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					NIKE, INC.
 Situation Analysis
   Eric Larmann
   March 31, 2001
Table of Contents

Section                                              Page Number
The Industry                                                   3
       History                                                 3
       Current Conditions                                      3
       Industry Leaders                                        3
The Company                                                    4
       Overview                                                4
       History                                                 4
       Mission                                                 5
       SWOT Analysis                                           6
The Product- Nike+                                            10
       Stage of the Product Life Cycle- Growth Stage          10
       Product Sales Features                                 10
       Product Positioning                                    11
       Distribution                                           11
       Pricing                                                11
       Sales History                                          11
       Share of Market                                        12
Target Market                                                 14
The Competition                                               14
       Identification                                         14
       Strengths and Weaknesses of Competitors                16
       Communications Strategy of Competition                 17
Communications Strategy History                               19
       Television                                             19
       Print                                                  19
       Event Marketing                                        19
       New Media                                              20


List of Illustrations

Illustration                                         Page Number
Figure 1: Nike, Inc. SWOT Analysis                                6
Figure 2: Nike Annual Sales from 2005-2010                       11
Figure 3: Nike Annual Revenues by Product Division- 2009         12
Figure 4: Nike Annual Sales vs. Competitors in Footwear Industry
          - 2010                                                 12
Figure 5: Running Shoe Market Share- 2008                        13
Figure 6: Athletic Footwear Market Share- 2009                   13
Figure 7: Adidas SWOT Analysis                                   16
Figure 8: Puma SWOT Analysis                                     16
Figure 9: Asics SWOT Analysis                                    17
Figure 10: New Balance SWOT Analysis                             17

                                                                      2
The Industry1

History

Nike, Inc., particularly their operations in the manufacture of athletic
footwear and accessories, is situated under SIC code 3149, Footwear,
Except Rubber, Not Elsewhere Classified, and NAICS CODE 316219,
Other Footwear Manufacturing. This industry is comprised of companies
that participate in the manufacturing and selling of outdoor footwear,
athletic shoes, and safety footwear, with athletic footwear leading as the
largest-selling category in the industry. Key products include shoes
designed for all athletic activities, including, but not limited to, running,
basketball, football, and baseball.

Athletic footwear manufacturers captured one-third of the total footwear
market in the 1970s. 120 companies existed in 1987, but that number
would show a continual decrease over the next decade. The industry saw
a drop to only 54 companies in 1995, with a 19.5 percent decline in
profits. However, 94% of the profits were recorded by the two largest
athletic footwear producers.

The athletic footwear industry remained the only footwear industry to
report gains in the mid-1990s. Production and imports continued to
grow from 6.5 million pairs in 1993 to 1.6 billion pairs in 1995. This
growth saw the emergence of Adidas as a $3.5 billion company and Nike,
Inc. as the first-ever $9.5 billion company.

Current Conditions

The footwear industry currently consists of 100 manufacturers and
records over $2 billion in sales annually.

Industry Leaders

The leaders in the athletic footwear industry are:

        -   Nike, Inc.
        -   Adidias
        -   Puma
        -   Asics




1
 "Footwear, Except Rubber, Not Elsewhere Classified."Encyclopedia of American Industries.
Online Edition. Gale, 2011. Reproduced in Business and Company Resource Center. Farmington
Hills, Mich.:Gale Group. 2011. http://galenet.galegroup.com.ezp.lndlibrary.org/servlet/BCRC
                                                                                         3
The Company

Overview

Nike, Inc. is the world-leading manufacturer and seller of sports apparel,
footwear, accessories, and equipment used for a wide variety of athletic
activities. Its operations are divided into four separate segments:
footwear, apparel, equipment, and other. Headquartered in Beaverton,
Oregon, Nike employs 34,400 individuals and operates in over 160
countries across the globe. The company distributes all of its products,
within the U.S., through the channels of 346 retail outlets, including 145
Nike factory stores.2

