Successes factors of NIKE's Growth!!!

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“Succsess factors of NIKE’s growth”
Independent University, Bangladesh
Submitted to
Dr. Farah Hasin
Faculty of International Business (MBA 514, Sec-03)
School of Business
Independent University, Bangladesh
Submitted by
Farabi Ahmed
ID: 121-121-8
Date of Submission: 31st March, 2015

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Letter of Transmittal
31st
March, 2015.
Dr. Farah Hasin
International Business (MBA 514, Sec-03)
Faculty Member of School of Business,
Independent University Bangladesh.
Subject: A report on ―Succsess factors of Nike‘s growth".
Dear Madam,
With due respect, I would like to inform you that I have completed report on ―Succsess factor
of Nike’s Growth‖. It is immense pleasure for me because I have successfully completed this
report by receiving your continues guideline as a supervisor.
I have endeavored to prepare this report from my level of best to accumulate relevant &
insightful information. If I am included any wrong information in unconsciously so please
forgive me as your student. It is a great experience for me to make this report. I have tried to
make the report comprehensively within the schedule time & limited recourse.
You‘re sincerely
.....................................
Farabi Ahmed
ID: 121-121-8

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Table of Contents
Serial Contents Page
1 Abstract 5
2 Nike Overview
I. History
II. Products of Nike
7 - 10
3 Board of Directors 11
4 NIKE Products (male & female) 12 – 13
5 Key factor that influences succsess of the NIKE 14 – 17
6 External Analysis 17 – 20
7 Porter Five Forces Model 21 – 26
8 Internal Analysis 27 – 35
9 Internal Factor Evaluation 35 – 36
10 SWOT Analysis 36 – 39
11 Current Strategies & Goals 39 – 42
12 Growth Factors Spiking NIKE Revenues and Earnings 43 – 44
13 Recommendations
I. First Recommendation
II. Second Recommendation
III. Third Recommedation
45 – 46
14 Conclusion 47
15 References 48

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ABSTRACT
I analyze Blue Rıbbon Sports (NIKE) Company‘s key success factor of their
successful business growth with their products, market position, competitors,
external analysis, internal analysis, SWOT analysis organization structure etc.
Also I made up their current strategy according to the general data of NIKE.

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NIKE OVERWIEW
NIKE HISTORY
Founded as an importer of Japanese shoes, NIKE, Inc. (Nike) has grown to be the world's
largest marketer of athletic footwear and apparel. In the United States, Nike products are sold
through about 20,000 retail accounts; worldwide, the company's products are sold in about
110 countries. Both domestically and overseas Nike operates retail stores, including
NikeTowns and factory outlets. Nearly all of the items are manufactured by independent
contractors, primarily located overseas, with Nike involved in the design, development, and
marketing. In addition to its wide range of core athletic shoes and apparel, the company also
sells Nike and Bauer brand athletic equipment, Cole Haan brand dress and casual footwear,
and the Sports Specialties line of headwear featuring licensing team logos. The company has
relied on consistent innovation in the design of its products and heavy promotion to fuel its
growth in both U.S. and foreign markets. The ubiquitous presence of the Nike brand and its
Swoosh trademark led to a backlash against the company by the late 20th century, particularly
in relation to allegations of low wages and poor working conditions at the company's Asian
contract manufacturers.
Nike History Timeline Info
1950's
• Phil Knight and Bill Bowerman meet
1960's
• Blue Ribbon Sports (BRS) was made and founded by Phil Knight
• The popular Cortez aka "Dope Mans" are made in Japan
1970's
• The Swoosh logo is created by Carolyn Davidson for $35.00
• The first Nike model shoe to hit the retail market is a soccer/football shoe

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• A Promo Nike Tee becomes the first apparel item
• The famous Waffle Trainer is introduced, which becomes the best selling shoe in the
US
• Nike‘s racing and training spiked shoe is made called the "Elite"
• Factories for manufacturing are set up in Korea and Taiwan
• For the first time Nike shoes are sold in Asia
• Blue Ribbon Sports changes their company name to Nike Inc.
• The first Nike running shoe with a air sole system to come out is the "Tailwind"
• World Headquarters are opened in Beaverton, Oregon
1980's
• Nike talks with the P.R. of China so they can produce shoes there
• Nike shoes become Canada‘s top seller
• Nike shoes are now produced in 11 countries
• The famous "NIKE AIR" Air Force 1 and Air Ace make their introduction
• Over 200 shoes are now in Nike‘s footwear line
• The first high performance kid‘s running shoe is called the "Destiny"
• The Air Jordan makes it‘s way to Nike footwear line up
• The Sock Racer comes out and is part of the Dynamic-Fit technology
• The first Air Max
• The first Cross Trainer
• The famous "Just Do It" slogan comes to life
• The first model to combine the footbridge device and Air Sole is the Air Stab

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• Spike Lee‘s "Mars Blackmon" character helps promote the third style of Air Jordan
• Bo Jackson‘s "Bo Knows" commercials include the "Just Do It" slogan
• Nike moves to a new World Campus in Beaverton
1990's
• The new World Campus sits on 74 acres with 570,000 square feet.
• In Portland, Oregon the first Nike Town opens
• The intro of the Air Huarache running shoe
• The intro of the Air Mowabb
• Nike Town opens in Chicago
• Charles Barkley first signature shoe is introduced
• The intro of the Run Walk shoe
• Nike Town opens in Atlanta and Orange County
• The intro of dual pressure cushioning in the Air Max
• Nike gets distribution rights in Korea and Japan
• The intro of Zoom Air technology
• Nike Town New York opens
• The Air Penny comes to life
2000's
• 2000: The National Football League declines to renew its exclusive
• apparel licensing arrangement with Nike.
• 2001: Nike opens its first Nike Goddess store, a unit targeting women, in Newport
Beach, CA.

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• 2003: Nike purchases Converse Inc. for $ 305 million.
• 2008 :Nike acquired sports apparel supplier Umbro,
• 2009: Air Jordan Shoe
• 2010: Nike Future Sole Design Competition.
Origin of the Name and the Swoosh
•is the Ancient Greek goddess of victoryNike
―It is one of the most recognized symbols in the world – The Swoosh. Simple. Fluid.
Fast.”
Evolution of the Swoosh Logo

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BOARD OF DIRECTORS
Philip H. Knight:Chairman of the Board of Directors
Mr. Knight, 71, a director since 1968, is Chairman of the Board of
Directors of NIKE. Mr. Knight is a co-founder of the Company and,
except for the period from June 1983 through September 1984, served
as its President from 1968 to 1990, and from June 2000 to 2004. Prior
to 1968, Mr. Knight was a certified public accountant with Price
Waterhouse and Coopers & Lybrand and was an Assistant Professor of
Business Administration at Portland State University.

