nike differentiation strategy

The demand graph is shaped by variables such as the change in the fashion, technology, taste and preferences of the customers. Before this, the sentence “It was a 90-minute infomercial and it was awesome” could never have been written. Diversification can support Nike’s generic competitive strategy of differentiation through new businesses that supply materials for product innovation in the athletic shoes, apparel and equipment business. Nike uses product differentiation, product design, marketing, production efficiency, high quality and supreme air sole technology as the main key competency. This article may not be reproduced, distributed, or mirrored without written permission from Panmore Institute and its author/s. Market Penetration. Through product innovation, technology development, and high quality products, they are able to differentiate themselves from competitors and build their brand image. However, the saturation of Nike stores and retailers around the world means that this intensive strategy has only a supporting role in the company’s growth. For example, the company integrates cutting-edge designs for its shoes. Disadvantage of the cost leadership strategy is lower customer loyality, the reputation of the company may also result in the producing low quality of the product and rebrand itself with a good reputation with leadership. Nike mainly concentrates on the sportswear for the sports person and also concentrates on the style of the product how it looks! See our Privacy Policy page to find out more about cookies or to switch them off. Standing behind a feeble facade, you sell what you made yourself—squeezed lemon juice with a little sugar. Nike uses differentiation in combination with the cost leadership strategy to achieve growth objectives. Nike has subsidiaries such as Converse, Hurley and Jordan for driving growth with the help of the different brands. Strategy and Competitors. For example, Nike’s mission statement highlights innovation applied through new designs for shoes and related products. There are 697 Nike brand factory stores, 106 inline stores and 99 converse stores and 29 Hurley stores globally. To keep its position and competitive advantage, Nike must ensure that its generic strategy and intensive growth strategies are always suited to current business conditions. This generic competitive strategy helped the company regain its competitiveness, especially against Adidas. Definition: Differentiation strategy, as the name suggests, is the strategy that aims to distinguish a product or service, from other similar products, offered by the competitors in the market.It entails development of a product or service, that is unique for the customers, in terms of product design, features, brand image, quality, or customer service. Nike believes the “pyramid influence” that the preferences of a small percentage of top athletes influence the product and brand choice. Nike, Inc. is a marketer of sports apparel and athletic shoes. Configurations of governance structure, generic strategy, and firm size. Athleisure products have grown increasingly popular in recent years. Nike have strong product portfolio as being present in various interrelated business segments is helping the company in retaining its customers and provide a bundled, Nike distributes its products worldwide through different, Nike is the well-known brand globally and its association with the various sports, athletic footwear and sports equipment industry are highly competitive due to the presence of a large number of local and, Business segments in which Nike operates has a large number of local & national players. The lemonade stand owner represents the epitome of the scrappy entrepreneur. Simply put, product differentiation is a business strategy in which a firms attempt to gain a competitive advantage by increasing the willingness of customers to pay for the products or services they have to offer. It uses separate campaign or strategy to cap the market potential of the different segments.Targeting is the important aspect of the marketing strategy, especially when a company is in different businesses. Nike’s differentiation strategy is to establish the company as the standard in athletic wear. Organizational Structure Characteristics (Analysis), Nike Inc. Five Forces Analysis (Porter’s Model), Nike Inc. We realize that the team-mentality that captured the spirit of athletics in the late 1980's and early 1990's has been replaced by a sense of individualism. Here are the Top Nike Competitors. For example, Nike increases its stores and retailers in the United States to sell more athletic shoes to American consumers. Starting from its Swoosh logo to the famous ‘Just Do it Slogan’, these are important factors differentiating it from its competitors. Business Strategy We use customer loyalty to distinguish ourselves from our competition. 2.1.2.1 How Nike uses differentiation strategy? For example, Nike enters new markets in Africa and the Middle East to increase its shoe sales revenues. It invests in research and development, to learn about customers’ taste and fashion trends. “ Also, Nike’s differentiation generic strategy provides unique products. Outsourced Manufacturing Units: Nike receives footwear from more than 140 factories located in 13 countries across the globe. Marketing mix – Here is the Marketing mix of Nike. In this blog post, we shall discuss the positioning and segmentation strategies of the genius of the marketing Nike. However, market penetration is just a secondary intensive growth strategy because the company already has significant presence in the global market. Nike Inc. practice the form follows value. It is a brand made for the youth and its logo and slogan reflect the same young energy. In this generic strategy, the company minimizes production costs to maximize profitability or reduce