Nike

Table of Contents

INTRODUCTION...........................................................................................................................1
TASK 3............................................................................................................................................1
Executive Summary....................................................................................................................1
Company Overview ...................................................................................................................1
Situation Analysis.......................................................................................................................1
Financial Performance Analysis.................................................................................................3
Value Chain Analysis .................................................................................................................4
Product Portfolio Analysis..........................................................................................................5
External Environment analysis...................................................................................................5
Competitive Analysis Porter.......................................................................................................6
Market objectives........................................................................................................................7
Market Strategies........................................................................................................................8
STP..............................................................................................................................................8
Recommendation.........................................................................................................................8
CONCLUSION................................................................................................................................8
REFERENCES ...............................................................................................................................9
INTRODUCTION
Marketing strategy is the overall company business plan for reaching out the best
competitive results. Marketing plan of action includes some following points such as value
chain, proposition, key marketing messages, information on the target customer and other high
level targets. Present study will be based on Nike which is American multinational corporation
company that is engaged in the design & development, manufacturing and worldwide
marketing and sales of footwear, apparel, equipment, accessories and services. Present study
will be covering the whole marketing plan that includes company overview, situational
analysis, value chain analysis, product portfolio analysis external environmental analysis etc.
Overall, study evaluating the marketing plan for the company that helps it to grow in the
competitive marketing world.
TASK 3
Executive Summary
Marketing plan is the primary function of the management that helps to accomplish the
competitive needs and wants of the customers. This plan has been based on the needs and wants
of the customers and current trend in the market. Present market plan has been discussed about
the company situational analysis, external or internal analysis to identify the strength &
weaknesses. Overall, the basic purpose of the marketing plan is to explore the new possibilities
for the company that can grab for better sustainability.
Company Overview
Nike originally known as Blue Ribbon Sports which was founded by University of
Oregon track athlete Phil Knight and his coach. Nike has started business by distributing
Japanese shoes for Onitsuka company. Bowerman was the first person who made the first pair
of Nike Shoes for himself. The first experience was very bad people was not support and they
were too tight as well. On the other hand, Nike also acquired apparel and footwear companies
in order to expand the business activities and goals. Like Nike first acquisition was upscale
footwear company Cole Haan in 1988. Besides that, Nike also bought surf apparel company in
2003. Overall, it has been seen that, Nike has had great journey throughout, that makes Nike
more competitive and challenging company in competitive marketing world.

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Situation Analysis

The focus of Nike is on the quality of products at a competitive cost in more range
markets to grab the customer focus. Nike is the biggest brand which is also very competitive
organization with its challenging approach of “Just Do It” punch line. In order to analysis the
situational analysis of the company, SWOT analysis is the best tool to analyse the actual
company strength, weaknesses, opportunity and threats.
Strength
 The biggest strength of the Nike is that they outsourced their all kinds of required
material to overseas. That's why Nike do not have any manufacturing outlet of its own.
Besides, this helps Nike to more focus on the value adding activities such as shoe
design, research in new product development etc.
 Besides, Nike deal globally through it can easily approach the range of customers and
grab their attention through different promotional efforts. Nike brand is a synonymous
with quality and resilience as well as most competitive in their own field.
 Nike getting several benefits because of the fragmentation of the market that makes
more profit and good sales volume.
Weaknesses

 Nike was renown for the poor working conditions described as sweatshops, minimum
wages and child workers in its factories, hitting the brand image
 Nike is not acceptable by all customers as being too premium and a luxury brand. In
other words, as per the current market scenario goes towards the middle tier of luxury
scale. It must be understood by the company that low prices can get more customers
towards the Nike Outlets.
Opportunity
 The best opportunity for the company is to expand the market in some more countries
where they get good customers and lifestyle that helpful for the company sales.

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  Besides, Nike can also get into the new product development where they can diversify
their product at different manner such as providing accessories and other premium
products apart its signature footwear segment.
Threat
 This is the fact that company having a global chain which means it also creates
international trade practices including labour strikes and creates some legal unethical
issues.
 Heavy recession is another fall for the organisation which creates ineffective business
environment for the company. Besides, due to high or premium prices the power of
purchasing has been low by the customers.
Financial Performance Analysis
Comprehension income is the equality of Nike Inc. during a period from transactions
and other events and circumstances from non owners sources. In order to analysis the financial
position of the company. For that, study needs to be going through from the company current
position, benchmarking, scorecard, financial governance etc. all these elements and tools helps
to determine the best outcome results. In terms of calculations and profit revenue. So that, Nike
is achieving the large cap stock, with a market capitalization of USD $85.52B.
Income Statement : Income statement is the revenue and expenses are reported on the
income statement that ensure the positive outcome and results for the better development
growth. Companies all expenses and revenues are reported in the income statement. This
reporting could be for a month, year etc. such as Nike present income ratio has been increased
by 5% in 2018.
Ratio analysis : This is the another financial tool analysis that measure the company
financial position. In other words, ratio analysis often gets pulled into the lists of the most
popular or important ways to analyse financial statements. Ratio statements helps businesses to
get easily understood the overall situation of business. Such as Nike Current ratio in 2018 was
251% which comparatively less than 2017 293%.
Gross Profit Margin : The gross profit margin measures the efficiency of production
of the company services or products. This has been calculated by deducting the direct cost of
production from the total sales (Nike Company Financials. 2019). Direct costs of the

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production are labour, material, operating supplies and equipment costs. Such as Gross profit
margin of the Nike in 2018 was 44% which is 1 percent less than in 2017.