Nike is the world’s leading designer and manufacturer of footwear in the
United States. As stated in their annual report, “Nike is the largest seller
of athletic footwear and apparel in the world.”3 Its footwear is designed
for specific athletic use, including running, training, basketball, and
soccer. It distributes its footwear to outlets through two specific
distribution centers located in Wilsonville, Oregon and Memphis,
Tennessee.4

History5

Nike, Inc. was first born as Blue Ribbon Sports in 1964, created by Bill
Bowerman and Phil Knight. This company distributed Tiger shoes, made
by a Japanese shoe manufacturer, to the western half of the United
States. In 1967, the two partners incorporated themselves and opened up
their first retail store in Eugene, Oregon. 1971 saw the design of the
“swoosh” logo and the Nike brand name itself, and the company released
its first apparel item ever, the Nike t-shirt, that same year. Once their
agreement with Onitsuka Tiger ended in 1972, Nike released its own line
of athletic footwear, and finally, the company name was changed from
BRS to Nike in 1978.


2
  “Nike, Inc. SWOT Analysis” Datamonitor. New York, NY: 1 Dec. 2010. Business Source
Premier.
http://ezp.lndlibrary.org/login?url=http://search.ebscohost.com.ezp.lndlibrary.org/login.aspx?dir
ect=true&db=buh&AN=57338030&site=bsi-live
3
  “Nike 10-K Annual Report.” Beaverton, Oregon: 20 July 2010.
http://invest.nike.com/phoenix.zhtml?c=100529&p=irol-sec#7044005
4
  “Footwear Industry Profile: United States” Datamonitor. New York, NY: 1 June 2010.
Business Source Premier.
http://ezp.lndlibrary.org/login?url=http://search.ebscohost.com.ezp.lndlibrary.org/login.aspx?dir
ect=true&db=buh&AN=51689200&site=bsi-live
5
  “Nike, Inc. SWOT Analysis” Datamonitor. New York, NY: 1 Dec. 2010. Business Source
Premier.
http://ezp.lndlibrary.org/login?url=http://search.ebscohost.com.ezp.lndlibrary.org/login.aspx?dir
ect=true&db=buh&AN=57338030&site=bsi-live
                                                                                                4
Nike continued to grow with its footwear line and signed a deal with
professional tennis play John McEnroe to endorse their newly developed
air-sole shoe. This would spawn a series of endorsements with
professional athletes that includes names like Michael Jordan and Tiger
Woods. The company went public in 1980 and began its apparel
campaign in 1986. The ever-famous “Just Do It” advertising campaign
was developed in 1988.

The company continued to expand and grow, spreading to over 160
countries and becoming the world’s leader in footwear manufacturing.
Nike acquired five subsidiaries over the years: Cole Haan, Converse,
Hurley, NIKE Golf, and Umbro. Recently, the company has begun to
partner with powerhouses like Google and Apple (both in 2006) to bring
athletics into the digital age. Its partnership with Apple brought about
the release of the Nike+ line, which included the Nike+IPod sport kit,
allowing footwear to connect to the IPod Nano. In 2009, Nike
restructured the Nike brand to include six geographies, North America,
Western Europe, Eastern/Central Europe, Greater China, Japan, and
Emerging Markets, instead of four regions to follow with its immense
expansion.

Mission

“When Nike co-founder Bill Bowerman made this observation many
years ago, he was defining how he viewed the endless possibilities for
human potential in sports.”6 Nike’s goal is to use innovative techniques
in order to develop products that will help athletes reach their upmost
potential, as well as to create a brand name in sports footwear and
apparel that surpasses all others. It’s mission, as defined on its website,
is, “To bring inspiration and innovation to every athlete in the world.”7




6
  “Company Overview- Nike, Inc.” Beaverton, Oregon. 2011.
http://www.nikebiz.com/company_overview/
7
  “Nikebiz: Shop and Customer Service.” Beaverton, Oregon. 2011.
http://www.nikebiz.com/customer_service/
                                                                              5
SWOT Analysis8