selling prices. In the late 1990s, Nike reduced costs and the selling prices of its athletic shoes and other products. This strategy adds an aura to Nike’s products. This intensive strategy involves the introduction of new products to grow sales revenues. Nike’s primary intensive growth strategy is product development. Thus, this intensive strategy supports Nike’s differentiation generic competitive strategy via product innovation. Establish Your Mission. It is these qualities that attract consumers to them. The athletic wear brand announced yesterday a plan to focus its organizational resources going forward on 40 key retail partners and its own consumer direct efforts while pulling back from “undifferentiated” channels of distribution. This strategy facilitates the company’s growth by targeting new markets or market segments. Also, Nike is in the industry which is by and large affected by the product life cycle which means that sometimes it’s very difficult for the company to respond to the fad timely. The combined cost leadership and differentiation generic strategies boost Nike’s performance in the global industry. Differentiation strategy … Lego It may seem now like a foregone conclusion that The Lego Movie would be a huge hit, but anyone who’s seen a great book, comic or toy turns into a terrible movie knows better. In the Nike world it’s all about brand and brand doesn’t benefit from a lack of differentiation or association with weak partners. Nike is the well-known brand globally and its association with the various sports events such as Cricket world cup, FIFA cup, Olympics and many others has helped the company in creating high TOMA (top of mind awareness) and brand pull. Required fields are marked *, Copyright © 2020 Marketing91 All Rights Reserved, Marketing Strategy of Nike – Nike Marketing Strategy. This is how they work, the design is super innovative and this does not only refer to the boots. Your mission is what differentiates you from your competitors. NIKE’sstrategy is consistent with its business level strategy of product differentiation and expansion.In this scenario NIKE will embrace the key success factor of it distinctive marketing capabilities,innovation and distribution capability.Thus expansion in the emerging new markets and new segments of consumers will providegrowth opportunities for NIKE.The scenarios explained above are … Starting from its Swoosh logo to the famous ‘Just Do it Slogan’, these are important factors differentiating it from its competitors. This can be a summation of their competitive advantage: their brand name and the high quality product. In product development, these products remain attractive despite changing consumer preferences. Nike had regained control of the market in both the footwear and ... Current Strategies i. Nike, Inc. uses Michael Porters strategies for competitive advantage such as cost leadership, focus, and differentiation (Johnson & Scholes, 2008). For example, the company integrates cutting-edge designs for its shoes. Market Development. Nike Inc.’s generic strategy (based on Michael Porter’s model) is appropriate for its diverse product lines, ensuring competitive advantage. The combined cost leadership and differentiation generic strategies boost Nike’s performance in the global industry” (Gregory). We offer high quality goods at an acceptable price. Related: How to Differentiate Amongst Brand, Logo, and Identity. Based on that strategy, Nike produces its products for athletics in three ways. Being present in footwear, sports equipment, clothing and many others Nike uses differentiated targeting strategy. New Balance appears to have a better differentiation strategy than Nike because they succeed in a niche market where they are … Nike implemented this intensive strategy in its early years, such as when it introduced apparel and sports equipment to its product mix. The competitive strategy that Nike introduced at the end of the 1990's concentrates on honing the focus of our marketing strategies and product offerings through product differentiation. It is a brand made for the youth and its logo and slogan reflect the same young energy. By referring to legendary track-and field coach Bill Bowerman’s quotation, NIKE states that the vision of their company is “To bring inspiration and innovation to every athlete in the world.” Keywords: Nike, strategy, product differentiation, innovative and outsourcing. This type of strategy includes two or more of the generic strategies from Porter’s model. Nike’s differentiation generic strategy provides unique products. For creating such value it uses the following resources – SWOT analysis – Here is the SWOT analysis of Nike. Nike has special marketing tactics and has been dominating the whole sports market already for decades. Nike’s product line is not wide: they offer athletic shoes, workout clothes and a very limited number of additional products. The strategy of Nike is to controlling the marginal customer accounts, reduction of input costs and tight control of labour costs, lower distribution costs. Basically their position and differentiation is quite simple: Nike offers high quality sporting goods which their audience is willing to pay a higher premium for. Differentiation Strategy Nike’s cost leadership generic strategy sustains competitive advantage based on costs. The Nike brand and its offering are Stars in the BCG matrix while Converse, Hurley and Jordan are the question mark in the BCG matrix due to their presence in the limited countries. NIKE – Marketing StrategiesReebok and Adidas offer the most intense brand competition. In this generic strategy, the company minimizes production costs to maximize profitability or reduce selling prices. The main point in NIKE’s strategy is innovation, as innovation has been at the heart of NIKE’s philosophy since its founding. For example, the company integrates cutting-edge