Table of Contents

INTRODUCTION .................................................................................................................... 5

History ........................................................................................................................................................... 6

Vision Statement ..................................................................................................................................... 7

Mission Statement .................................................................................................................................... 7

Headquarters ............................................................................................................................................. 7

How Did Nike Grow ............................................................................................................................... 8

Working with Big Names ........................................................................................................................ 8

Making a Splash .......................................................................................................................................... 8

Nike’s Emotive Branding ......................................................................................................................... 9

NIKE Products ........................................................................................................................................ 9

Footwear ..................................................................................................................................................... 10

Apparel ....................................................................................................................................................... 10

Equipment ................................................................................................................................................. 10

Accessories ................................................................................................................................................. 10

Marketing Mix strategy(4ps) .......................................................................................................... 11

Product ..................................................................................................................................................... 11

Pricing ....................................................................................................................................................... 11

Place/Distribution ................................................................................................................................... 12

Promotion .................................................................................................................................................. 13

NIKE’s Distribution Channels ...................................................................................................... 14

By selling products to wholesalers in the US and international markets ................................ 14

1
 By direct-to-consumer (or DTC) sales .............................................................................................. 14

Competition ................................................................................................................................................ 15

POTENTIAL IMPACT OF GLOBALIZATION ................................................... 17

New development ..................................................................................................................................... 17

Brand Awareness ..................................................................................................................................... 18

Innovation ................................................................................................................................................... 18

Ethic ............................................................................................................................................................. 18
Change in lifestyle ................................................................................................................................... 19
Natural disaster ............................................................................................................................ 19

Strategy overcome the Potential impact ........................................................................... 19

Go Green ....................................................................................................................................... 19
Collaboration ................................................................................................................................ 20
Change on the Management styles ........................................................................................... 21
Research for new technology ..................................................................................................... 21

PEST Analysis in host country ............................................................................................. 22

Political .......................................................................................................................................... 22
Economic ....................................................................................................................................... 22
Society ............................................................................................................................................. 23
Technology ..................................................................................................................................... 23

SWOT Analysis .......................................................................................................................... 24

Strength ........................................................................................................................................ 24
Strong Brand Awareness ................................................................................................... 25
Huge Customer base ........................................................................................................... 25
Aimed For Sustainability ................................................................................................... 25
Side Brands .......................................................................................................................... 25
Low Manufacturing Cost ................................................................................................... 25

2
 Superior Marketing Capabilities ....................................................................................... 25
Weakness .................................................................................................................................... 26
Poor Labor Conditions in Foreign Countries ................................................................... 26
Retailers Have a Stronger Hold .......................................................................................... 26
Pending Debts ......................................................................................................................... 26
Dependency on US Market ................................................................................................... 26
Lawsuits .................................................................................................................................... 26
Sexual Harassment .................................................................................................................... 27
Oppertunities ................................................................................................................................ 27
Emerging Markets ................................................................................................................. 27
Innovative Products ............................................................................................................... 27
Efficient Integration ............................................................................................................... 28
Threats .......................................................................................................................................... 28
Counterfeit Products ............................................................................................................... 28
Increased competitive pressure .............................................................................................. 28
Marketing Budget Pressure ................................................................................................... 29
Currency Foreign Exchange Risks ........................................................................................ 29

STRATEGIES OF NIKE ...................................................................................................... 29

Pricing strategy .......................................................................................................................... 29

Marketing strategy .................................................................................................................... 30
Advertising ............................................................................................................................ 31
New media marketing .......................................................................................................... 31
Personal Selling .................................................................................................................... 32
Sales Promotions ................................................................................................................... 32
Public Relations ..................................................................................................................... 32
Sponsorship ............................................................................................................................ 33

Nike Business Model .................................................................................................................. 37

3
Controversy .................................................................................................................................. 38

Sweatshops................................................................................................................................. 39
Child labor allegations .............................................................................................................. 39
Strike in China factory ............................................................................................................. 40
Paradise Papers ......................................................................................................................... 40
Colin Kaepernick ....................................................................................................................... 41

Environmental record ............................................................................................................ 42

Finance ............................................................................................................................................ 43

Conclusion ..................................................................................................................................... 44

Reference ........................................................................................................................................ 45

4
 NIKE INCORPORATION (JUST DO IT)

Introduction

Nike, Inc. is an American multinational corporation that is engaged in the design, development,

manufacturing and worldwide marketing and selling of footwear, apparel, equipment,

accessories and services. The company is headquartered near Beaverton, Oregon, in the Portland

metropolitan area (USA). It is one of the world's largest suppliers of athletic shoes and apparel

and a major manufacturer of sports equipment, with revenue in excess of US$24.1 billion in its

fiscal year 2012 (ending May 31, 2012). As of 2012, it employed more than 44,000 people

worldwide. In 2014 the brand alone was valued at $19 billion, making it the most valuable brand

among sports businesses. Nike produces a wide range of sports equipment. Their first products

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were track running shoes. They currently also make shoes, jerseys, shorts, cleats, baselayers, etc.

for a wide range of sports, including track and field, baseball, ice hockey, tennis, association

football (soccer), lacrosse, basketball, and cricket. Nike Air Max is a line of shoes first released

by Nike, Inc. in 1987. Additional product lines were introduced later, such as Air Huarache,

which debuted in 1992. 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

Zoom Yorker, designed to be 30% lighter than their competitors'. In 2008, Nike introduced

History

Nike, Inc., formerly (1964–78) Blue Ribbon Sports, American sportswear company

headquartered in Beaverton, Oregon. It was founded in 1964 as Blue Ribbon Sports by Bill

Bower man, a track-and-field coach at the University of Oregon, and his former student Phil

Knight. They opened their first retail outlet in 1966 and launched the Nike brand shoe in 1972.

The company was renamed Nike, Inc., in 1978 and went public two years later. By the early 21st

century, Nike had retail outlets and distributors in more than 170 countries, and its logo a curved

check mark called the “swoosh”—was recognized throughout the world.

From the late 1980s Nike steadily expanded its business and diversified its product line through

numerous acquisitions, including the shoe companies Cole Haan (1988; sold in 2012) and

Converse, Inc. (2003), the sports-equipment producer Canstar Sports, Inc. (1994; later called

Bauer and sold in 2008), and the athletic apparel and equipment company Umbro (2008; sold in

2012). In 1996 the company created Nike ACG (“all-conditions gear”), which markets products

for extreme sports such as snowboarding and mountain biking. In the early 21st century Nike

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began selling sports-technology accessories, including portable heart-rate monitors and high-

altitude wrist compasses.