                    STRENGTHS                                             WEAKNESSES

        -   Strong brand equity enhances                         -   Recent decline in revenues
            position within the market
                                                                 -   Recent setbacks overseas and
        -   Innovative technology adds to                            with celebrity endorsements
            already strong brand equity

        -   Products manufactured at low
            costs and distributed over a broad
            network

               OPPORTUNITIES9                                                 THREATS

        -   Association with NFLwill                             -   Intense competition
            enhance market leadership in
            U.S.                                                 -   Increase in counterfeit market

        -   New product launches

        -   Strong growth in footwear market


                      Figure 1: Nike, Inc. SWOT Analysis


         a. Strengths

             i. Strong brand equity enhances position within the market.

                  Through marketing and innovation, Nike’s footwear and
                  sports apparel have very strong brand equity. Interbrand
                  ranked Nike as the 25th best overall brand, valuing it at
                  $13,706 million. This brand equity has allowed them to
                  secure an extremely large share in the global footwear
                  market: approximately 16% as of 2009.




8
  “Nike, Inc. SWOT Analysis” Datamonitor. New York, NY: 1 Dec. 2010. Business Source
Premier.
http://ezp.lndlibrary.org/login?url=http://search.ebscohost.com.ezp.lndlibrary.org/login.aspx?dir
ect=true&db=buh&AN=57338030&site=bsi-live
9
  “Nike, Inc. – Financial and Strategic Analysis Review.” GlobalData. 2010. Business and
Company Resource Center. http://galenet.galegroup.com/servlet/BCRC
                                                                                                6
  ii. Innovative technology adds to already strong brand
      equity

     Nike’s constant focus on technical innovation to improve
     their footwear, apparel, equipment and accessories has
     made them the leader of the athletic footwear market. In
     the developmental stage of their products, the company
     obtains the opinion of committees that consist of
     podiatrists, orthopedists, trainers, coaches, and athletes to
     ensure their products give the best results.

     Also, Nike’s recent partnership with Apple has spawned a
     whole new era in technical innovation for the industry. The
     Nike+ line has brought the athletic footwear and apparel
     industry into an online community, from which Nike
     constantly updates and adds new products. For example, in
     2010, Nike released its Nike+ GPS App to allow IPhone
     users to track their runs with the Nike+ community.

  iii. Products manufactured at low costs and distributed over
      a broad network.

     Nike’s low-cost manufacturing revolves around its suppliers
     in other countries such as China, Vietnam, Indonesia, and
     Thailand. Almost all of Nike’s product manufacturing
     occurs outside U.S. borders in low-cost countries.

     Nike’s wide distribution network across the U.S. comes
     from its two main centers in Wilsonville and Memphis.
     From there, they are able to distribute their brands to 346
     individual retailers in the country. The company’s
     international distribution is handled by 14 individual
     centers, which are able to ship products to about 24,000
     retail accounts.

     This use of low-cost manufacturing combined with Nike’s
     wide distribution system allows for them to keep their
     prices competitive while ensuring on-time delivery of their
     products.

b. Weaknesses

  i. Recent decline in revenues

     Nike’s recorded revenues over the past five years show a
     steady decline in growth for the company. From 2006-
     2010, the company’s compounded annual growth rate was

                                                                     7
                 6.19%, showing that it underperformed in growth and
                 possibly leading it to a competitive disadvantage.10

              ii. Recent setbacks overseas and with celebrity endorsements

                 As of 2010, most of Nike’s stores in Russia have been closed
                 down, as the company managing its retailers went
                 bankrupt. Only two retailers remain, and they look to be
                 sold to another company as well.

                 Nike has also suffered recently due to a few of its celebrity
                 endorsements, namely Tiger Woods and Lebron James.
                 Woods’ recent sex scandal and James’ broken reputation
                 due to his free agency move have made them extremely
                 hard to market as two of Nike’s leading professional
                 athletes.

            c. Opportunities

              i. Association with NFL will enhance market leadership in
                 U.S.