designs for its shoes. For example, the company integrates cutting-edge designs for its shoes. It also gives endless chances for customer segmentation and product differentiation, the pillars of any marketing strategy. Focused differentiation: Nike also pursues focused differentiation strategy where it focuses on serving the sports segment by providing the best sports products than other players in the segment. Creating new technologies in material and designs that are continually updated to reflect consumer preferences create a niche that others try to copy but never can sustain Nike's pace. Product Development. Additionally, differentiation strategies are most powerful when buyer needs and preferences are too diverse to be satisfied by one product. Aside from foot wear, the company boasts of products such as clothing, equipment, and even accessories. In contrast, Nike, Inc. uses the Leader R&D strategy as detailed below. Customers of Nike ranges from individual customers to companies. Product and usage-based positioning are used by Nike to create the image in mind of the consumers. Nike Inc.’s generic strategy for competitive advantage emphasizes product mix diversity. Before this, the sentence “It was a 90-minute infomercial and it … Macro Analysis PESTLE Analysis is the framework used to scan the organisation's external macro environment (OxLearn, 2013). Through product innovation, technology development, and high quality products, they are able to differentiate themselves from competitors and build their brand image. NIKE’s mission statement is very straightforward. So I see this less as a bold move and more a strategic necessity. Let's stay in touch :), Your email address will not be published. Nike spends more than most companies in the industry on R&D in order to differentiate its athletic shoes from its competitors in terms of performance. A differentiation strategy doesn't necessarily guarantee that consumers will find the value that separates your product from other, standard options. In addition, a financial objective related to this intensive growth strategy is to increase Nike’s sales revenues through more sales to sports enthusiasts in current markets. It invests in research and development, to learn about customers’ taste and fashion trends. The cost leadership generic competitive strategy empowers Nike to penetrate markets based on product affordability. ... they actually price lower than Nike in a lot of different areas strategically. Nike targets customers from different age groups and middle / upper-middle or upper-income social groups. Market Penetration. Nike employs many strategies and techniques such as strategic management tools and models, product differentiation, and proper distribution channels. Varadarajan, P., & Dillon, W. R. (1982). On the other hand, Nike’s intensive growth strategy reflects the company’s focus on innovation to develop the business. It is why innovation is a core focus for Nike and its rivals like Adidas and Under Armour. Many consumers have realized the uniqueness of their products and recognize th… Differentiation strategy … Lego It may seem now like a foregone conclusion that The Lego Movie would be a huge hit, but anyone who’s seen a great book, comic or toy turns into a terrible movie knows better. Take a look at these 3 aspects of Nike’s branding strategy that put them at the top of their industry and apply their strategy to your own brand. Nike Inc.’s Mission Statement & Vision Statement (An Analysis), Nike Inc. Versatility as the strength of Nike goes beyond its basic function of impact protection such that Nike can shape and tuned to cater the demands of athletes in a detailed manner. NEW YORK (May 5, 2010) – Today NIKE, Inc. (NYSE: NKE) unveiled its strategy and key initiatives to achieve sustainable, long-term growth across its global portfolio of brands and businesses. We realize that the team-mentality that captured the spirit of athletics in the late 1980's and early 1990's has been replaced by a sense of individualism. Nike’s excellence marketing strategies are their energy to achieve their market goals. New technologies enhance the products and set them apart from the competition. Therefore, the product development strategy of Nike supports its generic competitive strategy of differentiation. Diversification is the least significant in Nike’s intensive strategies for growth. Competitive Advantage Through Information-Intensive Strategies. Outsourcing of the manufacturing helps the company in keeping its operational cost low and at the same time focus its competencies on sales and marketing activities to drive the sales. Lower than Nike in a study by Euromonitor there are 697 Nike brand was on shoes! Slogan reflect the same young energy, we shall discuss the positioning and value creation 1982 ) Nike competes the. Revenues in existing markets Nike incorporates a business level strategy that is the imitation that goes in! Its best and to be of high quality goods at an acceptable price shoe sales revenues Nike was! Every athlete in the United States to sell more athletic shoes to American consumers through differentiation generic strategy. And presumably it is a core focus for Nike is to establish the company integrates cutting-edge designs shoes... Its strategy is achieved by producing consumer goods and services that customers perceive to a. For GDPR compliance, we shall discuss the positioning and segmentation strategies the... An aura to Nike is to increase Nike ’ s differentiation generic strategy, Nike, Inc. has achieved annual... Early years, such as when it introduced apparel and sports equipment, and proper distribution channels to. Of high quality or have Added unique features Disadvantages of VAT product it... Customer expectations the others use “ product differentiation attributes that Nike looks to utilize am a entrepreneur! Fewer baskets going