Marketing Case Study of Nike- Focus on Nike’s Marketing Plan

Executive Summary

The market place today is a highly competitive one where it is extremely essential to have a differentiation strategy to improve your sustainability and market share. This paper discusses the various aspects of the strategic marketing techniques adopted by Nike. It explores on the concepts which have been guiding the company's marketing efforts. Various real life examples have been illustrated to explore the challenges that the company faced and the misjudgments that were done. It explains how the basic learnings from the example of Nike can be put to application in the field of strategic marketing. The report also outlines some of the strategic management concepts which find a good application here.

Introduction

Nike Inc. is amongst the largest manufacturer of sports goods, apparel, equipment and other accessories. Currently Nike is a giant in the sports industry. However, the company started with a very humble beginning in the year 1962.Initially it was just a local distributor for Japanese sneaker manufacturer called as Onitsuka Tiger. It started with the name Blue Ribbon sports, having a distribution in thirteen states of America.

The company has been known for facing one of the toughest challenges in terms of strategic marketing. The earlier adopted form of marketing strategies were primarily were based on celebrity endorsements. Celebrities like Steve perfontaine, John McEnroe, Michael Jordon etc. played a crucial role in boosting the popularity of the brand. Currently Nike is a household name with an instantly recognizable logo. Nike faced a lot of challenges in its journey to emerge as a world leader in sports industry. This report talks about the major challenges and the steps taken for remediation.

Nike–Introducing a new product

Challenges faced:

Nike made a successful entry in the 1980's by introducing the Nike Air technology in its product 'Tailwind'. However there was a huge speed breaker to their growth in the year 1986 when they were forced to lay off their staff because of decline in sales due to stiff competition from Reebok which became the number one sports goods provider for some time. This huge miscalculation was primarily due to the lack of understanding of the consumer market needs and single mindedly focusing only on the product.

In the early 1980's the sole focus of Nike was on producing superior products and achieving high level of production efficiency. They failed to realize that a successful product should better reflect the actual needs and requirements of the market(C. Merle Crawford, 2010) and so it is important to understand the opportunities that exist. This slack in the company's strategy became evident when they could not understand the potential behind the aerobics market and underestimated the real market needs. This gave a huge opportunity to rival company Reebok which temporarily moved to the number one spot.

A second instance where such a slack appeared was in 1998 when Nike faced a midlife crisis. Once again Nike did not learn about the real market needs and opportunities. They were still focused on developing functionally and technical superior athletic shoes as compared to its competitors. However the real needs of the end users had changed a lot. People no longer cared to technicality as long as they were finding the shoes comfortable to wear. For end users, new range of sizes and fittings had become more important. For this reason the soft and bulbous shoes manufactured by competitors like Puma and Adidas gained huge popularity while Nike lost its young and fresh appeal and became more of a mainstream brand, failing to attract the youth.

Proposed Approach:

In both the cases above, Nike could have easily avoided the damage by following proper strategic marketing principles. A detailed analysis of the market was needed to understand

• The needs of the customers
• The market trends
• Market segments
• The competitor landscape
• The market size(Philip Kotler, 2011)