                 The NFL declared Nike its official licensed-partner for on-
                 field apparel in 2010. This agreement will ensure all Nike
                 products are worn, including uniforms, fan gear, and
                 clothing worn on the sidelines, during NFL events from
                 2012-2016. This looks to increase Nike’s earnings per share
                 about 3% and will provide the company with excellent
                 exposure and marketing opportunities to the millions of
                 NFL fans.

              ii. New product launches

                 Nike’s innovative thinking within the athletic and footwear
                 industry have allowed them to release newer, more
                 advanced products every year. In footwear alone, they’re
                 newer products include the Nike Zoom Kobe V and the
                 Nike Free line, which includes lightweight shoes for people
                 who prefer to run barefoot.

                 Once again, Nike’s partnership with Apple has only
                 increased their potential for releasing new products,
                 including the Nike+IPod sport kit, the Nike+ SportBand,
                 which was re-introduced in 2010, and the Nike+
                 LunarGlide.11

10
     Ibid
11
     Ibid
                                                                                 8
             iii. Strong growth in footwear market

                  Though the footwear market’s growth has decelerated over
                  the years, the market shows potential to begin a steady
                  increase in growth until 2014. The market’s growth is
                  scheduled to increase from $62.11 billion in 2009 to $69.48
                  billion in 2014.12

         d. Threats

             i. Intense competition

                  Nike is forced to compete with several different footwear
                  and apparel manufacturers, including: Adidas, Puma, K-
                  Swiss, New Balance, Dick’s Sporting Goods, and Reebok.
                  Also, due to its release of the Nike+ line, this has opened
                  the door to new competitors, such as GPS systems (Garmin
                  and TomTom) and startup companies (ex.
                  Dailymile.com).13

             ii. Increase in counterfeit market

                  The growth of the counterfeit goods market threatens to
                  take away sales from the Nike brands. Spurred by digital
                  sites on the Internet, online counterfeit sales increased by
                  9% in 2009, and today, they amount to about $500 billion
                  in global annual sales.14 Also, low-quality products can do
                  irreparable damage to the brand’s image, as consumers are
                  receiving products that aren’t the same caliber as the real
                  Nike brand.




12
   Footwear Industry Profile: United States” Datamonitor. New York, NY: 1 June 2010.
Business Source Premier.
http://ezp.lndlibrary.org/login?url=http://search.ebscohost.com.ezp.lndlibrary.org/login.aspx?dir
ect=true&db=buh&AN=51689200&site=bsi-live
13
   Morrissey, Brian. “Nike Plus Starts to Open Up to Web.” Adweek. Vol. 50 Issue 28. 20 July
2009. Reproduced Business Source Premier.
http://ezp.lndlibrary.org/login?url=http://search.ebscohost.com.ezp.lndlibrary.org/login.aspx?dir
ect=true&db=buh&AN=43646279&site=bsi-live
14
   “Nike, Inc. – Financial and Strategic Analysis Review.” GlobalData. 2010. Business and
Company Resource Center. http://galenet.galegroup.com/servlet/BCRC
                                                                                                9
The Product- Nike+

Stage of the Product Life Cycle- Growth Stage

After its release in May of 2006, the Nike+ line of products has continued
to grow and evolve to connect an entire community of runners. These
products started with the partnership between Nike and Apple, creating
the Nike+IPod Sport Kit that allowed runners to monitor their runs via
their IPod. The connection was triggered through a tiny sensor that is
placed within the Nike+ shoe.

Now, the line has added more products, including the Nike+ SportBand
(for those who don’t wish to listen to music), the Nike+ GPS App (for
IPhone users), and many new sneakers that have pouches for the sensor.
Also, in 2009-2010, the Nike+ website was reorganized to enhance the
community aspect of the line as well as make it more user-friendly and
open it up to social networks.

