More than half nikes sales were from outside of the

This preview shows page 12 - 14 out of 26 pages.

More than half Nike’s sales were from outside of the United States, so it is apparent that Nike has a huge global footprint. Nike focuses their resources heavily on: principal products, marketing/promotions/endorsements, research and development, and manufacturing. Principal Products Nike designs their athletic footwear models and styles for specific athletic use. Nike’s footwear consists of: running, training, basketball, soccer, sport-inspired casual shoes, kids’ shoes, baseball, football, golf, lacrosse, cricket, outdoor activities, tennis, volleyball, walking, and wrestling. Due to the fact that Nike has a broad differentiation strategy and offers products for all of these sports, Nike is able to capture attention from all customers within the sports industry. Marketing, Promotions, and Endorsements Nike focuses their marketing strategy towards, “trends and shirts in consumer preferences by (1) adjusting the mix of existing product offerings, (2) developing new products, styles, and categories, and (3) striving to influence sports and fitness preferences through aggressive marketing, promotional activities, sponsorships, and athlete endorsements. Nike spent $2.45 billion in the fiscal year 2011 on marketing, promotion and endorsement contracts, and that number has grown to $2.61 bullion in fiscal year 2013. Nike realizes that Soccer is a popular sport globally, so they decided to have more endorsement contracts with soccer athletes than any other sport. 12
Research and Development Nike understands that innovation is key, and has been a key factor in their success. Nike focuses heavily on this area due to the fact that innovation is key in an industry like this one because customers are always looking new trends and fads. The company hires staff specialists that include: biomechanics, chemistry, exercise physiology, engineering, industrial design, and related fields. Furthermore, they consult with athletes, coaches, trainers, equipment managers, orthopedists, podiatrists, and many other experts. This is how important Nike believes product innovation is that key to their business. Manufacturing Nike produced 98 percent of their footwear in Vietnam, China, and Indonesia for all markets excluding Latin America in fiscal year 2013. Also, they have manufacturing agreements in Argentina, Brazil, India, and Mexico to manufacture footwear for sale primarily within these countries. Most of Nike-branded apparel was manufactured in China, Vietnam, Thailand, Indonesia, Sri Lanka, Pakistan, Malaysia, Turkey, Mexico, and Cambodia. Adidas Competitor Analysis Adidas has a broad differentiation strategy. Adidas’ mission is to be the, “global leader in the sporting goods industry with brands built on a passion for sports and a sporting lifestyle. Adidas believes that sales would reach $17 billion, in Euros, in 2015. Fiscal year 2013 sales $14.5 billion, in Euros. Furthermore, management expected to achieve an operating margin of 11 percent in 2015, along with growing annual earnings at a compounded annual rate of 15 percent.

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture