Companys digital business and an un anticipated customs assessment in the Emerging Markets geography. The positive impact of these factors was partially offset by higher labor costs, unfavorable changes in foreign exchange rates and higher discounts, particularly in Greater China as the Company continues to work with its retailers to optimize marketplace inventory. Selling and administrative expenses grew at the same rate as revenue, up 7 percent to $2.0 billion. Demand creation expenses were $642 million, down 13 percent due to higher prior year

spending in support of the European Football Championships, the Summer Olympics and key product launches. Operating overhead expense increased 19 percent to $1.4 billion due to additional investments in the Companys wholesale and Direct to Consumer businesses. Other expense, net was $13 million, primarily comprised of foreign currency exchange losses. For the quarter, the Company estimates the year-over-year change in foreign currency related gains and losses included in other expense, net, combined with the impact of changes in foreign currency exchange rates on the translation of foreign currency-denominated profits, decreased pretax income by approximately $18 million. The effective tax rate was 22.8 percent compared to 23.9 percent for the same period last year. The decrease was primarily driven by a net reduction of tax reserves on foreign operations, partially offset by an increase in the percentage of earnings in higher tax jurisdictions. Net Income increased 25 percent to $696 million while Diluted earnings per shareincreased 27 percent to $0.76, reflecting a 2 percent decline in the number of weighted average diluted common shares outstanding.

FY2013 INCOME STATEMENT REVIEW - CONTINUING OPERATIONS

Revenues for NIKE, Inc. were up 8 percent to $25.3 billion, up 11 percent on a currency neutral basis. o NIKE Brand revenues rose 11 percent excluding the impact of changes in foreign currency, driven by growth in each key category, product type and geography except Greater China. On a currency-neutral basis, NIKE Brand wholesale revenues increased 8 percent to $18.4 billion, while Direct to Consumer revenues grew 24 percent to $4.3 billion, driven by 14 percent growth in same store sales and new door expansion. As of May 31, 2013 the NIKE Brand had 645 DTC stores in operation as compared to 557 a year ago. o Revenues for Other Businesses grew 9 percent with no significant impact from changes in foreign currency exchange rates, driven by growth across all businesses.

Gross margin increased 10 basis points to 43.6 percent, primarily driven by higher selling prices and easing material costs. These positive factors were largely offset by higher labor costs, unfavorable changes in foreign exchange rates, a shift in the mix of the Companys revenues to lower margin geographies, products and businesses, and higher discounts, particularly in Greater China.

Selling and administrative expenses grew at a faster rate than revenue, up 10 percent to $7.8 billion. Demand creation expense increased 5 percent to $2.7 billion due to marketing support for the European Football Championships, Summer Olympics and other key product and brand initiatives, as well as an increase in sports marketing expense. Operating overhead expense increased 13 percent to $5.0 billion due to additional investments made in the Companys wholesale and Direct to Consumer businesses.

Other income, net was $15 million for the fiscal year, primarily comprised of non-operating items and net foreign currency related losses. For the year, the Company estimates the year-overyear change in foreign currency related gains and losses included in other income, net, combined

with the impact of changes in foreign currency exchange rates on the translation of foreign currency-denominated profits, decreased pretax income by $56 million. The effective tax rate was 24.7 percent compared to 25.0 percent for fiscal 2012. Net Income increased 9 percent to $2.5 billion and Diluted earnings per shareincreased 11 percent to $2.69, reflecting higher net income and a 2 percent decline in the number of weighted average diluted common shares outstanding.

MAY 31, 2013 BALANCE SHEET REVIEW

Inventories for NIKE, Inc. were $3.4 billion, up 7 percent from May 31, 2012. NIKE Brand inventories increased 8 percent, with 6 percentage points of growth due to higher unit inventories to support future demand and the remainder driven by changes in foreign exchange rates and product costs. Cash and short-term investments at period-end were $6.0 billion, $2.2 billion higher than last year mainly as a result of proceeds from the issuance of debt in the fourth quarter, proceeds from the sale of the Umbro and Cole Haan businesses, higher net income and continued focus on working capital management.

SHARE REPURCHASES
During the fourth quarter, NIKE, Inc. repurchased a total of 4.2 million shares for approximately $242 million. For the fiscal year, the Company repurchased a total of 33.5 million shares for approximately $1.7 billion. Repurchases for the fiscal year were made in conjunction with two approved repurchase programs. In the second quarter of fiscal 2013, the Company completed its previous four-year, $5 billion share repurchase program approved by the Board of Directors in September 2008 under which the Company purchased a total of 118.8 million shares. Having completed the previous program, the Company began repurchases under the four-year, $8 billion program approved by the Board of Directors in September 2012. Of the total shares repurchased during the fiscal year, 15.3 million shares for approximately $789 million were purchased under this program.

