Nike Retail Analysis

In 1962 Blue Ribbon Sports was created by Phillip Knight to import running shoes from Japan.  Knight had written a paper about how he planned to break the German’s dominance of the U.S shoe industry with low priced shoes from japan.  Knight went to Japan and ended up making a deal with Onitsuka Tiger Company to be Blue Ribbon Sports only distributor in the United States. That first year they made $8000 in sales because Knight was selling shoes at tack meets. In 1964 Knight and Bill Bowerman became partners for Blue Ribbon Sports.

In 1966 the first Blue Ribbon sports outlet was opened. They only sold Tiger running shoes in their store. Later Bowerman worked with Onitsuka’s company and designed the Cortez running shoe in 1968. This shoe was a success for both Onitsuka and Blue Ribbon Sports. In 1971 Blue Ribbon Sports started manufacturing their own shoes. The first shoe they created was a soccer shoe. This

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When thinking about the most important strengths of the Nike brand are its international presence in over 180 countries. With being in so many different countries they can offer distinctive styles and fits based off the demographics market in that country. Another one of their strengths are research and development team. This team analysis the fibers chosen to create their products they also research what innovative technologies and designs fit the fibers and how it can keep their consumers try and comfortable. With their innovative technology and the fibers, they are able create high quality products and stay ahead of their competition.

The weaknesses Nike faces are labor issues in different countries. In the past they problems with having children working in their sweatshops in the 1990’s and last year there were claims that a Nike factory in Vietnam were verbally abusive to workers and stealing their wages. Workers were also passing out from the hot temperatures of the factory. Another weakness is lack of product units their production units are not stable like their retailers. They also make most of their revenue from retailers and footwear.

In 2016 Nike was the brand chosen to create the athlete’s uniforms and gear for the 2016 Olympics. Their innovative gear had helped push sales since Nike product is trendy and fashionable. Nike footwear is one of their best sellers, but they also have room for product extension. It can extend to sport watches, sunglasses, and several types of accessories. They can also improve their labor practices in different countries. This can help build a better relationship between their employees if they have a pay increase and offer benefits.

The top threat to the Nike brand are its competitors. Adidas and Reebok are creating innovative designs to beat Nike. If they cannot find a way to improve conditions for their employees, they can end up having repeat of the 1990’s and can harm their brands image. Counterfeiters are making a profit from fake products and pretending to be retail and Nike sellers online. This can affect the revenue, sales and the brand image.

Every business has their own business strategy. To have a successful strategy you will need to use the four P’s which are production, price, place, and promotions. The four P’s will help you build a concreted retail strategy. For production it is important that you line captures and reflects your consumers wants and needs. If your line fails to relate to your consumer that can cause a lost of revenue and loss of consumer loyalty.  It is important to make sure that prices match your target consumers household income. You want to make consumers feel like they are getting a bargain even if the item is full price. Choosing the right place for your location is a key factor in your strategy. You want to choose a place that is heavy with traffic and will make you a profit and in an area, you target consumers shops in frequently. Promotion covers your marketing and advertising. A business replies on strong and effective marketing planning. You also need to know who your competitors are, their strength and weaknesses so you can stay a step ahead of them.

        Nike is a strong global branded company that is leading in the footwear market. It is very important that they stay on top of the strategies their biggest competitor Adidas is using. Nike and Adidas are the top two footwear companies in the world with a rivalry that is very known in the industry. Both brands have grown so much over the last two decades. Their reach has expanded through all seven continents and was possible due to the internet and ecommerce. Online selling has allowed both brands to increase their sales with minimal operating costs. With Adidas being a German company, they are the big players when supplying sports apparel to the soccer league. For the last seven years Adidas has been the number one brand with the most sales in soccer revenue. They were able to stay on top because soccer is very popular in Europe and they sign the highest soccer players and lucrative contracts with Manchester United for 10 years. They also have different and better approach when marketing their brand. They do not only use athletes for advertising they also have collaboration with celebrities like Missy Elliot, Pharrell, and Rita Ora. They have launched successful lines that introduced a new targeted consumer that was fashion trendy that wanted statement pieces.  The future for Adidas is still bright. They know how to market their target market and does an excellent job trend forecasting. They invested in a market that Nike didn’t, but now they must worry about Nike causing them to lose their contracts and athletes with better deals.

With a brand like Nike that is a number one company globally for it footwear, and apparel it still has so work to do. There are some strategies that can hep them in the long run. Since they outsource the brand in other countries that implement some long-term strategies that can keep their employees happy and keep them out of the press. Nike needs better labor practices strategy. I recommend they can increase the minimum age requirement to work in the factories to age 18 old and all light manufacturing like bagging accessories or smaller merchandise minimum age to 16 years old. For employees to be hired they must go through a very strict training so they can do their job without incidents. Another long-term benefit for employees is benefits and higher wages. Having these benefits and higher wages can help families improve their household and help them more comfortable. Offering workers educational courses so they can have a chance to move up in the company. This will help improve relationships within the company and can prevent future accidents from happening. Nike needs a strategy to prevent imitation product sales. A recommendation that could help with prevent more imitations product hitting the streets is adding special serial numbers inside the clothing. To protect their customers if the items don’t have a serial number inside they will know the item is fake. They could test it out and ask customers back for feedback, so they know if it is a positive benefit or negative benefit to the company. other higher end brands like Coach, and Louis Vuitton have serial numbers you can type, and the item will pop up on their website. To keep up and ahead of their competitors Nike will have to stay on top of what sports outside of the United States is very popular and can offer small deals until that sport is big on the market. If they would pay more attention to the soccer market they would been ahead of Adidas in that field. They need to pay better attention to their big and small competitors.