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PRODUCTS
For Men and Women: Shoes
The Nike Air Force, now known as the Air
Force 1 (or AF1 or AF-1) athletic shoe is a
product of Nike, Inc. created by designer
Bruce Kilgore. This was the first basketball
shoe to use the Nike Air technology. This
shoe is offered in low, mid and high top.
Nike Max is a line of shoes first released by
Nike in 1987. The shoe was originally
designed by Tinker Hatfield, who started out
working for Nike as an architect designing
shops and offices; he also designed the Air
Jordan shoe
The shoe is given a simple outer design that
consists of the Nike Swoosh symbol across
the sides of the shoe and a streak across the
lower portion of the outer sole. Leather was
the first material used to construction the
shoe
Nike designers began a mission to re-craft iconic
sports apparel in the most technical materials they
could find. The ubiquitous American varsity jacket was
an obvious choice for the experiment that would
become Nike Sportswear. Raiding the All Conditions
Gear (ACG) innovation cache, they found fabrics,
laminates, and bonding methods that could brave nasty
weather but still look fresh.

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Wind runners and shells
T-shirt:
Gear – Backpacks, bags
The Nike Checkered Flash Men's Running Jacket offers
ultra-lightweight weather protection and reflectivity for
comfort and visibility on cool, low-light runs. The Nike
Checkered Flash Men's Running Jacket offers ultra-
lightweight weather protection and reflectivity for
comfort and visibility on cool, low-light runs.
 The Nike Checkered Flash Men's Running
Jacket offers ultra-lightweight weather
protection and reflectivity for comfort and
visibility on cool, low-light runs. Rib crew neck
with interior taping for durability and comfort.
Screen print at front for style. Regular fit that's
not too slim, not too loose.



With a cushioned shoulder strap and water-
resistant bottom, the Nike Team Training Max
Air (Medium) Duffel Bag provides lightweight
shock absorption and keeps gear dry in wet
conditions. Adjustable shoulder strap with Max
Air unit for shock absorption and custom
cushioning. Dual-zip main compartment for
secure, spacious storage. Ventilated shoe
compartment for versatile storage. The Nike
Team Training Gym Sack helps you organize
your gear with an interior divider and bonded zip
pocket. Water-resistant fabric with a PU-coated
bottom keeps your essentials dry and secure.




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Key factors that influence success of NIKE
If a company is able to establish brand awareness, they will have a significant advantage in
grabbing consumer's attention and, therefore, market share. In today's society where
consumers have significantly less time to shop and compare, brand awareness is critical. If an
established brand name effectively conveys the messages of quality and dependability,
consumers will automatically go to that brand relying on the image that has been created
when they don't have time to shop around.
Manufacturing efficiency is something that companies are constantly striving for as well.
Athletic shoe manufacturers must balance the costs of labor, raw materials, shipping, import
tariffs, and technological advancements. In an effort to keep costs down, the industry has been
looking to overseas sourcing. This reduces the risk of losing revenue if one region which a
manufacturer incurs problems. Favorable legislation regarding foreign manufacturing has led
to a huge increase in foreign sourcing. Overseas production and sourcing can lower material,
and labor costs.
The footwear companies must choose their distribution channels carefully because they want
to make the product available, yet remain true to their image and goals. Retailers account for
the largest percentage of sales, so manufacturers must be especially careful with their
relationships with them.
Technological advancement is becoming more and more of a player in the footwear industry.
With computer-aided design (CAD), companies have been able to successfully shorten their
design to distribution cycle to only a few months. Also, new technology has facilitated new
quick-response programs that link retailers with manufacturers to allow the retailer to have the
correct inventory when it is needed called electronic data interchange (EDI). Immediately
after a sale is made, electronic point of sale scanners read the information related to the sale
such as price, product, size, etc. and notify the manufacturer of the sale. With this, the
manufacturer is able to accurately modify production to fit consumer demand.

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Demand cycles
Due to the largely subjective nature of athletic footwear purchasing, the success of the
industry is dependent on the current economic cycle. When consumers are concerned about
future economic conditions, they will put off their purchases until their confidence rebounds.
In addition to the amount of confidence that consumers have for the future, the amount of
disposable income available to them directly affects how much is spent on athletic footwear.
When consumers experience a drop in disposable income, discretionary purchases such as
footwear are put off.
Advertising campaigns
Companies spend a large portion of their revenue on advertising. A lot of pressure is put on
the companies to come up with new and successful advertising campaigns. If a campaign
fails, the companies‘ sales suffer as a result.
NIKE has always been an industry leader when it comes to advertising. Their advertising
campaigns are known all over the world as being widely successful. NIKE is truly a
trendsetter when it comes to advertising, not just for shoes, but for the advertising industry as
well. The company was all about the clarity of matching technology to athletic performance-
and, in the ads, showing the passion that resulted. By going against the norms in advertising,
NIKE was able to distance itself from other shoe makers and thus establish strong customer
core.
Segmentation & Targeting
Nike‘s target market for its shoes, clothes and other accessories are males and females
between the age of 13 and 35 years. Nike segments its markets on the basis of age, gender,
geographic locations, psychographic, and benefits sought.
On the basis of age, Nike targets a variety of age groups from young adolescent to middle-
aged adults. Nike has different advertisements for men and women of every race and

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nationality separately. Nike now is focusing on targeting more on women and Generation Y.
Also teams of any sport are targeted by Nike.
Nike‘s aim is to push its products in countries that apply to certain sports, which are
popular in that particular country. For example, Products relating to Rugby are advertised
more frequently in Europe when compared to U.S., as Rugby is popular in Europe.
Nike promotes a positive and confidant attitude and targets people who want to attain that
attitude. It also is targeted towards customers who are interested in athletics.
On the basis of benefits sought, Nike provides shoes, apparel and equipment for a variety of
sports all over the world. It also offers products to many different people who have different
tastes, interests and needs. This can be seen from the fact that Nike has a website where
consumers can design their shoes according to their requirements and tastes.
Main customers
The industry of footwear can be broken up into three main customer groups, which are the
Baby Boomers, Generation X, and Generation Y. These three generations are broken down as
follows: Baby Boomers are from ages 35-53, Generation Y are consumers from 4-21, and
Generation X is consumers from 22-32. As we develop ideas about the main customer groups
within the footwear industry we can conclude that the Baby Boomers account for 31% of the
population, which is equal to about 81 million consumers. Generation Y is the second largest
group that accounts for 28% of the population which represents about 75 million consumers.
The smallest customer group is Generation X; they comprise about 17% of the population,
which equals about 46 million consumers. Nike has become more appealing among younger
consumers and has shifted away from the Generation of the Baby Boomers.
Nike and many other large shoe industry retailers are shifting their marketing direction from
the Baby Boomers to the younger consumers of Generation X and Generation Y. There are
many reasons to why the industry is trying to change their target market to younger viewers.
As people become older many of their attitudes, priorities, and time obligations have
decreased their ambition for shopping. Now that many of the Baby Boomers are within their
forties and fifties, many of their priorities have shifted towards the future, in a sense that they