FUTURES ORDERS
As of the end of the quarter, worldwide futures orders for NIKE Brand athletic footwear and apparel, scheduled for delivery from June through November 2013 totaled $12.1 billion, 8 percent higher than orders reported for the same period last year. Changes in foreign currency exchange rates did not have a significant impact on total reported futures orders growth.*

DISCONTINUED OPERATIONS
The Company continually evaluates its existing portfolio of businesses to ensure resources are invested in those businesses that are accretive to the NIKE Brand and represent the greatest growth potential and highest returns. During the 2013 fiscal year, the Company completed the divestures of the Umbro and

Cole Haan businesses, allowing the Company to focus resources on driving growth in the NIKE, Jordan, Converse and Hurley brands. For the 2013 fiscal year the Companys net income fro m discontinued operations was $21 million, which represents the net gain on the sale of these two businesses, net of operating losses, divestiture transaction costs, and tax expense. As of May 31, 2013 the Company had substantially completed all transition services related to the sale of both businesses.

CONFERENCE CALL
NIKE, Inc. management will host a conference call beginning at approximately 2:00 p.m. PT on June 27, 2013 to review fiscal fourth quarter and full year results. The conference call will be broadcast live over the Internet and can be accessed at http://investors.nikeinc.com. For those unable to listen to the live broadcast, an archived version will be available at the same location through 9:00 p.m. PT, July 4, 2013.

//Strategic Objectives
Provision of bets quality and balanced priced shoes range to the customers around the world with a special focus on America. Making the product availability possible in all possible marketable stations. To focus all types of customers including old aged, Young men and women and children as well. Attainment of sustainability in product innovation and novelty to assure the existence of the company along many generations.

Target Market Segments

The company is targeting the groups of customers separately; as the target market of the company is huge. The company targets at fulfilling the peoples expectations that are belonging to different age groups. The separate focus on different groups makes it possible for the company to generate maximum revenues.

Nike Marketing Mix

Product The main categories of the products offered by the company include apparels and athletic footwear. The sports categories in which the company is excelling includes Baske tball, Tennis, Running, Cross-training, Outdoor activities, Aquatic activities, recreational use, Golf, Football, cheerleading, Volley ball, Bicycling, wrestling, Soccer and Baseball. The innovative sports products of the company include timepieces, bats , sport balls, skates and eyewear etc.

Price Variable product pricing range mostly between 75 to 150 dollars, depending upon the article being purchased. The competitive pricing strategy is being followed by the company. Place More than 100 countries are targeted by the company. The major selling stations are based in America, Asia pacific and Europe with almost 20,000 retailers in America. Beside company owned stores, different malls showcase the Nuke products. They have more than 20,000 retailers in United States and also in other 200 countries. Promotion The official website of the company serves for its promotion. The companys major promotional source is electronic media. Famous athletes like Ronaldo are serving as the brand ambassador of the company adding to it promotional activity.

Main strategies
1. Market Penetration The market penetration is strategically designed through global expansion and making the availability of its innovative product possible worldwide. The market penetration is done by maximizing the product range at the selling points of either the company or the retailers. 2. Market Development The company initially was supplier for the Japanese entrepreneur. Major shares of the market were earned in the 1980s. The product range successively increased to address maximum customers. The development led to that extent that company has been owning the huge revenue of more than $20 billion. 3. Diversification Strategy The product line that is owned by Nike is a true representation of controlled diversification strategy. The control here refers to the generation of maximum revenues up to 70 % from the major product line, business shares and business and technological linkages.

Budget
The community stores has been the one of the sink of companys budget and received up to $1 billion for the successive years. The investment planned for the fiscal year 2011 is $315. They plan to invest at least 315 million U.S dollars by 2011. Another budget sink would be dealings with 700 factories to extend the production capacity of the company.

References
//

Market Share According to graph 3 (refer appendix), Adidas Group & Reebok together hold 22 percent of the market share, followed by Puma 7 percent and New Balance 6 percent. Since the athletic footwear market is saturated, there may be a possibility that the companys market share erodes. Target Market All the companies in the athletic footwear market are targeting the same type of consumer those who are interested in sports like the aspiring athletes, teams, individual athletes, etc., along with the urban youth. THE COMPANY Sales & Profit Trend According to graphs 4 & 6, Nikes revenue and net income are constantly growing from the year 2005. This shows that Nike has a strong grip on its market share. Consumers like Nikes innovative new products and are willing to pay a higher price than its competitors. Market Share Nike is the market leader in the athletic footwear industry with a 31 percent market share. This shows that Nike with its strong research and development and extensive product range along with the marketing expertise have captured the consumers preferences. Business Sector Nike is part of the Consumer Goods sector which mostly consists of Fast Moving Consumer Goods such as dairy products, farm products, etc. In this sector, Nike belongs to the Textile-Apparel, Footwear and Accessories Industry.

