Strategic Analysis of Nike, Under Armour & IMG Content include: Mission & Vision of each organization PESTEL Analysis Five Forces Model Analysis Suggestions Strength & Weakness Strategic Implementation

1. Florida State University
SPM 5116 Strategic Management for Sport Organizations
Final Project Presentation

2. •Nike
• One of the most recognizable global brands in the world
• Sponsor some of the world’s best athletes
• Number one athletic shoe retailer
•Under Armour
• Emerging brand and competitor of Nike
• Interesting to analyze areas in which they can better compete with Nike
• Emerging in athletic shoe segment
•IMG
• One of the most recognizable brands in sports marketing
• Large focus on collegiate athletics
• FSU is a client of IMG

3. “To bring inspiration and innovation to every athlete
in the world.”
* If you have a body, you are an athlete.

4. Direct to consumer to drive growth and sales
•Nike is placing a strong emphasis on its direct to consumer, or DTC, growth
channel.
•The segment includes items sold at Nike stores and online sales through
www.nike.com .
•The company plans to improve its margin through increased DTC penetration and
achieve $8 billion in sales by 2017, compared to $4.3 billion in 2013. $50 billion in
revenue by 2020.
•It's a goal. CEO Mark Parker called "ambitious." In its most recent fiscal year ended
May 2015, Nike had $30.6 billion in revenue, a 10% increase over the previous year.

5. How does Nike plan to reach 50 billions?

6. Political
-Nike is able to benefit though the US government's low
interest rates, stable currency conditions, and
international competitiveness of the tax system.
Economical
-Positive: Brand equity
-Negative: Biggest threat held against Nike is if an
economic recession were to hit the market.
Social
-Consumers becoming more health conscious

7. Technological
-Information technology
Environmental
-Environmentally friendly and efficient with their
production methods
-Creating Awareness
Legal
-Allegations of sweated labour
-Sued under California’s Unfair Competition and False
Advertising Laws

8. New entrants:
Low to Medium
Threat of substitute products:
Medium
Competitive rivalry:
High
Bargaining power of
consumers:
Low to Medium
Bargaining power of suppliers:
Low

9. Bargaining Power of Customers: Low to Medium
-Wholesales and Direct-to-customer channels
-Certain big wholesales customers hold the bargaining power
Bargaining Power of Suppliers: Low
-Products manufactured by third-party companies outside the U.S.
-Nike have strict terms in the contract with suppliers to protect their rights and
intellectual property
-Suppliers all over the world, none of them can account for more than 6% of the
total production

10. Threat of new entrants: Low to Medium
-The whole industry structure has been established
-Financial problem may become barriers for new entrants
-Internet selling may become a challenge in the future
Threat of substitute products: Medium
-Customers are facing plenty of choices for sports apparels and footwear.
-The brand recognition and loyalty of Nike is still in the domination spot.
-The long-term sponsorship to sports organizations can help them to continue
their competitive advantage with others

11. Intensity of competitive rivalry: High
-Nike has several major rivals, including Adidas, Under Armour, Puma etc.
-In the U.S, Nike still has the dominate position, but UA has had the ability to compete with the Giant.
-In Europe, Nike’s biggest competitor is Adidas Group, especially in soccer.
-To the east, Nike also need to compete with local companies, i.e. Li-Ning & Anta in China, Asics in Japan,
Fila in Korea etc.
-Due to Nike’s various kinds of products, Nike also faces challenge from some other companies with a
narrow segmentation.

12. • Nike should continue to find ways to move towards human labor instead of
machines in order to create jobs and create more environmental stability.
• Nike should create more “going green” campaigns and continue to find ways to
make the production of their products more efficient. New products made from
recycled products could be a hit (Air Jordan XX3).

13. • Nike should continue to focus on research and development as well as innovation to
debut new sneaker/clothing technology that will protect them from the threat of
substitute products.
• Nike should continue to focus on maintaining its brand loyalty by catering to its
current customer base.
• Nike should continue to build its brand identity by offering products to new customers
in market segments. For example, Nike could start producing equipment for upcoming
sports such as Lacrosse and MMA. Expansion into other sports could help Nike limit
opportunities for new entrants to make an impact on the sports retailer market.

14. • Nike should continue to exploit advantages they have over their competitors such as,
the overwhelming success and notoriety of Nike sponsored athletes. Athletes such as
Kobe Bryant, Lebron James, Kevin Durant, Serena Williams, and Tiger Woods are
associated with winning and accomplishments and Nike has done a tremendous job
making their brand associated with their athletes’ accomplishments.

