“Keep On Running” Case

NIKE: The Training Shoe Industry

Applying STEP and SWOT
B200A
By Course Coordinator: Zaher Charara

STEP: Social, Technological, Economic, and Political Factors

(Business Environment)

Social Factors: (most of them are ‘Opportunities’ under SWOT analysis)

Sneakers are used by most people from all ages
Product is mostly popular among young people: ages 15-24
More men than women wearing sneakers
Sneakers worn by movie stars and regular people (not only for sports)
1950s: Sports became very popular
1960s: Jogging craze and popularity started
1970s: sneakers became part of fashion
1997-99: Timberland shoes were very popular (temporary threat)

Technological Factors:
Reebok: Early 80s: Aerobics shoes with very soft materials
Nike: 1980s: Waffle sole (Air Concept)
1987: Nike’s Cross-Trainer
DMX Technology by Reebok
Use of computers & software for designs
Use of internet for sales and e-commerce

Economic Factors:
Jobs created by Nike and the factories to which it outsourced
Jobs created in china and Vietnam (part of GDP)
Prices / Inflation
Trade balance with other countries

Political Factors:
Tariff and Trade agreement between USA and Chinese government
Government regulations regarding minimum age of labor

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 Strengths of Nike
(as part of SWOT)

 Marketing and advertising strengths with very successful campaigns like

“Just Do It”.
 Very successful designs and very good product performance.
 Sponsorship of games and sporting events. Very competitive sportsmen as
spokespersons.
 Youngsters use sports heroes like Michael Jordan as role models to
associate themselves with.
 ‘Nike Town’ retail mega-stores that represent Nike’s image and reinforce
Nike’s positioning as industry leader.
 Savings from outsourcing of manufacturing are invested into Nike’s core
competencies like marketing and design.
 CEO Phil Knight is a great marketing strategist and initiator of “Just Do It”.
 Coach Bill Bowerman was the source of the inspirational thoughts built into
Nike’s mission and culture.
 Nike’s mission and advertising themes are very inspirational and emotional
(stressing the great human potential).
 Nike built a very strong image as well as great sporting heritage.
 Nike has always been on the cutting edge of technology and innovations to
create products able to enhance the athletic performance (Waffle sole, Air
Jordan, etc…).
 Nike overcame criticism by improving its social responsibility (appointing
a VP for social responsibility).

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