Illustration 1: Annual Income Statement

(Source : Nike Company Financials, 2019)

Value Chain Analysis

It has been analysed that since Nike using the outsourcing strategies they get minimise
the lower investment risk rather than using in sourcing strategies under that company does not
need to invest on production facility. Overall, this strategy or process can help company reduce
the efforts on production facility. In order to analyse the value chain analysis it consists three
stages are given below:
Separate the organisation operations into primary and support activities
In order to reduce the stress company should need to separate both primary activities
and support activities. Primary activities includes activities such as produce the product, create

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a product, deliver the product to the customer and after sales support. Besides, support activities
helps to promote the primary activities in order to get help from marketing activities. Such as
Nike has produced the shoe and then distribute by distribution centres all across the globe. But
in order to make sure Nike keep on tracking the product sales by the help of POS computer
systems.
Allocate cost of each activity
Allocation cost of each activity will help company to ensure the effectiveness and
proper handling the overall system. On the same side, this phase of value chain make sure that
all the information regarding activities should communicate the managers with valuable
insights.
Identify the activities critical customer satisfaction and market success.
In order to identify the activities through company can easily get the market success and
customer satisfaction so that it can be helpful for the company stability growth. In modern time,
customers become more advanced and challenging. They better understand the information
provided by the company. In the contrast, unexpected interruption in the information flow can
affect the customer supplier relationship. Nike Value chain analysis and its implementation can
highlight and remove the bottlenecks to the information flow.
Product Portfolio Analysis
Nike is the most recognized symbol of brand which gives the great impact on the
customers minds. Nike acquired different several brands such as Cole Haan, Converse, Hurley,
Nike Golf, Umbro etc. Under which they provide luxurious items and accessories, handbags,
coats, luxury shoes, UK leading football etc. Nike each brand represents their own unique
identity which also define the clear meaning to the customers. That process or brands enhance
the growth for the company development and stability. This is the strength of the company
brand portfolio and leverage the sales volume as well.
External Environment analysis
Political: Political factors affect the new working style and make the best output results
and growth. Pestle analysis model with governmental influence on the remote of macro
environment of businesses. Some factors might help to the company to get the best and
effective results goals such as stable political climate in most major markers which can be the

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most effective results goals. Expanding free trade policies is the another affecting strategies that
can help to recontinue the work and most effective learning outcomes.
Economical: Nike business performance depends on the state of economies where it sells its
athletic footwear, equipments and apparel. These components of the PESTLE analysis model
identifies the economic concerns that affect the remote or macro environment of the business.
On the same side, Some factors play a significant role in determining the Nike Performance
such as economic stability of developed markets, rapid growth of the developing markets that
can also affect the company as a threat.
Social: Social environmental factors are highly influencing driver in the business
environment. Such as social factor is the attractive factor that gain customer interest towards
the company development. On the other hand, by increasing the individual wealth and income
level can directly upgrade the profitability of the company automatically. Besides, by
increasing emphasis on product safety can also lead the sales of Nike.
Technological: Nike has been changes their technologies as per the current trend or
new technologies in the market. Such factors are directly helpful to gain customer satisfaction
and leading challenging goals. Such as increasing the R&D investment can lead the opportunity
of development. Rapid technologies can help to resolve the customer problems and quick
service resolutions.
Legal: Legal influences businesses like Nike, legal implications affect the business in
indirect manner. Analysis model consider the effects of laws that affect the company
reputation.
Environmental: Changes in seasonal preferences can also affect the company demand
and its products. Such as Expanding environmental law can be the opportunity for the company
to develop.
Competitive Analysis Porter
Competition rivalry (Strong force): Competitive force for Nike is stronger due to
other competitors. In other terms, the main share company get the market growth from footwear
market. High aggressiveness of firms influence the company uncertainty goals.
Power of supplies (Weak force): Suppliers affect the Nike Business through the
availability of raw materials. This element of the five forces analysis tackles suppliers influence

