ABOUT THE BRAND

Nike is an American Multinational Corporation that is engaged in the

design, development, manufacturing, and worldwide marketing and sales of
footwear, apparel, equipment, accessories, and services. The company is
headquartered near Beaverton, Oregon in the Poland metropolitan area. It
is the world's largest supplier of athletic shoes and apparel and a major
manufacturer of sports equipment with revenue in excess of
US$24.1 billion in its fiscal year 2012 (ending May 31, 2012). As of 2012, it
employed more than 44,000 people worldwide. In 2014 the brand alone
was valued at $19 billion, making it the most valuable brand among sports
businesses. As of 2017, the Nike brand is valued at $29.6 billion.
The company was founded on January 25, 1964, as Blue Ribbon Sports
by Bill Bowerman and Phil Knight and officially became Nike, Inc. on May
30, 1971. The company takes its name from Nike, the Greek goddess of
victory. Nike markets its products under its own brand, as well as Nike Golf,
Nike Pro, Nike+, Air Jordan, Nike Blazers, Air Force 1, Nike Dunk, Air Max,
Foamposite, Nike Skateboarding, Nike CR7, and subsidiaries including
Brand Jordan, Hurley International and Converse. Nike also owned Bauer
Hockey (later renamed Nike Bauer) from 1995 to 2008, and previously
owned Cole Haan and Umbro. In addition to manufacturing sportswear and
equipment, the company operates retail stores under the Niketown name.
Nike sponsors many high-profile athletes and sports teams around the
world, with the highly recognized trademarks of “Just do it” and the
“Swoosh” logo.

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 7 P’s OF MARKETING MIX

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, physical evidence,
people and process (the 7Ps). In this business case, Nike has a marketing mix that
involves athletic products

Following are the Nike Inc.’s 7 Ps of Marketing Mix:

 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 intensive growth strategy, 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:

 shoes

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.

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  Apparel

Nike also sells apparel,

such as jerseys, shorts,
t-shirts, trousers and
tights, sports bra,
hoodies, jackets etc.

 Equipment and accessories

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.

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  Place 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:

 Retail stores

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 Online store

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  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, 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.

 Promotion 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
recommendations. 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:

 Advertising
 Personal selling
 Direct marketing
 Sales promotions
 Public relations

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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.

 Price Mix

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:

 Value-based pricing strategy

 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

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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 analysis
recommendations, such trend is linked to the socio cultural 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.

 Physical Evidence

According to Bhasin (2016) Physical Evidence is the material part of a

service. Services are very intangible when marketing. Although customers
tend to rely on physical cues to help them evaluate the product before they
buy it. So, marketers develop physical evidence to replace the physical
cues in a service. The marketers’ role is to design and implement the
tangible evidence.

In the service interest there needs to be physical evidence that the service

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was delivered. Physical evidence pertains how a business and its products
are perceived in the marketplace (The Marketing Mix, 2015). Nike try to
understand the customers perspective. They do this by providing physical
evidence they can see and feel to the customer before they can see the
end product For example they show demonstrations of new products
before they are actually out. They provide advertisements and videos of
new products to explain what the customer can expect. In most cases this
is when they use professional sports athletes to try out the products
and demonstrate what they can do.

People
All companies are reliant on the people who run them from front line Sales
staff to the Managing Director. Having the right people is essential because
they are as much a part of the business offering as the products/services
that are offered. People are the most important element of any service or
experience. Services tend to be produced and consumed at the same
moment, and aspects of the customer experience are altered to meet the
individual needs of the person consuming it. Most of us can think of a
situation where the personal service offered by individuals has made or
tainted a tour, vacation or restaurant meal. Remember, people buy from
people that they like, so the attitude, skills and appearance of all staff need
to be first class. People have an important role in service delivery, they are
relied upon to deliver and maintain transactional marketing and people play
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an important part in the customer experience. There are 23,000 Nike
employees. There are many organizations who rely on Nike Sponsorship.
Nike pays top athletes in many sports to use their products and
promote and advertise their technology and design.
Nike's first professional athlete endorser was Romanian tennis player Ilie
Nastase. The first track endorser was distance runner Steve Prefontaine.
Prefontaine was the prized pupil of the company's co-founder, Bill
Bowerman, while he coached at the University of Oregon. Today, the Steve
Prefontaine Building is named in his honor at Nike's corporate
headquarters.
Nike has also sponsored many other successful track and field athletes
over the years. Nike has been the official kit sponsor for the since 2005.
They have loyal customers.

Process
Process ensures consistent service delivery to every customer, at any time
of the day, on any given day. And a successful business incorporates
scenario where customer preferences can be accommodated to provide
them unique experience. Nike company lays a lot of strategies to aim their
immediate users, athletes and all sportsman. These targeting techniques
include Product sponsorship by professional and well known athletic team,
college sports team as well as celebrity athletes. Company pays particular
emphatic concentrating to the sportsman more than some member
individuals even if it also targets teenagers who have hold the hip hop
customs.

