Second, the other competitor is Puma which is also an iconic brand for its panther logoand its fame in soccer wears. Unlike Adidas, Puma takes less market shares comparing toformers. (Statista) And Puma focuses more on athletic wear instead of the fit that fits allcustomers since its mission is “Forever Faster.” (Linkedin) Even though Puma does not sound asthreatening as Adidas, Puma is concentrating on the Research and Development and technologieswhich is the reason why Puma has so many loyal customers who continuing use the brand.Therefore, Puma is one of the biggest competitors who Nike is facing with.On the other hand, one could exam the market environment analysis based on the five forces ofanalysis. As it is already known that the rivalry pull is very strong in the sports brand since thereare numerous competitors existing in the current market with similar strategies to target the samegroup of customers. Similarly Bargaining power of buyers pulls very strong because there are2
many buyers existing in the markets, especially in the sports wear market. Bargaining power ofsuppliers has low force because Nike has many manufacturers oversea which could satisfyclients around the globe, and also it could reduce some expense for oversea shipping or longdistance selling. Threat for entrants is, comparatively, very low because there are so many brandexisting in the markets already. In order to stand out from the millions of competitors, the newentrant must have significant amount of capital, unique strategies and heavily invested researchand development. Threat for substitution for Nike is also very low because Nike has well-established brand and innovative technologies that is trusted by many buyers. All of the above isthe market analysis for Nike. (Linkedin slideshare)Next, the internal analysis for Nike is very revealing as well. As one of the biggest sportswear supplier in the market, Nike’s strength is very well-established. The recognition of its brandthrough the mass advertisement and innovative technologies are one of the strength Nikepossesses. Also the “Just Do It.” slogan is very iconic and eye-catching for many potentialcustomers. Nike also focuses on customization which is call “Nike-ID” that helps the brand to fitinto the current market’s taste of “unique.” It also has a lot advantages in offshoring andoutsourcing that reduces expenses and maximize it revenue.On the other hand, there are some weaknesses that Nike cannot avoid. The first one is thehigh expensive on the advertisement. On average of the year, Nike spend over 10% of itsrevenue on the advertisement via internet, celebrities, TV etc. (Bloomberg) Especially thecelebrity endorsement is one of the biggest weaknesses to Nike. Why? Shouldn’t it be the bigadvantage to have such power? No, on the contrary, the endorsement is not a safe game. Wordscan make it famous then can make it fall. If there is another competitor offers more money to thecelebrities, then Nike will lose its big pitch. The heavy reliant on celebrities become a weakness.
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- Fall '07
- Business, Nike, Inc., Nike Inc