Team Project Phase 1

Elise Wright, Henry Newman, Matthew Friedberg, Taylor Kiel, Lincoln Koyejo
Group 72
Nike, Inc.
Eller College of Management
MKTG 361
October 10, 2021
Organization Description

Nike is one of the most popular brands in the world and widely known for their innovations and
products within the footwear industry and the renowned athletes they endorse. Originally known
as BIue Ribbon Sports, Nike was originally founded by the University of Oregon’s track-and-field
coach, Phil Knight, in 1964 and became a world recognizable brand by the early 21st century.
There are three main business units that Nike focuses the majority of its efforts on: athletic
footwear, apparel, and equipment. Nike dominates the athletic footwear industry with having an
estimated 50% market share, then an 18.3 percent market share of the athletic apparel industry,
and lastly a small market share of the more competitive athletic equipment market (Polk, 2021).

Timeline

Nike’s mission statement is to “bring inspiration and innovation to every athlete* in the world. *If
you have a body, you are an athlete”. This is the purpose of Nike as an organization and reflects
how they see themselves going into the future as a leader in the athleticwear industry. Their key
values include innovation, teams, social and community impact, and sustainable business
innovation. These values are aligned with the mission statement and are there to guide Nike’s
conduct over time. Inspiration appears to be extremely prevalent in their mission statement,
which ties to the company’s slogan, “Just Do It”. This short yet effective slogan with the Nike
swoosh has allowed Nike to become one of the most visually recognizable brands ever (2021
Digital Brand Blueprint).

Nike’s athletic footwear business unit will be the area of focus for analysis. Nike provides
footwear for a multitude of different sports ranging from running and golfing to football and
basketball. Some of Nike’s best selling shoes include the Air Force 1, Air max 270s, and Air
Max 97. Nike has been focusing much of their efforts on creating more sustainable footwear
with their Move to Zero campaign and been making shoes out of 100% recycled materials such
as the Nike Space Hippie. These sustainability efforts are one of the largest drivers of the
industry at the moment.
Market Description

Nike is the world's leading sports footwear and apparel company and is the most prominent
sports brand on the planet. They operate in the industry of design, development, marketing, and
sales of athletic wear and textile and their success can be linked to the brand's marketing
campaigns and endorsement deals. Nike's target markets are primarily consumers aged 15 to
45, with a focus on tweens and teens to increase brand loyalty. Women, everyday athletes, and
professional athlete sponsorships are also key markets.

One of Nike’s most important markets includes celebrity athletes and professional sports teams.
For most brands, acquiring big-time athletes to represent their brand is a tall task but for Nike,
they appear to have a seemingly endless stream of top-tier athletes. People are more inclined to
listen to personal testimonies from superstars such as Michael Jordan and LeBron James, so
this type of marketing is highly effective.

Women's apparel, specifically athleisure wear, is another area where they've put a lot of effort in
the last few years. This popular trend is categorized by athletic clothing that is both comfortable
and aesthetically pleasing. Nike believes this line of women's clothing can bring in an additional
$2 billion in sales (Lutz, 2015 Business Insider).

Young athletes who train, work out, and play sports as a hobby are another key target market
for Nike. Nike sponsors local leagues, clubs, and federations to promote athletes to wear its
products. They also market by running advertisements about young adults aspiring to be like
their sports idols. This has been a useful method attracting younger customers.

Finally, because running is such a fast-growing market, Nike devotes a significant portion of its
innovation efforts to it. One of the primary reasons driving market growth is the large increase in
the number of health-conscious customers, due to increased awareness on the benefits of
exercise and physical fitness (Global Running Market, 2021, Businesswire). This is one of
Nike's most profitable divisions, and they have almost completely cornered the market due to
the high quality of their shoes. They have invested a significant amount of spending into
marketing into the running category and it continues to earn over $3.8 billion per year (Maese,
2020, The Washington Post).

Nike has plenty of effective marketing strategies to reach consumers. The majority of it is
classified as direct marketing, which involves direct communication rather than the use of
third-party media platforms. One of the more successful marketing strategies that Nike has
carried out is digital marketing. Nike has traditionally sold most of its products through
brick-and-mortar stores, but this new approach places a greater emphasis on speeding up
innovation, producing and delivering products to customers faster, and selling to and connecting
with customers directly through digital channels (Duffy, 2019, CNN).
Competition Description

To thoroughly analyze Nike’s main marketing strategies, it can be useful to look at competitors’
strategies. This allows us to learn from competitors and set an industry standard to compare
Nike against. This section will identify Nike’s two main competitors, Adidas and Puma, and
explore their most noticeable marketing strategies.

Nike’s biggest and oldest rival is Adidas, which follows after Nike as the second largest
sportswear manufacturer in the world. Adidas specializes in athletic footwear but also produces
other sports apparel. From their own website, their most noticeable marketing strategy is to put
the consumer first in all situations, in a strategy they refer to as “Own the Game”
(https://www.adidas-group.com/). One of the ways they do this is by increasing their credibility
through market segmentation and collaborations with celebrities. Recently, Adidas identified a
new target market in consumers who wear athletic clothes for style rather than sport. In
response to this demand, they launched their “Sportswear” line and extended their “Originals”
line into the premium segment by improving their quality.

Nike’s second most significant competitor is Puma, who specializes in both athletic and casual
apparel. Puma’s main marketing strategy is to utilize a broad product portfolio. Because of this,
many of their accessories and apparel products fall into the question mark category in their BCG
Growth Share Matrix due to competition from Adidas and Nike. Another key marketing strategy
used by Puma is collaborations with designers such as Segio Rossie and singers such as
Rihanna. These collaborations serve the purpose of establishing Puma as an edgier, more
unique brand.
SWOT Analysis

Four Market-Product Strategies

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EricplusK, P. author B. (2021, March 2). Global Branding Strategy: Nike Analysis using 4 PS.

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https://globalmarketingprofessor.com/nike-global-branding-strategy/

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arket-2021-to-2026---Industry-Trends-Share-Size-Growth-Opportunity-and-Forecasts---R

esearchAndMarkets.com

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https://www.businessinsider.com/nike-is-going-after-3-kinds-of-customers-2015-4

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from https://www.managementstudyguide.com/swot-analysis-of-nike.htm
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https://www.nike.com/sustainability.

Polk, A. (2021, September 27). athletic footwear market dominated by Asia-Pacific with 42%

share. FDRA. Retrieved October 8, 2021, from

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hare/.

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