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Nike Business Presentation

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Niraj de Silva

on 17 September 2014

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Transcript of Nike Business Presentation

Arguably Nike's best decision ever. Nike's Air Jordan shoes were banned by the NBA for violation of their rules on shoe colour and each time Michael Jordan wore them, Nike paid the $5000 fine that was delivered to him which created 'buzz' in the news media which also helped promote their brand and products for free.
It helped that Michael Jordan was the 'new thing' at that time and everyone wanted to be like him.
Please refrain from any use of laptops and cellphones.

Please feel free to participate as you will rewarded for your participation!
Good Afternoon :
JU
T
DO
IT
Photo de la Tiger.
Profile
Nike
By Niraj de Silva
Business Project
Company History
Bill Bowerman, who was a nationally respected track and field coach shook hands with Phil Knight who was a mid- distance runner to form Blue Ribbon Sports in 1964.
Why was Nike created?
How did they do it?
Jeff Johnson, who, like Phil Knight, was also a runner, became the first full time employee of Blue Ribbon Sports in 1965.
He very soon became the utility man for the new company. He created brochures, print ads and even shot photos for catalogues. He opened the first retail store in California and designed many early Nike shoes and even came up with the name Nike in 1971. Today they are one of the largest businesses in the world. A graphic design student by the name of Carolyn Davidson at Portland State University designed the Nike Swoosh and was paid $30 for it.
Product Range
Bibliography
- http://nikeinc.com/pages/history-heritage
- http://www.managementparadise.com/forums/marketing-management/221970-product-range-nike.html
- http://help-en-us.nike.com/app/answers/detail/a_id/34741/p/3897
- http://www.ukessays.com/essays/business/pestle-analysis-of-nike-macro-environmental-factors-business-essay.php
- http://www.nike.com/gb/en_gb/sl/find-a-store?display_country=AU
- http://www.nikeresponsibility.com/report/uploads/files/Product_LCA_Method.pdf
- http://www.businessinsider.com.au/25-nike-ads-that-shaped-the-brands-history-2013-8?op=1#the-very-first-just-do-it-ad-1988-1
- http://thelongestlistofthelongeststuffatthelongestdomainnameatlonglast.com/first308.html
-http://laura-nikeshox.blogspot.com.au/2009/04/pricing-and-distribution-strategies.html
- http://www.123helpme.com/nike-tactics-and-marketing-function-audit-view.asp?id=166615
- http://www.nike.com/us/en_us/c/help/promo-code
-http://www.businessinsider.com.au/nike-the-brand-that-keeps-on-giving-2011-12
-http://602communications.com/2013/02/nike-brand-strategy-emotional-branding-using-the-story-of-heroism/
-http://www.businessinsider.com.au/how-nike-solved-its-sweatshop-problem-2013-5
-http://www.nike.com/us/en_us/c/better-world/recycled/innovation
Link For Videos in Order (incase they don't work)
-http://602communications.com/2013/02/nike-brand-strategy-emotional-branding-using-the-story-of-heroism/
-other's are there in case they don't work, it's annoying me at the moment!
These include:
Footwear
Shoes are Nike's main product. The company makes shoes for a huge range of sports such as basketball, football, soccer, golf, baseball, snowboarding, hockey, tennis and volleyball. As well as casual shoes just for going places
Apparel
Nike makes all sorts of clothing for sporting activites including things like yoga and dance. They also make casual clothes for men, women and kids and a lot of people wear Nike clothes not just for sport, but also for brand status
Equipment
Nike also sell sports equipment such as baseball bats, all kinds of balls, swimming caps, rackets and gold clubs. Gloves, yoga mats, as well as agility cones, weights and sports guards such as knee pads and shin guards are all things Nike manufacture and sell.
&
Accessories
Nike is also well known for accessories such as watches, bags and socks, as well as technology such as Nike+ for iPhones and iPods. Rubber bracelets, sunglasses, training DVD's and athletic belts are just some of the accessories Nike sell. Another product they sell quite successfully are bags, which sometimes feature particular teams such as Manchester United.
Three products
Nike Free Runs
"The idea behind Nike Free is simple: Let your body perform as it wants to perform to develop significant performance benefits."
The flexible bottom allows for for your toes to flex and grip, setting off a natural chain that exercises muscles normally not exercised in traditional footwear
The difference b
etween Nike Free 3.0, 4.0 and 5.0 is that the lower the number, the closer it is to barefoot running
The outsoles have deep slices and revese flex grooves to encourage flexion and extension in both directions.
Nike Free Run shoes are designed to make it feel as natural as possible by merging the natural, healthy motion of a bare foot with the protection of traditional footwear
Nike Air Max
The technology consists of pressurized air inside a tough, yet flexible bag. The air soles compress to reduce the force of impact and then recover to original shape ready for the next impact
The benefits of Nike Air are that they are lightweight and versatile. The cushioning of the air soles protect muscles and tendons and the durability of the shoes allows for long lasting ones.
Nike Air Jordan
In 1985, Nike Air Jordan is born, inspired by the young NBA superstar rookie, Michael Jordan. Originally it was only shoes, but now it has expanded to socks, caps, bags and all sorts of apparel.
Macro Environment
Social Factors Affecting Nike
Technological Factors
Economic Factors
Political Factors
Legal Factors
People are becoming more health conscious with the judgemental society of today. So in order to do so, heaps of people are joining gyms and being more active and because of that, Nike shoes become very popular and their sporting apparel starts to sell very well.
