ASSINGMENTARKETING ASSINGMENT

8/7/2019 ASSINGMENTARKETING ASSINGMENT

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ASSINGMENT

ON

MARKETING MANAGEMENT

Submitted

By:

Swayam Prabha

Submitted

To:

Mr. Santosh

Department of Faculty of Management Studies

National Institute OF Fashion Technology

Ministry Of Textile

Bhubaneswar



INTRODUCTION

To bring inspiration and innovation to every athlete* in the world.

* If you have a body, you are an athlete.

When Nike co-founder Bill Bower man made this observation many years ago,

he was defining how he viewed the endless possibilities for human potential in

sports. He set the tone and direction for a young company called Nike, and

today those same words inspire a new generation of Nike employees. Our goal

is to carry on his legacy of innovative thinking, whether to develop products

that help athletes of every level of abili ty reach their potential, or to create

business opportunities that set Nike apart from the competition and provide

value for our shareholders. It started with a handshake between two visionary

Oregonians - Bower man and his University of Oregon runner Phil Knight.

They and the people they hired evolved and grew the company that became

Nike from a US-based footwear distributor to a global marketer of athletic

footwear, apparel and equipment that is unrivalled in the world. Our world

headquarters is located near Beaverton, Oregon, a suburb of Portland. So while

the Pacific Northwest is the birthplace to Nike, today we operate in more than

160 countries around the globe. Through our suppliers, shippers, retailers and

other service providers, we directly or indirectly employ nearly one million

people. That includes more than 30,000 Nike employees across six continents,

each of whom makes their own contribution to fulfil our mission statement: to

bring inspiration and innovation to every athlete* in the world.



HISTORY

Founded as an importer of Japanese shoes, NIKE, Inc. (Nike) has grown to be the world'slargest marketer of athletic footwear and apparel. In the United States, Nike products are soldthrough about 20,000 retail accounts; worldwide, the company's products are sold in about110 countries. Both domestically and overseas Nike operates retail stores, including NikeTowns and factory outlets. Nearly all of the items are manufactured by independentcontractors, primarily located overseas, with Nike involved in the design, development, andmarketing. In addition to its wide range of core athletic shoes and apparel, the company alsosells Nike and Bauer brand athletic equipment, Cole Haan brand dress and casual footwear,and the Sports Specialties line of headwear featuring licensing team logos. The company has

relied on consistent innovation in the design of its products and heavy promotion to fuel itsgrowth in both U.S. and foreign markets. The ubiquitous presence of the Nike brand and itsSwoosh trademark led to a backlash against the company by the late 20th century,particularly in relation to allegations of low wages and poor working conditions at thecompany's Asian contract manufacturers.

ADVERTISING

Nike, . is a major publicly traded sportswear and equipment supplier based in the United

States. The company is headquartered near Beaverton, Oregon, which is part of the Portlandmetropolitan area. It is the world's leading supplier of athletic shoes and apparel and a major

manufacturer of sports equipment with revenue in excess of $18.6 billion USD in its fiscalyear 2008 (ending May 31, 2008). As of 2008, it employed more than 30,000 people

worldwide. Nike and Precision Castparts are the only Fortune 500 companies headquarteredin the state of Oregon, according to The Oregonian.

The company was founded in January 1964 as Blue Ribbon Sports by Bill Bowerman andPhilip Knight and officially became Nike, Inc. in 1978. The company takes its name fromNike, the Greek goddess of victory. Nike markets its products under its own brand as well asNike Golf, Nike Pro, Nike+, Air Jordan, Nike Skateboarding and subsidiaries including ColeHaan, Hurley International, Umbro and Converse. Nike also owned Bauer Hockey (later

renamed Nike Bauer) between 1995 and 2008. In addition to manufacturing sportswear andequipment, the company operates retail stores under the Niketown name. Nike sponsors manyhigh profile athletes and sports teams around the world, with the highly recognizedtrademarks of "Just do it" and the Swoosh logo.



PRODUCT RANGE

Nike produces a wide range of sports equipment. Their first products were track runningshoes. They currently also make shoes, jerseys, shorts, baselayers etc. for a wide range of sports including track & field, baseball, ice hockey, tennis, Association football, lacrosse,basketball and cricket. Nike Air Max is a line of shoes first released by Nike, Inc. in 1987.The most recent additions to their line are the Nike 6.0, Nike NYX, and Nike SB shoes,designed for skateboarding. Nike has recently introduced cricket shoes, called Air ZoomYorker, designed to be 30% lighter than their competitors'. In 2008, Nike introduced the Air Jordan XX3, a high performance basketball shoe designed with the environment in mind.

Nike sells an assortment of products, including shoes and apparel for sports activities likeassociation football,[18] basketball, running, combat sports, tennis, American football,athletics, golf and cross training for men, women, and children. Nike also sells shoes for outdoor activities such as tennis, golf, skateboarding, association football, baseball, Americanfootball, cycling, volleyball, wrestling, cheerleading, aquatic activities, auto racing and other athletic and recreational uses. Nike is well known and popular in youth culture, chav culture

and hip hop culture as they supply urban fashion clothing. Nike recently teamed up withApple Inc. to produce the Nike+ product which monitors a runner's performance via a radiodevice in the shoe which links to the iPod nano. While the product generates useful statistics,it has been criticized by researchers who were able to identify users' RFID devices from60 feet (18 m) away using small, concealable intelligence motes in a wireless sensor network.

In 2004, they launched the SPARQ Training Program/Division.

Some of Nike's newest shoes contain Flywire and Lunarlite Foam. These are materials usedto reduce the weight of many types of shoes.