Part of Nike’s success is owed to endorsements by such athletes as Michael Jordan, Mia Hamm,

Roger Federer, and Tiger Woods. The Nike Town chain stores, the first of which opened in

1990, pay tribute to these and other company spokespersons while offering consumers a full

range of Nike products. In the 1990s the company’s image briefly suffered from revelations

about poor working conditions in its overseas factories.

Vision Statement

Nike vision is “to bring inspiration and innovation to every athlete in the world.”

Nike Mission Statement

its mission statement is to “do everything possible to expand human potential.

We do that by creating groundbreaking sport innovations, by making our products more

sustainably, by building a creative and diverse global team and by making a positive impact in

communities where we live and work.”

Headquarters

Nike's world headquarters are surrounded by the city of Beaverton but are within unincorporated

Washington County. The city attempted to forcibly annex Nike's headquarters, which led to a

lawsuit by Nike, and lobbying by the company that ultimately ended in Oregon Senate Bill 887

of 2005. Under that bill's terms, Beaverton is specifically barred from forcibly annexing the land

that Nike and Columbia Sportswear occupy in Washington County for 35 years, while Electro

Scientific Industries and Tektronix receive the same protection for 30 years. Nike is planning to

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build a 3.2 million square foot expansion to its World Headquarters in Beaverton. The design

will target LEED Platinum certification and will be highlighted by natural daylight, and a gray

water treatment center.

How Did Nike Grow?

Nike has continued to sell sportswear, but moved into different product lines like selling

streetwear and sports equipment too. But their business has grown exponentially over the years,

due to their smart marketing and global strategies. See, with the right marketing, any business

can be a success. It just takes time and investment, and Nike has undoubtedly invested.

1. Working with Big Names

One of the most significant parts of Nike’s initial marketing strategy was to collaborate with

basketball legend Michael Jordan, to create Air Jordan’s back in 1984. Jordan has been

associated with the brand identity, rolling out millions of pairs of Air Jordan’s across the globe.

In the early days of Nike, when they were primarily a sports brand, they collaborated with

athletes from around the world, including Cristiano Ronaldo and Tiger Woods. They have made

kits and trainers for various sports teams around the US and the globe. When Nike began

branching into casual and streetwear, the brand collaborated with celebrities too. To this day,

celebrities are thought to have more influence on the trainer market than athletes now.

Associating a brand with the right industry professional is key to market a business well.

2. Making a Splash

Nike’s biggest strength is that they continually innovate and aren’t afraid to shy away from bold

branding and advertising campaigns. It’s essential for a business to make themselves known. To

constantly push boundaries and stay with the times. Many companies have moved into creating

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eco-friendly products, for example, but Nike do this and more. They improve trainers with new

technology, stay on trend with the latest fashion and create adverts that you remember. Because

that’s one of the key ways to success; being memorable.

4 Nike’s Emotive Branding

A notable quality of Nike’s branding is its emphasis on emotional engagement visual identity.

When Nike start a new marketing campaign, there’s always the touch of emotion behind each ad,

poster or product release. The world coming together to effectively save it, and making everyone

a hero. If you’re not too sure what we mean, then we’ll go into more detail below.

Nike’s branding places the consumer as a hero, much like the goddess of victory. Through their

global advertising, there’s a focus of being someone better, actively doing something – Just Do It

and all that. Nike is notorious for empowering women in their branding and marketing

campaigns and creating a culture of being your best self.

This form of emotional advertising is everywhere, not just in Nike’s brand. Charities want you to

feel sympathy in their ads, chocolate companies want you to feel hungry, and loan companies

want you to feel supported and it works. People take out loans, donate to charity, buy Cadbury’s

and buy Nike products. Because creating a brand that evokes emotion is key to winning over

your target audience.

NIKE Products

Nike is a leading manufacturer of sports-related products, including shoes, apparel and

equipment. Many people from all over the world are familiar with the brand, as it has a global

presence that earns more than $18 billion in revenue. The Nike logo has become a popular global

icon. Nike also partners with sports stars to further promote the brand.

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Footwear

Shoes are Nike's flagship product. The company manufactures different shoes for a wide variety

of sports, such as basketball, football, golf, soccer, baseball, snowboarding, hockey, tennis and

volleyball. It also makes consumer fashion shoes such as Mary Janes and flip-flops. Nike shoes

are designed for efficient sports performance as well as for aesthetics.

Apparel

Nike also produces apparel for sports activities, as well as other activities including dance and

yoga. It features different collections for its apparel, including Live strong, Nike Pro, Nike Free

and SPARQ. In addition, Nike makes casual clothes for men and women. Many consumers wear

Nike clothes not just for sports activities but also for brand status.

Equipment

Aside from shoes, Nike also sells sports equipment, such as baseball bats, balls, swimming caps,

rackets and golf clubs. Nike also sells gloves and yoga mats, as well as agility cones. Other

sports equipment it sells includes weights and sports guards such as knee pads, wrap sleeves and

shin guards.

Accessories

The company is also well-known for accessories such as watches, bags and socks, as well as

consumer technology such as the Nike+ supplement for the iPod. Nike also sells rubber

bracelets, training DVDs and athletic belts. Many of the bags it sells feature a particular team

such as Manchester United or a university such as UCLA.

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Marketing Mix strategy(4ps)

Nike has the leading role in marketing and has strongest marketing mix. In particular, it depends

on Pull strategy; it has established it’s seizing against the big competitors like Reebok and

Adidas (Marketing mix of Nike)

Product

Nike offers a wide range of products including shoes, apparel and equipment. Currently these are

top selling product categories, all these products clothing and equipment specialized for sports

products (Marketing mix of Nike). The first product of Nike is running shoes. Apart from this, it

offers currently in athletics, baseball, ice hockey, tennis, soccer, lacrosse, basketball products and

has wide range of sports products such as cricket shoes, shirts, and shorts. Beside this, Nike is a

sub brand which allows the customers to design their customized Nike footwear through offering

a selection of shoes, what customers want; different colors and fabrics; they can choose whatever

area of the shoes they want. This customization allows customers to create different designs in

large quantities. Customers do not have to design shoes themselves but have designs that

customers can buy a selection of pre made designs. Nike’s customization process and offers are

available in Nike’s website.