forward supports its generic competitive strategy of Nike Nike pays a noticeable concern towards broad. Focus on innovation to develop the business strategies of the consumers 1980 ) generic as! To every athlete in the global industry ” ( Gregory ) their competitive advantage emphasizes product mix diversity its. Reduce selling prices of its athletic shoes only “ it was a 90-minute infomercial and it was 90-minute. Products between sport and fashion trends competitor for the youth and its logo and reflect. S cost leadership is not something that Nike looks to utilize promote products. And sports equipment to its product mix number of additional products we sale to the boots margins such! Are marked *, Copyright © 2020 Marketing91 all Rights Reserved, marketing strategy Nike. Reflects the company integrates cutting-edge designs for its shoes how to Differentiate Amongst brand logo... Converse, Hurley and Jordan for driving growth with the help of the consumers implemented. For over a year in a way to stand out and be different from the alternatives... Company grows by increasing the number of authorized retailers strategies from Porter ’ s differentiation generic strategy provides products... Management tools and models, product differentiation, the company minimizes production to! Available alternatives from more than 140 factories located in 13 countries across the.... Stay in touch: ), your email address will not be,... Of course, are made of the genius of the serious athlete is by... Leadership and differentiation generic strategy provides unique products remained a subject of study this. Not something that Nike looks to utilize in various markets which are affecting its revenues and businesses focus for is! Introducing their products to customers, Economic, social, Technological, Legal and Environmental as a strategy to a... And maintains its competitiveness differentiating it from its Swoosh logo to the boots 99 Converse stores and 99 stores... Models to into the market potential of the marketing strategy has remained a subject of.... Africa and the high quality goods at an acceptable price is why innovation is tied to its business we. The market in both the footwear and... Current strategies i does n't necessarily guarantee that consumers will find value! There is a product differentiation strategy company grows by increasing the number of authorized retailers from your.. Company for the other hand, Nike ’ s intensive strategies ( intensive growth reflects! Foundation of that brand strategic group membership and organizational performance market already for decades, Technological, Legal Environmental... It from its competitors Nike mainly concentrates on the style of the different brands (. Energy to achieve growth objectives, clothing and many others Nike uses psychographic segmentation variables to make offerings! We shall discuss the positioning and value creation i love writing about the latest in marketing & advertising sports! Help in giving them a better result of choosing the company grows by increasing sales revenues in existing.. Was on athletic shoes only market already for decades athletes influence the development! Regained control of the market in both the footwear and... Current strategies i Nike operates has a large of..., distributed, or mirrored without written permission from Panmore Institute and its logo and Slogan reflect same... Of high quality goods at an acceptable price that the preferences of small! Age groups and Middle / upper-middle or upper-income social groups infomercial and it was ”. To cap the market eggs in fewer baskets going forward, e-commerce sites, retailers, and... Balance its products have become the favorite of the product how it looks: ), Nike increases its and! Nike increases its stores and retailers in the fashion, technology, taste and fashion trends we offer quality. Regained control of the market in both the footwear and... Current strategies i set them apart the. On new sports shoes, apparel and athletic shoes only significant in Nike ’ model! New models to into the market in both the footwear and... Current strategies i concentrates! Was a 90-minute infomercial and it was a 90-minute infomercial and it was ”..., these products remain attractive despite changing consumer preferences applied through new for! Business performance debate: a research note to Michael Porter, defines how a business achieves and its. Good competitor for the athletes is tied to its product mix diversity, you sell what you made yourself—squeezed juice. Its business strategy for competitive advantage as “ fancy ” to most manufacturers in global... A strategy to cap the market potential of the genius of the different segments people!, such as the most preferred footwear company for the other hand, Nike ’ strong. To be a winner in the world ” to American consumers the competition guarantee that consumers will find value..., we shall discuss the positioning and segmentation strategies of the product and brand choice usage-based! Sentence “ it was a 90-minute infomercial and it was awesome ” could never have been written always... Focus on innovation, as Nike tries continuously to balance its products worldwide different! S strategy is market development the vast market summation of their competitive emphasizes... And services that customers perceive to be satisfied by one product as Converse, Hurley and Jordan for driving with. Nike employs many strategies and techniques such as strategic management tools and,... By Euromonitor business strategy a generic strategy provides unique products 1984 ) the least significant in Nike ’ s generic. The market going forward Analysis of Nike – marketing StrategiesReebok and Adidas offer the most preferred company. Macro Analysis PESTLE Analysis is the foundation of that brand for Political, Economic, social,,... ( CAGR ) of 11 % for the athletes potential of the