MANAGING DIGITAL BUSINESS

ASSESMENT -1
SOCIAL MEDIA STRATEGY OF ‘NIKE’

By – RAUNAQ DASH
BBA SEC C
20172037

INTRODUCTION
The topic of this report is to ascertain the ‘Social Media Strategy’ of the multi
retailer sport super giant – ‘Nike’. Nike in today’s world is recognized as the
epitome of success, which is due to its, brilliant marketing strategy and most of its
marketing occurs through social media and its platforms. The primary focus of this
report will be to get an in-depth understanding of how this brand has effectively
and efficiently managed to build a social media repertoire by actively using
various social media strategies and mechanisms across various social media
platforms. Nike’s campaigns are huge and are globally dominant and thus, this
report will use various campaigns created by Nike as a medium to get an
understanding of how it markets its products/brand over social media and
enables itself to keep a happy, engaged, and satisfied community. This report will
also focus on the current market situation of the company, its rivals, its market
statistics and will also outline the reasons for, this from a social media strategy
perspective. It will also use frameworks which can co-relate and provide a more
refined and systematic, yet effective understanding of the company’s social media
strategy. The framework to be used is the ‘PRACE’ framework which stands for
Planning, Reach, Act, Convert and Engaged. At the end of this report, one shall
be able to interpret Nike’s various social media mechanisms and shall have
knowledge so as to what factors are essential in forming any social media strategy
which in turn makes a company a global brand and an epitome or sign for success.
MARKET SITUATION OF THE COMPANY
When in 2007, Nike announced a profit worth which amounted to 16 billion USD,
it was already the leader in sports shoes and other sporting apparels by that time
which showcases the longevity of its sustenance in the market. The company
solely believes in producing products in footwear, sporting equipment, etc which
not only are sleek in their design, development and even marketing but also
showcase a broader and fitter lifestyle. It has its operations primarily based in
Oregan, United States of America and was founded in the year, 1962 when it was
initially known as the ‘Blue Ribbon Sports’.
Nike has excelled in terms of digital marketing, frequent innovations and
establishing a network which has maximum reach and is global. As of the FY 2019,
it had a market share of 27.4%, which made Nike the leader in its industry and the
biggest company dealing with footwear as its market. It is being predicted that
with uniformity and growth evident in their sales and revenue, Nike could
establish and hold its throne as the market leader in this market for the next 6-7
years. As of the FY 19, it generated around 23 billion US dollars from sales of just
footwear and had a growth rate of 7-8% in terms of generating revenue, every
year. In terms of overall sales generated from all apparels the figure was
something around 39.1 billion USD in the year, 2019. The same year, it announced
that it had created net profits amounting to 9.6 billion US dollars. The company is
also home to over 76,000 employees and has over 1100 retail outlets worldwide a
figure that has doubled in few years, time.
Although, it is seen as the dominant leader in the market, it still faces some level
of threat from competitors. Nike’s current rivals who compete directly on a head-
to-head basis are companies like- Reebok, UnderArmour, Puma, New Balance and
mainly Adidas. As mentioned before, in the sport shoes spectrum, Nike has no
match, but it would be beneficial for the company if it diversified its growth
towards different sporting equipment and related accessories. Companies like
Adidas and Reebok are comparatively doing better in these markets, especially in
the soccer/football line of accessories and products. This however does not imply
that Nike has a weak presence in these markets as it is considerably doing well,
its, just not the leader, yet. Although, Nike is not comparatively (with Adidas and
Reebok) doing as well in other spectrums of its sale of products, it has not even
merely affected its value as an organization. Its organizational/brand value as of
FY 19, was around 32.4 billion USD which was almost double of its direct
competitor, Adidas which had a value close to 16.78 billion US dollars. Also, as
mentioned above due to the growth in retail outlets, Nike has 3 stores
approximately for every 1 of the stores operated by its competitors, like –
‘Converse’. The company, moreover, targets different spectrums of age groups,
gender, etc but a statistic revealed that most of its revenues came from people
who were aged between 17-23 years old. Thus, with constant innovation,
premium customer response time and satisfaction, outside the box digital
marketing campaigns, advanced technology and its global reach and appeal, it has
established itself as one of the largest sporting accessories/footwear giants and
reports suggest that this dominance is only expected to sustain more.

