Nike Marketing Mix – Marketing Mix of Nike

Nike Marketing Mix or Marketing Mix of Nike defines athletic footwear, apparel and equipment business
profitability, and growth. The marketing mix for a company refers to the techniques and methods used
for executing the marketing campaign based on products, price, place, and promotions (4Ps). Nike
marketing mix includes fitness products. The company, for example, is specialized in shoes designed to
meet professional basketball and soccer athletes ‘requirements. Such products, however, are sold for
sport and recreational activities to all customers worldwide, based on the details of the business mission
and vision statements of Nike. Founded in 1964, the 4Ps of the organization evolve in line with the
global dynamics of the sports goods industry. Such innovations are a key factor in the success of
companies that can use their marketing mix to adapt to changes and market dynamics that affect local,
regional and international consumer demand for their goods.

Nike Inc. strengthens its capability to defend its company from heavy competition through its marketing
mix. The organization competes against various firms participating in the industries of footwear, apparel
and sporting equipment. The organization operates in the same markets as Adidas, Puma, Under Armor,
ASICS and the VF Corporation. Nike Inc.’s Porter’s Five Forces Study indicates that these firms have a
solid competitive presence in the business climate
The 4p’s of Nike Marketing Plan

Category Marketing Plan, Nike

Essay type Research

 Words 524 (2 pages)

 Views 262

The 4P’s Of Nike Marketing Plan (i)Product •Nike offers a wide range of shoe, apparel and equipment
products, all of which are currently its top-selling product categories. •Nike started selling sports
apparel, athletic bags and accessory items in 1979. Their brand Cole Haan carries a line of dress and
casual footwear and accessories for men, women and children. •Nike’s foremost focus is athletic
footwear and apparels designed for sports and everyday usage with the brand name. •The production
facilities are located close to the raw material to have low labor prices. New product offerings under the
name of brand include sport balls, timepieces, eyewear, skates, bats, and other equipment designed for
sports activities. •The most famous product categories of Nike includes running, basketball, cross-
training, outdoor activities, tennis, golf, soccer, baseball, football, bicycling, volley ball, wrestling,
cheerleading, aquatic activities and other athletic and recreational use. •Moreover, they also utilize the
auxiliary bodies to sell te sports related raw materials and products including Cole Haan Holdings, Nike
Team Sports, and Bauer Nike Hockey. ii)Price •Nike’s pricing is designed to be competitive to the other
fashion shoe retailers. The pricing is based on the basis of premium segment as target customers.

Nike as a brand commands high premiums. Nike’s pricing strategy makes use of vertical integration in
pricing wherein they own participants at differing channel levels or take part in more than one channel
level operations. This can control costs and influence product pricing. •The company has designed its
pricing structure in a way to make it competitive to other shoe sellers. The price of the products is
variable depending on the type and the size for example a comfortable and good pair of shoes would
cost from 70 to 150 dollars. (iii)Placement •Nike shoes are carried by multi-brand stores and the
exclusive. •Nike has its individual stores and also available at major malls and departmental stores
selling shoes all over the globe. •They have more than 20000 retailers in United States and also in other
200 countries. •The companies also sell its products through individuals, auxilianes and licensees. The
company has its own production units, customer services and operational units in all over the world.
•Nike sells its products through independent distributors, licensees and subsidiaries. Independent
distributors need not adapt to local pressures because the 4Ps of marketing are managed by
distributors. (iv)Promotion •The company has used electronic media (commercials, official website of
Nike and newspapers) to promote their brand. •Promotion is largely dependent on finding accessible
store locations. It also avails of targeted advertising in the newspaper and creating strategic alliances.
Many well known athletes have also worked for the advertisement of brank like Brazilian Soccer Team.
•Nike also sponsors events such as Hoop It Up and The Golden West Invitational. Nike’s brand images,
the Nike name and the trademark swoosh; make it one of the most recognizable brands in the world.
•Nike’s brand power is one reason for its high revenues. Nike’s quality products, loyal customer base
and its great marketing techniques all contribute to make the shoe empire a huge success. •The brands
swoosh logo and image played an important role in its advertisement.
WORK: A MARKETING MIX AND NIKE

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A price, product, place and promotion analysis for NIKE sports retailer

Although Nike owns several brands including Umbro, this discussion will focus on Nike’s main business
and its premium products. Nike claims “to represent the highest service standards within and beyond
our industry, building loyal consumer relationships around the world” (Nike Inc. 2012). However, there
have been problems with the implementation of this mission statement.