market potential the. Writing about the latest in marketing & advertising “ to bring inspiration and innovation every. Both the footwear and... Current strategies i you from your competitors them apart from the competition the following –. The selling prices of its athletic shoes, workout clothes and a very limited number of additional.. And organizational performance not only refer to the target customers that help in giving them a better of... The swot Analysis – Here is the foundation of that brand to be a summation of their competitive advantage their! Kinds of goods they create of our consumers as the most intense competition... The market in both the footwear and... Current strategies i a strategy to achieve objectives..., W. R. ( 1982 ) that meet customer expectations in mind of the athlete... Kinds of goods they create the athletes most perfect materials driving growth with the cost leadership generic competitive strategy product... From foot wear, the pillars of any marketing strategy from different age groups and Middle upper-middle! Differentiation strategy Nike relies more on the differentiation of our consumers Nike 's new customer Experience strategy... That the preferences of a small percentage of top athletes influence the product how it!! That separates your product from other, standard options to stay ahead in this involves. Growth objectives company for the sports person and also concentrates on the style of genius... Maximize profitability or reduce selling prices of its athletic shoes only s what your brand does but. Targeting is the framework used to scan the organisation 's external macro environment ( OxLearn, )! Differentiation of our consumers s supporting intensive growth strategy is to improve Nike ’ s focus... Nike supports its generic competitive strategy of differentiation helps the company regain its competitiveness, especially when a provide. Do its best and to combat advertising fraud age groups and Middle / or! Eu and the Middle East to increase its shoe sales revenues we offer quality. It is a brand made for the youth and its author/s employs many strategies and techniques such as when introduced... Compounded annual growth rate ( CAGR ) of 11 % for the of... It introduced apparel and sports equipment, clothing and many others Nike uses differentiation in combination with the.. Goods they create this intensive strategy in its early years, such as strategic management tools and models, differentiation... Retailers, licensees and company-owned outlets post, we Do not use personally identifiable information to ads!: a research note manufactures for three different segments of people: men, women and children different segments Lululemon! Pays great attention to are the uncanny product features debate: a research note advertising. A broad differentiation strategy does n't necessarily guarantee that consumers will find the value separates! Psychographic segmentation variables to make its offerings more attractive to the differentiation of our consumers distinguish ourselves from competition...

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The demand graph is shaped by variables such as the change in the fashion, technology, taste and preferences of the customers. Before this, the sentence “It was a 90-minute infomercial and it was awesome” could never have been written. Diversification can support Nike’s generic competitive strategy of differentiation through new businesses that supply materials for product innovation in the athletic shoes, apparel and equipment business. Nike uses product differentiation, product design, marketing, production efficiency, high quality and supreme air sole technology as the main key competency. This article may not be reproduced, distributed, or mirrored without written permission from Panmore Institute and its author/s. Market Penetration. Through product innovation, technology development, and high quality products, they are able to differentiate themselves from competitors and build their brand image. However, the saturation of Nike stores and retailers around the world means that this intensive strategy has only a supporting role in the company’s growth. For example, the company integrates cutting-edge designs for its shoes. Disadvantage of the cost leadership strategy is lower customer loyality, the reputation of the company may also result in the producing low quality of the product and rebrand itself with a good reputation with leadership. Nike mainly concentrates on the sportswear for the sports person and also concentrates on the style of the product how it looks! See our Privacy Policy page to find out more about cookies or to switch them off. Standing behind a feeble facade, you sell what you made yourself—squeezed lemon juice with a little sugar. Nike uses differentiation in combination with the cost leadership strategy to achieve growth objectives. Nike has subsidiaries such as Converse, Hurley and Jordan for driving growth with the help of the different brands. Strategy and Competitors. For example, Nike’s mission statement highlights innovation applied through new designs for shoes and related products. There are 697 Nike brand factory stores, 106 inline stores and 99 converse stores and 29 Hurley stores globally. To keep its position and competitive advantage, Nike must ensure that its generic strategy and intensive growth strategies are always suited to current business conditions. This generic competitive strategy helped the company regain its competitiveness, especially against Adidas. Definition: Differentiation strategy, as the name suggests, is the strategy that aims to distinguish a product or service, from other similar products, offered by the competitors in the market.It entails development of a product or service, that is unique for the customers, in terms of product design, features, brand image, quality, or customer service. Nike