Product Sales Features

         -   Compatible with IPod Nano and IPhone

         -   Lightweight sensor able to fit into pouches within the
             Nike+ shoes- only Nike shoes are able to hold this sensor
             inside the shoe

         -   Monitors running time, distance, pace, and calories
             burned- this can either be voiced to the runner via
             headphones, or shone by using the SportBand

         -   Monitor and track changes in running patterns and
             improvements through community website-
             www.nikeplus.com

         -   Compete against others (or yourself) by checking
             website details- over 2 million members as of 200915

         -   Application now available for newer versions of the
             IPhone




15
  Morrissey, Brian. “Nike Plus Starts to Open Up to Web.” Adweek. Vol. 50 Issue 28. 20 July
2009. Reproduced Business Source Premier.
http://ezp.lndlibrary.org/login?url=http://search.ebscohost.com.ezp.lndlibrary.org/login.aspx?dir
ect=true&db=buh&AN=43646279&site=bsi-live

                                                                                               10
Product Positioning

Nike positions Nike+ as being “the largest running club in the world”.16
These products are made for active runners who seek a chance to
monitor and track their running capabilities. The theme behind these
products is very competitive, almost challenging the runner to compete
against themselves or against other users within the community. Also,
Nike is now making this line more available to any user by adding
different products like the SportBand and the App, as well as making the
online community more user friendly.


Distribution

Nike distributes these products to the U.S. market out of its centers in
Wilsonville, Oregon and Memphis. From there, they are able to be sent
to 346 individual retailers across the nation. Nike also makes use of its
website for sales, and this partnership with Apple allows the Nike+
products to be sold in Apple stores across the nation.

Pricing

        -    Nike+ compatible shoes- range from $95-$140
        -    Nike+ SportBand- $89
        -    Nike+ Sensor- $19
        -    Nike+ IPod Sport Kit- $29
        -    Nike+ GPS App- $1.99

Sales History

                          Nike Annual Sales from 2005-201017
                                 (in millions of dollars)
                              2010                      $19,014.00
                             2009                        $19,176.10
                             2008                       $18,627.00
                             2007                       $16,325.90
                             2006*                      $14,954.90*
                             2005                       $13,739.70
                                   *Year Nike+ was released.

                 Figure 2: Nike Annual Sales from 2005-2010


16
   “Nike Running.” Beaverton, Oregon. 2011.
http://nikerunning.nike.com/nikeos/p/nikeplus/en_US/
17
   “Nike, Inc.- Ten Year Financial History.” Beaverton, Oregon. 2011.
http://invest.nike.com/phoenix.zhtml?c=100529&p=irol-irHome
                                                                        11
                  Nike Annual Revenues by Product Division-
                                     200918
                                     Revenue
                                                    Percent of
                 Product Division (in millions of
                                                  Annual Revenue
                                      dollars)
                    Footwear       $10,300.00          54%
                     Apparel        $5,240.00          27%
                   Equipment        $1,110.00           6%
                      Other         $2,500.00          13%

                   Figure 3: Nike Annual Revenues by Product
                                  Division- 2009


                Nike Annual Sales vs. Competitors in Footwear
                                  Industry- 2010
                             (in millions of dollars)
                       Nike, Inc.                 $19,014.00
                        Adidas                    $14,878.05
                         Puma                     $3,586.52
                         Asics                    $2,420.77
                       Sketchers                  $2,006.87
                      New Balance                 $1,640.00

                Figure 4: Nike Annual Sales vs. Competitors in
                           Footwear Industry- 2010




Share of Market

As Figure 5 shows on the following page, the release of the Nike+ line
spurred an increase in Nike’s share in the running shoe market. Its share
was 48 percent in 2006 during the line’s release, but it grew to 62% only
two years later.19




18
   “Nike, Inc. Financials.” Wikinvest, 2009. 28 March 2011.
http://www.wikinvest.com/stock/Nike_(NKE)
19
   “Running Shoe Market Research- 2008.” Business and Company Resource Center. 28 March
2011.
                                                                                     12
              Figure 5: Running Shoe Market Share- 2008




Figure 6, below, clearly shows that Nike is the leader in the athletic
footwear market, as its market share is 35.21% as of 2009.20