Project Focus Nikes focus is on product development & providing its customer with innovative & compelling products. The introduction of Nike+iPod establishes this fact that Nike wants to cater the customer need for new & innovative products. Nike also lays heavy emphasis on maintaining its Brand name & value in the market. Hence, it invests large amounts of money in research & development of its products so that it can maintain its position as the market leader.

Read more: http://www.ukessays.com/essays/marketing/evaluating-marketstrategy-of-nike-inc-marketing-essay.php#ixzz2f86XAB9q Market Share According to graph 3 (refer appendix), Adidas Group & Reebok together hold 22 percent of the market share, followed by Puma 7 percent and New Balance 6 percent. Since the athletic footwear market is saturated, there may be a possibility that the companys market share erodes. Target Market All the companies in the athletic footwear market are targeting the same type of consumer those who are interested in sports like the aspiring athletes, teams, individual athletes, etc., along with the urban youth. THE COMPANY Sales & Profit Trend According to graphs 4 & 6, Nikes revenue and net income are constantly growing from the year 2005. This shows that Nike has a strong grip on its market share. Consumers like Nikes innovative new products and are willing to pay a higher price than its competitors. Market Share Nike is the market leader in the athletic footwear industry with a 31 percent market share. This shows that Nike with its strong research and development and extensive product range along with the marketing expertise have captured the consumers preferences. Business Sector Nike is part of the Consumer Goods sector which mostly consists of Fast Moving Consumer Goods such as dairy products, farm products, etc. In this sector, Nike belongs to the Textile-Apparel, Footwear and Accessories Industry. Project Focus Nikes focus is on product development & providing its customer with innovative & compelling products. The introduction of Nike+iPod establishes this fact that Nike wants to cater the customer need for new & innovative products. Nike also lays heavy emphasis on maintaining its Brand name & value in the market. Hence, it invests large amounts of money in research &

development of its products so that it can maintain its position as the market leader. Read more: http://www.ukessays.com/essays/marketing/evaluating-market-strategyof-nike-inc-marketing-essay.php#ixzz2f86XAB9q // NIKES MARKETING STRATEGY Segmentation & Targeting Nikes target market for its shoes, clothes and other accessories are males and females between the age of 13 and 35 years. Nike segments its markets on the basis of age, gender, geographic locations, psychographic, and benefits sought. On the basis of age, Nike targets a variety of age groups from young adolescent to middle-aged adults. Nike has different advertisements for men and women of every race and nationality separately. Nike now is focusing on targeting more on women and Generation Y. Also teams of any sport are targeted by Nike. Nikes aim is to push its products in countries that apply to certain sports, which are popular in that particular country. For example, Products relating to Rugby are advertised more frequently in Europe when compared to U.S., as Rugby is popular in Europe. Nike promotes a positive and confidant attitude and targets people who want to attain that attitude. It also is targeted towards customers who are interested in athletics. On the basis of benefits sought, Nike provides shoes, apparel and equipment for a variety of sports all over the world. It also offers products to many different people who have different tastes, interests and needs. This can be seen from the fact that Nike has a website where consumers can design their shoes according to their requirements and tastes. Positioning Nike promotes products that ooze with style, attitude and self-confidence. This message is clear in Nikes tagline Just Do It or If you have a body, you are an athlete which is shown in many advertisements of Nike. The former message of Nike has been used since 1989, when it was first introduced and the latter was developed by Bill Bowerman when Nike first started. This message clearly defines Nikes image which is a positive and self-confident nature.