The 2010 Nike Pro Combat jersey collection will be worn by Miami, Alabama, Boise State,

Florida, Ohio State, Oregon State, TCU, Virginia Tech, West Virginia and Pittsburgh. Teamswill wear these jerseys in key match ups as well as any time the athletic department deemsnecessary.

Manufacturing

Nike has contracted with more than 700 shops around the world and has offices located in 45countries outside the United States. Most of the factories are located in Asia, including



Indonesia, China, Taiwan, India, Thailand, Vietnam, Pakistan, Philippines, and Malaysia.Nike is hesitant to disclose information about the contract companies it works with. However,

due to harsh criticism from some organizations like CorpWatch, Nike has disclosedinformation about its contract factories in its Corporate Governance Report.

Marketing strategy

Nike's marketing strategy is an important component of the company's success. Nike ispositioned as a premium-brand, selling well-designed and expensive products. Nike lurescustomers with a marketing strategy centering around a brand image which is attained bydistinctive logo and the advertising slogan: "Just do it". Nike promotes its products bysponsorship agreements with celebrity athletes, professional teams and college athletic teams.However, Nike's marketing mix contains many elements besides promotion. These aresummarised below.

Advertising

In 1982, Nike aired its first national television ads, created by newly formed ad agencyWieden+Kennedy, during the New York Marathon. This was the beginning of a successfulpartnership between Nike and W+K that remains intact today. The Cannes AdvertisingFestival has named Nike its 'advertiser of the year' on two separate occasions, the first andonly company to receive that honor twice (1994, 2003).

Nike also has earned the Emmy Award for best commercial twice since the award was firstcreated in the 1990s. The first was for "The Morning After," a satirical look at what a runner might face on the morning of January 1, 2000 if every dire prediction about Y2K came tofruition. The second Emmy for advertising earned by Nike was for a 2002 spot called"Move," which featured a series of famous and everyday athletes in a stream of athleticpursuits.



In addition Acquisitions

This section is in a list format that may be better presented using prose. You can help by

converting this section to prose, if appropriate. Editing help is available. (February 2010)

y As of November 2008, Nike, Inc. owns four key subsidiaries: Cole Haan, Hurley International,

Converse Inc. and Umbro.

y Nike's first acquisition was the upscale footwear company Cole Haan in 1988.

y In February 2002, Nike bought surf apparel company Hurley International from founder Bob

Hurley,

y In July 2003, Nike paid US$305 million to acquire Converse Inc., makers of the iconic Chuck

Taylor All Stars.

y On March 3, 2008, Nike acquired sports apparel supplier Umbro, known as the

manufacturers of the England national football team's kits, in a deal said to be worth £285

million (about US$600 million).

y O

ther subsidiaries previously owned and subsequently sold by Nike include Bauer Hockeyand Starter. To garnering awards, Nike advertising has generated its fair share of

controversy:

SWOT Analysis Nike, Inc.

Strengths.

y Nike is a very competitive organization. Phil Knight (Founder and CEO) is oftenquoted as saying that 'Business is war without bullets.' Nike has a healthy dislike of iscompetitors. At the Atlanta Olympics, Reebok went to the expense of sponsoring thegames. Nike did not. However Nike sponsored the top athletes and gained valuablecoverage.

y Nike has no factories. It does not tie up cash in buildings and manufacturing workers.This makes a very lean organization. Nike is strong at research and development, as isevidenced by its evolving and innovative product range. They then manufacturewherever they can produce high quality product at the lowest possible price. It pricesrise, and products can be made more cheaply elsewhere (to the same or better specification), Nike will move production.

Nike is a global brand. It is the number one sport brand in the World. Its famousµSwoosh¶ is instantly recognisable, and Phil Knight even has it tattooed on his ankle.

Weaknesses.



y The organization does have a diversified range of sports products. However, theincome of the business is still heavily dependent upon its share of the footwear

market. This may leave it vulnerable if for any reason its market share erodes.y The retail sector is very price sensitive. Nike does have its own retailer in Nike Town.

However, most of its income is derived from selling into retailers. Retailers tend tooffer a very similar experience to the consumer. Can you tell one sports retailer from

another? So margins tend to get squeezed as retailers try to pass some of the low pricecompetition pressure onto Nike.

Opportunities.

y Product development offers Nike many opportunities. The brand is fiercely defendedby its owners whom truly believe that Nike is not a fashion brand. However, like it or not, consumers that wear Nike product do not always buy it to participate in sport.Some would argue that in youth culture especially, Nike is a fashion brand. Thiscreates its own opportunities, since product could become unfashionable before itwears out i.e. consumers need to replace shoes.

y There is also the opportunity to develop products such as sport wear, sunglasses andjewellery. Such high value items do tend to have associated with them, high profits.

y The business could also be developed internationally, building upon its strong globalbrand recognition. There are many markets that have the disposable income to spendon high value sports goods. For example, emerging markets such as China and Indiahave a new richer generation of consumers. There are also global marketing eventsthat can be utilised to support the brand such as the World Cup (soccer) and TheOlympics.

Threats.

y Nike is exposed to the international nature of trade. It buys and sells in differentcurrencies and so costs and margins are not stable over long periods of time. Such anexposure could mean that Nike may be manufacturing and/or selling at a loss. This isan issue that faces all global brands.

y The market for sports shoes and garments is very competitive. The model developedby Phil Knight in his Stamford Business School days (high value branded productmanufactured at a low cost) is now commonly used and to an extent is no longer abasis for sustainable competitive advantage. Competitors are developing alternativebrands to take away Nike's market share.

y As discussed above in weaknesses, the retail sector is becoming price competitive.This ultimately means that consumers are shopping around for a better deal. So if onestore charges a price for a pair of sports shoes, the consumer could go to the store

along the street to compare prices for the exactly the same item, and buy the cheaper of the two. Such consumer price sensitivity is a potential external threat to Nike.



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