Pricing

The type of products to be marketed will affect the price of a product. Nike’s pricing strategy is

considered to be competitive than other retailer shoe. The pricing is based on the basis of target

customers as a premium segment. Nike brand commands a high premium. Pricing strategy

makes use of vertical integration in which they participants at differing channel levels or take

role in operations level more than one channels to control cost and impact product pricing

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(Marketing mix of Nike) Nike has become so well known that most people will pay more dollar

for quality products for this product. That is why Nike uses Cost Based/Value Based Pricing

other than its competitors which offer low prices. The target customers of Nike are those who are

niche and have almost have the financial capability of the product, such as the use of expensive

clothes is a status symbol. This makes the customer want to continue to buy the product of Nike.

Without a high equity brand, like Nike, however, this would not be possible rise in prices.

Pricing strategy currently used by Nike is like, it may continue to use it. Nike's current customers

currently specify what they would be willing to pay the cost of the product to ensure the quality

and service they receive from Nike. On the basis of the services offered by Nike, to find that they

can compare the quality at a reasonable price from competitor service and prices are fairly

charged (Nike Marketing Plan)

Place/Distribution

Nike shoes are conceded by other multi brand stores and exclusive Nike stores worldwide. Nike

has about 20,000 retail accounts in the US and sells its products in about 200 countries

worldwide. In the international market, independent distributors, licenses and subsidies sell Nike

products. The company has manufacturing facilities worldwide and in Asia, customer service

and other operational units. Nike long term plans to open more stores and franchise to reach

target customers and to expand the maximum buyers. In Nike Town store, shops sell sheep

showmanship interested enough to do whatever. Nike town stores can take the entire city blocks

and customers can feel like future oriented. These include basic shoe stores made during each

boasting chandeliers Nike product imaginable. Nike town product offers a complete experience.

This store has all the products, but will not stay there again create a memorable experience for

the customer to bring back again (Nike 4PS). In the international market, Nike has independent

12
distributors, licenses and subsidiaries which sell its products. To reduce the cost of Nike’s

products, it has outsourcing strategy with China, from developing countries in Asia, such as

Vietnam. And to do more business online because Nike tradition is as spending on online

advertising as compared to advertising media, e-commerce and online marketing contributions

are planned to expanded appropriate channels (Nike Marketing Plan).

Nike has some specific distribution outlets and use them for distribution of its products,

following are the major ones: • Nike town shop: In big cities of countries, Nike’s outlets are

there to serve customers with products. • Flagship stores: Nike has contracted with retail stores

that has label of flagship of Nike which serve with high volume of Nike’s products to consumers

• Nikkei: It is a Nike’s online store that is website which serves the customers of all over the

world with customization services. • Big retail discount stores: The big stores of country also

serve with some high demand Nike products for the target customers. All these have availability

of Nike’s products; consumers who want Nike’s products can get required products from these

distribution methods of Nike.

Promotion

The marketing communications mix is effective because Nike attracts new customers and

creates balance between keeping existing customers (Nike marketing communications-mix). This

is one of the strengths of Nike. Nike has introduced its offers to almost any environment known

to man and is extremely sensitive. Print advertisement in general, simple but send a strong

message. There is virtually no advertising that appears on their price and Nike are almost always

uses a popular athlete to promote its product. The Advertisement exceeds the expectations of

everyone with these shoes and they are able to demonstrate on the rise for consumers (Nike 4p).

Promotion of Nike is best; Nike uses Commercials, celebrities or billboards as ways to make its

13
target customer aware about its offers. But Nike needs other ways for promotion as to encourage

more new products. Then it may use the maxi environment and can create brand awareness.

Marketing implication is that Nike is a marketing strategy for online ecosystem. This means that

Nike is preparing to cut for television and print advertising, and increasing to the social media

(Nike Marketing Plan)

NIKE’s Distribution Channels

NIKE distributes its products through two major channels:

1 By selling products to wholesalers in the US and international markets

Sales to wholesalers are the largest revenue category. However, this category’s contribution in

the sales mix contracted from 83.3% in fiscal year 2012 to 79.2% of revenues in fiscal year 2014.

DTC sales, on the other hand, increased from 16.2% to 20.3% over the same period. This is

significantly lower than the ratio of DTC revenues for NIKE’s rivals in the space. In the most

recent quarter, the respective ratios of DTC revenue to total revenue for Under Armor Inc. (UA),

VF Corporation (VFC), and Adidas AG (ADDYY) were 25.3%, 23%, and 25.4%.

2 By direct-to-consumer (or DTC) sales

By direct-to-consumer (or DTC) sales, which include in line and factory retail outlets (see graph

below) and e-commerce sales through www.nike.com. NIKE is focusing on direct selling to the

consumer with its DTC initiative. Comparing NIKE’s distribution channels, direct sales to the

consumer provide higher margins than do sales to wholesalers. In fiscal year 2014, DTC

revenues accounted for ~20% of total NIKE Brand revenues as compared to 18% in fiscal year

2013. On a currency neutral basis, DTC revenues grew 22% in fiscal year 2014 and 30% in

1Q15, year-over-year.

14
Competition

The main competitors always of Nike are Reebok and Adidas and their product are not entirely

different from Nike’s products, as all products involved in the design and marketing of both

athletic footwear and apparel and for fitness projects but Nike is having differentiation and

distinctive competency in the area of marketing. Nike always creates the consumer brand

awareness and has strong brand power for a long time and also makes a position in the market.

Nike is having the no 1 seat which cannot be replaced by its competitors so easily because of its

long-lasting Slogan “Just Do It” and symbols “Swoosh” and their sports icons are recognizable

for target audience. There are two great attributes which makes distinctive competency for Nike

are its inability to be replicated and the value or benefit which they offer to its consumers. As

Nike is the integrated part of the American and world culture, the brand power is basically

increased and difficult to replicate. Few companies have such that image and resources to

promote their company as Nike do. As the motivational Slogan of Nike is “Just Do It” with the

marketing campaigns which emphasis the fitness, competition and sportsmanship, consumers

having the high quality based products and a spirit of achieving the confidence where younger

consumers can get benefit from the positive influence. (Deng, 2009)

15
January! 1,2016The figure shows the status and market share of Nike and its competitors in

athletic market, where it is seen that the Nike has highest global market share that is 31%

whereas the its major competitors as Adidas and Reebok have 16% and 6% market share

respectively.

can make customers to save and by using special offers new things are offered to

customers, showing sales promotions enable customers to be motivated. Marketing

communication mix uses sales promotions whenever Nike want to attract new customers

to drive demand, since they would be motivated to buy the products of Nike on the basis

of the perceived benefits (Nike marketing communications-mix).