Porters Generic Strategy (Differentiation/Low Cost Leadership/Focus) Since the footwear market is highly competitive, companies are striving to provide the best possible deals to the consumers. This means that they are trying to cut down costs. Since Nike outsources its manufacturing to other countries, it doesnt have any capital tied up in machinery, equipment or factories. This means it doesnt have any expenses that may arise out of maintenance of any of the above. Nike also lays heavy emphasis on Differentiation and continually strives to innovate and develop its products. The introduction of Nike+iPod sports kit in the year 2008. This enables runners to log and monitor their runs via iTunes and the Nike+ website. Growth Strategy On May 5th, 2010 Nike revealed its Global Growth Strategy to achieve sustainable, long-term growth across its global portfolio of brands. With a revenue target of $27 billion by the year 2015, Nike outlined each and every category of their product line from Nike SB to Womens Training and hoped to reach that goal through a consumer-focused strategy. The company also expects to generate over $12 billion of cumulative free cash flow from operations through 2015. Both goals extend NIKE Inc.s long term financial model of high single-digit revenue growth, mid-teens earnings per share growth and expanding returns on capital. NIKE INC.S MARKETING MIX Marketing Mix Product Mix Nikes product range includes an assortment of goods which include shoes and apparel for sports activities such as Basketball, Football, Athletics, Golf, Cross training, etc., for men, women as well as children. Product Life Cycle The athletic footwear industry and Nike Inc. are both at the maturity stage of the Product Life Cycle. This can be established through graphs 4 & 6. According to these graphs Nikes revenue and net income are constantly increasing at almost the same pace for the last 5 years. But in the year 2009, we can see that the rate of growth in revenue and net income has decreased due to saturation and high competition in the market. Nike can maintain its revenue, net income and market share in the footwear market by introducing new innovative products to keep the consumer base captivated, expansion into new market like India and China and use extensive marketing of the product to continue its demand in the market. Boston Consulting Group Growth-Share Matrix Source: http://www.flatworldknowledge.com/node/115329#web-115329

Since Nike is the market leader in the footwear market, it is safe to say that it is established within its market segments. The market for footwear is saturated with high competition. This places Nike in the Cash Cows category. Being in the cash cows category means that Nike has to maintain its sales and hold its position of a market leader in the market. To do this Nike has to spend a lot of money in research and development to provide customers with fresh and original products to keep them loyal to the brand Nike. Ansoff Matrix Source: http://www.anythingresearch.com/Strategic-Planning/AnsoffMatrix.htm Since the athletic footwear market is saturated with no scope for much growth in the market Nike can choose from either Market Development or Diversification Strategies. If Nike opts for Market Development it means that Nike will focus on the emerging markets such as India, China, etc. with its existing products. If Nike opts for Diversification then it would have to focus on new markets with new and innovative products. Price Mix Nike Inc. applies a premium pricing strategy. This strategy implies the product to be priced higher than that of the competitor based on the quality of the product. Some critics and people claim that the prices of Nikes product are high. However, the company owners and employees argue that these prices reflect the quality of the product. This strategy seems to be working as consumers who purchase Nike products are ready for their prices. Place Mix Nike products are available in multi-brand stores along with the exclusive Nike stores across the globe. Nike sells its products to more than 20,000 retailers in the U.S. and in approximately 200 countries in the world. Along with this Nike has its own Niketown stores. Nike also sells its products through its official website, where people can also customize and design their shoes according to their preferences and directly delivers these from the manufacturer to their house. Nike sells its products in the international markets through independent distributors, licensees & subsidiaries. Promotion Mix Nike reinvests around 12 percent of their revenue into marketing, which includes advertising, endorsements and sponsorship deals. Nike advertises it products through print media, television and billboards and posters. Apart from this Nike has a number of celebrity athletes like Cristiano Rolando for soccer, Tiger Woods for golf, etc., and professional teams like Manchester United to focus attention on their products.

Nike also has several websites for individual sports such as nikebasketball.com, nikefootball.com and nikegolf.com. EVALUATION OF COMPANYS STRATEGIES AND TACTICS Evaluation of Nike Inc.s Current Position & Evidence of Success & Prospects of Future Growth/Success From graph 7 & 8, we can see that Nikes Earnings per Share (EPS) and Return on Invested Capital has gone down. This may be due to the reduction in Earnings before Interest and Tax (EBIT) due to fall in revenue (refer graph 4-appendix). Hence, we can say that Nike has to maintain its position in its existing market and grow in the new markets to increase or maintain its EPS and Return on Invested Capital. If Nike wants to maintain its market leadership it has to focus its strategies on product development to provide its loyal customer base with new, captivating and innovative products. Along with product development, Nike also has to penetrate new & emerging market like India and China if it wishes to grow be number one in its industry. CONCLUSION Time and again Nike has proven to be the best when it comes to satisfying consumers needs. Nike provides people with innovative and original products that others in the industry are not able to provide, thus upholding its position as market leader in the athletic footwear market. This gives Nike a competitive advantage over its competitors, which provides Nike with opportunities which Nike has used to its maximum. With its Marketing mix, Nike has been able to create an all around dominant strategic plan. Nike has shown that they are a true force to be reckoned with. Read more: http://www.ukessays.com/essays/marketing/evaluating-market-strategyof-nike-inc-marketing-essay.php#ixzz2f86fFrIz