15. To Make All Athletes Better Through Passion, Design
And The Relentless Pursuit Of Innovation.
To Empower Athletes Everywhere

16. Under Armour anticipates that
revenue generated directly
through its Connected Fitness
initiatives will represent a $200
million business by 2018.

17. Political
-Struggle against FDI policies in other countries
Economical
-Positive: growth of the performance apparel industry
-Negative: China’s increase in inflation rates, labor costs,
and interest rates
Social
-Obesity rates increasing in the U.S → Fitness & Healthier
Lifestyle
-Sport participation rising

18. Technological
-E-commerce
Environmental
-Five components to Going Green
Legal
-Sued any organization or company that used the
word “Armor”

19. New entrants:
Medium
Threat of substitute
products:
Medium
Competitive
rivalry:
High
Bargaining power
of consumers:
Medium
Bargaining power of
suppliers:
Low to Medium

20. Bargaining Power of Customers: Medium
-Wholesales and Direct-to-customer channels
-Certain big wholesales customers hold the bargaining power
Bargaining Power of Suppliers: Low to Medium
-Global strategy of production. UA’s products are produced by 27
manufacturers across 14 countries.
-Due to the fast growing pace of UA Brand, suppliers intend to
share more interests and the raise the cost of labors.

21. Threat of new entrants: Medium
-The whole industry structure has been established
-Other companies also want to enter the athletic performance apparels’
market, i.e. Nike Dri-Fit, Adidas Clima.
Threat of substitute products: Medium
-Athletic performance apparels are UA’s competitive advantage in the
market.
-UA is the best in this field.
-But for other categories, UA has limited advantage towards its competitors.

22. Intensity of competitive rivalry: High
-Due to UA’s fast growing, Nike & Adidas has regarded UA as their biggest competitor.
-UA’s brand recognition and brand loyalty is limited outside the U.S.
-UA’s performance outside the U.S. still can not compare to Nike and Adidas. Besides, Nike and
Adidas are also trying to stop UA’s global development.

23. • Under Armour should try to capitalize as much as
possible on the increasing demand for fitness
apparel. Under Armour has an advantage in this
category and the overall increased demand for these
products should help Under Armour in the short run
while the trend lasts.
• Under Armour could create a campaign fighting
obesity in the U.S.. With Obesity being a very big
problem in the U.S., A campaign by a leading
performance athletic retailer could be huge to
motivate people to be active and get healthy. Under
Armour could be the official retailer of the
movement.

24. • Under Armour should continue to innovate and develop their apparel where they have an
advantage over their competitors which is in the apparel segment.
• Under Armour should research a way to innovate a technology that would be a good
substitute to the technologies their main competitors (Nike and Adidas) are producing in the
performance footwear market.
• Under Armour should look to continue to expand in markets where Nike and Adidas are
not as prevalent such as Lacrosse and MMA.

25. Using imagination, creativity and energy, our mission
is to leverage the unparalleled power of IMG's
worldwide resources, capabilities and assets to the
benefit of our clients, customers and partners in the
areas of sports, entertainment

26. Rutgers Partnership with IMG
Learfield Ticket Solutions
(IMGLTS) to lead all new and
renewal ticket sales initiatives
for 2016
IMG has renewed its agreement with the PGA
of America to distribute international
broadcast rights for the PGA Championship
and the Senior PGA Championship presented
by KitchenAid until 2021.The new agreement,
which officially begins in 2017, extends the
relationship between IMG and the PGA to 35
years

27. Political
-Government attitude changes
Economical
-Currently in a strong financial position
Social
-Growing interest in sport

28. Technological
-Interactive Content Factory
Environmental
-Potential opportunity
Legal
-Terminated a joint venture with Indian and
Chinese firms

29. New entrants:
Low to Medium
Threat of substitute products:
Low to Medium
Competitive rivalry:
High
Bargaining power of
consumers:
Medium to High
Bargaining power of suppliers:
Low

30. Bargaining Power of Customers: Medium to High
-Different customers has different level of bargaining power.
-Customers have a high level of bargaining power according IMG’s business service
characters.
-Big organizations have the major bargaining power.
Bargaining Power of Suppliers: Low
-IMG can distribute their business to different suppliers. This can reduce the
bargaining power of suppliers
-IMG also has some self-suppliers, i.e. IMG Academy to IMG Talent Representative

31. Threat of new entrants: Low to Medium
-IMG is dominated in the U.S
-In Europe, IMG has weak resources in soccer. New entrants in soccer may challenge it.
-Sport industries in Asia and South America are in explosion. IMG may face challenges from new
local companies in different areas.
Threat of substitute products: Low to Medium
-Although there are plenty types of substitute products can threat IMG, a company established on
services is still relying on their reputation and resources.
-Low penetration in the soccer market and lack of properties in the new markets (i.e. BRIC
countries) may become a problem.