            Figure 6: Athletic Footwear Market Share- 2009

20
     Ibid
                                                                         13
The Target Market

Nike brand products always cater to an athletic type of person who is
passionate, driven, and dedicated to their sport of choice. The company
has attempted to continue to bring innovation to enhance the
performance of athletes across the globe by offering enhanced footwear,
apparel, equipment, and accessories, and they have succeeded. The
Nike+ line is no exception to their innovative mission. This line brings a
new technological advantage to those serious about tracking and
monitoring how far and how fast they run on a daily basis. The line
teams technological advances to everyday running gear to allow runners
to join a digital community of runners.

The target market, therefore, refers to competitive, exercise enthusiasts,
particularly running, who enjoy the knowledge of their distance and pace.
The market doesn’t necessarily have to be running enthusiasts because
many people simply run to stay in shape rather than for competition.
Due to the technological aspect, the Nike+ consumer is either moderately
technological savvy, understanding of the workings of ITunes, or an
adapter to technological change. The target age group is between 17-35,
with gender and race not playing significant roles.




The Competition

Identification

Nike’s major competitors in the athletic footwear industry include:

         a. Adidas AG21

             Adidas, one of the largest sporting goods companies in the
             world, is headquartered in Germany. Broken up into three
             divisions, adidas, Reebok, and TaylorMade, the company
             revolves its brand around sport performance and sport style,
             manufacturing footwear, apparel, and accessories. They
             registered $14,878.05 million in sales in 2010 and is Nike’s
             main competitor. Also, to compete with Nike+, they have
             released their own brand of tracking devices known as
             MiCoach, which also includes a heart-rate monitor.

21
  Footwear Industry Profile: United States” Datamonitor. New York, NY: 1 June 2010.
Business Source Premier.
http://ezp.lndlibrary.org/login?url=http://search.ebscohost.com.ezp.lndlibrary.org/login.aspx?dir
ect=true&db=buh&AN=51689200&site=bsi-live
                                                                                               14
        b. Puma22

            Puma, another German based sports company, keeps its main
            focus on athletic footwear. However, more recently it has
            begun expansion on its apparel manufacturing. Though most
            of its sales are based in Europe, 26% of them still come from
            North and South America. Puma’s 2010 registered $3,586.52
            million in sales for fiscal 2010.

        c. Asics23

            Asics is a footwear, sportswear, and uniform manufacturer
            based out of Kobe, Japan. It markets to numerous sports,
            including basketball, wrestling, track and field, and running. It
            also recently began the manufacturer of accessories, like hats,
            glasses, and protective gear. Asics posted a decline in all of its
            sales for fiscal 2010 with $2,420.77 million.

        d. New Balance24

            New Balance, based out of Massachusetts, creates a brand that
            focuses on the quality of the footwear rather than the style.
            The company rarely uses celebrity endorsers and, instead, it
            promotes events and teams for fitness. They have not moved
            onto sports apparel and design six select brands of footwear.
            In 2010, they recorded $1,640.00 million in sales.




22
   “Puma AG Rudolf Dassler Sport”. Hoover’s. Hoover’s Inc., 2011.
http://subscriber.hoovers.com.ezp.lndlibrary.org/H/company360/overview.html?companyId=912
92000000000
23
   “Asics Corporation”. Hoover’s. Hoover’s Inc., 2011.
http://subscriber.hoovers.com.ezp.lndlibrary.org/H/company360/overview.html?companyId=912
92000000000
24
   “New Balance Athletic Shoe, Inc.”. Hoover’s. Hoover’s Inc., 2011.
http://subscriber.hoovers.com.ezp.lndlibrary.org/H/company360/overview.html?companyId=912
92000000000
                                                                                      15
Strengths and Weaknesses of Competitors

        a. Adidas25

                       Strengths                              Weaknesses

                 -   Strong performance                   -    Dependence on
                     driven by success of                      third party
                     2010 World Cup                            manufacturing