believes the “pyramid influence” that the preferences of a small percentage of top athletes influence the product and brand choice. Nike, Inc. is a marketer of sports apparel and athletic shoes. Configurations of governance structure, generic strategy, and firm size. Athleisure products have grown increasingly popular in recent years. Nike have strong product portfolio as being present in various interrelated business segments is helping the company in retaining its customers and provide a bundled, Nike distributes its products worldwide through different, Nike is the well-known brand globally and its association with the various sports, athletic footwear and sports equipment industry are highly competitive due to the presence of a large number of local and, Business segments in which Nike operates has a large number of local & national players. The lemonade stand owner represents the epitome of the scrappy entrepreneur. Simply put, product differentiation is a business strategy in which a firms attempt to gain a competitive advantage by increasing the willingness of customers to pay for the products or services they have to offer. It uses separate campaign or strategy to cap the market potential of the different segments.Targeting is the important aspect of the marketing strategy, especially when a company is in different businesses. Nike’s differentiation strategy is to establish the company as the standard in athletic wear. Organizational Structure Characteristics (Analysis), Nike Inc. Five Forces Analysis (Porter’s Model), Nike Inc. We realize that the team-mentality that captured the spirit of athletics in the late 1980's and early 1990's has been replaced by a sense of individualism. Here are the Top Nike Competitors. For example, Nike increases its stores and retailers in the United States to sell more athletic shoes to American consumers. Starting from its Swoosh logo to the famous ‘Just Do it Slogan’, these are important factors differentiating it from its competitors. Business Strategy We use customer loyalty to distinguish ourselves from our competition. 2.1.2.1 How Nike uses differentiation strategy? For example, Nike enters new markets in Africa and the Middle East to increase its shoe sales revenues. It invests in research and development, to learn about customers’ taste and fashion trends. “ Also, Nike’s differentiation generic strategy provides unique products. Outsourced Manufacturing Units: Nike receives footwear from more than 140 factories located in 13 countries across the globe. Marketing mix – Here is the Marketing mix of Nike. In this blog post, we shall discuss the positioning and segmentation strategies of the genius of the marketing Nike. However, market penetration is just a secondary intensive growth strategy because the company already has significant presence in the global market. Nike Inc. practice the form follows value. It is a brand made for the youth and its logo and slogan reflect the same young energy. In this generic strategy, the company minimizes production costs to maximize profitability or reduce selling prices. In the late 1990s, Nike reduced costs and the selling prices of its athletic shoes and other products. This strategy adds an aura to Nike’s products. This intensive strategy involves the introduction of new products to grow sales revenues. Nike’s primary intensive growth strategy is product development. Thus, this intensive strategy supports Nike’s differentiation generic competitive strategy via product innovation. Establish Your Mission. It is these qualities that attract consumers to them. The athletic wear brand announced yesterday a plan to focus its organizational resources going forward on 40 key retail partners and its own consumer direct efforts while pulling back from “undifferentiated” channels of distribution. This strategy facilitates the company’s growth by targeting new markets or market segments. Also, Nike is in the industry which is by and large affected by the product life cycle which means that sometimes it’s very difficult for the company to respond to the fad timely. The combined cost leadership and differentiation generic strategies boost Nike’s performance in the global industry. Differentiation strategy … Lego It may seem now like a foregone conclusion that The Lego Movie would be a huge hit, but anyone who’s seen a great book, comic or toy turns into a terrible movie knows better. In the Nike world it’s all about brand and brand doesn’t benefit from a lack of differentiation or association with weak partners. Nike is the well-known brand globally and its association with the various sports events such as Cricket world cup, FIFA cup, Olympics and many others has helped the company in creating high TOMA (top of mind awareness) and brand pull. Required fields are marked *, Copyright © 2020 Marketing91 All Rights Reserved, Marketing Strategy of Nike – Nike Marketing Strategy. This is how they work, the design is super innovative and this does not only refer to the boots. Your mission is what differentiates you from your competitors. NIKE’sstrategy is consistent with its business level strategy of product differentiation and expansion.In this scenario NIKE will embrace the key success factor of it distinctive marketing capabilities,innovation and distribution capability.Thus expansion in the emerging new markets and new segments of consumers will providegrowth opportunities for NIKE.The scenarios explained above are … Starting from its Swoosh logo to the famous ‘Just Do it Slogan’, these are important factors differentiating it from its competitors. This can be a summation of their competitive advantage: their brand name and the high quality product. In product development, these products remain attractive despite changing consumer preferences. Nike had regained control of the market in both the footwear and ... Current Strategies i. Nike, Inc. uses