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need to save for retirement, different tuition payments for their children, and also different
healthcare necessities that are important to them and their families.
Positioning
Nike promotes products that ooze with style, attitude and self-confidence. This message is
clear in Nike‘s tagline ‗Just Do It‘ or ‗If you have a body, you are an athlete‘ which is shown
in many advertisements of Nike. The former message of Nike has been used since 1989, when
it was first introduced and the latter was developed by Bill Bowerman when Nike first started.
This message clearly defines Nike‘s image which is a positive and self-confident nature.
Growth Strategy
On May 5th, 2010 Nike revealed its Global Growth Strategy to achieve sustainable, long-
term growth across its global portfolio of brands. With a revenue target of $27 billion by the
year 2015, Nike outlined each and every category of their product line – from Nike SB to
Women‘s Training – and hoped to reach that goal through a consumer-focused strategy. The
company also expects to generate over $12 billion of cumulative free cash flow from
operations through 2015. Both goals extend NIKE Inc.‘s long term financial model of high
single-digit revenue growth, mid-teens earnings per share growth and expanding returns on
capital.
EXTERNAL ANALYSIS
POLITICAL FORCES:
 Striking dock workers
 Political unrest in the production countries
 Terrorism in the home country
The government must create economic policies that will foster the growth of
businesses. Nike, fortunately, has been helped by the US policies which enable it to
advance its products. The support accorded to Nike by the US government, particularly in
the general macroeconomic stability, low interest rates, stable currency conditions and the
international competitiveness of the tax system, form the foundation critical to Nike‘s
growth.

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ECONOMIC FORCES:
 Slowdown in the economy
 Reduction in consumer confidence
 Barriers of entry to the EU
 Contract manufacturing
In economy, the biggest threat for Nike would be economic recession. During
recession, Nike‘s growth will be adversely affected. The US economy is experiencing
a downturn right now. Consumer purchases are slowing down. Currently, Nike's
feeling the pinch of the economic recession. The Asian economic crisis also affects
Nike since its goods are manufactured in Asia. The labor costs and material prices are
going up. Nike's growth is not just affected by the local economy but also in the
international economy. A weak Euro and an Asian recession could mean weak sales
for Nike.
SOCIAL CULTURAL FORCES:
 Brand conscious consumers
 Change in buying habits in younger people
 Generation Y prefers other types of footwear
 Increase in the female share of the market
 Corporate social responsibility
People are more health conscious nowadays. Diet and health are getting more prominence.
Consequently, more and more people are joining fitness clubs. There is an accompanying
demand for fitness products particularly exercise apparel, shoes and equipment. Nike is at the
forefront of this surge in demand as people are looking for sports shoes, apparel and
equipment.Nike, however, failed to foresee problems brought about by a sweatshop expose
pertaining to labor and factory conditions at production locations in Asia. This caused bad
publicity and declining sales as society and consumers demand more socially responsible
companies.
TECHNOLOGICAL FORCES:
 Speed of change of product

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 Design Ability
 Speed of News reporting
Nike uses IT in its marketing information systems very effectively. Nike applies
marketing information systems to the economics of innovation, segmentation and
differentiation for most of its businesses. Nike‘s leadership status owes in large part to the
use of extremely valuable Information Technology, and applying it to every aspect of the
product from development to distribution. Nike introduced Nike Shoe, which
revolutionized the cushioning foam used in shoes Nike also collaborated with Apple and
is launching new apparel and footwear that will easily carry the consumer‘s iPod .Product
innovation is an ongoing process and is vital to stay ahead of competition Companies in
this industry invest money in R&D to keep up with the new demands of today‘s athletes.
Nike employs many specialists including engineers, athletes, biomechanics, and industrial
designers to work together in the design process.
ENVIRONMENTAL FORCES:
 Re use a shoe
 Sustainability philosophy
 Climate impact
Environmental consciousness has a strong presence in Western Europe and Japan, as well as
in the United States. Currently, Nike has been ―… pursuing product sustainability for more
than a decade. From increasing the use of water-based solvents in footwear manufacturing
and working to keep greenhouse gas emissions in check, to supporting organic cotton and
turning old shoes into new sports surfaces, Nike‘s commitment to sustainability is part of our
Considered ethos‖ (―What led us to Nike Considered‖). It can be said then that Nike does not
suffer environmental issues.
LEGAL FORCES:
 Threaten action by underage workforce
 Poor employment record
 Corporate social responsibility
 Contract manufacturing and copying of product (intellectual property)

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 Trade agreements
Without proper management leading and planning in the Nike Corporation, the company
would have suffered from the child labor issue. Nike has made a true bounce-back from the
negative media attention, and continues to be successful due to their strong business ethic
philosophy.
GEOPAPHICAL FORCES:
- Production is outsourced to plants in Asia, Latin America, and Africa
- This reduces costs because labor is cheaper
-Puts sources of production closer to where they will be sold
Firms who outsource lose the ability to closely monitor product quality and working
conditions .Although some people find this unethical, firms cannot afford to keep production
close to home and still compete on profit margins.Plants are also located in many different
countries, rather than being concentrated in one area .
INTERNATIONAL FORCES:
The demographic environment tells marketers who can be potential customer in terms of
size, density, location, age, sex, race, occupation, and other statistics. Changes can result in
significant opportunities and threats presenting themselves to the organization and major
trends for marketers include worldwide explosive population growth (Kotler and Armstrong).
All of these can provide Nike with the tools and assets it needs to promote its products in
different areas of the world and gain a bigger share of the market globally. The industry has
realized the influence of women‘s sport players and is preparing to accommodate such an
increase and as women increase their consumption the younger generation is decreasing
because of the popularity of other footwear.