                 -   Spread out                           -    Excess
                     geographically,                           inventories led to
                     emphasizing on                            weak progress in
                     emerging markets                          China

                 -   Operations brought in
                     record levels of cash


                        Figure 7: Adidas SWOT Analysis



        b. Puma26

                       Strengths                              Weaknesses

                 -   Increased markets                -        Late entry into
                     overseas through                          apparel market
                     expansion


                        Figure 8: Puma SWOT Analysis




25
  DAtamonitor Adidas
26
  “Puma AG Rudolf Dassler Sport”. Hoover’s. Hoover’s Inc., 2011.
http://subscriber.hoovers.com.ezp.lndlibrary.org/H/company360/overview.html?companyId=912
92000000000
                                                                                      16
         c. Asics27

                        Strengths                             Weaknesses

                   -   Opening up of store                -   Current financial
                       in NYC brought                         situation shows
                       more brand                             declines in all areas
                       recognition


                           Figure 9: Asics SWOT Analysis


         d. New Balance28

                        Strengths                             Weaknesses

                   -   Focused on                         -   Lacking celebrity
                       technology and                         endorsements
                       innovation

                   -   Diverse product
                       portfolio


                   -   Large geographic
                       presence


                  Figure 10: New Balance SWOT Analysis



Communications Strategy of Competition

         a. Adidas

             Adidas has normally focused on using similar tactics to that of
             Nike, including celebrity endorsements and television spots
             during major international sporting events. However, recently

27
   “Asics Corporation”. Hoover’s. Hoover’s Inc., 2011.
http://subscriber.hoovers.com.ezp.lndlibrary.org/H/company360/overview.html?companyId=912
92000000000
28
   “New Balance Athletic Shoe SWOT Analysis.” Datamonitor. New York, NY: 23 December
2010. Business Source Premier.
http://ezp.lndlibrary.org/login?url=http://search.ebscohost.com.ezp.lndlibrary.org/login.aspx?dir
ect=true&db=buh&AN=57337872&site=bsi-live
                                                                                              17
             they have launched a new, worldwide campaign that includes
             television spots and print advertisements using the tagline,
             “Adidas is all in”. This campaign features celebrities like Katy
             Perry, Derrick Rose, and David Villa, and it also contains a
             digital and social network campaign to promote the new
             MiCoach App and technology.29

         b. Puma

             Puma’s strategy for the past decade has been to link their
             brand with certain styles of the era. Their ideas form to create
             a link between colorful fashions and footwear. They have done
             so through print advertising, using fashion models sporting
             their products. They have also followed many trends,
             including skateboarding and running, and look to move into
             future trends, like auto racing. Puma’s release of their new
             apparel line will definitely undertake the same approach of
             matching fashion with their clothing in print.30

         c. Asics

             Asics marketing strategy is based behind its acronym, which
             means “A Sound Mind in a Sound Body”. At the end of 2010,
             they released a new global campaign that includes television,
             radio, print, and online advertising that directs the message of
             ridding ourselves of negative energy. They look to portray
             running as “beyond running” and as a way to cleanse the body
             and mind. However, this campaign is mostly directed at
             foreign markets, not the U.S.31

         d. New Balance

             New Balance strays away from celebrity endorsements, which
             seems to hurt their brand image and awareness. However,
             their main focus is event marketing, from which they sponsor
             various events, races, and teams to promote fitness. Their
             most successful example was their 20th Anniversary for the
             Cure in 2010, which included 120 races and 15 three-day walks.