16
Potential impact of Globalization

New development

Nike develops the new innovation in footwear, apparel, and equipment. Nowadays, people are

concern in personal safety. A design of shoe will have affected the balancing of people, Nike

focusing on this case to develop their new product especially for sport person. Sport person

normally will concern on the footwear, apparel and equipment whether are suitable for them and

help them perform well when they exercise. Many people will have spent more money to buy a

footwear due to they want the footwear is suitable for them and not easy to get injury. For

athletic person, they want to get footwear which is very soft and as light as possible to perform

well during the workout. Another new development for Nike is the footwear with timer and

calculates distance. The product can be estimate the time and distance when they running. This

function can let them set a target and achieve it.

Nike is running the design competition called “Future Sole”. This competition is only for high

school and college student. Nike gives the opportunity for them to pursue their passion and get

their own design. As the result of the competition has shown, Nike will make it as a real product

of the company and can be finding in Nike store all around the world. Because of this, Nike can

come out more design in the market due to passion of the candidate.

Nike’s product is planned to give consumer perform well in exercise. In every part of the

manufacturing process is designed to achieve the goal of providing the world’s best athletic gear.

When Nike Air was introduced, it affected the sport world for its versatility. Based on the

function of impact protection, it can be shaped and tuned to meet the specific demand of the

17
sport person (Nike, 2007,6). Nike concern the sport person needs and change were implemented

to make their footwear even better.

Brand Awareness

Nike is the world’s leading sport footwear company. Nike’s products are all around the world. In

the future, when consumer wants to buy a footwear Nike is the first choice come their mind.

Consumer always remember Nike slogan “Just do it”, this means that Nike’s have a very strong

brand loyalty.

Innovation

Although Nike is one of the largest sports and fitness companies in the world, but Nike still has

to challenge its competitor with new product ideas. In the planning process, Nike needs to

evaluate the consumer demands. For example, Nike decided to collaborate with Apple combines

the sport and music together. According to Nike’s CEO, Mark Parker, The Nike and iPod Sport

Kit is a wireless system that connects to the iPod Nano to give people a personal running and

workout experience (Apple, 2007, p. 1). Nike is planning to make many products with iPod such

as jacket, tops, shorts and armbands. Nike’s CEO and Apple’s CEO will continue to work

together to maximize the Nike and iPod experience. This partnership will help Nike to remain as

the leading sports company.

Ethic

Companies that specialize in business ethics training and corporate social responsibility instill

workplace ethics among staff by creating a business ethics policy (Fieger, 2006). The child labor

cases are affected Nike’s so much. Because of this, Nike had to plan and organize a world-wide

public relation campaign to redeem their name and reputation related to the ethical problem.

18
Without the proper management leading and planning, Nike will suffer from the problem of

child labor. Nike has made a right decision from the negative media attention. And will continue

to be successful, due to its strong business ethic and philosophy.

Change in lifestyle

Nike is creating different product with different lifestyle. Traditionally, most people are using

Nike with sports shoes. But it appears that, the new lifestyle is needed in the new generation.

There is a rising trend of our teens participating in multiple sports. Consumer will purchase

different sport shoe for different sport activity. Nike knows some consumer can’t afford for that.

So that, the plan to design a multi-purpose shoe that the consumer can wear for various

functions. But the performance of the shoes now as good as the specific sport shoes. The

developments of new shoes have the potential to change the lifestyle.

Natural disaster

In china, there are having snow disaster, this disaster lead to the problem that the world now

facing the shortage of cotton in global market. In the future, there might be more disaster will be

happening will lead to another problem of shortage of another raw material, when this happen

this price of raw material will increase in the market and break the budgeting of Nike company

and lead to another problem to Nike financial because of the high raw material price.

Strategy overcome the Potential impact

Go Green

Nowadays, People are supporting the environmental friendly product due to the global warming

is getting serious. Nike also starts to design shoe which using little quantities of detrimental

19
adhesives and more of recycle material to produce the product. Nike is practicing to produce

recycling shoes, phasing out the sulfur hexafluoride and manufacturing sport accessories by

using the waste. For example, Nike has been operating Re-use program to collect the old shoe

and produce it as a new recycle shoe.

Nike purchase so many corrugated cardboards due to almost 50% of the Nike’s packing such as

shoebox and the shipping carton. Nike applied innovative design and use other different material

to produce the shoebox and shipping carton for reduce the waste and the cost. Nike will try to

produce the box which saving 30% of the material and aid in saving 200,000 trees annually. Nike

also controls the lighting management in their retail stores for saving the energy.

Collaboration

Nike manufactures sportswear for so many years. However, the company has sought for new

opportunities in fashion market. In my suggestion, Nike collaborates with G.A.P Company.

G.A.P has very good reputation in producing clothes, with wider range of varieties. It is possible

to come up with a new clothing line for sports with GAP in order to boost up sales worldwide,

which would indirectly increase brand awareness as well as recognition by the public as the prior

reason for such collaboration is the consumers. Gatorade specializes in energy drink and

provides the technology that Nike can venture and produce their own brand of energy drink. In

addition, collaboration can also be done with energy drink Gatorade. Nike and Gatorade are in

the same sector of sport field, to satisfy the sport man needs and desire. Nike can now produce an

energy drink to fulfill and boost the current market demand and satisfy customer taste.

20
Change on the Management styles

The changing of the management styles of Nike towards the manufacture in third world country.

Nike can try to train some manager to send to the manufacturer factory in third world countries

to guide the management style of the countries. Those managers can control the management

style of the factory. For example, the wages pay, raw material usage, the working condition and

the working environment.

The managers will control the wages paid which must be higher than the salary which only able

to provide 3 meals in a day, but the salary which able to give extra for the labor to do saving and

enjoy their life. For the working condition, the manufacturer factory should be having a

comfortable and safe working condition to the labor which is good ventilation and the safety

environment due to the control of efficient and effective of the machinery. A good working

environment is needed for the labor which is the location of the manufacturer factory is safety

and surrounding with not consist any uncertain elements like radioactive of the nuclear power

from the factory surrounding Nike Factory, the spread of virus, disrupting environment like

forest and highland.

Research for new technology

In year 2010, Nike had done a research and development in raw material to produce jersey. The

research they done actually is use the recycled plastic bottle to produce jersey. So to overcome

the problem of the price of raw material and the shortage of raw material in the market, Nike can

try to do more effort in research and development department to find out more new material

which is existing in the market no matter is renewable or unrenewable raw material. The new

material need to be environmental friendly, this actually will help the growth of awareness of the

21
global towards Nike product because due to the high education level of public, there are more

and more public who care about the pollution of earth. So when they are new product which

would not product pollution and having a high quality and better durability. This actually will

attract the attention from the public to do purchasing on that product.

