The band tracks the wrist movement, predicts the activity performed and the approximate amount of calories burned. The shoes featured gas-filled plastic membranes that could be inserted into the sole for comfort during running. I'm writing this as I sit in a Starbucks (NASDAQ:SBUX) cafe at Charles De Gaulle Airport in Paris, and while the language is different, the experience is very much the same. Through apps, Nike has come closer to its customers and can study them and communicate with them conveniently. This case study analyses the ever-evolving marketing strategies adopted by Nike to become a global brand. She has now turned her focus to helping investors lead happier and richer lives at The Motley Fool. Today, each Nike sub-brand has its own Facebook page, which runs product specific promotions and features events in a particular sporting activity. The athletic footwear leader's digital strategy was the … He used to take help from university runners to test his creations and collect their feedback. Nike is headquartered in a state of art building that has a lake and more excellent and extraordinary facilities for its staff. In many ways, Nike is hard to beat, too. He already thought that it would be beneficial to the company if it used manufacturing plants in other countries outside the United States, because the labor costs would be much lower. Many of the high-end luxury shops are understandably quiet, but Starbucks is hopping. Practice Leads to High Performance as Nike Executes Global Strategy. This made it easy for a person involved in a particular sport to choose his/her shoes. Fast forward to May 20, 2006. It has been pushing the technological boundaries of innovation to offer its customers new products and also differentiate itself from its competitors. Nike's sales philosophy - if you have a body, you are an athlete - had enticed everybody who wanted to think of himself/herself as an athlete or wanted to get more athletic. Known for bringing the best innovations to athletes at every level, it is no surprise that Nike continuously strives for excellence. A very large infrastructure is essential to manage its global presence well. Nike didn’t build its … Today, the estimated market value of Nike is about $10.7 billion. Nike pairing up with Apple Inc, another company known for its innovative products, was a way to bring into its fold the Facebook fans of the company. The whole evolution process has managed to change the concept of what a regular apparel seller is. In today’s competitive environment, Nike, one of the global leaders in sporting goods industry, has established a strong position for enhancing athletic life style. The marketing campaign for this product was supported by a memorable TV ad in which the Beatles' Revolution was the soundtrack. So now iPhones and iPods come pre-installed with Nike+ app. Market data powered by FactSet and Web Financial Group. Both of these companies have seen rising share price, with Starbucks up 46% and Nike up 32% over one year, and there's good reason to believe that they will continue in that direction. Global marketing helps create a strategy for a similar product in a different market. In 1966, it opened the first BRS retail store in Santa Monica, California. These areas pertain to the main decisions in managing streamlined opera… Our mission is to bring inspiration and innovation to every athlete* in the world. And it is here that Nike Fuel comes into play. Many large U.S. companies, such as Nike (NYSE:NKE) are catching on. Adapting from their origins of supplying trainers to athletes, they’ve evolved to focus on everyone, all across the globe. And yet, Nike’s marketing is not just about selling shoes or athletic apparel–it’s pitching a lifestyle. Invented in the mid 1970s by a NASA engineer, it kept up the revenue of Nike for long. Nike also customised the product to suit individual needs by inserting bags of different size depending on the height and pressure exerted by users. Compared to other specialised players like Jawbone's UP and Fitbit Flex, FuelBand is rather primitive. The company's innovation debut was in 1979 when it introduced air cushioning technology. A Nike + Sportwatch was also introduced in combination with the chip. The Nike marketing strategy, in summary, is, invest heavily in marketing, use emotional advertising that every human being can identify with, offer premium products at premium prices and sell their products primarily through 3rd party retails stores. For example, a Facebook user who wants to know more about the latest basketball shoes or game can turn to Nike Basketball Facebook page. Nike Outlines Global Strategy for Creating a More Sustainable Business. Nike's competitors had by then developed their business in this segment. Nike has a strategy of growing in a way that is responsible and ensures long term financial growth. NIKE is a brand of Innovation, Growth and Purpose. Global Marketing Strategies. Nike's success lies in its ability to understand how innovation can be used to reinforce brand identity: Simona Botti, Nike took a unique approach for its shoe manufacturing process and occupied the mind space as a maker of athletic shoe: Sunil Chandiramani, Michelle Sanusi, Alexander Lazarev, Jesper Milling Jorgensen, Vasyl Latsanych, Setting aside its global strategy helped Gillette in India, How Starbucks survived financial crisis of 2008. It created convenience so customers in other parts of the world could easily acquire Nike’s products and increased customer satisfaction as a result. It had less to do with shoes and more to do with athletes. Doing business responsibly has been at the cornerstone of Nike’s growth strategy. 2. Returns as of 12/23/2020. Starbucks and … The bags can be seen by the athletes (users) through a 'special window' in the heel or toe shoe. The page on Facebook does not say much about the FuelBand. The Ascent is The Motley Fool's new personal finance brand devoted to helping you live a richer life. An effective distribution strategy would be key for Nike. The greater share of the gain came from international markets, specifically in China, as these areas have been fueling the company's growth over the past year: Not only are these numbers fantastic, they're also remarkably consistent, which is important for investors to consider when evaluating a company's longer-term sustainability. Nike- A Truly Global Company: Nike is the world market leader in athletic shoes and apparel and operates in more than 200 countries. Nike delivers innovative products, experiences and services to inspire athletes. Meaningful story – They’re selling more than a product; they’re selling aspiration. Nike produces a […] Somewhere in its evolution, Nike also realised the importance of hi-tech gadgets in day-today lives. Users can compare the Nike Fuel accumulated and comment on the challenge, motivate each other, share their difficulties and get suggestions on how to improve the general level of fitness. The second quarter of 2020 saw $10.3 billion in revenue and 10% growth, crushing numbers for its closest rival, Adidas (OTC:ADDYY), which saw $7.1 billion and 6% growth in its most recent quarterly report. You can read more about them on the official Nike file here. This case study analyses the ever-evolving marketing strategies adopted by Nike to become a global brand. 