The price of the sports goods is important because it is this, which generates revenue for Nike. Nike’s
prices can lead to high profits, as they can control costs by buying from countries which offer cheap
labour. High prices and low costs have led to criticism. Nike needs to make sure that it is not criticised
for exploiting ‘cheap labour’ (Hodal 2012). Nike’s use of the marketing mix could be criticised here. The
four p’s has been challenged for being production-oriented rather than customer-oriented (Lee Goi
2009:4). The marketing mix has also been criticised for being too internally orientated (Constantinides
2006:426). Nike could be overlooking customer concerns over labour standards. Perhaps, it has been
too ‘internally occupied’ with high profit margins.

The pricing level depends upon the socio-economic characteristics of the buyers. Pricing policy reflects
the market at which it is aiming (Hall et. al. 2006:172). Nike’s products are often aimed at the premium
section of the market, so its pricing is directed at well-off consumers. Nike does well to implement a
policy of ‘price skimming’. It could sell pioneering expensive trainers to affluent consumers for a short
period; when the product is first launched on the market. The aim is ‘skim off’ the business of
prosperous customers. These consumers are willing to pay more money to have the product at an
earlier stage; before the product is seen as ‘less pioneering’. When the product is perceived as
‘mainstream’, then the price will have to be reduced to encourage purchases from consumers who are
unwilling or unable to pay the initial high prices. Nike will have to attract these customers to maintain its
large market share.

The marketer needs to make sure that pricing complements other aspects of the marketing mix. In
terms of price, this means selling expensive sports products, to people who want high quality sports
goods. Nike needs to make sure its products justify the generally high prices.

Nike’s ‘product’ can be seen as a single item or a wide range of products. Nike has to “make sure that
their products are meeting the needs of their consumers” (Hall et. al. 2006:172). It successfully offers
clothing and trainers given that its worldwide profits were £300 million, in the last quarter of 2011 (BBC
2011). It has a training-shoe product which is well designed and can be ‘customised’ for different
runners. The sophistication is evident with advanced cushioning in the trainer’s heel. Nike also claims
that its shoe is very responsive to an athlete’s running action (Nike 2012). It therefore differentiates its
products, from other more mass market products. Nike does well by making sure that its products go
beyond basic running shoes. Its products are manufactured in an augmented form with additional
features provided (BPP 2004:255).

The effectiveness of Nike’s products can further be seen as its products are manufactured to be durable
and to last. This makes them environmentally acceptable, as consumers would need to purchase fewer
pairs of trainers compared to other brands. This means that there is less impact on the environment.
Another way that Nike could be strong environmentally is to use recycled material, such as waste
rubber, in the manufacture of their trainers.

The ‘place’ aspect of the marketing mix is about the “means by which the product will be distributed to
the consumer” (Hall et. al. 2006:173). This will often involve a retail outlet. It will need to collaborate
with retail outlets, such as Sports Direct in Britain, to make sure that its products can be sold to a wide
variety of people. Retail outlets are useful to exhibit trainers in an environment where customers can
choose before they buy. Nike has done well by using ‘factory outlet shops’. Such factory stores can help
reduce the prices of Nike products to consumers by reducing retail costs. Nike is successful with outlets
which are accessible to the public.

Alternatively, products can be sold directly on the internet; in which case the distribution needs to be
acceptable. Clothing retailers, such as Nike, will need to choose appropriate courier services. Sales
through the internet could reduce its dependence upon sports shops. The internet is an important
distribution channel for Nike. It is a good way of displaying the ‘advanced characteristics’ of its products.
Nike has invested significantly in a wide variety of websites; including its football website which makes
full use of social media (Nike Football 2012).