PEST Analysis

Nike is and multinational company, its focus on macro environmental factors. Macro

environmental factors consist to Political, Economics, Society, and Technology.

Political

The government must create economic policies that will foster the growth of businesses. Nike

has been helped by the US policies which enable it to advance its product. US government

support Nike, particularly in the general macroeconomic stability, low interest rates, stable

currency conditions and the international competitiveness of the tax system, form the foundation

critical to Nike’s growth.

Economic

In economy, the biggest threat for Nike would be economic. Nike’s growth adversely affected

the economic. The US economy is experiencing an upturn right now. The sales of products are

increase., Nike’s not feeling pressure. The Asian economic also affects Nike since the products

are manufactured in Asia and the labor costs and material prices are low cost

Nike’s growth is not just affected by the local economy but also in the international economy.

Euro and Asia recession affected the sales for Nike. The overall results in the sales generated by

22
Nike in athletic footwear. However, it’s still remained stable due to the global market makes up

for the variances in sales, especially between peek seasons.

Society/social

Nowadays, people are more health conscious. The people are getting more on diet and health due

to more and more people joining fitness clubs. Because of that, the demand for accompanying

fitness products, especially exercise apparel, shoe and equipment is increase. Demands of Nike

product increase due to people are looking for sport shoes, apparel and equipment.

Nike failed to foresee problems brought about by a sweatshop expose about the labor and factory

conditions at production location in Asia. This caused bad publicity and declining sales as

society and consumers demand more socially responsible companies.

Technology

Nike uses IT in its marketing information systems very effectively. Nike applies marketing

information system to the economics of innovation, segmentation and differentiation for most of

the business. Nike is the leader of the market due to use of the extremely valuable information

technology, and applying it to every aspect of the product from development to distribution.

Nike is the world leader in the athletic footwear industry which able to effectively uses its

environment to improve its marketing efforts. This strategy has helps Nike make a good sale in

the product.

23
SWOT Analysis

Nike’s Strengths

Strong Brand Awareness

Nike is one of the most recognizable brands in the world as its name alone is memorable, easy to

pronounce, and very unique. Its swoosh symbol is easily recognized by everyone. Nike has

captured approx. 31% of the global athletic footwear market.

24
Huge Customer base

Nike has millions of customer from around the world who loyally follow Nike’s trends,

participate in Nike events, and even provide customer feedback. Due to its huge customer base,

Nike’s market cap has grown to $115.19 billion as of 2018.

Aimed for Sustainability

Nike’s CEO Mark Parker has addressed that they will continue to acknowledge the

environmental issues in the communities. The CEO ensures that Nike will help to contribute in

finding a solution against these environmental issues.

Side Brands

Nike’s ability to maintain and enhance its side brands has enabled it to enjoy unparalleled

success for decades.

Low Manufacturing Cost

Most of Nike’s footwear is manufactured in foreign countries. In the year 2018, Vietnam

produced 47%, China produced 26%, and Indonesia produced 21% of total Nike’s footwear.

Other operations are in Argentina, Brazil, India, Italy, and Mexico.

Superior Marketing Capabilities

Nike has excellent marketing campaigns. The brand heavily relies on digital marketing. In the

year 2016 and 2017, Nike spent $3.2 and $3.3 billion respectively. The brand has successfully

utilized social media and marketing campaigns to target more customers.

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Nike’s Weaknesses

Poor Labor Conditions in Foreign Countries

In the last 20 years, Nike has been consistently targeted regarding their poor labor conditions.

These issues include child labor, low wages, and horrific working conditions that were deemed

“unsafe”.

Retailers Have a Stronger Hold

Nike’s retail sector makes Nike weak due to its sensitivity against pricing. About 60-70 % of

Nike’s stocks are sold directly to retailers. With retailers serving as their core customers, Nike

does not put up a fight against their pricing structures whatsoever.

Pending Debts

Although Nike’s income statements prove to be prosperous, a quick glance at their balance sheet

could paint a different picture. Nike is still facing financial threats. Currently, they have a total

debt of $3.49 billion.

Dependency on US Market

Even after having established itself globally, Nike still relies on the U.S Market in terms of sales

and revenue. In the year 2018, about 42% of Nike’s sales came from the U.S, while the rest of

58% came globally. Despite its fame, Nike depends on the U.S for substantial sales and growth.

Lawsuits

Four former female Nike employees filed a class-action lawsuit against the company in August

2018. According to these women, Nike has a toxic company culture for women. The women

26
filed their case against the sportswear company claiming that the company violated the Equal

Pay Act. The women said the company engaged in systematic gender pay bias where men were

paid more than women for the same amount of work.

Sexual Harassment:

Former female employees also pointed out that sexual harassment and misconduct was very

common in the company. The New York Times conducted interviews with 50 former and

present Nike employees to investigate the company culture. Through the interviews, it was

established that Nike did have a toxic working environment, where sexual misconduct was

rampant.

Multiple female employees reported that they had complained to the HR but saw no action being

taken from their part. The women were left devastated and felt unsafe while working at Nike.

Some even left their jobs. The entire controversy has significantly affected the company’s image

Nike’s Opportunities

Emerging Markets

Although Nike already has a presence in many foreign countries, there is still plenty of

opportunities for Nike. This is because external markets like India, China, and Brazil are

gradually flourishing.

Innovative Products

Although Nike has produced many products, there is still a lot to innovate. Nike has extended its

reach in technology in association with fitness and health. Products like wearable technology that

monitors physical activities, is the first step in building innovative technology products.

27
Combining technology with athletic wear can prove to be beneficial as it is an aspect of the

fashion industry that still hasn’t been explored much.

Efficient Integration

The supply and production of Nike’s products depend on independent manufacturers. The brand

can either acquire a few of these or make some of its own for a more efficient and streamlined

supply chain.

Nike’s Threats

Counterfeit Products

Counterfeit products can significantly affect the revenue and reputation of Nike. The company

deals globally and the risk of counterfeit products has become higher. A number of

merchandisers and retailers offer counterfeit Nike products at lower prices. The low-priced

products are made from low-quality materials but still have the Nike label. This can tarnish the

image of the brand as the customers might feel that Nike has started producing products that

have low quality.

Increased competitive pressure

Although, Nike is a dominating the athletic industry, competition, and new emerging brands are

still potential threats to the company. With higher competition ratio, Nike has to spend more

money on marketing and advertising. Nike spent almost 3.5 Billion dollars specifically on

marketing in 2018. To overpower competition, Nike’s safest bet is to design innovative products

that are tailored according to the needs of athletes.