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on firms and the industry environment. This element of the five forces analysis tackles
suppliers influence on firms and the industry environment.
Power of buyers (Moderate): Customer effects directly affect the company overall
performance. Low switching costs can highly affect the company overall reputation and
profitability ratio as well. The moderate availability of substitute also connects customer to
purchase the other company product or services.
Threat of substitute (Moderate): This is the threat for the company if its customer
attracts to other substitute products. But in case of Nike it involves moderate risk of substitution
on the business and the industry environment.
Threat of new entrants (Weak): Entrants of new companies threat is always involves
in the business environment. New companies sometimes impact on the existing companies due
to which it affects the long term challenging goals due to which it reduces the competition of
other companies as well. In case of Nike risk of new entrants are weak due to existing high
brands. Such as high cost of brand development is sometimes difficult for new firms. Or the
another reason of weak threat of new entrant is high economies of scale.
Market objectives
Market objectives is always referred to full fill the needs of target market customers.
The aim of the Nike is to explore the wide range of product or services for the target customers.
In other words, Marketing objectives specify the company plan that full fill the objectives of
marketing strategies. Nike also wants to provide number of diversify products to their target
customer that are all sports persons of tennis, basketball, soccer and golf.
SMART Objectives
Specific : Objective must be specific and clear so that it can be achieve into more
productive manner. Nike planning to open their outlets in 12 key countries as mentioned above
(SMART Goals For Nike 2018 Marketing Strategies, 2018).
Measurable : Measurable refer that objective must be fulfilled the company aims. Like
Nike research on the consumer behaviour and collect all data and their needs and wants.
Attainable : Nike has to research and collect data to grab the target customer attraction
helps company to get closer to the company objectives. By the help of Nike Free RN Flyknit's
variables it can be easy for Nike to attain the customer engagement and increased sales.

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 Relevance : By the help of marketing strategy it can become more easy for the
company to achieve the set objective.
Time : Over the next 6 fiscal months this project will be completed. By the end of the
calendar year 2020.
Market Strategies
Soon Nike planning to opening the outlets in more than 12 key cities such as New york,
London, Shanghai, Beijing, Los Angeles, Tokyo, Paris and so on. Besides to attract the buyers'
attention they also bring new colours, textures into their products etc.
STP
Segmenting : Segmenting define the target customers who will be most accurate for the
respective product or services. Such as Nike customers are Sportsman.
Targeting : After segmentation next company will decide what are the target strategies.
Such as what criteria company should select to gain customer attraction etc. such as Nike target
for Sportswear, accessories, etc.
Positioning : This is the phase where company starts to make marketing plans and
setting objectives for further implementation.
Recommendation
In order to increased the market growth company should have required to adopt the
different market strategies that helps to boom the Nike market share. Marketing strategies can
better help to reach higher customer satisfaction growth for target market. Besides, that, Nike
should prioritize strategies that address competition as well.
CONCLUSION
As per the above report, it has been presented the whole marketing plan and their
elements towards the company growth. Report described value chain analysis, financial
analysis, situational analysis to measure the company actual performance. Besides that, report
also explained about the internal or external analysis to determine the strength and weaknesses.
Overall, study concluded the Nike Marketing plan to enhance the new marketing opportunities.

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REFERENCES
Books & Journals
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Brohi, H., and et.al., 2016. Strategic Marketing Plan of Nike.

Cateora, P., c Gilly, M. and Graham, J. L., 2015. International Marketing. McGraw-Hill Higher
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Curry, E., 2016. The big data value chain: definitions, concepts, and theoretical approaches.
In New horizons for a data-driven economy (pp. 29-37). Springer, Cham.

D'Agostino, J. L., 2018. The Impact of E-commerce on Brands: An Analysis of Amazon and a

Plan for the Future (Doctoral dissertation, University of Oregon).

Daniel, M., Neves, R. F. and Horta, N., 2017. Company event popularity for financial markets
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Donnelly, T. J. and et.al., 2018. Marketing content selection and execution system with
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Easton, M. and Sommers, Z., 2018. Financial Statement Analysis & Valuation, 5e.

Kozlowski, A., Searcy, C. and Bardecki, M., 2015. Corporate sustainability reporting in the
apparel industry: an analysis of indicators disclosed. International Journal of
Productivity and Performance Management. 64(3). pp.377-397.

Mudambi, R. and Puck, J., 2016. A global value chain analysis of the ‘regional
strategy’perspective. Journal of Management Studies. 53(6). pp.1076-1093.

Nwakanma, C., Ude, G. and Unachukwu, M. N., 2015. The Use of DNA Barcoding in
Identification of Genetic Diversity of Fish in Ugwu-Omu Nike River in Enugu. Nigerian
Journal of Biotechnology. 29(1). pp.27-33.

PANDEY, B. C., 2017. Nike Inc-Complete Analysis: SWOT, PESTLE and Marketing strategy.
BookRix.

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Ranjan, W., 2016. The Financial Performance Analysis of Nike Inc: with Special Reference
Year 2015 Annual Report.

SHTAL, T. V. and et.al., 2018. Methods of analysis of the external environment of business
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Yu, C. J. and et.al., 2015. Boeing Drone Project: Marketing Plan.

Online
Nike Company Financials. 2019. [Online]. Available
through:<https://www.nasdaq.com/symbol/nke/financials?query=ratios>.

SMART Goals For Nike 2018 Marketing Strategies. 2018. [Online]. Available
through :<https://www.mbnymedia.com/blog/smart-goals-for-nike-2018-marketing-strategies>.

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