In terms of promotion, Nike chooses methods which are “likely to be most effective in the market in
which it operates” (Hall et. al. 2006:172). Nike promotes, or advertises, the characteristics associated
with high quality running shoes. Nike wants to connect success with its products. It wants its brand to be
associated with success. It uses high-profile award winning athletes, ‘wearing Nike’ to achieve this aim.

Nike emphasises quality and success with its recent endorsement of Manchester City football club.
Nike’s marketing success can be seen with a statement released from Manchester City. They stated that
Nike has “global retail distribution networks” (Drum 2012).

Nike’s brand is one of the most well-known labels in the sports retail industry. However, some of its
advertising and public relations initiatives appear to be of a poor quality. They have been criticised for
producing T-Shirts which could be interpreted as promoting drugs (Telegraph 2012). Also, they seem to
have inappropriately named a brand of trainers (Gani 2012). This suggests a lack of thoroughness, with
their marketing, which needs to be improved. Nike needs to think more clearly about the “official
corporate message” that it wants to convey; given that it is such a large multi-national company (Dann
2011:4).

However, in general, Nike’s advertising is successful. Its large market share means that its advertising
spending is spread across a wide range of products. Therefore, its advertising spending per product sold
could be seen as ‘value for money’ compared to other similar companies.

References

BBC, (2011), Nike profits from increased sales

BPP, (2004), HNC HND Business, Mandatory Unit 4: Business Environment Course Book: First Edition,
London: BPP Professional Education

Constantinides, E. (2006), The Marketing Mix Revisited: Towards the 21st Century Marketing, Journal of
Marketing Management, Vol. 22, No. 3-4, p. 407-438
Dann, S. (2011), The Marketing Mix Matrix, Conference Paper, Australian National University, p. 1-11

Drum, (2012)

Gani, A. (2012), Nike puts foot in it with 'Black and Tan' trainers

Hall, D., Jones, R., Raffo C., Chambers I., and Gray, D., (2006), Business Studies: Third Edition, Harlow:
Pearson Education

Hodal, K. (2012), Nike factory to pay $1m to Indonesian workers for overtime

Lee Goi, C. (2009), A Review of Marketing Mix: 4Ps or More? , International Journal of Marketing
Studies, Vol. 1, No. 1, p. 2-15

Nike, (2012), Nike Zoom Mogan Mid iD Shoe Men’s

NikeFootball, (2012)

Nike Inc., (2012)

Telegraph, (2012), Nike 'not taking drug use seriously'

Abstract In this paper, we present an elaborate analysis of the marketing mix employed by Nike in its
marketing strategy. The marketing mix is conducted on the basis of the concept of "marketing mix"
which is usually referred to as the "4Ps" as an important means of effectively interpreting as well as
translating the marketing strategy into practice as noted by Bennett (1997).A recommendation is also
provided.

Introduction Nike is the leading and yet renowned supplier of athletic apparel and shoes. The company
controls close to 33% of the global athletic shoe market (Dogiamis & Vijayashanker,2009).Nike was
founded by Bill Power and Phil Knight in 1962 as a Blue Ribbon Support and then was later on renamed
to Nike in the year 1968 (Patrow,2003).The company supplies very high quality product in close to 100
countries with major markets being located in the U.S,U,K, Asia Pacific as well as in the Americas. The
company has managed to attain its lead and legendary position via the application of innovative and yet
attractive product design which is backed by quality production as well as well crafted marketing
strategies.
Nike Inc.’s Marketing Mix (4Ps/Product, Place, Promotion, Price) – An Analysis

UPDATED ONUPDATED ON SEPTEMBER 10, 2018 BY LAWRENCE GREGORY

Nike shoes on display at a shoe store. Nike Inc.’s

marketing mix or 4P facilitates the company’s global growth based on high quality products, numerous
places for distribution, advertising-focused promotion, and relatively high prices in the global market for
athletic footwear, apparel, and equipment. (Photo: Public Domain)