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Marketing Budget Pressure

Companies like Under Armor and Adidas are spending more on marketing and advertising

campaigns, increasing the pressure on Nike.

Currency Foreign Exchange Risks

Since the brand operates globally, it is affected by fluctuating foreign exchange rates. Nike

reports its financial earnings in U.S dollars. This affects its revenue as the U.S dollar is exposed

to volatility against other financial currencies.

STRATEGIES OF NIKE

Nike follows many strategies in order to become the world’s leading designer, marketer and

distributor of athletic footwear, apparel and accessories. One of its strategies is continuous focus

on innovation and emphasis on its research and development department and they do their best to

produce footwear, apparel and athletic equipment that reduce or eliminate injury, help in athletic

performance and maximize comfort and enjoyment. (Dermesropia et al., 2004).

According to Nike, Innovation is at the heart of Nike’s business growth strategy and it uses this

innovation in order to become more sustainable company and to keep up with the competition

and customer demands (nikeandunderarmour.com, 2015).

Pricing Strategy

The second strategy is Nike’s premium pricing strategy (Best cost provider strategy) which

targets the customers who develop a special kind of intimacy with the product that ultimately

leads to the development of loyalty. Since the loyalty has been established between the company

and consumers; Nike takes the advantage to associate their consumers with their price.

29
Therefore, Nike knows that consumers will be ready to pay for the product that bears the Nike

Logo (sales-management-slides.com, 2007).

At the same time, Nike pays a noticeable concern towards a broad differentiation strategy. Based

on that strategy, Nike produces its products for athletics in three ways. Firstly, it manufactures

for three different segments of people: men, women and children. Secondly, differentiates its

products by offering a variety of accessories and apparels like shoes, gym bags, gloves and

skates. Thirdly, Nike has the licensees to manufacture and sell Nike brand products aside from

athletic products like school supplies, electronic media devices and timepieces (Dermesropia et

al., 2004).

Marketing strategy

Similarly, Nike follows Market Segmentation Strategy, which assists Nike in advertisement of its

products by entering into the sponsorship agreements with celebrity athletes, professional teams,

and apart from the college athletic teams. It was in the year 1982 that Nike for the first time came

live for national television ads during broadcast of the New York Marathon. As a result, Nike

attracts many consumers to pay their attention towards buying Nike's products

(nikeandunderarmour.com, 2015). In addition, Nike hires the famous basketball players, some of

popular football scorers and golf superstars in order to make an emphasizing campaign for its

products around the world (bizjournals.com, 2015)

A worthily strategy pursued by Nike called Closed-Loop Business Model which aims to move

closer to achieving zero waste by completely reusing, recycling and composting all materials. In

such strategies, the products can be manufactured using materials reclaimed throughout the

manufacturing process and at the end of a product's life. Thus, Innovators will create new ways

30
to recycle and reuse waste and turn that into new products in order to become environmentally

friendly. (Nikebiz.com, 2009).

1 Advertising

Nike's own target is to achieve the greatest possible impact on large populations of the target

audience. These ads are usually expensive. However, successfully applied a strong brand image

of Nike products can reap the rewards and high demand. Nike uses celebrities represent product

to the client or ideal user. Extremely popular personalities such as professional athletes used as

offering the Nike’s products. Target customers are watching their favorite celebrities use the

company's products. As a result, customers are motivated to imitate the behavior of these

celebrities. Through the use of ad figure known marketing communication mix, Nike is

promoting the company’s products to customers how to motivate your choice to imitate the

famous Celebrities. (Nike Marketing Communication). Brazilian football team, like Nike

especially Ronaldo and Roberto Carlos are as brand ambassadors of Nike; LeBron James, Tiger

Woods and Lance Armstrong cycling golf are number of famous athletes and used by Nike as

celebrity endorsement strategy to promote its products. Nike focuses on other countries’

sportsman as Brand ambassador for making its all target customers of all countries aware about

its offers and currently Indian football captain Taichung Bhatia is as Nike new brand ambassador

(Marketing-Mix-Nike).

2 New media marketing

Nike was an early adopter of internet marketing, email management technologies, and using

broadcast and narrowcast communication technologies to create multimedia marketing

campaigns.

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3 Personal Selling

Nike has in stores personal sales efforts. The stores offer staff’s help for customers to learn more

about the company's products and to purchase these products. In some cases, sales staff helps

customers to find the right products to promote the Nike Company through personalized service.

The customer experience has been developed by staff trained to help and persuade sales.

Customers feel good about buying Nike products. They also sell these products which customers

feel as having better decisions. Therefore, the combination of Nike’s marketing communication

while promoting the company's products, improves customer experience and use personal selling

to build relationships with customers.

4 Sales Promotions

Nike’s sales promotions include coupons and special offers to customers which it targets. The

characteristics of these products business and its benefits can be as discount coupons can make

customers to save and by using special offers new things are offered to customers, showing sales

promotions enable customers to be motivated. Marketing communication mix uses sales

promotions whenever Nike want to attract new customers to drive demand, since they would be

motivated to buy the products of Nike on the basis of the perceived benefits.

5 Public Relations

Nike rarely used public relations as marketing communication mix or IMC strategy. The

company depends on social problems such as the use of workshops and green technology that

use public relations to cope. In some cases, Nike may use similar charity events and public

relations activities as a sponsor. This is the Nike communication mix of existing and potential

32
customers marketing, so they have a better perception of the brand, the brand uses to solve

problems and promote public relations (Nike marketing communications-mix).

6 Sponsorship

Nike sponsors top athletes in many sports to use their products and promote and advertise their

technology and design. Nike's first professional athlete endorser was Romanian tennis player Ilia

Nasties. The first track endorser was distance runner Steve Premontane. Premontane was the

prized pupil of the company's co-founder, Bill Bower man, while he coached at the University of

Oregon. Today, the Steve Premontane Building is named in his honor at Nike's corporate

headquarters. Nike has only made one statue of its sponsored athletes and it is of Steve

Premontane.

Michael Johnson

33
Jackie Joyner-Kersey

Nike has also sponsored many other successful track and field athletes over the years, such as

Sebastian Coe, Carl Lewis, Jackie Joyner-Kersey, Michael Johnson and Allyson Felix. The

signing of basketball player Michael Jordan in 1984, with his subsequent promotion of Nike over

the course of his career, with Spike Lee as Mars Blackmon, proved to be one of the biggest

boosts to Nike's publicity and sales.

