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Nike Case Study - Present Well-Being

Essay by   •  July 11, 2011  •  Essay  •  612 Words (3 Pages)  •  1,141 Views

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BACKGROUND

Founded as an importer of Japanese shoes, NIKE, Inc. (Nike) has grown to be the world's largest marketer of athletic footwear, holding a global market share of approximately 37 percent. In the United States, Nike products are sold through about 22,000 retail accounts; worldwide, the company's products are sold in more than 160 countries. Both domestically and overseas Nike operates retail stores, including Nike Towns and factory outlets. Nearly all of the items are manufactured by independent contractors, primarily located overseas, with Nike involved in the design, development, and marketing. In addition to its wide range of core athletic shoes and apparel marketed under the flagship Nike brand, the company also sells footwear under the Converse, Chuck Taylor, All Star, and Jack Purcell brands through wholly owned subsidiary Converse Inc. and sells under the brands Starter, Shaq, and Asphalt in the discount retailer channel through another subsidiary, Exeter Brands Group LLC. The firm also sells Nike and Bauer brand athletic equipment; Hurley surfing, skateboarding, and snowboarding apparel and footwear; and Cole Haan brand dress and casual footwear. Nike has relied on consistent innovation in the design of its products and heavy promotion to fuel its growth in both U.S. and foreign markets. The ubiquitous presence of the Nike brand and its Swoosh trademark led to a backlash against the company by the late 20th century, particularly in relation to allegations of low wages and poor working conditions at the company's Asian contract manufacturers.

PRESENT WELL-BEING

Employing more than 36,000 people globally, it is considered to be a very lean organization that does not tie up cash in buildings and manufacturing workers. Instead, it is strong at research and development, as is evidenced by its evolving and innovative product range, though income of the business is still heavily dependent upon its share of the footwear market. Product development offers many opportunities because the company believes that Nike is more than a fashion brand. It has a strong global brand recognition, which appeals to many emerging markets such as China, India, as well as Philippines that have the disposable income to spend even on high value sports goods. As a global brand, Nike is exposed to the international nature of trade that buys and sells in different currencies and so costs and margins are not stable over long periods of time while the market for sports shoes and garments is becoming very competitive.

Nike lays a number of strategies to target their immediate consumers; athletes and other sportsmen. The targeting strategies include among others the sponsorship of products by professional athletic teams, celebrity athletes and college athletic teams. It targets the consumers who embrace product intimacy that enables the company to set relatively

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