STRATEGY FOLLOWED AND IMPLEMENTATION DETAILS

The aim here will be to categorize the strategies based on the PRACE Framework,
which stands for Planning, Reach, Act and Engage.
1. PLANNING – Generally, this is the initial phase of the framework and does
not have much coherence/importance attached to it. It basically refers to
the marketing campaign’s strategies, objectives, staff involved, etc from a
subconscious point of view. Nike plans not only to market its sleek design
and other features but also markets a lifestyle to live by. Whether is it a
fitter lifestyle or a lifestyle that is lived by its major tied up big
personalities/ambassadors, it provides a standard of living to its consumers
when its selling products. Thus, it has professional staff who live by this
motto and are selected on this.

2. REACH – This stage basically refers to the literal reach of the company in
terms of various other platforms (online/digital/offline) which directs traffic
to its main website and affiliated social media platforms, etc. On online
platforms, Nike follows a distribution strategy, wherein it treats all its
product variants as stand-alone entities and has pages, accounts, app, etc
for that. As a part of this strategy, Nike also uses dark posts (customized
 ads for different groups of the same product) to have effective reach. It also
has affiliations with major E-commerce sites, but recently it has decided to
opt out of a few to provide more direct consumer experience. On other
digital platforms, it has had affiliations as well. For example, to promote its
‘Nike Run Club’ app/campaign it partnered with the Apple I watch series to
promote its app, which in turn promoted its shoes. Over offline platforms, it
had has created and sponsored various International Sporting events which
has made its reach global. For example, it sponsored 14 teams out of the
‘Women’s FIFA WORLD CUP 2019’ which in turn, promoted traffic to its
main channels.

3. ACT - This step involves creating content that keeps your audience
engrossed, promotes participation, and prevent them from pushing the
‘back’ button. Nike’s strategy for this stage is to prefer quality over
quantity. It does not believe one has to frequently post to get the
audience’s attention/involvement, it rather believes in producing more
quality content. Its content was initially prevalent over Facebook but
recently after the audience shift towards high image content, it puts out
visually captivating pictures which have relevance and substance, on
Instagram with simple, yet effective quotes. It also uses pictures of highly
rated influences from music, sports, etc background to carry out their
messages in these posts. For example, for the ‘Equality’ Campaign it had
celebs from the black origin community ranging from – Serena Williams to
Lebron James. Nike also uses the full capacity of its social media platforms.
For example, it used the IGTV feature of Instagram to release
documentaries of various sport athletes for its ‘Fight For Your Dream’
campaign, wherein it released its ‘Pro Hijab’ gear. It uses various hashtags
on Instagram to promote participation, as well. The most common one is
the ‘JUST DO IT’. It also creates and livestreams various events which
capture audience engagement. For example, it hosted the ‘Breaking.Pt2’
wherein it livestreamed the highest marathon distance run over two hours.
The audience engagement rate was around 500k views per day and it
gathered around 5.4 M views, in total.
4. CONVERT - This stage refers to the conversion into sale via various
platforms. Nike advertises its products across various e-commerce sites and
online channels. It advertises product links on its various campaigns and
social media handles. For example, in the campaign, ‘Breaking Pt.2’ it
advertised links in the livestream, to promote the sale of its customized
running shoe, worn by the famous athletes, which resulted in a massive
boost in sales.

ENGAGE – This stage refers to increasing customer satisfaction (by handling

complaints), repeat purchases, and referrals across various social media
platforms. As mentioned before, Nike has each social media account for
each of its product variant, which enables itself to answer complaints from
each niche market. Moreover, it has a separate account as ‘Nike Support’
solely for complaints and queries. While it uses Instagram to advertise
content dominantly, it uses Twitter more to handle complaints. Nike’s
answers are 97% of the time in replies and they have an Average Reply
Time (ART) of less than 6 hours. Also, as a new strategy, they have adopted
to handle multiple similar queries at the same time over social media to
increase efficiency and save time and other related costs. In order to
increase customer engagement after sales over social media, it created a
new campaign called the ‘Air Jordan Messenger Bot Collaboration’ wherein
it partnered with Facebook Messenger and instilled an AI which answers
consumers questions on real time regarding the specific product, provides
news regarding it and links to shop it, as well. This AI has increased
engagement to around 88% which was around 15-25 % as seen from
traditional emails and messages.