1.0 INTRODUCTION OF NIKE Nike is a major publicly traded sportswear, footwear and equipment supplier based in the US which was founded in 1962 originally know as Blue Ribbon Sports. The users of Nike+ can not only store and review their results in their computers or devices but also analyse and share them within the community. However, the number of calories spent is not a robust index of energy used because 100 calories burned by a person who weighs 100 kg is not the same as the same amount of energy burned by a person who weighs 50 kg. 13 3.3.1 - Product Nike is a global company with a portfolio based on Nike Inc. (2017) that includes a vast variety of products of footwear, apparel, equipment, and accessories for men, women, boys and girls. Its swoosh symbol is easily recognized by everyone. Strong Brand Awareness – Nike is one of the most recognizable brands in the world as its name alone is memorable, easy to pronounce, and very unique. So, they moved on from being distributors of athletic footwear to designers and manufacturers of athletic footwear and took full control over their value chain. One of the company's latest products is Nike FuelBand, a wristband that calculates the amount of energy spent during a day. Starbucks is now in over 80 global markets, and the fourth quarter of 2019 saw a 3% increase in international comps, up from a 1% increase in 2018. All the rest (calculation, storage, integration) was done by the iPod. The production of goods in locations other than those in which they are sold has been … Thanks to its technology leap, Nike, it is said, was able to cut down on advertising expenses by 40 per cent without compromising on efficiency and results. Although sales to wholesalers accounted for about 68% of Nike’s global revenues in fiscal 2019, … NIKE GLOBAL SOCCER MARKETING STRATEGY The Positioning statement of Nike is “For serious athletes, Nike gives confidence that provides the perfect shoe for every sport”. Stock Advisor launched in February of 2002. It was for the first time that a Beatles song was being used in a TV ad. The fact that the company has a global supply chain means that it is subject to the vicissitudes of international trade practices including labor strikes in its overseas locations, currency fluctuations that decrease its margins, as well as lack of control over the geopolitical events happening around the world which have the potential to disrupt its global supply chain. A positive impact of Nike’s offshoring strategy was that it allowed Nike to meet the growing market demand of its customers that resulted from global economic growth. A design student Carolyn Davidson created the famous 'swoosh' logo for $35. Overall, revenue was up 6% year-over-year. A strategic objective based on the cost leadership generic strategy is to grow the company’s competitive advantage through new technologies to reduce production costs. Nike Global Expansion. Going miles ahead of its competitors with a user community of more than six million people, Nike products were not just dressing up the athletes but also coaching the masses who wanted to be like athletes. Nike owns 31% of the global footwear market with an average of shoes sales that reach 120,000,000 pairs (Statistic Brain, 2017). It seems like everyone knows that here, you'll get a quality cup of coffee in a relaxed environment and a table for your laptop. On this day, Nike introduced its first mass produced gadget, Nike + iPod Sports Kit, in the US market. Nike Inc.’s International Strategy Nike Inc. defines its international strategy based on three core strategic questions (This international strategy is also valid for Turkey): What new business concepts could enable NIKE, Inc. to thrive in a sustainable economy? What an iconic brand.” I thought to myself. Let's conquer your financial goals together...faster. 31% of the global athletic footwear market. Nike Inc (Nike) had been a phenomenal mature sporting goods brand controlling the market share and growing faster than the competitors. The shoes had two interdependent bags with compressed air inside. We do that by building creative and diverse global teams, making a positive impact in the communities where we live and work and by … The company released the Nike app in China this past quarter, and it was downloaded 1 million times on the day of the launch, making it the top shopping app in all of China. Consumer Direct Offense strategy grows revenues The company, under its Consumer Direct Offense strategy, is growing its digital presence. Also, the … Its image as a technological front-runner and high status symbol gives it an edge in sales, and no other athletic shoe company can quite match it in terms of revenue and innovation. But it was Nike's product. Nike monitors that region thoroughly to find opportunities for community engagement, and the result has been explosive growth. In those days, Bowerman would often rip apart the Tiger brand shoes to see how he could make them lighter and better. It brought the idea and developed it into a business. In contrast, a regular apparel seller even after spending huge amounts on advertising can only expect to meet a customer in the store when the customer has already made a decision to go and shop there. See you at the top! Nike Inc. is a leading global manufacturer and seller of sports shoes, apparel and equipment. Nike is the world leader in the manufacturing of sportswear and gear with more than 47 market shares across the global (Nike.com, 2011). Products like Nike + iPod for gym goers and Polar WearLink+ targeted specific needs of users. Nike was cashing in on the most technologically advanced portable device that could do all the tech work brilliantly. But it helps that most of us drink coffee, which makes for a more seamless international transition. The main driver of Starbucks revenue is domestic sales, which accounted for 69% of the total revenue in the 2019 fourth quarter. Founded in January 1964 as Blue Ribbon Sports (BRS) by University of Oregon track athlete Philip Knight and his coach Bill Bowerman, the company was initially a distributor for the Japanese shoemaker Onitsuka Co and their brand Tiger. Nike has captured approx. Instead it uses the social media site to motivate its users to get fit. 14. According to Mintel, 20%of the U.S. athletic market is controlled by Nike. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. It paved the way to a truly innovative future of the company. This market position is partly a result of effective and efficient operations management (OM). Constant innovation has been the byword for Nike's success. 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