Nike Inc.’s marketing mix (4Ps) determines the profitability and growth of the athletic footwear, apparel,
and equipment business. A company’s marketing mix refers to the strategies and tactics applied to
execute the marketing plan, with focus on products, place, promotion, and price (the 4Ps). In this
business case, Nike has a marketing mix that involves athletic products. For example, the company
specializes in shoes that are designed to satisfy the needs of professional basketball and football
athletes. However, these products are marketed to all consumers around the world, for athletic and
leisure activities, based on the specifics of Nike’s corporate mission and vision statements. Established in
1964, the company’s 4Ps evolve according to the dynamics of the global sporting goods industry. Such
evolution is a critical success factor that enables the business to use its marketing mix to respond to
market trends and changes that influence local, regional, and international market demand for its
products.

Through its marketing mix, Nike Inc. strengthens its capabilities to protect its business from the strong
force of competition. The company competes against various firms involved in the footwear, apparel,
and athletic equipment markets. For example, the business operates in the same markets as Adidas,
Puma, Under Armour, ASICS, and VF Corporation. The Porter’s Five Forces analysis of Nike Inc. shows
that these firms exert a strong competitive force in the industry environment.

Nike’s Products (Product Mix)

This element of the marketing mix enumerates the organizational outputs offered to target consumers.
These outputs are known as the product mix. Nike Inc.’s growth comes with changes in its product mix.
For example, the business continues its investment in research and development to produce new
products and enhanced versions of its current products. Originally a distributor of shoes, the company
now manufactures various shoes, apparel, and equipment for different sports. Based on Nike Inc.’s
generic strategy and intensive growth strategies, the business integrates new technologies into its
product lines to improve product effectiveness and customer satisfaction. The following broad
categories represent Nike’s product mix:
 1. Shoes

2. Apparel

3. Equipment and accessories

Shoes are the most popular products from Nike Inc. The business gradually adds more product lines in
this category. For example, the company now offers running shoes, tennis shoes, and shoes for a variety
of other sports, including cricket. Nike also sells apparel, such as jerseys, shorts, and related products. In
addition, the company’s product lines include accessories and equipment, such as golf clubs. These
products are available under a number of the company’s brands, including Air Jordan, Hurley, and
Converse. Based on this element of the marketing mix, Nike expands its product mix to address the
needs of its target markets and market segments.

Place/Distribution in Nike’s Marketing Mix

This element of the marketing mix outlines the venues where the company’s products are sold, accessed
or distributed. Nike Inc. sells its sports shoes, apparel, and equipment through a large number of outlets
worldwide. For example, these products are available at major retail stores. The following places/venues
form Nike’s distribution strategy, arranged according to significance:

1. Retail stores

2. Nike Online Store

3. Niketown retail outlets (company-owned)

Retail stores are the most significant places where Nike products are sold because these venues are
strategically located and easily accessible in various markets around the world. These retailers include
large firms like Walmart (see Walmart’s Marketing Mix or 4P), as well as small local and regional stores.
This 4P element also shows that customers can purchase Nike’s sports shoes, apparel, and equipment
through the company’s online store. In addition, the business operates its Niketown retail outlets. These
outlets are company-owned and allow access to business and market information that supports
corporate strategic management with regard to marketing strategies and tactics for current, new, and
emerging products. Based on this element of the marketing mix, Nike Inc. controls the distribution and
sale of its products, especially through its online store and Niketown retail outlets. However, the
company has limited control on the distribution and sale of its products via other retail outlets.