29
   “Adidas Launches Social Media Campaign to Promote MiCoach App.” Football Marketing.
28 March 2011. http://www.football-marketing.com/2010/08/07/adidas-launches-social-media-
campaign-to-promote-micoach-app/
30
   Wasserman, Todd. “The Secret to Puma’s Pounce.” Brandweek. Vol. 50 Issue 18. 4 May
2009. Reproduced Business Source Premier.
http://ezp.lndlibrary.org/login?url=http://search.ebscohost.com.ezp.lndlibrary.org/login.aspx?dir
ect=true&db=buh&AN=39145626&site=bsi-live
31
   “Asics’ Largest Global Campaign.” Fashion United. 18 March 2011.
http://www.fashionunited.co.uk/fashion-news/fashion/asics-largest-global-campaign-
2011031811454
                                                                                               18
            This got amazing publicity from daily talk shows and television
            programs. Also, 2010 saw the launch of their online “365”
            campaign of posting a new video every day.32




Communications Strategy History

Nike’s success and increase in revenue over the years have allowed it to
structure a large amount of their budget toward marketing, averaging 11-
13%. For example, in 2008, Nike’s marketing budget was 12.4% of its
annual revenues, totaling in $2,309.74 million for marketing.33

Television

From its release in 2006, the Nike+ line was portrayed in several
television commercials aired during major sporting events, including
basketball games and professional sports. These were usually shown on
ESPN, TNT, and TBS, aiming at competitive runners and workout
enthusiasts. The commercials ran taglines such as “Need Motivation?”
and targeted consumers wishing to compete against themselves.

Since then, Nike has stopped television marketing for these products as
the majority of its awareness is generated digitally through the online
community. However, Nike’s other products are still promoted in the
same way.

Print

For a brief time, Nike+ print ads were displayed in “Men’s Health” and
“Sports Illustrated”. This has ceased since 2007. Nike still holds ads in
similar magazines for the rest of its products.

Event Marketing

Nike has used major running events to help promote and market their
Nike+ line. Some of these events are simply annual running events that
Nike sponsors and attempts to bring more Nike+ users to:

32
   “New Balance 20th Anniversary Campaign.” Penton Media, Inc. 2010. Reproduced Business
and Company Resource Center.
http://galenet.galegroup.com.ezp.lndlibrary.org/servlet/BCRC?vrsn=unknown&locID=loyoland_
main&srchtp=glbc&cc=1&c=2&mode=c&ste=72&tpc=Sales+%26amp%3B+Marketing&tbst=t
sCM&tab=2&ccmp=New+Balance+Athletic+Shoe+Inc.&mst=new+balance&n=25&docNum=
A233466878&bConts=13223
33
   “Nike, Inc. Financials.” Wikinvest, 2009. 28 March 2011.
http://www.wikinvest.com/stock/Nike_(NKE)
                                                                                      19
         -        Nike Women’s Marathon

         -        Chicago Marathon

         -        NYC 26.2

Others are specialized events specifically for Nike+ users, which ask them
to run miles for a certain cause or for a certain event:

         -        All Miles for Japan- this cause asks Nike+ runners to
                  run miles to secure donations for Japan after the
                  devastating Tsunami

         -        Nike+ Human Race- this race was the largest 10K ever
                  ran. Held in 25 different cities, Nike+ was able to connect
                  the largest community of runners ever in one single race.34

New Media

         a. Digital

             The Nike+ online community remains the best resource for
             promotion of this line of products. As of 2009, the site had
             over 2 million users, logging over 100 million miles. This site
             has also been revamped to include all of Nike’s running
             products.

             Nike also makes use of its regular website, Nike.com, to market
             and sell its products online.35

         b. Social Media

             Nike+ has now been reorganized to include social network
             sites like Facebook and Twitter, allowing runners to share their
             statistics with their friends. Also, the Nike+ website now also
             uses a “friend” application, allowing users to make connections
             with runners they wish to speak with or compete against.36




34
   “Nike+ Human Race: The World’s Largest One Day Running Event.” Nikebiz.com. 1 May
2008. http://www.nikebiz.com/media/pr/2008/05/01_HumanRace.html
35
   Morrissey, Brian. “Nike Plus Starts to Open Up to Web.” Adweek. Vol. 50 Issue 28. 20 July
2009. Reproduced Business Source Premier.
http://ezp.lndlibrary.org/login?url=http://search.ebscohost.com.ezp.lndlibrary.org/login.aspx?dir
ect=true&db=buh&AN=43646279&site=bsi-live
36
   Ibid
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