“DOING THE SWOOSH THING”

NIKE INC.

LOGESH NADARAJANMGT 7201

STRATEGIC MANAGEMENT

COMPANY OVERVIEW

Stock symbol : NKE (NYSE) Annual revenue : more than $19billion ( as of 2010) Founders : Bill Bowerman & Philip Knight Year established : 1964 (as Blue Ribbon Sports) Industry : Sportswear/equipment HQ : Beaverton, Oregon , USA President/CEO : Mark Parker Staff : 34,400 (as of 2010) Products : Shoes, apparel and sports equipment Slogan : Just Do It!

TIMELINE

1960’s – Blue Ribbon Sports

founded by Phil Knight

1970’s – Swoosh logo created for just USD

35.00-BRS changed into

“Nike"

1970’s – HQ opened at

Beaverton, Oregon

1990’s – Opens World Campus

- Opens Nike Town in Oregon

1980’s – Famous slogan “Just Do It”

comes to life

1980’s – Introduction of Nike Air Shoes

- Canada’s top seller

1990’s – Gets distribution rights in

Korea & Japan- Opens Nike town in

NY & Chicago

2000’s – Purchases Converse Inc for USD

305 million- Opens first Nike

Goddess Store

2000’s – Acquired Umbro (apparels)

CORE VALUES

• To experience the emotion of competition

• Winning• Crushing Competitors

Core Values

VISION & MISSION

• To bring inspiration and innovation to every athlete* in the world

• * If you have a body, you’re an athlete – Bill BowermanVision

• To be the world’s leading sports and fitness companyMission

CORPORATE LOGO

Nike Logo as at 1971

Nike Logo as at 1978

Nike Logo as at 1985

Current Nike Logo

BOARD OF DIRECTORS

Philip KnightCo founder/ Chairman

Alan Graf Jr.Fedex

Timothy CookApple Inc

John ConnorsIgnition Partners

Mark ParkerCEO/President

BRAND PORTFOLIO

Cole Haan, designs and distributes dress and casual footwear, apparel, and accessories for men and women

Converse Inc., offers a diverse portfolio including premium lifestyle men's and women's footwear and apparel.

Hurley International LLC., designs and distributes a line of action sports apparel for surfing, skateboarding and snowboarding, and youth lifestyle apparel and footwear

NIKE Golf, designs and markets golf equipment, apparel, balls, footwear, bags and accessories worldwide.

Umbro.Ltd., designs, distributes, and licenses athletic and casual footwear, apparel and equipment, primarily for the sport of football (soccer)

PERFORMANCE ANALYSIS

Strength•Nike Inc is listed in NYSE•Strong marketing strategy

•Operates a chain of Niketown retails•Has factories in China, Vietnam, Malaysia

•Contracts with 700 shops worldwide

Weakness•The income of the business is still heavily dependent upon its

share of the footwear market. •Contracts overseas companies that apply non-transparent and

inadequate labor regulations, involving child labor

Opportunities•The opportunity to develop products such as sport wear,

sunglasses and jewelry•Producing sportswear products from manufacturing waste

•Nike is a fashion brand. Consumers that wear Nike product do not always buy it to participate in sport

Threat•Financial crisis may lead to job shortages in a number of

Nike’s worldwide subsidiaries•Nike is exposed to the international nature of trade. •The market for sports shoes and garments is very

competitive

SWOT ANALYSIS

PERFORMANCE ANALYSISProduct / Place / Promotion / Price

Product Strategy

- Several lines of athletic shoes and apparel

- Product mix width consist of athletic shoes , apparel and sports equipment

Pricing Strategy- Uses market skimming pricing strategy

- Product line pricing

Promotion Strategy- Direct marketing (through e-shop)- Public relations (massive sponsorship)- Mass Advertising

Place Strategy- Sells product in international market through independent distributors, licenses, subsidiaries

- Sells product in approximately 110 countries around the world

4P’s

PERFORMANCE ANALYSISPorter’s 5 Forces

Threat of New Entry

(Moderate)

Threat of Substitutes(Moderate)

Bargaining Power of

Buyer(High)

Bargaining Power of

Suppliers (Low)

Rivalry(High)

TECHNICAL FACTORSTechnology In Products

Nike has historically had some of the most cutting-edge products on the market.

For example, Nike teamed up with Apple and launched the “Nike + iPod” line of products.

This technology allows consumers to connect their iPod devices to sensors inside the shoes to record time, distance, pace, and calories burned.

TECHNICAL FACTORSManufacturing Factors

Due to cheap labor in foreign countries, Nike outsources virtually all production to other areas of the world.

This behavior has become an industry standard, with all major competitors also outsourcing production.

Consequently, no competitor has a major advantage in manufacturing

TECHNICAL FACTORSStrength of Patents

One of Nike’s most revolutionary technologies comes through its footwear cushioning.

Nike has patents on four cushioning technologies: Nike Air / Nike Zoom / Nike Air Max / Nike Shox

Although some of Nike’s earlier patents are beginning to expire, they still hold patents on the newer technologies

TECHNICAL FACTORSEconomies of Scale

Nike is the single largest producer of athletic footwear and apparel, allowing them large cost advantages over competition

Larger companies tend to have major economies of scale over smaller companies in areas such as distribution and marketing.

Nike is so large that many of the company’s suppliers depend on Nike to remain in business.

REVENUE / INCOME %

Source : Nike Annual Report (2011)

Corp. Social Responsibility

- Contributes for the study of rural children

- Innovates its product constantly to make it eco-friendly

- Offers scholarship to children in sports

- Member of Fair Labour Association (FLA) & Global Alliance

- Funds number of NGO’s as part of contribution towards society

PERSONAL JUDGEMENT

Formulating a strategic plan for the corporation’s future is key in determining the all around goals of the company.

Nike, with their marketing, innovation, technological advancements, and equitable manufacturing departments, has created an all round dominant strategic plan.

Nike has raised their competitive advantage to the highest form possible.

NIKE VIDEO

http://www.youtube.com/watch?v=ijTwZNUBhcI

http://www.youtube.com/watch?v=A_ooJE9Veo0&feature=related

QUESTIONS?