Nike’s Strategy to Become the Leader in their Market
Nike Success
Nike is successful because it has some of the best, if not the best, marketing in the world. Their brand is the #1 brand in the sporting goods industry and is the 14th most valuable brand in the world.
The Nike business strategy is clear,
1.Invest in building your brand through emotional marketing and
2.Sports celebrity endorsements, develop products that have high-quality, market-leading technology and buy out competing sports brands.
3. Nike Has Established their Brand and Logo through Marketing
Why is Nike successful at marketing?
How did Nike become popular?
What is the Nike strategy when it comes to marketing and branding?
They work hard at marketing and invest a lot into it.
“No company in the world spends as much money on sports sponsorships as Nike..”
Nike invests in marketing and this can be seen in their 2014 fiscal report. “…Nike spent $3.031 billion on what they call “Demand Creation.” Nike’s a little fuzzy on what that means (marketing can be anything from a TV ad buy to a collaboration with a niche shop). According to Matt it’s “Nike-speak for ‘Advertising.'” That means that Nike spends about $100 per second on advertising.” Nike is spending almost the same amount on marketing that Under Armour makes in sales.
This article discusses the importance of marketing that Nike focuses on in 2016, “Nike spent $3.3 billion on marketing in the last year, while Under Armour did $3.96 billion in sales in the last year.”
Nike spends over $3 Billion in advertising a year
Nike promotes their products with having celebrities, professional and college athletes with sponsorship agreements.
What is your budget for advertising and marketing?
Nike’s first athlete to endorse their products was a Romanian tennis player named Ilie Natase.
Nike also invested in marketing early on in their establishment.
Currently, Nike focuses on sponsorships, internet marketing, email marketing, and utilized multimedia marketing campaigns.
Are you using email marketing , Internet marketing or sponsorship of any brand in your business or influencers in your business?
Some examples of Nike’s Sponsorships are:
Golf – Tiger Woods
Basketball – Michael Jordan, Lebron James, and Kobe Bryant
Baseball – Albert Pujols and Joe Mauer
Hockey – Alex Ovechkin
Soccer – Ronaldinho and Cristiano Ronaldo
Tennis – Roger Federer and Serena Williams
Football – Peyton Manning, Drew Brees, Eli Manning, and Joe Flacco
In 1982, Nike produced their first advertisement. Nike has been given various awards for their advertisements (Emmy award twice for best commercial, Advertiser of the Year in 1994 and 2003).
Nike Focuses on Selling the “Emotional Benefits” of their Product
Nike sells a lifestyle, it taps into an emotional part of the consumer that wants to aspire to live healthier and to find their own “greatness”.
It is noted that Bill Bowerman did not sell his shoes with his marketing strategy, but the emotional benefits of feeling good about jogging and healthy living. One writer observed that Nike mentions their product minimally in their advertisements, but focuses on the benefits of exercise.
Nike once had 6 NFL stars to go back to their high schools and work with their football teams. There is minimal showcasing of Nike’s products or even mention of their brand.
Become The Leader In Your Market
Nike Embraces New Technologies
Nike has developed and established a variety of new technologies associated with their brand. For example, Nike developed a shoe that will auto-lace when you put your heel in the shoe. It is noted that it took them 10 years to create HyperAdapt 1.0.
Nike is constantly being innovative with the development of their shoes.
They have done things to make the shoe lighter and sturdier such as Flyknit.
They also have developed a shoe called Nike Air Vapormax that has eliminated foam and has replaced it with air bags. In 2006, they also developed a shoe that connected to an i-pod to track the pace and distance of the walker or runner.
Nike Provides a Wide Variety of Products To A Large Number Of Sports To Capture Great Market Share
Nike has a variety of sporting products for everyone.
This includes sports equipment and apparel for baseball, ice hockey, track and field, soccer, surfing, yoga, tennis, basketball, lacrosse, skateboarding, combat sports, cycling, wrestling, volleyball, cheerleading, auto racing, aquatic activities, cricket, and golf.
In addition to shoes and sport equipment, they also provide clothing (tracksuits, sport shorts, sports bras, and casual clothes such as shirts, jeans, jackets, socks, hats), watches, apps, backpacks, purses, wallets, gloves, sunglasses, hair-bands, scarves, belts, etc. 19 Not only does Nike have a variety of options of products, but Nike also owns Hurley, Converse, and Jordan brands. By offering more products to more people, in more markets than any other sports company, they are able to capture a far greater market share of the market than any other company.
Nike Focuses on Product Quality and Creating Products that Help Athletes Perform Better
Like most leaders in the market, Nike values the consumer and the importance of providing a quality product.
Nike quality and durability is a critical part of their strategy to be able to command high prices for their products.
Their brand is associated with providing top-notch product for athletes that help them perform better. One article notes how Nike has been consistent in their message to consumers that they stress the importance of their needs and preferences.
The message to consumers is that Nike wants to make your life better at something you are passionate about (whether that is basketball, running, jogging, etc) and to improve your overall health.
In 2016, it is noted that Nike won the Olympics for the United States athletes who wore their sneaker brand. See below for the chart comparison of Nike and their competitors and how one may argue Nike’s product helped the athletes perform better.
Question of the Day
What are the lessons you learnt from Nike that you can use to upgrade your business and sales today?
How does your products or services increases the quality of life of your customers and prospects?
Are you using email marketing , Internet marketing or sponsorship of any brand in your business or influencers in your business?
What Emotional or lifestyle benefits does your customers or prospects enjoy from your products or services?
Thanks for your attention and please enjoy your day.
Dr Laide Okubena