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PORTER’S FIVE FORCES MODEL
POTENTIAL ENTRANTS:
 Other sportswear manufacturers expanding their portfolio
 Cheap copies from the Far East
 Threats of New Entrants: (Low)
Barriers to entry in the athletic footwear industry are high due to several factors.
It is as very capital intensive industry. Even though it would not be difficult for a new
company to obtain the raw materials and the labor needed to produce shoes, there is
almost no chance for them to gain popularity in such a mature industry with some of
the strongest brand names in the world. Brand loyalty is extremely strong and it would
be very hard for a new entrant to ―steal‖ loyal customers from the already existent
players. Economies of scale play a huge role as well and the bigger players have an
advantage of producing the products at a lower price than compared with newer
entrants. As the output is bigger and the fixed costs of factories, machinery, marketing
and R&D will be decreased per unit. Both marketing and R&D constitute high costs

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and since new entrants will not be able to take advantage of the economies of scale
they will be less competitive.
The industry itself is in a consolidation phase and only the big ones will survive.
The large companies are strategically and constantly acquiring smaller companies.
Some of the most popular acquisitions include Reebok by Adidas, Converse by Nike,
Saucony by Stride Rite, etc. Small companies are bought before they become a threat
to the bigger ones and before they have a chance to gain market share. In other words,
it is impossible to grow in this industry because someone will take over your
company.
BUYERS:
 The buyers of sports footwear have changed in the past decade.
 There has been an increase in women purchasing the shoes,
 Generation Y has a different tastes and purchasing methods
 Customers more affected by price
 Buyer Power: (Very High)
 The buyers for this industry are retailers and end users.
The footwear retailers, i.e. Footlocker, Wal-Mart, range in sizes. However, the top
25 retailers account for two-thirds of the sales of athletic footwear- approximately
$15 billion in value. New retailers are entering the market, such as ―big box stores‖
and vendors that open their own stores. The lack of concentration among buyers
brings down the margins and gives the power to the vendors. Retailers also have no
power in determining the design of the product. Therefore the big footwear
manufacturers generally dictate the price of their shoes.
In order to gain more power buyer companies have started merging- Footlocker –Foot
Action, Sport Authority- Gart. This consolidation will transfer some of the power
from the big players because in order to be industry leaders they will need these well-
recognized retailers as well. Growing margins suggest that buyer power has been
increasing.The end user of the industry is also considered a buyer and he has
unlimited power.Every company is fighting for the loyalty of the end user through

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constant innovations and brand management. However, if the user is dissatisfied, he
can easily switch the brand to another one.
SUBSTITUTES:
 Substitutes for athletic shoes are shoes in another category.
 When required for professional use there is no substitute goods, but as a fashion item
there are many other goods that could be purchased.
 Substitutes: (Low)
 Lifestyle athletic shoes sales, for instance are growing at the fastest annual
rate and Puma is undoubtedly the leader in this segment- with more than 50%
sales growth.
First, in the sports industry, other types of apparel could also be seen as a substitute,
in terms of building image and style.Second, in the same product category, other
types of shoes are also substitutes, such as slippers, heels, boots, flip-flops, etc.
Even though sneakers are still the most popular type of footwear in the
world. Companies such as Steve Madden and Sketchers are also seen as threats.
Steve Madden‘s ―thick high heeled shoes‖19 are very popular and since thick heels
are considered a more comfortable version among women they could be a substitute
for sneakers. Sketchers introduced non-athletic heel-less shoes also called ―sneaker
mules‖20 These shoes, first gained popularity in Europe but now are also becoming
popular in the United States.
SUPLIERS:
-Using production facilities in the Far East has give Nike economies of scale. Although there
are now problems arising from these factories, they are switching to making there own goods,
labour and political unrest causes delays in manufacturing and shipping of the goods,
-Supplier Power: (Low)
-The suppliers do not have the power to bargain the price of their product, since there are
numerous suppliers.

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There has been some standardization of production in the industry due to growing
concerns of labor practices of the suppliers and manufacturers. These practices have
been damaging the image of some companies including Nike.Therefore, the big
companies prefer to work only with approved manufacturers and suppliers that are
known to follow these labor standards. Both Adidas and Nike have created a system to
ensure that all the high quality of the product, the working conditions, and the
distribution are at high standards.
COMPETITIVE RIVARLY:
 Reebok, offering more choice of shoe, introducing endorsement by
sports personalities, sponsoring sporting leagues
 Adidas have recovered from the problems that plagued them, and have
a good product mix, covering a wide range of sports.
In order to stay competitive and have presence in all sectors, many mergers and
acquisitions, i.e. Adidas and Reebok, are taking place and the market is going towards
consolidation. As a result, maintaining a single brand image for companies like Nike
becomes really a tough ask.In general, with three out of five forces being high,
emerging market does not look like a favorable environment. However, on continuous
marketing an educating effort, this market might be transferred into a growth region
for all companies.
 Technology in Products
ž 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.
 Manufacturing Skills
ž 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.

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 Strength of Patents
ž One of Nike‘s most revolutionary technologies comes through its footwear
cushioning.The cushioning systems in a shoe serve to distribute pressure evenly among the
foot, absorb shock, and deliver comfort to the user.
Nike has patents on four cushioning technologies:
 Nike Air: Nike Air Max is a line of shoes first released by Nike, Inc. in 1987. The
shoe was originally designed by Tinker Hatfield, who started out working for Nike as
an architect designing shops and offices; he also designed the Air Jordan shoe
.
 Nike Zoom: Nike Zoom cushioning is part of the Nike Air family, and—like its
siblings—it‘s lightweight and durable. Because Nike Zoom cushioning is incredibly
thin, it brings the foot closer to the ground and enhances stability, especially during
quick cuts and multi-directional movements. After impact, the tightly stretched fibers
inside the pressurized air unit quickly bounce back into shape, providing a super-
responsive feel and improved awareness of the surface you‘re playing on.

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 Nike Air Max: Max Air is part of the Nike Air family and designed to provide
maximum impact protection during repetitive landings. Shoes with Max Air feature
less midsole material and larger-volume airbags for lighter weight and maximum
cushioning you can see.
 Nike Shoe: Nike Shoe technology is a revolution in cushioning and impact protection.
Nike Shoe technology provides an optimal environment for cushioning, a slower rate
of impact loading (helping reduce the risk of impact-related injuries) and a uniquely
responsive feel. The highly resilient foam in Nike Shoe columns is made of energy-
efficient material that enhances durability and spring.
ž Although some of Nike‘s earlier patents are beginning to expire, they still hold patents
on the newer technologies.In the past, competitors have tried to match rival Nike‘s cushioning
systems, but none have matched their success.