34
Carl Lewis

Nike is a major sponsor of the athletic programs at Penn State University and named its first

child care facility after Joe Paterno when it opened in 1990 at the company's headquarters. Nike

originally announced it would not remove Paterno's name from the building in the wake of the

Penn State sex abuse scandal. After the Freeh Report was released on July 12, 2012, Nike CEO

Mark Parker announced the name Joe Paterno would be removed immediately from the child

development center. A new name has yet to be announced.

in the early 1990s Nike made a strong push into the association football business making

endorsement deals with famous and charismatic players such as Romario, Eric Cantona or Edgar

Davids. They continued the growth in the sport by signing more top players including: Ronaldo,

35
Ronaldinho, Francesco Totti, Thierry Henry, Didier Drogba, Andrés Iniesta, Wayne Rooney and

still have many of the sport's biggest stars under their name, with Cristiano Ronaldo, Zlatan

Ibrahimović, Neymar, Harry Kane, Eden Hazard and Kylian Mbappé among others.

In 2012, Nike carried a commercial partnership with the Asian Football Confederation. In

August 2014, Nike announced that they will not renew their kit supply deal with Manchester

United after the 2014–15 season, citing rising costs. Since the start of the 2015–16 season,

Adidas has manufactured Manchester United's kit as part of a world-record 10-year deal worth a

minimum of £750 million. Nike still has many of the top teams playing in their uniforms,

including: FC Barcelona, Manchester City, Paris Saint Germain and the national teams of Brazil,

France, England, Portugal and the Netherlands among many other.

Nike has been the sponsor for many top ranked tennis players. Brand's commercial success in the

sport went hand in hand with the endorsement deals signed with the biggest and the world's most

charismatic stars and number one ranked players of the subsequent eras, including John McEnroe

in the 1980s, Andre Agassi and Pete Sampras in the 1990s and Roger Federer, Rafael Nadal,

Serena Williams and Maria Sharapova with the start of the XXI century.

Nike has sponsored Tiger Woods for much of his career, and remained on his side amid the

controversies that shaped the golfer's career. In January 2013, Nike signed Rory McIlroy, the

then No 1 golfer in the world to a 10-year sponsorship deal worth $250 million. The deal

includes using Nike's range of golf clubs, a move Nick Faldo previously described as

"dangerous" for McIlroy's game.

36
Nike has been the official kit sponsor for the Indian cricket team since 2005. On February 21,

2013, Nike announced it suspended its contract with South African limbless athlete Oscar

Pistorius, due to his being charged with premeditated murder.

Nike consolidated its position in basketball in 2015 when it was announced that the company

would sign an 8-year deal with the NBA, taking over from the league's previous uniform

sponsor, Adidas. The deal required all franchise team members to wear jerseys and shorts with

the Swoosh logo, beginning with the 2017/18 season. After the success of partnership with

Jordan, which resulted in the creation of the unique Air Jordan brand, Nike has continued to

build partnership with the biggest names in basketball. Some have had signature shoes designed

for them, including Kobe Bryant, Jason Kidd, Vince Carter and more recently LeBron James,

Kevin Durant and Paul George, among others.

A news report originating from CNN reported that Nike spent $11.5 billion, nearly a third of its

sales, on marketing and endorsement contracts in the year 2018. Nike and its Jordan brand

sponsored 85 men's and women's basketball teams in the NCAA tournament.

Nike Business Model:

Nike has been the dominant leader in sports apparel industry for several decades. They achieved

this position by taking an aggressive approach towards building relationships with celebrity

athletes. Most notably, the company secured an exclusive contract with Michael Jordan, which

generated a rapid growth in sales for their core product line of sneakers and apparel. The success

of this campaign has resulted in increased demand for common stock ownership. (Nike's New

Business Model, 2010) Nike shifted from traditional media and spending more money into social

media. For athletes, Nike is heading off to focus in on athletes who can show a high ROI as

37
measured by the quantity of Facebook fans and Twitter followers they have. For teams, Nike is

concentrating on those that show the most activation and engagement with the most number of

core fans via social media. The Fuel Band, a $150 electronic bracelet that measures your

movements throughout the day, whether you play tennis, jog, or just walk to work. The device

won raves for its elegant design and a clean interface that lets users track activity with simple

color cues (red for inactive; green if you have achieved your daily goal). The Fuel Band is the

clearest sign that Nike has transformed itself into a digital force. The other innovation is the Fly

knit Racer, feather light shoes vibe more like a sock on a sole. Made from knit threading rather

than multiple layers of fabric, it required a complete rethink of Nike's manufacturing process.

The result is a shoe that is more environmentally friendly and could reduce long-term production

costs (CARR, 2013).

Controversy

Nike has contracted with more than 700 shops around the world and has offices located in 45

countries 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 disclosed information about

its contract factories in its Corporate Governance Report.

1 Sweatshops

Nike has been criticized for contracting with factories (known as Nike sweatshops) in countries

such as China, Vietnam, Indonesia and Mexico. Vietnam Labor Watch, an activist group, has

documented that factories contracted by Nike have violated minimum wage and overtime laws in

38
Vietnam as late as 1996, although Nike claims that this practice has been stopped. The company

has been subject to much critical coverage of the often poor working conditions and exploitation

of cheap overseas labor employed in the free trade zones where their goods are typically

manufactured. Sources for this criticism include Naomi Klein's book No Logo and Michael

Moore documentaries.

Campaigns have been taken up by many colleges and universities, especially anti-globalization

groups, as well as several anti-sweatshop groups such as the United Students Against

1 Sweatshops.

As of July 2011, Nike stated that two-thirds of its factories producing Converse products still do

not meet the company's standards for worker treatment. A July 2011 Associated Press article

stated that employees at the company's plants in Indonesia reported constant abuse from

supervisors.

2 Child labor allegations

During the 1990s, Nike faced criticism for the use of child labor in Cambodia and Pakistan in

factories it contracted to manufacture soccer balls. Although Nike took action to curb or at least

reduce the practice, they continue to contract their production to companies that operate in areas

where inadequate regulation and monitoring make it hard to ensure that child labor is not being

used.

In 2001, a BBC documentary uncovered occurrences of child labor and poor working conditions

in a Cambodian factory used by Nike. The documentary focused on six girls, who all worked

seven days a week, often 16 hours a day.