32. Intensity of competitive rivalry: High
-IMG is facing a lot of challenges in different businesses in the world.
-Some of noticeable competitor of IMG are Octagon, CSM Group, Sport Entertainment Group, Creative
Artists Agency.
-Different types of company can challenge IMG in different areas.

33. • IMG should look to sponsor an environmental sustainability campaign in order to get
their brand name associated with protecting the environment. The campaign would help
strengthen the brand and image of IMG.
• IMG should develop Web 2.0 software in order to level the playing field with their
competitors in that technological aspect. In today’s modern world, the best companies are
always ahead of the curve technology wise.

34. • IMG should continue to look for
opportunities to take advantage of emerging
markets such as China and India. In China
they have taken advantage of the growth in
golf interest. It would beneficial to do the
same in countries such as India. IMG could
also look to a South American country like
Brazil.

35. • In order to expand, IMG should try to
penetrate the international soccer market in
order to increase their brand recognition. For
example, IMG could contact some international
club teams and offer sponsorship deals for these
franchises.
• IMG may be under threat by other substitute
products but in order to nullify this threat as
best as possible IMG should continue to focus
on providing elite service. Their reputation and
results help to fend off the appeal of substitute
products.

36. • IMG can focus on strengthening their relationships with their current businesses in order
to protect from outside companies taking a segment of their business.
• IMG could look to expand business interests into Asia and South America. In Asia, IMG
could look to make partnerships in sports such as soccer, baseball, and basketball. The
same could be said for South America with more of an emphasis on soccer and baseball.
IMG could look to forge a relationship with the major leagues in Asia and South America.

38. 1. Its own reputation among the world--The most famous sports brand.
2. The design and innovation ability
3. The huge marketing network which reach almost every corner of world.
4. Produce from worldwide factories. i.e.Many shoes are made in China or Thailand.
5. The diversify of product’s category including: clothes, shoes, bag, sports equipment.
6. Getting the top athletes to wear and sponsor their products

39. 1.The price is expensive for some classes.
1.The single way of making profit. Although Nike’s product
including many kinds of sports equipment, its main profit is made
from the shoes. It means once other big rival organization such as
Adidas just only do better on the shoes area than Nike, Nike’s entire
sports equipment profit will be effected deeply.
3.Intensity of competition. The most famous brand= The biggest
target to every potential rival organization.

40. To achieve sustainable, long-term growth across its global portfolio of brands and
businesses.

41. 1.Under Armour shares have outdistanced Nike’s over the past year, rising 64 percent to Nike’s 46 percent
2.Under Armour also has the hottest NBA star, Stephen Curry, to offset Nike’s all world talent LeBron James.
3. Built a strong brand by engaging certain market segments really well
4.To focus on building special and unique characters(tough guy)--leotard. Some products are involved with
American comic hero such as Iron Man, Captain America, Quicksilver, Black Widow.

42. 1.Compared with Nike, UA is still only popular in America not the whole world.
2.Its shorts history--only 20 years. It’s still a very young organization.

43. When Nike and Adidas began to transfer
from professional sports to leisure sports
equipment, UA as a young organization ,still
only focus on professional sports equipment
which can avoid some competition from the
senior organizations. And this strategy can
also attract many real fans who prefer
profession sports equipment than leisure
sports equipment.

44. 1.The diversity of their products and business: worldwide companies--over 30 countries.
Involved many kinds of business such as sports, entertainment and media.
2.The sports area includes holding top sports games, sponsor sports game, the agents of sports stars and
world-class sports training school.
Its sports area includes soccer, basketball, table tennis, tennis and golf.
3.Strong financial position
4.Strong partnership(SNTV and AP)
5.Strong Negotiation Skills
6 . IMG is the first foreign company which produce and broadcast international live game in China.
7.Few rival organization can compete with IMG(main competitors are Octagon (Marketing) and Sunset)

45. 1.Unlike Nike and UA, IMG are not focus on commodity producing and selling which results that their
influence are not reach to every class of society. IMG only focus on top sports game and superstar and their
fame and reputation is not high among normal people.
2. Although the IMG sports area involved many kinds of sports, some sports have become their weakness
such as soccer. The invest in soccer game didn’t make too much profit especially in North America and
Europe.
3.Not many properties in BRIC nations
4.Web 2.0 absence

46. - Market entry into growing economies i.e. India
- Develop Branded TV content which can be country/sport specific i.e. IPL related programs such as Indian
market.
- Acquiring businesses that will grow. Evaluating new acquisitions in the web 2.0, m-streaming and content
development space.