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 Economies of Scale
ž 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.
 ž Application of Information Technology
ž Being such a large corporation, Nike relies heavily on IT in order to manage its supply
chains.Nike admits that it is at serious risk if a breakdown were to happen in these systems,
resulting in bad effects on their business and financial condition This puts them at a
disadvantage against some of their smaller competitors, who do not rely so heavily on IT .The
very fact that they are such a large company makes them more likely to have these problem.
INTERNAL ANALYSIS
NIKE MANAGEMENT STRUCTURE
Nike management structure is composed of a matrix organizational structure commonly
known as a flat organizational structure. Nike is one of the few companies that has been able
to apply this model effectively.The Compensation Committee is responsible for overseeing
the performance evaluation of the CEO. The Compensation Committee considers (1)
achievement against approved financial performance measures and targets (such as revenue,
net income, and earnings per share), and (2) other factors such as leadership, achievement of
strategic goals, market position, and brand strength, which are signals of Company success.
The Compensation Committee endeavors to reflect the CEO‘s performance in the CEO‘s
compensation. The Board plans for succession of the CEO and certain other senior
management positions in order to assure the orderly functioning and transition of the
management of the Company, in the event of emergency or retirement of the CEO. As part of
this process, the Chairs of the Nominating and Corporate Governance Committee and the
Compensation Committee, in consultation with the CEO, assess management needs and
abilities in the event a transition becomes necessary.A strategic plan is something that a

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company needs in order to succeed at anything. Nike needs to develop this plan and move
forward from this fiscal year in 2010. The manager of Nike needs to set goals and determine
the best way to achieve them. Core values upon the crew at Nike and ask the question: What
does this organization stand for? A revamp of all of this is need if Nike is to make sales
revenue increase in 2010. A core value that can be put into the Nike Company is telling the
employers that they need to be winners, as opposed to heroes. A SWOT analysis could be
created for Nike by a manager and the employees will read it and will see an assessment of
how the company is doing in terms of strengths, weaknesses, opportunities, and threats. These
will keep the companies employees on its toes.Functional organization is something that Nike
might want to take into consideration when thinking about a change in their organization.
They can cluster groups together who are alike and who can compatibly plan and keep the
company in its prime. Directing is providing focus and direction to others within the Nike
Company and the managerial can take directing and use it to their advantage. With Nike‘s
board being an extremely experienced and thoughtful board they can take a lot of ideas from
each other. Even the other employees such as middle managers and low level managers can
give input into the companies managerial such as marketing in other companies and making
sure the quality of Nike‘s product is better than its competitors. Phil Knight can set high, yet
achievable goals for his employees to look forward to. He could improve his company by
using the principle of leverage. Phil Knight could use new technologies in sneakers, apparel,
and sports equipment to successfully manage his company. He can use networking by
socializing with companies he could cooperate with such as he has done with Apple in the
past to increase revenue.
MARKETING
Significant role for the competition of market share in the footwear industry plays marketing
in order to strengthen the brand image, develop product identity and expand customer loyalty.
Competition between players is n o n - p r I c e but rather based on differentiation in brand
image and product innovations. Therefore, substantial investments in marketing campaigns
are required. Nike invests annually between 11% and 13% of revenue in marketing. Nike
focuses all of their attention on the Athlete, but delivers much more than shoes; they deliver
all the surrounding products that the Athlete needs for experience. It is part and parcel of what
makes Nike such a great consumer-focused brand.

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Marketing Mix
1. Product:
Nike offers a wide range of shoe, apparel and equipment products, all of which are currently
its top-selling product categories. Nike started selling sports apparel, athletic bags and
accessory items in 1979. Their brand Cole Hana carries a line of dress and casual footwear
and accessories for men, women and children. They also market head gear under the brand

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name Sports Specialties, through Nike Team manufactures and distributes ice skates, skate
blades, in-roller skates, protective gear, hockey sticks and hockey jerseys and accessories.
2. Price:
Nike‘s pricing is designed to be competitive to the other fashion Shoe retailer. The pricing is
based on the basis of premium segment as target customers. Nike as a brand commands high
premiums. Nike‘s pricing strategy makes use of vertical integration in pricing wherein they
own participants at differing channel levels or take part in more than one channel level
operations. This can control costs and influence product pricing.
3. Place:
Nike shoes are carried by multi-brand stores and the exclusive Nike stores across the globe.
Nike sells its product to about 20,000 retail accounts in the U.S. and in almost 200 countries
around the world. In the international markets, Nike sells its products through independent
distributors, licensees and subsidiaries. The company has production facilities in Asia and
customer service and other operational units worldwide.
4. Promotion:
Promotion is largely dependent on finding accessible store locations. It also avails of targeted
advertising in the newspaper and creating strategic alliances. Nike has a number of famous
athletes that serve as brand ambassadors such as the Brazilian Soccer Team (especially
Ronaldo, Renaldo, and Roberto Carlos), LeBron James and Jermaine O‘Neal for basketball,
Lance Armstrong for cycling, and Tiger Woods for Golf. Nike also sponsors events such as
Hoop It Up and The Golden West Invitational. Nike‘s brand images, the Nike name and the
trademark swoosh; make it one of the most recognizable brands in the world. Nike‘s brand
power is one reason for its high revenues. Nike‘s quality products, loyal customer base and its
great marketing techniques all contribute to make the shoe empire a huge success.

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Market Share
Nike was the clear market leader, with 31% of the global athletic footwear market in 2007.
Looking at the market in the United States, Europe, or Asia reveals a similar picture: Nike's
market share in these regions hovers around 36%, followed by Adidas at 20%, with Puma and
New Balance as distant third and fourth.