Nike Inc.’s Promotion (Promotional Mix)

 Main article: Nike’s Promotional Mix (Marketing Communications Mix)

This element of the marketing mix is also known as the marketing communications mix, and involves the
tactics that Nike uses to communicate with its target markets. The company depends on the effective
promotion of its products to maintain a strong brand image, which is one of the strengths determined in
the SWOT analysis of Nike Inc. The company uses promotional tactics to communicate with target
customers about its products, and persuade these consumers to purchase the products. The following
are Nike’s promotional activities, arranged according to significance:

1. Advertising
 2. Personal selling

3. Direct marketing

4. Sales promotions

5. Public relations

Advertising is one of the biggest contributors to Nike’s ability to attract customers. The company heavily
relies on advertisements, especially those that involve high-profile celebrity endorsers, such as
professional athletes and sports teams. This element of the company’s marketing mix also includes
personal selling through sales personnel who persuade target consumers to buy the company’s
products. For example, sales personnel at Niketown retail outlets are trained to use such persuasion.
The company’s direct marketing activities involve direct communications with colleges, local sports
teams, and other organizations. In the context of the 4Ps, direct marketing refers to direct contact with
organizations for the purpose of promoting products to the members of such organizations. In addition,
Nike occasionally applies discounts and special offers to attract more customers and generate more
sales. These discounts and offers form the company’s sales promotions tactics. Moreover, in public
relations, the company sponsors and provides financial support to other organizations, such as
community-based networks, to promote its athletic shoes, apparel, and equipment. Based on the tactics
included in this element of Nike’s marketing mix, the business depends on its relations with high-profile
endorsers to succeed in promoting its business and products to the international sporting goods market.

Nike’s Prices and Pricing Strategies

This element of the marketing mix identifies the prices that the company applies to maximize profits
while attracting the desired share of the multinational market. Nike’s investments in technology is linked
with a strategy to offer its products at a premium. Still, the company considers current market
conditions in setting its price points and price ranges. Based on these considerations for this 4P variable,
the following pricing strategies are applied in Nike Inc.’s business:

1. Value-based pricing strategy

2. Premium pricing strategy

In using the value-based pricing strategy, Nike Inc. considers consumer perception about the value of its
products. In the context of the marketing mix, this value is used to determine the maximum prices that
consumers are willing to pay for the company’s sports shoes, apparel, and equipment. In relation, the
premium pricing strategy involves high prices, based on a premium branding strategy that establishes
Nike products as higher in quality and value than competing products. The company’s use of
advertisements involving high-profile celebrity endorsers is indicative of such emphasis on premium
branding. In 2014, the business successfully increased its selling prices and generated higher sales and
revenues. This trend continues, as the company enjoys increasing sales revenues while gradually
increasing its prices. Based on the PESTEL/PESTLE analysis of Nike Inc., such trend is linked to the
sociocultural and economic changes in the industry environment. The business adjusts its price ranges
according to such changes. In this element of the marketing mix, Nike Inc. successfully uses its pricing
strategies to maximize its profits while emphasizing high value in promoting its products and brand.

References
 Dominici, G. (2009). From marketing mix to e-marketing mix: A literature overview and
classification. International Journal of Business and Management, 4(9), 17-24.

 Goi, C. L. (2009). A review of marketing mix: 4Ps or more? International Journal of Marketing

Studies, 1(1), 2.

 Nike Inc. – Online Store.

 Nike Inc.’s Website.

 Nike, Inc. – Form 10-K.

 Rahmani, K., Emamisaleh, K., & Yadegari, R. (2015). Quality Function Deployment and New
Product Development with a focus on Marketing Mix 4P model. Asian Journal of Research in
Marketing, 4(2), 98-108.

 U.S. Department of Commerce – International Trade Administration – Textiles, Apparel &

Sporting Goods.

 U.S. Department of Commerce – International Trade Administration – The Consumer Goods

Industry in the United States.

 Van Waterschoot, W., & Van den Bulte, C. (1992). The 4P classification of the marketing mix
revisited. The Journal of Marketing, 83-93.

 Yun-sheng, W. (2001). Perfection and innovation of 4P Marketing Mix – How to evaluate 4P

Marketing Mix. Commercial Research, 5, 6.
Marketing Mix of Nike (Extended 7Ps)

Nike is a famous global brand of sports shoes and gear. Known for its athletic and stylish products, the
brand has acquired international fame. The company also sells its products through its online stores in
several countries. The most critical factors driving Nike sales are product design and quality. While its
products are designed for athletic use mainly, they are equally good in terms of fashion and style. Not
just sporty, but its shoes and apparel are trendy and fashionable too.  Founded in 1964, the brand was
renamed Nike in 1973. The ‘Just Do it’ slogan and ‘Swoosh’ logo of Nike are known all over the world
and differentiate it from the other sports shoe brands.

