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ADVANCED MARKETING STRATEGY 362MKT Example on Nike
Dr. Eric Chu

362Mkt‐2012 Example

Company Background
• NIKE, Inc. is the world’s leading innovator in athletic footwear, apparel, equipment and accessories. The mission of Nike is to bring inspiration and innovation to every athlete in the world.

362Mkt‐2012 Example

Product Market
• Garment Industry
– The garment industry consists of different categories of wearing apparels that serve both beauty, comfortable and body protection. – Product categories could involve men wear, kids wear, sports wear, ladies, …

362Mkt‐2012 Example

Market Audit (1)
• External Environment
– By STEEPLE
• Social factor: people are more concern with health, fashion and beauty. Diverse segments are emerging in the garment industry. (Opportunity) • Technology: different material by nano technology could help to build more comfortable garment for consumer market. Different material available lead to better design for manufacturers. (Opportunity) • Legal: pirated products costs a lot of money for litigations in the industry. (Threat)
362Mkt‐2012 Example

Market Audit (2)
• External Environment
– By 5‐forces
• Supplier: supplier marketing in the garment industry are mainly small low costs manufacturers in the area and many suppliers are available. Suppliers bargaining power to the industry is low. (Opportunity) • Buyer: Information transparency increase and there are lot more competitive products for customers to choose. Buyer bargaining power is high. (Threat)

362Mkt‐2012 Example

Market Audit (3)
• Internal Environment
– Resources and Competence
• Human Resources: a valuable asset to the Company developed throughout the decades in coordinating global production and sales activities. (Strength) • Physical Manufactories: one of the earliest manufacturers moving in the low costs China market and having a massive number of plants and equipment in China. (Strength) • Financial Position: Cash position accumulated over the years enable different value‐added activities development at Nike. (Strength) • Product innovation, Marketing and Production: Efficient value activities that form a major competence to Nike in competition. High brand equity and efficiency in production. (Strength) • Human Resources Development: the value activities is becoming more challenging as labour laws in different Asian countries are developed. Recruitment and retention of labour becomes more difficult and original manufactories need to relocated to lower costs areas such as Africa and Indonesia. (Weakness)

362Mkt‐2012 Example

Competitive Advantages
• The company is competing in the Sports wear market within the Garment Industry. Major competitors in the same market including Addidas, Puma, Reebok, New Balance, Asics,… An extraordinary financial resources with hugh support of marketing and production setup enable the company to develop and capture different opportunities in the market more efficient than her competitors.
362Mkt‐2012 Example

Segmentation
• Segmentation variables for the Sports Wear Market
– Intensive of Use: high, medium, low – Control of body performance: high, medium, low – Comfortability: high, medium, low – Fashion and appearance: high, medium, low

362Mkt‐2012 Example

Sports Wear Market Segments (1)
• Professional Sports
– – – – – – – – Intensive of Use: high Control of body performance: high Comfortability: medium Fashion and appearance: medium Intensive of Use: medium Control of body performance: medium to high Comfortability: high Fashion and appearance: medium to high
362Mkt‐2012 Example

• Regular Sports

Sports Wear Market Segments (2)
• Casual Sporty Wear
– – – – – – – – Intensive of Use: medium to high Control of body performance: low Comfortability: high Fashion and appearance: medium to high Intensive of Use: medium to high Control of body performance: high Comfortability: low to medium Fashion and appearance: low to medium
362Mkt‐2012 Example

• Physiotherapy

Targeting
• As the competitive advantages of is brand, innovation and production capabilities with different available resources, Nike focuses on targeting a wide range of sports wear market segments including professional, regular sports and causal sporty wear. • Physiotherapy segment is not targeted due to inconsistence with the brand image although the Company is capable in serving the segment.
362Mkt‐2012 Example

Positioning
• Nike focuses on symbolic and functional concepts to positioning in which a consistent high quality and fashionable brand image together with highly innovative product feature. Brand management and product innovation are key marketing development programmes for the Company

362Mkt‐2012 Example

Positioning for different Segments
• Professional Sports
– Product: high quality and precise product design in delivering high athletic performance – Price: high price for premium product features – Place: limited to professional sports outlets – Promotion: limited to sponsorship of major sport events and professional athletic publications

• Regular Sports
– Product: high quality and fashionable design in delivering good performance and a healthy look for the customers – Price: medium to high price for comfortable and fashionable products – Place: available to most sports wear stores – Promotion: Sponsorship of sport events and general consumer publications

362Mkt‐2012 Example

Marketing Development Programme
• Brand Management
– High brand equity and innovative culture developed throughout her history – Successful brand extension strategies leverage the brand equity. Other than different models of sports wear, accessories like eye glasses, watch, decorative accessories and TV games are developed

362Mkt‐2012 Example

Marketing Development Programme
• Product Innovation
– High innovative team provide synergy for producing new product for brand extension – Occasionally provide new products to shape the market trend – The innovative culture help the company to produce a series of high quality and fashionable sports wear as compare to competitors. Number of models and choices of product line are obviously higher than competitors
362Mkt‐2012 Example

Conclusion
• Base on the competitive advantages of Nike, the Corporation successfully compete as a premium brand and wide range of products.
Garment Industry
Professional Sports Wear Physiotherapy Ladies Causal Regular Sport

Men

Kids

362Mkt‐2012 Example

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