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The market for athletic apparel is both larger--$49.5 billion in 2005--and more diffuse; the top
five firms control only 27% of the market. Nike is, however, also the global leader in apparel,
with a 7% market share in 2007.
NIKE RESEARCH AND DEVELOPMENT
Product Research and Development
Nike believe our research and development efforts are a key factor in our past and future
success. Technical innovation in the design of footwear, apparel, and athletic equipment
receive continued emphasis as NIKE strives to produce products that help to reduce injury,
enhance athletic performance and maximize comfort.
In addition to NIKE‘s own staff of specialists in the areas of biomechanics, chemistry,
exercise physiology, engineering, industrial design and related fields, we also utilize research
committees and advisory boards made up of athletes, coaches, trainers, equipment managers,
orthopedists, podiatrists and other experts who consult with us and review designs, materials
and concepts for product improvement. Employee athletes, athletes engaged under sports
marketing contracts and other athletes wear-test and evaluate products during the design and
development process. The Nike Sports Research Laboratory (NSRL) is located on the Nike
campus in Portland, Oregon in the United States of America. The research and development
(R&D) centre's role is to identify the physiological needs of athletes. The NSRL works
directly with Nike's design teams and has established partnerships with major universities
throughout Asia, Europe and North America.
Nike’s Research Program
Nike has been in the Research & Development in the market for quite a long time. The
research that it has been carrying out relates to the earlier STP analysis which allows Nike to
create a market for its products. Also Nike has a history of constantly innovating new
products and attain the first-in-the-market advantage and charge a premium price. Nike
spends a lot out of its revenue into R & D of new products and designs to constantly stay
ahead of the competition. Nike conducts both qualitative and quantitative research
forgathering vital information for its products and new launches. The qualitative research

33. 33
refers to the consumer purchasing behavior like why, how, what do they decide on the basis
of Nike‘s image as well as products. The quantitative research deals with what are the results
of the company i.e. revenue against cost and other financial analysis .Nike indulges into
research analysis of consumer markets as well as competitor‘s analysis and thus
understanding the consumer behavior and their buying pattern. Nike does extensive research
in the attitudes and tastes and preferences and their changing pattern by having questionnaires
filled up by its customers online as well as personally. It also indulges into personal
interviews with its valued-customers to make some necessary changes that they might require.
This is how the company came to be recognized as a high valued by its customers and thus
attain maximum loyalty. Also the company came up with the idea of customization of their
products online through this type of research itself which has yielded high results. Nike
products undergo a rigorous testing process that covers a huge variety of testing surfaces
(regular basketball hard wood, soccer turf, a running track, and endless outdoor testing on
various terrain), and takes into account four major factors, geography, gender, age, and skill
level as well as profession. All of this combined with the results of about a dozen other tests
are use to develop new, user-friendly products like the Nike Shox, Nike Air, and other Nike
basketball and running shoes. This is mainly because Nike needs to constantly be aware of the
changes in the consumer buying behavior which can only be done through various researches.
Nike has an underground research lab full of evil geniuses toiling to create the newest and
most advanced designs and technology in the sneaker business. It‘s true that Nike‘s research
lab has grown up considerably from its early days with Bill Bowerman and a waffle iron to
create the Nike Waffle Racer. Today, it commands approximately 13,000 square feet
containing some state-of-the-art research equipment.
Research is primarily divided into three parts:
Biomechanics
How the body moves.
Physiology
How the body works, especially under stress.

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Sensory/Perception
The evaluation of how a product works, feels, and wears; how a person feels when wearing
the shoes.
The Nike Sports Research Laboratory is located on the Nike campus in Portland, Oregon in
the United States of America. Nike‘s research team has spent more than 16 years dreaming,
researching, developing and testing the possibility of attaching springs to the bottom of an
athlete‘s foot. Nike Shox, the most acclaimed technological development makes the dream a
reality (―Nike‖). Therefore, by advancing in technology, Nike holds a competitive edge in the
market.
PRODUCTION SYSTEM
Location of Facilities
Nike‘s facilities are located throughout Asia and South America. The locations are
geographically dispersed which works well in our mission to be a truly global company. The
production facilities are located close to raw materials and cheap labor sources. They have
been strategically placed in their locations for just this purpose. In general, the facilities are
located further from most customers, resulting in higher distribution costs. However, the cost
savings due to the placement of our production facilities allows for cheaper production of our
products despite the higher costs of transporting our products. As Nike continues to expand in
the global economy and increase its market throughout the world, these dispersed facilities
will prove to be beneficial.
Newness of Facilities
Our facilities abroad have attracted bad publicity in recent years. Though our facilities
comply with local labor standards, generally, they have not met U.S. standards. We want to be
a leader and set a responsible corporate example for other businesses to follow. As part of
Nike‘s new labor initiative, we commit to:

35. 35
 Expanding our current independent monitoring programs to include non-
governmental organizations, foundations and educational institutions. We want
to make summaries of their findings public;
 Adopting U.S. Occupational Safety and Health Administration (OSHA) indoor
air quality standards for all footwear factories;
 Funding university research and open forums to explore issues related to global
manufacturing and responsible business practices such as independent
monitoring and air quality standards.
While establishing these policies is a step in the right direction for Nike, the difficult task at
hand will be the implementation of the aforementioned goals to ensure the success of the
program.
INTERNAL FACTOR EVALUATION
STRENGTHS:
• Strong brand recognition
• Internet sales
• Growing international presence
• Superior research and development department
• Strong financial returns

36. 36
• Strong sense of culture in the working environment
• Great celebrity spokespersons
• Automatic replenishment system
• Successful experience being competitive
• Nike doesn‘t own any factories
• Successful marketing campaigns
WEAKNESSES:
• Lack of stores catering to the active females
• Poor employment practices at their international manufacturing sites giving a bad
reputation
• Heavy dependency on footwear sales
• Issues with Footlocker
SWOT ANALYSIS
NIKE should use result of the SWOT matrix analysis to make strategic planning . SWOT
does not show how to achieve a competitive advantage because capabilities, threats, and
strategies change, the dynamic of a competitive enviroment may not be revealed in a single
matrix. SWOT analysis may lead the firm to overemphasize a single internal or external factor
in formulating strategies. There are interrelationships among the key internal and external
factors that SWOT does not reveal that may be important in devising strategies.
STRENGTHS
Nike has a strong global brand which everyone will know by its logo. The logo itself needs to
be presented without the name and everyone will know what it is, that is how powerful the
brand is. Some companies require their names to be present but in this case that is not true.
This is garnered a long term customer loyalty base where the products are synonymous with
high quality clothing and fitness trainers. The power of the brand is also evident in the fact