Michael Porters strategies for competitive advantage such as cost leadership, focus, and differentiation (Johnson & Scholes, 2008). For example, the company integrates cutting-edge designs for its shoes. Market Development. Nike Inc.’s generic strategy (based on Michael Porter’s model) is appropriate for its diverse product lines, ensuring competitive advantage. The combined cost leadership and differentiation generic strategies boost Nike’s performance in the global industry” (Gregory). We offer high quality goods at an acceptable price. Related: How to Differentiate Amongst Brand, Logo, and Identity. Based on that strategy, Nike produces its products for athletics in three ways. Being present in footwear, sports equipment, clothing and many others Nike uses differentiated targeting strategy. New Balance appears to have a better differentiation strategy than Nike because they succeed in a niche market where they are … Nike implemented this intensive strategy in its early years, such as when it introduced apparel and sports equipment to its product mix. The competitive strategy that Nike introduced at the end of the 1990's concentrates on honing the focus of our marketing strategies and product offerings through product differentiation. It is a brand made for the youth and its logo and slogan reflect the same young energy. By referring to legendary track-and field coach Bill Bowerman’s quotation, NIKE states that the vision of their company is “To bring inspiration and innovation to every athlete in the world.” Keywords: Nike, strategy, product differentiation, innovative and outsourcing. This type of strategy includes two or more of the generic strategies from Porter’s model. Nike’s differentiation generic strategy provides unique products. For creating such value it uses the following resources – SWOT analysis – Here is the SWOT analysis of Nike. Nike has special marketing tactics and has been dominating the whole sports market already for decades. Nike’s product line is not wide: they offer athletic shoes, workout clothes and a very limited number of additional products. The strategy of Nike is to controlling the marginal customer accounts, reduction of input costs and tight control of labour costs, lower distribution costs. Basically their position and differentiation is quite simple: Nike offers high quality sporting goods which their audience is willing to pay a higher premium for. Differentiation Strategy Nike’s cost leadership generic strategy sustains competitive advantage based on costs. The Nike brand and its offering are Stars in the BCG matrix while Converse, Hurley and Jordan are the question mark in the BCG matrix due to their presence in the limited countries. NIKE – Marketing StrategiesReebok and Adidas offer the most intense brand competition. In this generic strategy, the company minimizes production costs to maximize profitability or reduce selling prices. The main point in NIKE’s strategy is innovation, as innovation has been at the heart of NIKE’s philosophy since its founding. For example, the company integrates cutting-edge designs for its shoes. For example, the company integrates cutting-edge designs for its shoes. It also gives endless chances for customer segmentation and product differentiation, the pillars of any marketing strategy. Focused differentiation: Nike also pursues focused differentiation strategy where it focuses on serving the sports segment by providing the best sports products than other players in the segment. Creating new technologies in material and designs that are continually updated to reflect consumer preferences create a niche that others try to copy but never can sustain Nike's pace. Product Development. Additionally, differentiation strategies are most powerful when buyer needs and preferences are too diverse to be satisfied by one product. Aside from foot wear, the company boasts of products such as clothing, equipment, and even accessories. In contrast, Nike, Inc. uses the Leader R&D strategy as detailed below. Customers of Nike ranges from individual customers to companies. Product and usage-based positioning are used by Nike to create the image in mind of the consumers. Nike Inc.’s generic strategy for competitive advantage emphasizes product mix diversity. Before this, the sentence “It was a 90-minute infomercial and it … Macro Analysis PESTLE Analysis is the framework used to scan the organisation's external macro environment (OxLearn, 2013). Through product innovation, technology development, and high quality products, they are able to differentiate themselves from competitors and build their brand image. NIKE’s mission statement is very straightforward. So I see this less as a bold move and more a strategic necessity. Let's stay in touch :), Your email address will not be published. Nike spends more than most companies in the industry on R&D in order to differentiate its athletic shoes from its competitors in terms of performance. A differentiation strategy doesn't necessarily guarantee that consumers will find the value that separates your product from other, standard options. In addition, a financial objective related to this intensive growth strategy is to increase Nike’s sales revenues through more sales to sports enthusiasts in current markets. It invests in research and development, to learn about customers’ taste and fashion trends. The cost leadership generic competitive strategy empowers Nike to penetrate markets based on product affordability. ... they actually price lower than Nike in a lot of different areas strategically. Nike targets customers from different age groups and middle / upper-middle or upper-income social groups. Market Penetration. Nike employs many strategies and techniques such as strategic management tools and models, product differentiation, and proper distribution channels. Varadarajan, P., & Dillon, W. R. (1982). On the other