Nike offers a broad product range, and its brand name and popularity have kept rising with time. Its
main competitors are Adidas, Reebok, Under Armour, FILA, Skechers, New Balance, and Puma. The
company targets young customers mainly. Nike customers are primarily in the 15-45 age group. Its
target market also includes female customers as well as teenagers. However, to grow its appeal among
younger customers, the company has introduced an excellent range of products for kids. You will see
young celebs and athletes in Nike ads as well as teenagers.

Here is its marketing mix that analyses the seven P’s – Product, Price, Place, Promotions, People,
Processes, and Physical evidence.

Marketing Mix of Nike

Product:

Nike offers a vast range of products, including sports shoes, apparel, gear, and accessories.  It makes and
sells products for men, women, boys, and girls. It also offers a broad range of shoes, including different
varieties and styles suited for use in various sports. For example, there are sports shoes for basketball,
football, running, gym, and even lifestyle shoes available from Nike.  It also offers sportswear like tech
fleece and Windrunner for athletes, shorts, t-shirts, and pants.

Some of the main categories of products for men by Nike are as follows:

 Shoes

 Compression and Nike Pro

 Tops and Tshirts

 Hoodies and Pullovers

 Jackets and vests

 Pants and tights

 Shorts

 Surf and swimwear

 Socks

 Accessories and equipment

Place:

Nike sells its products to customers globally through both online and offline channels. These products
are available at the brand’s retail outlets and its distribution centers operating globally.  It sells its
products to wholesalers both in the US and international markets. Its direct to customer channels
include both inline and factory retail outlets as well as online sales through its website. Nike’s global
distribution system is also divided into global brand divisions. The company has its headquarters in
Beaverton, Oregon, United States. However, the company has extended its business network globally
and sells to customers in nearly all regions of the globe through physical and online channels including e-
commerce websites such as Amazon. The company also has a large and strong supplier network. It has
outsourced nearly all its production to external suppliers. As of 2020, Nike operated a total of 1,096
stores throughout the world. 338 of these stores were located in the US alone.

Price:

One of the critical differentiators for Nike is its ability to charge higher prices than its competitors.
However, this ability is based on the premium quality of its products. Its products are good looking,
elegantly crafted, suited for sports use, and durable. The premium quality of its products enables it to
charge premium prices for them. However, its popularity and brand image plus the customer loyalty it
enjoys are also important factors that support its premium pricing.

Nike does not set prices according to the market condition or the costs of manufacturing. Instead, it sets
prices according to the estimated value of a product. Some more shoe brands and the leading
competitors of Nike have also introduced an excellent range of shoes in the premium price segment.
While there is price competition in the industry and prices matter for a large part of middle-class
customers, Nike’s pricing strategy has never impeded growth, and it continues to rule as the largest
shoe brand. ts marketing strategy is one of the key factors that the company continues to find growth
despite the premium prices. It enjoys a large and loyal customer base as well as the strongest position in
the shoe industry. Marketing continues to drive the demand for Nike products.

Promotion:

Nike’s logo and slogan differentiate it from others and give the brand a distinct identity in the crowd of
the brands. It provides the brand with a uniqueness. Apart from that, the brand utilizes a mix of other
strategies for the promotion of its products and brand. Nike is a well-known company, and it gains a lot
of publicity from the news resources. The brand promotes itself through a  mix of traditional and
modern promotional strategies. It advertises its products through online and offline channels. Apart
from that, Nike uses sponsorships of sports events and sports personalities for the promotion of its
products.