37. 37
that Nike has well known athletes and other celebrities which will put further backing to the
brand if it is deemed to be ―cool‖ to wear. Athletes like LeBron James, Roger Federer and
others such as Andrew Luck where each of these people represent a different sport from
basketball to tennis to American football respectively. They promote the company by wearing
Nike branded clothes from head to toe to more recently wrist in the form of the Nike
FuelBand. The company is a clothing brand and there is little to innovate in. However, Nike
has managed to find ways to innovate their products and to provide a range for various
different price points to cater for different demographics. This shows that the company is
versatile in its product offering, whilst also remaining relevant as the industry leader. The new
Flyknit running shoes, the FuelBand wristband and the Dri-Fit clothing technology are all
innovative and are applicable to different products. The Flyknit trainers are very unique where
they allow the runner to have a bare foot feel experience, while the FuelBand moves into the
new market of wearable technology with a focus on keeping active. The FuelBand allows the
user to connect it to their smartphones and to compete against their friends to give a
competitive side to always moving and being active.
WEAKNESSES
Due to the strong brand, the company can be seen as exploitative and greedy. The company
can stick their logo on a plain white t-shirt and sell it for over triple the manufacturing cost,
not to mention the fact that the company has had problems in the past with its manufacturing
processes. The high mark up on the basic products allows the company to generate large
levels of profits which can be a seen as unethical, but they do operate as a for profit company.
The supply chain is the most important aspect of Nike‘s business model, as they need to
ensure that they have a solid supply chain from sourcing raw materials to manufacturing and
to delivery logistics. Each of these areas creates a cost for the company, much like any other,
and they could try to squeeze their factory workers with lower wages and/or bad working
conditions. Due to the strong brand, the company can be seen as exploitative and greedy. The
company can stick their logo on a plain white t-shirt and sell it for over triple the
manufacturing cost, not to mention the fact that the company has had problems in the past
with its manufacturing processes. The high mark up on the basic products allows the company
to generate large levels of profits which can be a seen as unethical, but they do operate as a
for profit company. The supply chain is the most important aspect of Nike‘s business model,
as they need to ensure that they have a solid supply chain from sourcing raw materials to

38. 38
manufacturing and to delivery logistics. Each of these areas creates a cost for the company,
much like any other, and they could try to squeeze their factory workers with lower wages
and/or bad working conditions.
OPPORTUNITIES
Technology is moving very quickly, and the industry is coming up with new different form
factors of usable technology. Mobile phones became smartphones, CDs became MP3 players
and VHS became Blu-Ray discs. Nike has dabbed its hand in technology when it created
Nike+ with a collaboration with Apple where is sold as a smartphone feature to track running
distances and calories burned. Nike had then moved onto making its own wearable fitness
technology with a fitness watch, the Fuel Band and with a game with the kindest camera for
Xbox 360. Nike could look at investing into more of these types of wearable technology so
that they technology is already placed in smartphones. This would be an excellent way to
create licensing revenue as well as having a wider reach of consumers.
There are various different types of shoes that Nike offers and the products are seemed to be
blurring into other product ranges. Within the Nike Free range, there is Freerun 3.0, Freerun
5.0, Freerun+ 2ID, FlyKnit, FlyKnit Lunar1 +ID and it can be confusing when picking a
running shoe. There are only slight differences in the product but the differences can be hard
to understand when there is no expanded explanation. The only way in which a consumer can
understand these differences is to spend time reading each one and comparing it, or physically
going to a Nike store and getting a sales person to assist, and there is no guarantee that the
sales person knows everything. Nike could try and streamline the naming of some of their
products within certain ranges. This will allow the company to maximize the customers
understanding of the products on offer and the features they represent.
THREATS
For large multinational corporations, the profit generated from different countries is a great
way to continue operating when the domestic market is reaching saturation. The main risk
with this is currency fluctuations and how a massive change in the foreign and domestic
currency will make any profits overseas can turn it into a loss. Companies have had to create
finance divisions specifically to manage their currency risk, most likely using a combination

39. 39
of forward contracts, futures contracts and call/put options. The recent decline in the Indian
Rupee shows how the company can benefit from drops in foreign currencies where the goods
that Nike will ship to other countries will be even cheaper. The main problem with any
currencies changing would be domestic currency for Nike which will be the US Dollar. The
US Federal Reserve choosing to continue its asset purchase scheme has allowed the US
Dollar to strengthen stock markets to be more risk taking and choose the US market to invest
in and the Federal Reserve seems to be continuing asset purchases for the foreseeable future.
The recent collapse of a Bangladesh clothing manufacturing factory caused major publicity
problems for fashion retailers. The collapse brought to light the bad working conditions and
the major problem of cutting corners in countries where building legislations are sometimes
ignored, especially in the case of the Bangladeshi factory. Nike has had problems with their
factories which they have actively and vocally created internal codes of conduct to address
concerns of the public. When it comes to the problems of the collapse, the developed world
would find it ways to boycott a company is there are seen to be unethical. Nike could find
difficulties domestically if they encounter problems with sales if they have any problems with
their factories.
Current Strategies and Goals
Nike has in placed several strategies that encompass improving growth and profits in a
variety of areas. The struggling economy has not changed Nike's attitude towards growth.
One strategy that Nike focuses on, in continuing to help the company grow is Person
Marketing. Nike has been using the best athletes, and sports teams (or clubs) all over the
world to help market their products. The regenerative nature of sports has allowed Nike to
sign new upcoming stars like LeBron James, Carmelo Anthony and others. These are the
athletes that will push Nike beyond their expectations and will set the standards for the next
generation to exceed. Nike's second greatest source of potential lies with the products the
company is working on. Nike's design team is constantly developing new concepts in speed
and agility to give athletes the latest innovative equipment to improve performance. The third
strategy that Nike uses, perhaps the most important, is advertising and marketing. These two
components capture the essence of the product and the attention of consumers around the
world. These strategies support the financials especially profit margin and market share.

40. 40
Under consumer measures Nike's strategies also support the percentage of customers who
purchase Nike products based on image.
Price and Earnings
To find out how much the market is actually willing to pay for each dollar of annual earnings
of Nike, we look at the Price/Earnings ratio. Currently the ratio is 17.9 showing that Nike is
not a risky investment. This is very valuable in comparing companies within the same
industry. The price/sales ratio uses the invested capital of the company and then divided by
sales over the past 12 months. This figure is usually seen as the lower the better for investors.
Granted there are far more competitors up and coming these days, we think Nike has a solid
place in the market and will only be growing in the next years and years to come. The return
on assets ratio has been considerably increasing from 10.37 in 2002 to 15 in 2007. The ratio is
higher than industry average which is at 14.1. Creditors, bondholders, and shareholders like to
see high return on their investment. This indicates that the business is sufficiently using its
assets. Nike Inc. is an efficient company as it boasts a higher gross profit margin than its
competitors and industry. During fiscal 2007, Nike Inc. gross margin has increased from 44%
in 2006 to 45.9% in 2007. It is higher than the industry average of 41.83%.
Analytical Theory Comparison
Project investment can be determined by using an analytical theory of project investment.
―The Analytical theory enables us to make precise calculations of returns of difference
projects under different kinds of environments.‖ (Chen, 37) We will examine the relationship
between fixed cost and variable cost at different levels of uncertainty. In NIKE‘s case, as
fixed costs are increased, variable costs decrease rapidly in a low uncertainty environment
(see exhibit 1). In relation to NIKE the high fixed cost represent the large amount of
marketing expenditures, and the variable costs are related to the low labor and manufacturing
costs.
This analytical theory differs from the real option theory because it is an initial value problem,
valuing the outcome as a variable cost to the project (C). Furthermore, after determining the
variable cost of a project (C) , the profit of a project can be determined based on the variables

