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Nike’s Marketing Organization and Contigency Plan

Student Name

Department, Institution

Unit

Instructor’s Name

Course

October 28, 2021

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Marketing Organization

Brand Extension: According to Kotler and Keller (2012), brand extensions capitalize on

their strongest brand identities through introductions of new products under these identities.

Brand extensions increase the acceptability of a new product since consumers already consider

the firm as a credible source and thus, feel comfortable adopting their products (Kotler and

Keller, 2012). Kotler and Keller (2012) also explain that brand extensions can help define the

core values as it establishes itself as dedicated to fulfilling specific consumer needs. Therefore,

the role of the brand extension marketing officer will be to ensure that the AI-enabled products

capitalize on Nike’s stature as a trusted brand and receive a positive response from the market in

terms of acceptability.

Sales Manager Tony Calella: The sales manager is in charge of providing oversight for

the sales department. The sales department is responsible for learning the specific traits of the

customers through their interactions during transactions. The sales manager oversees these

interactions and ensures that their department can establish the customer's needs and make

commitments to fulfill these needs where viable. By establishing the customer’s needs, sales

representatives inform the sales manager, who then has a responsibility to notify the research and

development team, who can then work on developing a product that fulfills these needs. For

Nike’s AI-enabled products, the sales manager is responsible for facilitating data collection from

consumers by their department’s representatives and passing this data to the research and

development team, who can then improve on the products.

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Promotion manager: Promotion involves all activities that a firm executes to generate

positive feedback on a product. These include public relations, sales promotion, direct marketing,

and advertisements. Nike’s promotion manager for the AI-enabled products will supervise these

activities and act on information from the promotion analyst.

Marketing Research Manager: The marketing research manager is responsible for

actively studying consumer trends of the target segment of the product they are overseeing. They

are responsible for determining customer responses to a company’s products to establish whether

there is a need for changes. For the Nike project, the marketing research manager will analyze

how customers react to the products and whether the firm is successful in reaching the target

segment. The marketing research manager was also responsible for the decision to target

millennials and Gen Z.

Regional Sales: The regional sales department supervises a group of zones, divided into

zones, though supervising zone managers. Nike’s marketing organization has two regions;

America and Canada. Therefore, the regional sales department for America will supervise all

sales activities in the different zones in America according to the divisions that Nike makes.

Advertising manager: Advertising involves spreading information from a firm to its

consumers to create awareness of the product and create a positive consumer attitude about the

product that should generate more purchases. According to Kotler and Keller (2012), an

advertising objective defines the specific communication activities, the results expected, and the

timeframe for achieving these results. Nike’s team advertising manager will ensure that

communication to the public about the product is in line with the firm’s advertising objectives.
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Promotion Manager: Promotions are actions that firms implement to affect consumer

behavior. The promotion mix refers to all activities that a firm executes to influence consumer

activities to make purchases. The role of the promotion manager is thus to supervise the

execution of these activities. The Nike promotion manager will supervise the execution of

advertisements, public relations, direct marketing, and sales promotion.

Promotion analyst: The main role of the promotion analyst is to ensure that a company’s

marketing and promotion goals are in agreement with the company’s sales goals. Therefore, at

Nike, the promotion analyst will be tasked with assessing whether the firm's marketing and

promotion activities support the sales objectives. The analyst will analyze the effectiveness of the

marketing and promotion activities and report their findings to the promotion manager.

Advertising analyst: Advertising’s goal is to create a positive response from the market

by making them aware of a firm’s product and generating interest in it that leads to purchases.

An advertising analyst’s role is to assess whether the firm accomplishes these goals. The Nike

advertising analyst will thus be in charge of reviewing the effectiveness of the advertising

routines that the firm implements, whether the advertisements result in more consumer

awareness, increased sales volumes, and other parameters that Nike will set as measures of

advertising success.

Contingency Plan

Market segmentation is a marketing strategy that involves dividing whole markets into

segments, selecting the segment that one wants to serve, and developing products specifically for

this segment. Kotler and Keller (2012) comment on the need for market segmentation by
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explaining that businesses cannot meet all the demands of all different types of consumers in a

free market. Nike has recognized this challenge and decided to focus its product development on

meeting the needs of the millennial and Gen Z segments of the population. Therefore, Nike has

adopted this strategy by segmenting the market into age groups, selecting a target segment based

on the segment’s spending habits and abilities, and positioning its products as an answer to the

demands of this segment.