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SEGMENTATION, TARGETING AND POSITIONING

Segmentation

It has following segmentation to create consumers groups to target:

Demographics segmentation: Nike has segmented an Age and gender
group that is it has such products that serve male and female that has age
range of 15-55. Psychographics and behavioral segmentation: Nike has
this segmentation to answer that why consumers need its products and
what the consumers have interest and purchasing habits. So regarding this
Nike segments its market which includes: • Sports or athletic oriented •
Active lifestyle(interest in fitness and exercise for recreation) Geographic
segmentation: On the basis of this, Nike has segmentation to serve its
target customers all over the world. It has major markets in USA, Asia-
pacific Europe, Africa but it has continuous objective to cater markets in
other countries as well like North-America, China, Japan, and Middle-East
etc. (Nike Inc, 2016)

Targeting

As for market segmentation, Nike has niche market to serve that is Nike
focuses and targets athlete or sportsperson segment and provides required
products to them as footwear and apparel products, which have quite
specific and unique feature as compared to other footwear products.
Following are the some target strategies of Nike: Its target strategies
include aggressive marketing to make aware its target consumers about its
product and even Nike make its target consumers enable to get their
desired products through customization process as own signature shoe is
offered to athlete that is it enabled Michael Jordan to have his name Jordan
shoes. Apart from this, its targeting strategies include sponsorship of its
products through sports team or celebrities. It has objective of styling its
product through psychological tactics on target market by linking triumph
with apparel that is products are viewed as victory when sponsorship is
done by athlete celebrities (Marketing strategy of Nike) Another targeting
strategy is Nike cross training established in 1989 which caters all the

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athlete participants all over the world and trains different sport activities
which has also become way to make its target market satisfied.

Positioning

Nike has positioned itself in the mind of its target customers as a leader in
sports goods. It has made such products that satisfy its niche market with
all products related to sports. Its slogan ‘Just do it’ has made an appeal to
target customers to buy the product with sense of inspiration and
confidence and which has made it major competitor in athlete industry. Its
positioning statement is ‘For every serious athlete Nike provides perfect
shoe or sports products that gives confidence for every sport activity’

It has following positioning strategies:

• Enhancing athletic lifestyle or fantasy in consumers mind

• Appealing style and attitude

• Positions itself as premium brand with well-designed products

• Appealing quality level and valuable products

CSR OF NIKE
Nike Inc. maintains corporate social responsibility (CSR) programs to
address the interests of its major stakeholder groups. According to Archie
Carroll, stakeholders are individuals or groups that have a significant stake
in what the business does. The company influences them, and they
influence the company in return. The brand image and sales performance
of Nike sports shoes, apparel, and equipment are significantly subject to
the effects of stakeholders’ interests and corresponding actions. Nike
addresses these stakeholders’ interests through a number of corporate
social responsibility programs. However, the Nike Foundation is the main
arm of the company’s corporate social responsibility strategy.

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 Nike’s Stakeholder Groups & CSR Initiatives
As a global business, Nike Inc. has a wide variety of stakeholders with
significant influence on the sales of the firm’s sports shoes and other
products. However, the company’s corporate social responsibility programs
target only a number of major stakeholder groups. Nike has the following
stakeholders, arranged according to the firm’s prioritization:

1. Customers (top priority)

2. Communities
3. Employees
4. Governments
5. Interest Groups

Nike Inc.’s CSR Performance in Addressing Stakeholders’

Interests
Nike’s prioritization of customers reflects the importance of this stakeholder
group. The satisfaction of customers directly affects revenues. The
company’s corporate social responsibility strategy is also satisfactory in
terms of giving second priority to communities, considering the variety of
policies and programs to support these stakeholders. While it is
understandable that employees determine organizational performance,
Nike’s corporate social responsibility support for communities is congruent
to its support for customers as a top-priority stakeholder group.
Communities also determine consumers’ buying behaviors. Overall, Nike
Inc. is effective in ensuring that its corporate social responsibility programs
support the business aim of optimizing revenues from the sale of sports
shoes, apparel and equipment worldwide.

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CONCLUSION

Nike Inc. is a company rooted in competition. From equipping athletes with

finest sports equipment in the world to continuosly improving their financial
performance, Nike dominates its competitors. Phil Knight and Bill
Bowerman could not have imagined in 1962 that at what degree their $500
investment would yeild in 2017. They did know that product quality will help
athletes to achieve greater goals. Nike still operates on this philosphy
today. It is one that helped athletes and stakeholders alike to realize
athletic and financial greatness. Despite a changing market place for
athlete footwear, Nike wants to expand their product lines to become a
more powerful global brand.

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