41. 41
of S (present value of the projects cash flows), K (fixed cost of the project), Q (market size or
output of the project), and C.
Exhibit 1:
A project with a high fixed cost will generate high returns if the level of uncertainty is
stable and the market size is large, and a project with a low fixed cost will benefit largely
from a small, unstable market. (see exhibit 2) ―When an industry becomes mature and
uncertainty decreases, increased in fixed costs, K, (capital investments and accumulated
human capital), drive down variable cost rapidly, which permits leading companies to lower
product prices and drive out small high variable cost companies. In a mature industry only
very few big companies can stay in business. Also, large companies often develop highly
optimized structures to reduce uncertainty and bring down variable costs in producing
particular products‖ (chen,40). In Nike‘s case, the company is able to use highly advanced
technologies, such as EDI‘s and CAD‘s to reduce variable cost. While using the analytical
theory of project investment,
0
1
VariableCost
5 10 15 20
Level of fixed Cost
High Volatility
Low Volatility

42. 42
Exhibit 2:
Rateofreturn
Low Fixed Cost
High Fixed Cost
Market size

43. 43
The Growth Factors Spiking NIKE Revenues and Earnings
NIKE’s businesses
Based in Beaverton, Oregon, NIKE (NKE) is the world‘s largest sportswear and footwear
company. The company designs, markets, and distributes footwear and apparel products for a
number of sports. Its core sports categories include running, basketball, and soccer.
No 1 sports brand
NIKE is the world‘s number one sports brand.1 Its brand value was estimated at $19 billion
by Forbes Magazine in 2014. Besides the NIKE brand, the company‘s stable of brands also
includes these:
Brand Jordan – named after iconic basketball player Michael Jordan
Converse – acquired in 2003
Hurley – targeted at action sports like surfing and skateboarding

44. 44
NIKE’s quarterly earnings update
The company reported financial results for the second quarter of fiscal year 20152 on
Thursday, December 18, 2014. NIKE‘s performance continued to outperform with the firm
beating consensus Wall Street estimates for revenues, net income and earnings per share, or
EPS.
NIKE’s outperformance
Despite being around for over 50 years, NIKE continues to deliver above-average growth and
earnings. In each of the past eight quarters, NIKE has beaten Wall Street estimates on net
income and EPS. In terms of revenues, this is the sixth quarter out of the last eight that the
company‘s come out ahead of revenue estimates.
Series components
In this series, we‘ll analyze the results of the past quarter and the reasons why NIKE
continues to outperform. We‘ll discuss the company‘s key growth drivers, both present and
future, and how its market share and competitive position compare to industry peers such
as Under Armour (UA) and Adidas (ADDYY).
UA and NKE are part of the Consumer Discretionary Select Sector SPDR ETF (XLY) and the
SPDR S&P 500 ETF Trust (SPY).
1. ―The Forbes Fab 40: The World‘s Most Valuable Sports Brands 2014″ ↩
2. Quarter ending November 30, 2014 – Fiscal year ends on May 31, 2015 ↩

45. 45
RECOMMENDATION
FIRST RECOMMENDATION
Product Development
We provide comprehensive consulting services from idea to product launch.NIKE by the
sport works with start-ups as well as established companies, utilizing virtually all disciplines
required to bring a new product to market. Some of these disciplines include:
• Market research and focus groups
• Marketing communication
• Public relations
• Sales and sales coaching
• Industrial design
• Mechanical design
• Mechanical fabrication
• Short-run manufacturing
• High-volume manufacturing
• Plastics tooling and production

46. 46
• Application software development
• Funding sources
Your creative idea infused with our strategic expertise will maximize the success of your
product in the marketplace.
SECOND RECOMMENDATION
Market Development
A company follows a market development strategy for a current brand when it expands the
potential market through new users or new uses. New users can be found in new geographic
segments, new demographic segments, new institutional segments or new psychographic
segments. Another way is to expand sales through new uses for the product.
The key difference between this growth strategy and market penetration is that the
definition of the target market must change. In other words, the market potential must
increase through this strategy, whereas the market size is "fixed" with a market penetration
strategy.
THIRD RECOMMENDATION
Market Penetratıon
A market development strategy targets non-buying customers in currently targeted
segments. It also targets new customers in new segments. Market development strategy
entails expanding the potential market through new users or new uses. New users can be
defined as: new geographic segments, new demographic segments, new institutional segments
or new psychographic segments. Another way is to expand sales through new uses for the
product. Penetration is a measure of brand or category popularity. It is defined as the number
of people who buy a specific brand or a category of goods at least once in a given period,
divided by the size of the relevant market population.

47. 47
CONCLUSION
NIKE Company has still well position on market and our increasing will regularly and we
will be best largest sports wear and shoes manufacturer.
We are already implement our current strategy of focusing strategy and diversification
strategy .But with some little bit focus on different conjectures.
We have recommended some strategies NIKE. They are Advertisıng, Brandıng, Sellıng,
Manufacturıng, Organızatıonal and Human Resource Management Strategy.We have chosen
one of them and it is Advertisement and Brandıng Strategy.We think that if we are change our
advertisement shape and tend to make a advertisement which touching the community values,
we will get much more sales and revenue from this market.

48. 48
Refferences
1-) www.nike.com
2-) www.slideshare.net
3-) www.wikinvest.com/stock/Nike
4-) www.assignmentstudio.net
5-)www.wikipedia.org/wiki/Nike
6-) www.financeyahoo.com
7-) www.google.com
8-) www.newyorktimes.com
9-) www.dailymarkets.com/stock/2010/09/22/earnings-preview-nike-inc/
10-) condor.depaul.edu/aalmaney/StrategicAnalysisofNike.htm
11-) http://marketrealist.com/