5/18/2020 CASE STUDY

HURRIYA KHAN 13980 Nike

Submitted to
SIR HAMMAD UR REHMAN
ANSWERS:

1. What are the pros, cons, and risks associated with Nike’s core marketing strategy?

Nike core marketing strategy:

Nike’s excellence marketing strategies are their energy to achieve their market goals. Nike

believe the pyramid influence that the preferences of a small percentage of top athletes influence

the product and brand choice. So Nike contracted with many athletes’ spokesperson, professional

teams and college athletic teams to advertise and promote their products to customers. Once

renowned example of Nike marketing strategy is during 2008 summer Olympic in Beijing.

Nike received special permission from the international committee to run Nike ads featuring

Olympics athletes during the game. In addition, Nike sponsored several teams and athletes,

including most of the Chinese teams’ and 11 of 12 high profile members on the US men’s

basketballs teams. Nike seriously pay attention on the technology producing, design and selling

such as e- commerce, high technology running shoes, Nike + with Apple etc., Nike outsourcing

their products most of the factories are located in Asia such china , Indonesia and India.

Pros and cons of Nike core marketing strategy:

Nike put heavily proportion in the marketing strategies and product design, in order to sustain

their dominance in the industry and retain their competitive advantages. Nike actively respond to

the market trends and changes in consumer preference by adjusting their marketing strategies,

the mix of existing product offerings, developing new products, styles and categories, and

influencing sports and fitness preference through various marketing strategies. Now we discuss

pros core marketing strategies and related them to relevant marketing theories help us to depth

understanding. Nike is very much efficient in the distribution of products. More efficient
distributions means more sales. By delivering right thing at right time to customers, Nike is

building beneficial customer relationships and gaining customer satisfaction and loyalty, Nike

distributes its products on different level basis. The high premium product are given to a certain

distributors while leaving a low priced to be sold at highly discounted price at the retail stores

such as Wal-Mart.

The e-commerce program of Nike is the first time a company has offered mass foot wear through

internet and provide competitive advantage to Nike. Nike website is very well designed and it is

very easy and comfortable for a customer to look for the desired footwear. As stated earlier that

Nike made a contract with worlds most renowned sports celebrities like tiger wood etc., this

creates high level of awareness among customers and people about what Nike is all about. Their

aggressive advertising, campaigns, celebrity endorsement and quality product all enhance their

brand and image. Nike targets on the consumers who care more about the utility and quality of

the product rather than the price. That is why Nike set the higher price of its shoes then its

competitor like Adidas.

The customer to consider a product to be high quality are likely to pay high price more often and

consistently. Once the consumer develop the product intimacy, they came to associate their

person with the product ad will pay whatever price quoted on the products. Most of the consumer

of Nikes products is mainly athletic. Nike is the master of segmentation, their segmenting market

typically targets athletes, both men and women from the age 15 to 35. Nikes targeting market is

active people who enjoy high quality sporting goods, especially footwear.

Nike focusing on creating premium consumer experiences on product innovation, brand

leadership and elevated retail presence. Nike targets on these customers by agreement between

Nike and athletic team, colleges athletic teams for products sponsorships and eventual promotion
to the members of these teams. Even though others are likely to buy the products. Nike focuses

on athletes more than any group of individuals even though it’s also target on the youth. This

strategy is especially successful because of its ability to reach a large number of athletes.

Cons:

However, unlike many companies, Nike doesn’t promote its efforts. One brand consultant say

that, “Nike has always been about winning. How is sustainability relevant to its brands?” Nike

executive agree that promoting ecofriendly message would distract from its slick high tech

image, so like recycling old shoes into new shoes are kept quiet. One other con of the Nike brand

is that the price of Nike product are quiet expensive as compare to other global competitors. So,

instead of buying such expensive product customer go for other competitive brands like adidas.

One of the Nike core marketing strategies is depend on the group of athletes to promote its

products.

Nike prefer to have high profile athletes as its endorsers, like runner Steve Prefontaine, Michael

Jordon and LeBron James. The athletes had positive and negative influences on changing

consumer preferences, changes in consumer taste and priorities and also consumer buying

decisions. The action and attitude of Nike chosen spokespersons could bring the impacts on its

promotional strategies. For instance it will attract the athlete’s idolater to purchase the product if

Nike using a popular athlete as endorser. On the other hand if athletes were caught in drug

addicted or any immoral attitude, it will affect the customers not to buy Nikes product, thus will

effect Nike sales, revenue and profit.

Risk:

The major risk associated with Nike at present is of competitor. The competitors are increasing

day by day and yet more development is needed in its product line.
2. If you were Adidas, how would you compete with Nike?

The very first I would do would be reducing the prices of the products without compromising on

the quality. Increasing the advertising and promotion would be my next strategy. The promotion

would be globally. Over pay what Nike is paying the best athletes in the world to endorse their

shoes? The product would be advertised by the national sports heroes. There would be selling

promotions. Product line depth would be more. I will check the availability of my products in

each outlet. Huge variety of ladies sports items would be included. Next I would target the

school educational attending pupils as well. The development of product line of a smart shoes

will build on this reputation and show buyers that adidas is humorless about innovation and

using technology to advance athletic accomplishment.

The line of smart shoes combine a microprocessor or implanted controller, sensor and tiny

motors along with memory and battery. The sensor work to steadily monitor, measure and supply

data looking at the land scape, impact of each step, athletes body temperature, environment

temperature, and athlete’s heart rate. This data can steadily be fed to a microprocessor which

agent motors to adjust padding and airflow within the shoe. Wireless GPS system is another

feature on the small computer production line that enables runners to decide their accurate

location, distance travelled and speed from the shoe’s GPS by wearing a small wireless GPS

wrist strap.

The shoes implanted memory can keep data about workout such as average heart rate, body

temperature, calories burnt and force of each step. For situation, in basketball the micro can

watch how high the athlete jumps and how hard of a landing they make. As many athlete

demands good created that can deliver both watching and accomplishment bettering capabilities,
they will find Adidas the solution thus leading to much higher revenue, profit and market share

in sport that Adidas already leads and in sports where Adidas lags in revenue, profit and market

share.

• Aim high; think BIG, take risk.

• A healthy disregarded for the impossible.