Assignment: NIKE Market
Overview:
Nike incorporation is the words leading sports footwear and Apparel Company. The main Nike brand is mostly targeted towards the athletes, selling related products such as shoes, sporting equipment's and clothes. Over the past five years the Athlete and sporting goods manufacturing industry has expected to slow growth according to the modest growth in the sports participation rate. The Demand for sporting goods is increasing over the period. In the next five years to 2020 consumer will becomes more health conscious, which will estimate demand for Athlete equipment's. This Athlete industry is highly fragmented and characterized by the high level of competition.
Environment Analysis-Pest Analysis
Political:
There are worker rights and employee laws which affect the Nike's internal procedures It has positive government policies which support it in increasing their growth prospectsespecially in US.
The surroundings legal issues affect it and are handled by Nike itself
Nike can take help from government as well as from foreign countries which have favorable relationship with Nike in making the products.
Economic: Nike get sponsorship from different other companies
Nike can be the way in creating new jobs when their higher growth in economy
Due to economic downturn consumers can be affected and it can reduce consumer confidence towards products of Nike
There can be risk of currency, interest rate and exchange rates for Nike's product Increasing material prices and labor cost in production countries or outsourcing for icreasing the living standards can also affect Nike's product sales
Social: Consumers are becoming more loyal towards the brand and becoming brand conscious that can be advantageous for Nike Changes in life style- health awareness, sport participation which is increasing the demand of sport products
Increasing market share of female customers can also be opportunity for Nike
Consumers preferences and demand are being diversified hence Nike can broaden its product range
Technological: New technology affects Nike because it incorporates it in its products.
Through technology it makes highly innovative products as shoe construction/ design
It can create mobile app and different facilities and website from which customers can do online shopping through new digital trends. (Hanrahan, 2002)
Weakness
It is a global brand and no.1 shoe maker Nike has the joint venture with Apple's
IPod in continued innovation
It has strong distribution channels
It has strong position over its minimal long term debt
Has innovative shoe design which enable consumer to design their own shoe online
It has diversified products worldwide Has strong marketing campaigns and endorses different products
Have different segments as baseball, golf and footwear etc.
Its sales highly depend on the footwear segment
It has violations in history and they provide minimal wage rate to its workers
Has poor conditions in work places It is having bad reputation
Has higher price compared to its competitors as Adidas
It can develop products such as sport's wear, sunglasses and jewelry
Its brand can also developed internationally
It can support different market events globally as (the Olympics, FIFA)
It may have expansion in larger brand recognition in market
It can have growing segmentation of women Athletes'
It can increase demand and introduce fashion brand image in market
Economic recession and fluctuations in the currency can lead Nike to losses
Higher competition as competitors are becoming more aggressive and creating high quality products Sensitivity to price
Maintaining reputation of eco-friendly (Swot analysis of Nike)
STP (Segmentation, Targeting and Positioning)
Market 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.
Another targeting strategy is Nike cross training established in 1989 which caters all the athlete participants all over the world and trains different sport activities which has also become way to make its target market satisfied.
Market 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.
Marketing Mix strategy
Nike has the leading role in marketing and has strongest marketing mix. In particular it depends on Pull strategy; it has established it's seizing against the big competitors like Reebok and Adidas (Marketing mix of Nike)
Product
Nike offers a wide range of products including shoes, apparel and equipment. Currently these are top selling product categories, all these products clothing and equipment specialized for sports products (Marketing mix of Nike).
The first product of Nike is running shoes. Apart from this, it offers currently in athletics, baseball, ice hockey, tennis, soccer, lacrosse, basketball products and has wide range of sports products such as cricket shoes, shirts, and shorts.
Nike recently shoe tracks the performance of a corridor on the radio device that connects to the iPod Nano to produce the Nike + Apple Inc. with the team, while the product generates useful statistics and enables the users to get value from product (4P of Nike).
Pricing
The type of products to be marketed will affect the price of a product. Nike's pricing strategy is considered to be competitive than other retailer shoe. The pricing is based on the basis of target customers as a premium segment. Nike brand commands a high premium. Pricing strategy makes use of vertical integration in which they participants at differing channel levels or take role in operations level more than one channels to control cost and impact product pricing (Marketing mix of Nike)
Place/Distribution
Nike shoes are conceded by other multi brand stores and exclusive Nike stores worldwide. Nike has about 20,000 retail accounts in the US and sells its products in about 200 countries worldwide. In the international market, independent distributors, licenses and subsidies sell Nike products. The company has manufacturing facilities worldwide and in Asia, customer service and other operational units (Nike Marketing Mix).
In Nike Town store, shops sell sheep showmanship interested enough to do whatever. Nike town stores can take the entire city blocks and customers can feel like future oriented. These include basic shoe stores made during each boasting chandeliers Nike product imaginable. Nike town product offers a complete experience. This store has all the products, but will not stay there again create a memorable experience for the customer to bring back again (Nike 4PS).
Promotion
The marketing communications mix is effective because Nike attracts new customers and creates balance between keeping existing customers (nike marketing communications-mix).
This is one of the strengths of Nike. Nike has introduced its offers to almost any environment known to man and is extremely sensitive. Print advertisement in general, simple but send a strong message. There is virtually no advertising that appears on their price and Nike are almost always uses a popular athlete to promote its product. The Advertisement exceeds the expectations of everyone with these shoes and they are able to demonstrate on the rise for consumers (nike 4p).
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