Nike did, although, fail to talk about the problems like the conditions of labor and factory conditions at different locations of the production in Asia. All this had a negative effect towards people and their want to buy Nike products
Nike has been able to maintain its name in the market with the help of advancing technology. With the help of the internet, the business has been able to promote itself more and reach more people around the world who have access to such things. The business is able to sell products online which is a huge saving in terms of employee wages.
The biggest threat economically would be the economic recession. The recession always has a large impacon the growth and advancement of Nike. When the US economy has a huge downturn, the purchase by the consumers is also going down and when Asia's economy follow suit, it also has many effects on Nike because many of te company's manufacturers are based in Asia. After that, the voices of labor work and materials are increasing rapidly, wanting more pay and better working conditions
Nike has been helped greatly by the US policies, providing them with the opportunity to modernize their products. The government has unintentionnally helped Nike with their low interest rates, the international competitiveness of the tax system and the stable currency conditions, all help a lot in the building of the company.
Nike has always maintained business ethics. They have always realised the importance of being environmently friendly. Legal issues have been have been handled by Nike well. They never entr a new country without knowing the laws and policies of that country, and if that country do not allow for Nike to do what they want to or need to, then Nike will stay out of trouble by avoiding that country or area.
Stores Around Australia
Nike is a very popular brand and because of that, there are 40 official stores spread around the country.
In New South Wales there are 16 offical stores.
In Queensland there are 7 official stores
In South Australia there are just 2 official stores
In Victoria there are 12 official stores
In Western Australia there are 3 official stores
Product
There are plenty of different technologies Nike uses for their products. Some of the more famous technologies would have to be 'Dri- FIT', 'Nike Air' and 'Nike+' which is responsible for some of the fitness areas.
The design of the products vary greatly because of the popularity of the products. Many famous sporting athletes have promoted the products by creating some of their own versions, like Lebron James and Kevin Durrant
Nike products aren't always of utmost importance. It's more of a want than a need. The value and the quality of the product are very high.
Nike uses orange boxes for their shoes which they say is because it is noticeable and it stands out. The Swoosh logo and the Nike brand name is also always somewhere on the packaging so that the consumer knows that they're buying a high quality product.
Nike products come in all range of colours, and the Nike website have a customization section where you're able to create your own basketball shoes from scratch of high quality as well.
Nike's accessories vary hugely. They have things from watches and sunglasses to running equipment like Nike+ which acts like a GPS and you can place it in your Nike shoes and run around and an app running on your phone will track how far you run.
Most of these accessories are also packaged with the familiar orange packaging which make it known that it is something from Nike.
Pricing
Product Life Cycle
Plan - The energy, water and waste impacts of the product are taken into mind when planning what Nike are going to make next.
Design of material - Material production from raw material extraction and processing to final finished material production.
Make - The finished product manufacturing and assembly takes place at a factory. This includes the transportation of the material to the factory
Move - Transport of the finished goods for distribution to retail stores.
Sell - The products are sold at retail stores or factory outlets.
Use - The products are used for whatever they're designed for.
Pricing Changes - As the product becomes old, the prices drop so stores can get rid of old products
Nike's pricing strategy at the initial release of the product is premium pricing nowadays because people know how popular Nike is and how good the quality of the products are so they are willing to spend good amounts of money for that product.
As the products begin to age, the pricing strategy changes into more of a penetration strategy so that people buy the low priced products in hope to increase the popularity again which has recently happened with Nike Air Max's.
You would say Nike's prices aren't cheap but they're not ridiculously expensive like some other brands such as ASICS.
Their products are, although, not for the lower earning members of society, you have to have a fair bit of 'spare' money to be able to afford these products. Nike's sporting equipment is actually very well priced, they're neither cheap nor expensive but when it comes to apparel, the pricing can be more on the expensive side.
Nike aren't really known for having huge sales but they don't need to because they sell enough things to make the money they need.
Nike's prices compared to competitors is quite reasonable. For example, in terms of running shoes, BROOKS and SAUCONY branded shoes are much more expensive, coming in at almost $280, while the most expensive Nike shoe is brand new and is sold at just under $220 which is a significant difference for a very good quality shoe.
With casual t-shirts, Reebok and Adidas are well on top in this category at $100 and $80 respectively, although Nike's most expensive t-shirt is at $80, it is the only one t-shirt that is so expensive.
In the basketball industry though, Nike's shoes are so much more expensive than the next competitor. Is that because Nike is the dominant brand in this industry and they can afford to have high priced shoes because it is such a big industry?