Concentrating all the efforts of a new product launch and resources towards one segment

creates a risk for the organization since the failure of the product to take off for this segment

means that the product will fail. Dolnicar et al. (2018) assert that while focusing on a specific

market segment can help secure a product’s future by creating a loyal customer base, there are

higher risks that come with this dependency. Nike’s target market of millennials and the Gen Z

population may fail to accept the product at Nike’s price. Unlike marketing strategies that

promote the same development in different demographics, market segmentation enables a

product’s use for only a specific segment. Therefore, the success of the product depends on the

acceptance of the product by this segment. In other strategies, uptake of the product depends on

the free market, and another segment’s uptake can balance one segment’s failure to uptake a

product. However, Nike’s marketing strategy does not afford them this ability to have a ‘back-

up’ market segment.

Since the success of the AI-enabled Nike shoes and jackets solely depends on the shoes

and jackets uptake in the millennial and Gen Z market segments, Nike must conduct adequate

market surveys. These surveys should seek to establish the consumer trends of this segment that

they can later exploit in the design and marketing of the product. Cross et al. (2014) explain that
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a research process that generates information for a company’s marketing needs is necessary

before segmentation. Given that Nike is adding new features to their shoes and jackets, a market

survey of their segment should seek information that could affect the design of these shoes and

jackets. Understanding the wants, needs, and demands of the target segment will help Nike

mitigate the risk of failure of uptake since they can develop shoes and jackets that meet the

consumer’s needs. Simply being the first shoe company to create AI-enabled shoes and jackets

will not suffice as a profitable venture unless there is a demand for shoes and jackets. Since Nike

is seeking to exploit the purchasing power of their target segment, they should focus on

developing a product that is consistent with this segment. An adequate market research plan

should extract information that can inform decisions that improve the target segment’s

acceptability of the shoes and jackets.

Nike is dependent on the nuance nature of their development of AI-enabled shoes and

jackets to gain a competitive advantage over their competitors. A significant portion of their

potential success is reliant on them being the only manufacturers that integrate this technology

into their products. Therefore, the likelihood that another manufacturer figures out the

technology they use, either through ethical or unethical means, is a potential risk factor for Nike.

Yang et al. (2011) explains that industries that deal with high-tech are especially sensitive to

product life cycle management, especially in timing since new technological developments could

easily make a product obsolete. Nike intends to use AI, which is a high-tech development and is

thus highly susceptible to time parameters. In a scenario where a Nike competitor develops a

product that integrates better AI technologies than Nike uses, Nike’s products could easily

become obsolete, causing the company great losses. However, while delaying the products’
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release puts Nike at the risk of allowing its competitors enough time to develop competing

products, early release of the commodity also poses its risks. Rushing to production may result in

the release of poor-quality commodities that may make Nike lose its credibility and thus

compromise the success of any future product launches.

Careful timing of the product launch will help Nike to maximize on the consumer

demand patterns, their exclusivity as producers of AI-enabled products, and the provision of a

quality commodity. Their market research should extract information on market trends to

determine the periods when their market segment is likely to spend on purchases. Nike should

also release their products only after sufficiently marketing it and creating enough anticipation

from the market to create momentum for a successful beginning of their product life cycleas.
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References

Cross, J., Belich, T., & Rudelius, W. (2014). How Marketing Managers Use Market

Segmentation: An Exploratory Study. Proceedings Of The 1990 Academy Of Marketing

Science (AMS) Annual Conference, 531-536. doi: 10.1007/978-3-319-13254-9_107

Dolnicar, S., Grün, B., & Leisch, F. (2018). Market Segmentation. Management For

Professionals, 3-9. https://doi.org/10.1007/978-981-10-8818-6_1

Kotler, P., & Keller, K. (2012). Marketing management. Pearson/Prentice Hall.

Yang, C.-L., Ni, M.-H., & Wei, C.-C. (2011). Timing for Launching a New Product to Maximize

Overall Profit. Concurrent Engineering, 19(3), 201–212.

doi:10.1177/1063293x10389798