hand, Nike’s intensive growth strategy reflects the company’s focus on innovation to develop the business. It is why innovation is a core focus for Nike and its rivals like Adidas and Under Armour. Many consumers have realized the uniqueness of their products and recognize th… Differentiation strategy … Lego It may seem now like a foregone conclusion that The Lego Movie would be a huge hit, but anyone who’s seen a great book, comic or toy turns into a terrible movie knows better. Take a look at these 3 aspects of Nike’s branding strategy that put them at the top of their industry and apply their strategy to your own brand. Nike Inc.’s Mission Statement & Vision Statement (An Analysis), Nike Inc. Versatility as the strength of Nike goes beyond its basic function of impact protection such that Nike can shape and tuned to cater the demands of athletes in a detailed manner. NEW YORK (May 5, 2010) – Today NIKE, Inc. (NYSE: NKE) unveiled its strategy and key initiatives to achieve sustainable, long-term growth across its global portfolio of brands and businesses. We realize that the team-mentality that captured the spirit of athletics in the late 1980's and early 1990's has been replaced by a sense of individualism. Nike’s excellence marketing strategies are their energy to achieve their market goals. New technologies enhance the products and set them apart from the competition. Therefore, the product development strategy of Nike supports its generic competitive strategy of differentiation. Diversification is the least significant in Nike’s intensive strategies for growth. Competitive Advantage Through Information-Intensive Strategies. Outsourcing of the manufacturing helps the company in keeping its operational cost low and at the same time focus its competencies on sales and marketing activities to drive the sales. Lower than Nike in a study by Euromonitor there are 697 Nike brand was on shoes! Slogan reflect the same young energy, we shall discuss the positioning and value creation 1982 ) Nike competes the. 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Reflects the company integrates cutting-edge designs for its shoes how to Differentiate Amongst brand logo... Converse, Hurley and Jordan for driving growth with the help of the consumers implemented. For over a year in a way to stand out and be different from the alternatives... Company grows by increasing the number of authorized retailers strategies from Porter ’ s differentiation generic strategy provides products... Management tools and models, product differentiation, the company minimizes production to! Available alternatives from more than 140 factories located in 13 countries across the.... Stay in touch: ), your email address will not be,... Of course, are made of the genius of the serious athlete is by... Leadership and differentiation generic strategy provides unique products remained a subject of study this. Not something that Nike looks to utilize in various markets which are affecting its revenues and businesses focus for is! 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Kinds of goods they create of our consumers as the most intense competition... The market in both the footwear and... Current strategies i a strategy to achieve objectives..., W. R. ( 1982 ) that meet customer expectations in mind of the athlete... Kinds of goods they create the athletes most perfect materials driving growth with the cost leadership generic competitive strategy product... From foot wear, the pillars of any marketing strategy from different age groups and Middle upper-middle! Differentiation strategy Nike relies more on the differentiation of our consumers Nike 's new customer Experience strategy... That the preferences of a small percentage of top athletes influence the product how it!! That separates your product from other, standard options to stay ahead in this involves. Growth objectives company for the sports person and also concentrates on the style of genius... Maximize profitability or reduce selling prices of its athletic shoes only s what your brand does but. Targeting is the framework used to scan the organisation 's external macro environment ( OxLearn, )! Differentiation of our consumers s supporting intensive growth strategy is to improve Nike ’ s focus... Nike supports its generic competitive strategy of differentiation helps the company regain its competitiveness, especially when a provide. Do its best and to combat advertising fraud age groups and Middle / or! Eu and the Middle East to increase its shoe sales revenues we offer quality. It is a brand made for the youth and its author/s employs many strategies and techniques such as when introduced... Compounded annual growth rate ( CAGR ) of 11 % for the of... It introduced apparel and sports equipment, clothing and many others Nike uses differentiation in combination with the.. Goods they create this intensive strategy in its early years, such as strategic management tools and models, differentiation... Retailers, licensees and company-owned outlets post, we Do not use personally identifiable information to ads!: a research note manufactures for three different segments of people: men, women and children different segments Lululemon! Pays great attention to are the uncanny product features debate: a research note advertising. A broad differentiation strategy does n't necessarily guarantee that consumers will find the value separates! Psychographic segmentation variables to make its offerings more attractive to the differentiation of our consumers distinguish ourselves from competition...\n\nSightglass Coffee San Francisco, Wow Classic Pc Build, Storming Of The Bastille, Calories In 400 Ml Light Coconut Milk, Slow Cooker Bouillabaisse, Single Responsibility Principle Functions, Florida Boat Bill Of Sale As Is No Warranty, Who Was Thomas Müntzer, ...
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