Market Segment
Nike typically target athletes, men and women who are about 15-30 years of age. The target market is people who are active and enjoy higher quality sporting goods and merchandises. Because Nike is so large, they target all regions thanks to their ability to sell online as well as through retailers.
By trying to target athletes, they're trying to target people who play sport mostly as they basically professionalize in that area.
But they also sell to toddlers and obviously elderly people can wear their clothes.
Nike products aren't specific to a culture or race. Although only some cultures can afford these products and other cultures may only have certain versions of Nike products available to them because of the region they live in.
The quality or look of the product doesn't change around the world but the 'fake' versions may look different.
The Nike 'swoosh' is easy to differentiate from other brands and that makes it easy for people from different cultures or races to purchase Nike products knowing how popular and famous the brand is.
Nike products are mainly for the middle to upper class wage earner.
You don't have to have a fancy job or be a genius to have Nike products, just money and a need for clothes.
People living in the city and suburban areas are more likely to need Nike products for everyday life but people who life in the country probably don't need their products for their everyday life. Especially since people living in the country are more than likely to be short for money
Nike's First Shoe
In 1972, Bill Bowerman used his wife's waffle iron filled with rubber to make the sole of Nike's first shoe that had better traction than any other shoe. It was called the Moon Shoe and it was given to four track and field athletes at the 1972 Olympic Trails.
Place
Distribution Channels
Nike distributes most of its shoe products as well as other products through large chain retailers like Foot Locker and Rebel before they are purchased by the consumer. Nike has to get the products to the retailer and this is a big must because most of their revenue comes from the selling of their products from these retail stores. To make sure their deliveries are getting to where they're meant to be, they have plenty of distribution centres and computer systems that track the deliveries.
These channels are the best because it allows for a large distribution of their products, meaning a lot of people from different areas are able to purchase the shoes.
Market Coverage
Nike operates in more than 160 countries around the world. Nike sells its products through independent distributors, licensees, subsidiaries and they also have the ability to sell online through retailers. The company is at it's peak at the moment but there is always room for improvement.
Promotion
Customer Loyalty
If you become a Nike member, you get the pleasure of having 'free, easy return shipping on all orders'. You also get the benefit of complimentary in-store shoe trials, pant hemming and more.
If you order direct through the Nike website, you get free shipping on orders of $75 or more.
Nike's main asset is the ability to sponsor some of the world's top atheletes. Some examples are Roger Federer, Rafael Nadal, Lebron James, Kevin Durrant, Christiano Ronaldo and Tiger Woods, as well as whole sides such as the Indian cricket team and Manchester United just to name a few. All these big names appear in countless advertisements and we see them wearing Nike apparel which lures us into stores to buy the very same products so we feel just as athletic.
Very first "Just Do It" Ad
Nike "Just Do It" Ad 25 Years
One of Nike's most enjoyed advertisements showing off a mere handful of the famous athlete's they sponser
Nike & Michael Jordan
This video shows how Nike clicks with our emotions to make us think about things we usually don't think about. It uses the old 'hero' vs 'villian' to make us feel like the hero and villian is within ourselves and we decide whether the hero or villian prevails and we of course want the hero to win. Nike does this well with the help of ads and in turn helps the promotion of their products.
Social and Ethical Responsibilities
Nike were shamed in public for its labour practices to the point where it badly wrecked the company's image and hurt sales badly.
Nike wasn't the only, nor were they the worst company to use sweatshops, but it was the only one people knew.
Instead of denying all the allegations though, Nike was able to turn it around and put the worst stage in their company behind them and now they're as popular as ever.
Importance of Social & Ethical Behaviour
Nike is doing the socially responsible thing by using innovations like recycled polyester which transforms plastic bottles into superior performance gear and so far, 2 billion bottles have been diverted from landfills, making it known that Nike is doing the right thing in terms of the environment is always a good thing.
In terms of ethics, as mentioned before, Nike have had their fair share of criticisms and have done extremely well to deal with these and keep the company on the right track
Nike Policies
Nike has a code of ethics for all employees called 'Inside the Lines', which pretty much defines the standards of conduct they expect employees to follow and includes a range of topics on employee activity, product safety, legal compliance, competition and use of resources.
Not only do they have this for Nike's employees, they also have the Code of Conduct which is directed at contractors at manufacture Nike- branded products. It tells them to respect the rights of their employees and to provide them with a safe and healthy work environment
Use in the Marketing Strategy?
Nike use the fact that they use recycled products and products that are better for the environment in their advertising strategies to make us feel like we're doing the right thing by helping out mother nature.
Their online sites love using these few things and call it innovation to make it sound fancy and more appealing.
What They Can Do Better
Nike still have a few problems with sweatshops. What they should do to counter this problem is actually employ properly trained people in proper environments to make sure none of these criticisms reappear. They get billions in revenue, it's not like they can't afford to do all these things, so I don't see why not, especially since it will guarantee more jobs for unemployed people and absolutely destroy any doubt involved with sweatshops
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