For example, while working in their Asian Nike Liaison Offices (NLOs), Nike’s Footwear
Developers needed to speed product development and take on more innovative projects. But
these Developers, not having been required to innovate much in the past, needed to be
“taught” how to take on more high- innovation projects (Trautman Co, T., 2013). Nike could
not just transfer codifiable information to its Chinese subsidiary. Instead Nike brought in The
Steve Trautman Co. to solve the problem and find a way to transfer the needed job skills and
manage the cultural change (Trautman Co, T., 2013). After analysing the problem and trying
to find a plan, The Steve Trautman Co. consultants then led Nike experts, apprentices, and
managers in a 2-day Knowledge Transfer Workshop (KTW) that taught 15 proven techniques
for quick and clear knowledge transfer on-the-job (Trautman Co, T., 2013). This way the
Chinese Footwear Developers could learn by doing and improve product development and
innovation.
Knowledge governance (especially knowledge sharing and transmission) led the success of
Nike and will probably determine part of their successes in the future. However, with Nike’s
localization strategy and numerous subsidiaries in different parts of the world, it will be
important for Nike to keep developing the organizational knowledge.
Chapter 17:
Marketing, defined as the “efforts to create, develop and defend markets that satisfy the needs
and wants of individual and business customers” (Peng and Meyer, 2016), is one of Nikes
capabilities. The concept of Marketing consists of four components known as the marketing
mix which include product, price, promotion and place (Peng and Meyer, 2016).
At the beginning Nike solely offered shoes in their product offering, however as they began
to grow they expanded their offering first by apparel and second by equipment and
accessories as they wanted to target different kind of consumers which different kinds of
buying behaviour and preferences. To meet these different buying behaviours Nike began to
offer different products (market segmentation) and carried out multi-tier branding by
introducing and acquiring different companies such as Converse and Umbro.
Furthermore, Nike offers their products through several distribution channels. First, their
most significant distributor are the retailers which are distributed over the whole world.
Second, the fasted growing distributor is their own Online Store, which accounted for ??% of
their sales last year. Last but not least are the Nike Retail Outlets which offers some of the
Nike products for a cheaper price. It is important to mention that Nike has major control over
the distribution of their products, especially in the case of their Online Store and Outlets.
Another component of the marketing mix is promotion. The goal of Nikes promotion is the
maintain a strong brand image (Nike Annual Report 2017), which is part of the ingredient
branding concept (Peng and Meyer, 2016) **. Nike heavily relies on advertising, which is
also one of their capabilities. One of Nike distinctive attributes of their advertisements is that
they partner of up with famous athletes that they sponsor. For example, they do launch
