Why Nike is So Successful? Complete MBA Business Study

Nike was started in 1964 in the US by Bill Bowerman and Phil Knight. The company is profitable for more than 6 decades now. What is the Secret? Know Now!

By Swati Chandra May 13 2021 12:00AM 706 Read
Learn How Nike is Ruling the Shoe Market Since 1964: Case Study

Nike has been a top player in the footwear business for a long time now. The company got founded in 1964 in the US. The founders of the company are Bill Bowerman and Phil Knight. Initially, it was known as Blue Ribbon Sports. Now, they follow the various trends and is a very famous brand, especially amongst the youth.

The company has around 47% share in this industry. They also have a wide range of sports equipment. It is the top three companies that are climate-friendly and focuses on the environmental aspects as well. Most of the factories of this brand are in Asia. Companies find cheap labor in Asian countries like India, China, Indonesia, Taiwan, etc.

Nike - Brand Equity

Holding customers is an art for any company. Nike has undoubtedly mastered this art. The company is very passionate about its products and always comes with a clear concept in the market. They focus on the authenticity, comfort, and uniqueness of the products. Their technology is very innovative and, this defines the identity of the brand.

Apart from providing outstanding products to their customers, Nike has also made an emotional bond with them. This emotional attachment made their bond stronger and won people's trust.

Nike - Campaign

Nike's trademark is one of its core components. It focuses mainly on the person wearing the product rather than the product itself. The brand emphasizes more on the comfort side for its customer than any other brand.

'Just do It' Campaign & Logo

Their 'Just do It' campaign started in 1990, was a massive hit and, it blends well with the idea of the brand.

Nike Case Study

The Swoosh Logo and the tagline of the brand go perfectly well with each other. People relate to both of these and, it helped Nike making a space in the heart of the people. The campaign was a huge success and, it bright the sales from 17% to 42% in America (its domestic market).

Nike - Core Marketing Strategy

Nike put a lot of effort into its marketing and advertisement. They respond to the market trends and analyze the need of the consumers. They believe in creating, developing, innovating, etc. It helped the brand in creating its marketing strategies and takes a fresh take on it whenever required. Some of their core marketing strategies are:

  • Distribution A company's sales and profits depend a lot on its effective distribution. They increase the level of their customer's loyalty and satisfaction by delivering the right product at the right time. Nike was also the first footwear brand to have its e-commerce website. It started selling shoes on the internet in 1999 that gave it an edge over other brands.
  • Price Nike sets a higher price than its competitors due to its quality and utility. It also mainly focuses on consumers who prefer the better product and do not worry too much about the price. The customers are ready to pay the high price if they are getting what they want.
  • Advertising and Promotion Nike has a tremendous advertising and promotional strategy. It has collaborated with many top athletes and, almost all of them were huge successes. The trademark and logo also play a vital role in its advertising. It is one of the most influential brands in the world. Its aggressive marketing and campaign helped in creating the brand image.
  • Market Divison and Target Nike targets mainly the people who enjoy high-quality sports goods. They mainly focus on athletes and people aged from 15 to 40. The strategy to focus specifically on athletes helps in reaching a larger group of people, typically youth. The brand is a master in the market division and knows exactly its focal point.

Nike - Collaborations

Nike's brand strategy involves a lot of collaboration with a lot of celebrities and companies. The collaboration thing has always helped them in bringing something good to the market.

Nike collaborated with Apple, which was one of its best and unique collaboration of them all. They are producing Nike + products. People can link it to the iPods through radio and, customers can monitor their performance. Nike has also collaborated with various celebrities and athletes. According to a report, the company has spent almost 15% of its revenue on the marketing campaign. Some of them are:

  • Ronaldinho
  • Tiger Woods
  • Michael Jordan
  • Roger Federer
  • LeBron James
  • Maria Sharapova
  • Lance Armstrong

Micharl Jordan Partnership

Nike's collaboration with Michael Jordon was a massive success amongst all of them. Nike sold air Jordans worth $126 million in the first year only. Michale made about $1.3 billion from this partnership.

Nike - Competitors

Nike, despite having a stronghold in the market, still has a lot of competitors. Its competitors are good too and are ever ready to give it a tough time. Nike is the king of the footwear market with a brand value of $33 billion.

With time several other companies entered the market. Somehow they are deviating the customer to their side with their products and marketing strategy. Some of the strongest competitors of Nike are:

  • Adidas
  • Puma
  • Converse
  • Reebok
  • Fila

Nike - Brand Loyalty

Nike has come a long way when it comes to loyalty and assurance. The brand has been leading the market for more than two decades and, it has always performed well. Despite having a few ups and downs, it has managed to make a space in the hearts of its customers.

Customer satisfaction with this brand is as high as 80%. The brand has always aced the game by coming up with new ideas and some crazy innovations. Thus, loyalty towards Nike is driven by many internal and external factors. They have always managed to bring their customers closer and make a deeper bond with them.

Closure

Nike has done a commendable job in changing the face of the footwear market. You think about buying footwear, Nike is the first brand that comes to your mind. Such is the impact that this brand has left on the mind of its customers. The brand has many competitors in the market, but the global market share of Nike is incomparable. It has a much diversified culture and, the company is only going to flourish in the future.

Swati Chandra
Swati Chandra View More Posts

I am an English Honours graduate from Delhi University and writing is my passion. I like writing sweet, fun, action-packed mysteries. My characters are clever and fearless, but in real life, I am afraid of basements, bees, and going upstairs when it is dark behind. I have 2+ years of experience in this field and have worked with several websites as an intern.

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