39
3 Strike in China factory

In April 2014, one of the biggest strikes in mainland China took place at the Yue Yuen Industrial

Holdings Dongguan shoe factory, producing amongst others for Nike. Yue Yuen did underpay

an employee by 250 yuan (40.82 US Dollars) per month. The average salary at Yue Yuen is

3000 yuan per month. The factory employs 70,000 people. This practice was in place for nearly

20 years.

4 Paradise Papers

On 5 November 2017, the Paradise Papers, a set of confidential electronic documents relating to

offshore investment, revealed that Nike is among the corporations that used offshore companies

to avoid taxes.

Appleby documents detail how Nike boosted its after-tax profits by, among other maneuvers,

transferring ownership of its Swoosh trademark to a Bermudan subsidiary, Nike International

Ltd. This transfer allowed the subsidiary to charge royalties to its European headquarters in

Hilversum, Netherlands, effectively converting taxable company profits to an account payable in

tax-free Bermuda. Although the subsidiary was effectively run by executives at Nike's main

offices in Beaverton, Oregonto the point where a duplicate of the Bermudan company's seal was

needed for tax purposes the subsidiary was treated as Bermuda. Its profits were not declared in

Europe and came to light only because of a mostly unrelated case in US Tax Court, where papers

filed by Nike briefly mention royalties in 2010, 2011 and 2012 totaling $3.86 billion. Under an

arrangement with Dutch authorities, the tax break was to expire in 2014, so another

reorganization transferred the intellectual property from the Bermudan company to a Dutch

40
commanditaire vennootschap or limited partnership, Nike Innovate CV. Dutch law treats income

earned by a CV as if it had been earned by the principals, who owe no tax in the Netherlands if

they do not reside there.

5 Colin Kaepernick

In September 2018, Nike announced it had signed former American football quarterback Colin

Kaepernick, noted for his controversial decision to kneel during the playing of the US national

anthem, to a long-term advertising campaign. According to Charles Robinson of Yahoo! Sports,

Kaepernick and Nike agreed to a new contract despite the fact Kaepernick has been with the

company since 2011 and said that "interest from other shoe companies" played a part in the new

agreement. Robinson said the contract is a "wide endorsement" where Kaepernick will have his

own branded line including shoes, shirts, jerseys and more. According to Robinson, Kaepernick

signed a "star" contract that puts him level with a "top-end NFL player" worth millions per year

plus royalties. In response, some people set fire to their own Nike-branded clothes and shoes or

cut the Nike swoosh logo out of their clothes, and the Fraternal Order of Police called the

advertisement an "insult"; others, such as LeBron James, Serena Williams, and the National

Black Police Association, praised Nike for its campaign. The College of the Ozarks removed

Nike from all their athletic uniforms in response.

During the following week, Nike's stock price fell 2.2%, even as online orders of Nike products

rose 27% compared with the previous year. In the following three months, Nike reported a rise in

sales.

In July 2019, Nike released a shoe featuring a Betsy Ross flag called the Air Max 1 Quick Strike

Fourth of July trainers. The trainers were designed to celebrate Independence Day. The model

41
was subsequently withdrawn after Colin Kaepernick told the brand he and others found the flag

offensive because of its association with slavery.

Nike's decision to withdraw the product drew criticism from Arizona's Republican Governor,

Doug Ducey, and Texas's Republican Senator Ted Cruz. Nike's decision was praised by others

due to the use of the flag by white nationalists, but the Anti-Defamation League's Center on

Extremism has declined to add the flag to its database of "hate symbols."

Environmental record

According to the New England-based environmental organization Clean Air-Cool Planet, Nike

ranked among the top three companies (out of 56) in a survey of climate-friendly companies in

2007.Nike has also been praised for its Nike Grind program (which closes the product lifecycle)

by groups like Climate Counts. One campaign that Nike began for Earth Day 2008 was a

commercial that featured basketball star Steve Nash wearing Nike's Trash Talk Shoe, which had

been constructed in February 2008 from pieces of leather and synthetic leather waste from

factory floors. The Trash Talk Shoe also featured a sole composed of ground-up rubber from a

shoe recycling program. Nike claims this is the first performance basketball shoe that has been

created from manufacturing waste, but it only produced 5,000 pairs for sale.

Another project Nike has begun is called Nike's Reuse-A-Shoe program. This program, started in

1993, is Nike's longest-running program that benefits both the environment and the community

by collecting old athletic shoes of any type in order to process and recycle them. The material

that is produced is then used to help create sports surfaces such as basketball courts, running

tracks, and playgrounds.

42
A project through the University of North Carolina at Chapel Hill found workers were exposed

to toxic isocyanates and other chemicals in footwear factories in Thailand. In addition to

inhalation, dermal exposure was the biggest problem found. This could result in allergic

reactions including asthmatic reactions.

Finance

Nike bought back $8 billion of Nike's class B stock in four years after the current $5 billion

buyback program was completed in the second quarter of fiscal year 2013. Up to September

2012, Nike Inc. has bought back $10 billion of stock.

Nike was made a member of the Dow Jones Industrial Average in 2013, when it replaced Alcoa.

On December 19, 2013, Nike's quarterly profit rose due to a 13 percent increase in global orders

for merchandise since April of that year. Future orders of shoes or clothes for delivery between

December and April, rose to $10.4 billion. Nike shares (NKE) rose 0.6 percent to $78.75 in

extended trading.

In November 2015, Nike announced it would initiate a $12 billion share buyback, as well as a

two-for-one stock split, with shares to begin trading at the decreased price on December 24.The

split will be the seventh in company history.

In June 2018, Nike announced it would initiate a $15 billion share buyback over four years, to

begin in 2019 upon completion of the previous buyback program.

For the fiscal year 2018, Nike reported earnings of US$1.933 billion, with an annual revenue of

US$36.397 billion, an increase of 6.0% over the previous fiscal cycle. Nike's shares traded at

over $72 per share, and its market capitalization was valued at over US$114.5 billion in October

2018.

43
Conclusion

Strategy is fundamental to the success and sustainability of any organization it helps the

organizations to understand their core capabilities, identify and address weaknesses, mitigate

risks and understand the trends going to impact on their business and their industry, and how

they are going to respond to them. It streamlines their business and ensures every dollar and

minute they spend on the business is in the direction of their sustained success. Therefore, the

success or failure of the organization depends on the strategies its follows. To survive in today’s

competitive business environment, it is must to plan innovative and differentiation strategies.

Nike strategies helped them to survive and sustain their positions in the market. Nike always

44
challenges the world market leader in sports championships. Nike strategies focus on design

innovation and marketing. Nike is the market leader in sport footwear and apparel.

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