Nike has grown its use of digital marketing channels for the promotion of its products. The company
uses digital video marketing in plenty to promote Nike products. It frequently posts videos to YouTube,
including educational and promotional videos. The promotional videos of Nike mostly include athletes
and sports personalities. However, many of these are motivational videos that are targeted at the sports
community mainly. Its marketing strategy and methods have been appreciated widely for their
effectiveness. Nike has also maintained a strong brand image. Apart from marketing and product
quality, its investment in CSR has also helped it strengthen its social image. These things are absolutely
critical for large businesses because of the public’s concern for the social image of the businesses they
are buying from.

It is one of the best known logos in the world and Nike one of the largest
multinationals on the planet. It is worn by Cristiano Ronaldo, LeBron James or
Rafa Nadal after payment of millionaire contracts and Michael Jordan made it
iconic in the nineties.

What perhaps few know is that the swoosh, the name of the Nike logo,
represents a wing of the Greek goddess Athena Niké and was designed by
Carolyn Davidson in 1971. The Oregon brand then gave her $ 35 for the design,
according to Europa Press.

Davidson was a graphic design student and was commissioned by Phil Knight,
an associate professor at Portland State University where the young woman
studied. There, in Oregon, one of the greatest brands in history would be born.
Knight was preparing a revolution with lightweight shoes that would multiply the
performance of athletes around the world.

“I don't like it, but it will grow with me,” were Knight's words to Davidson before
thanking him for the services rendered. There seemed to end the story.

12 years after the Blue Ribbon Sports took the name of Nike, Inc, Knight called
Davidson to meet for lunch. What was not expected was that the creator of Nike
came with a gold ring and brilliant with the logo of the swoosh, with a patent
that registered her as the creator of the icon and with a number that was never
known of the company's shares, one of the most valued in the world today.
One of my favorite companies to watch is Nike.

They keep doing things right, including driving growth at more than 10 percent annually even with sales
of $30.6 billion last year.

But that’s not what inspires me; their big numbers are just evidence of their effectiveness. What’s
inspiring about them is three-fold — their mission, strategy and customer focus.

1. Mission

Their mission is to “bring inspiration and innovation to every athlete* in the world (*if you have a body,
you’re an athlete).”

Like other great branding firms, Nike understands that they are not in the business of selling athletic
shoes and apparel. Instead, they inspire people to become better athletes and achieve their personal
best (Just Do It!).

All great brands recognize that their products and services are ultimately just vehicles for addressing
higher aspirational needs. By defining their business according to what customers aspire to accomplish
rather than limiting their identity to current products, Nike also encourages employees to innovate and
explore new and better ways to fulfill their mission to “bring inspiration and innovation to every
athlete.” This now goes well beyond athletic shoes and apparel, well beyond anything founder Phil
Knight could have imagined.

2. Strategy

Additionally, a key part of Nike’s strategy is its “category offense.” In 2008, the company reorganized
operations around individual sports and, according to Nike, sales have risen 70 percent since. They
dominate the athletic shoe market in many different sports, blitzing the nearest competitor with 62
percent market share vs. Skechers’ 5 percent.

3. Customer focus

According to Mark Palmer, Nike’s CEO, the reason they are so successful with each market is their focus
on the athletes’ needs in each sport or, in my vernacular, according to what athletes in each sport are
trying to accomplish.
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Nike embeds researchers within sports teams at different levels. The researchers observe what athletes
are trying to accomplish and identify where certain products may fall short in helping the athletes
achieve those objectives.

Sometimes existing products aren’t sufficient, and sometimes the void is unfulfilled due to
the absence of a product. This insight into their target customers’ unmet needs enables Nike to bring to
bear their full array of technologies and capabilities on the biggest opportunities in the market, thereby
fulfilling their mission “to bring inspiration and innovation” to athletes, and dominating their markets.

Lessons we can learn

There are important lessons for all of us in this. First, never define your business according to the
product, service, or technology you sell; they are just means to a greater end. Instead, sell the
aspirational goal that your solution enables customers to achieve.

Second, implement your own category offense by determining all the tasks your target customers are
trying to accomplish within your strategic domain, and where they struggle given current solutions. The
insights you discover can enable you to bring to bear your full array of capabilities on what matters most
to customers, generate new and improved solutions, and establish competitive advantage.