MM2711 INTRODUCTION TO MARKETING

A CASE STUDY OF NIKE, INC

TUT002 - Group CWong Mun Leong Moon 10580986D

YUEN Hoi Ying Winnie 12101937DCHIU Chin Ting 12102278D

BUATON Hon Ming Herman 12102347D

Monday, 31 March, 14

Monday, 31 March, 14

ABOUT .....................- American Sportswear Company- Founded 1964- Wide range of products- World’s largest supplier of sportswear- Fortune 500 Companies

Monday, 31 March, 14

Monday, 31 March, 14

TODAY’S AGENDA- Our Focus:

- United States- Greater China

- STP Strategies- Practice of 4Ps- Evaluations & Suggestions

Monday, 31 March, 14

STP STRATEGIESSegmentation

TargetingPosition

Monday, 31 March, 14

SEGMENTATIONUnited States Greater China

Geographic N/A Urban Cities

Demographic AgeOccupation

AgeIncome

Psychographic Lifestyle Personality

Monday, 31 March, 14

TARGETINGUnited States Greater China

Differentiated Concentrated

Customers YouthAthletes

YouthFashionLifestyle

Products Sports Function Casual Wear

[1] How Nike Figured Out China. TIME Magazine. Retrieved from http://content.time.com/time/magazine/article/0,9171,725113-3,00.html

Monday, 31 March, 14

POSITIONING IN USA

Monday, 31 March, 14

POSITIONING IN CHINA

Monday, 31 March, 14

4PPrice

ProductPlace

Promotion

Monday, 31 March, 14

PRICEUnited States Greater China

Air Force 1

USD85(~HKD680)

RMB769(~HKD980)

LeBron Ring King Tee

USD29.97(~HKD240)

RMB249(~HKD320)

Big Mac [1]USD4.62 USD2.74

[1] Big Mac Index, The Economist, Retrieved from http://www.economist.com/content/big-mac-index

Monday, 31 March, 14

PRICEReason for Price Difference:

- Consumer Behavior- Luxury Culture [1]

[1] For Nike Marketing Strategy in Greater China. 2013. Retrieved from http://www.youzhilunwen.com/lxlw/yylw/scyx/20130814/4823_2.html

Monday, 31 March, 14

PRODUCTUnited States Greater China

On online store:- >6700 products- of 20 different sports

On online store:- ~2100 products- of 8 different sports

Monday, 31 March, 14

PRODUCTReason for Product Difference:

- Focus on Urban Youngsters [1]- Geographical Difference

- e.g. No Snowboarding in China- Cultural Difference

- e.g. Hockey is not common

[1] For Nike Marketing Strategy in Greater China. 2013. Retrieved from http://www.youzhilunwen.com/lxlw/yylw/scyx/20130814/4823_2.html

Monday, 31 March, 14

PLACEUnited States Greater China

Exclusive Nike Store>20000 retail accounts worldwideIndependent / Licensed distributors

Exclusive Nike Store>20000 retail accounts worldwideIndependent / Licensed distributors

- Online Store since 1999- MANY Licensed Multi-brand distributors- e.g. Amazon, Eastbay, Zappos

- Online Store since 2008- FEW licensed online distributors- e.g. TMall

Monday, 31 March, 14

PLACEReason for FEWER online distributor in China:

- Reputation of Online Multi-brand Store [1]- Replica Nike products in China [2]

- Hard to identify- Lack confidence to buy online

[1] Nike Channel Conflict. Retrieved from http://www2.nkfust.edu.tw/~smguo/teaching/student/N964050014-%B8%EA%BA%DEHW2.pdf[2] 專賣店門口賣假鞋，攤主坦言”沒發票也不保真”, Sina News, 2013. Retrieved from http://ln.sina.com.cn/news/b/2013-06-22/065746811.html

Monday, 31 March, 14

PROMOTIONAdvertisingAdvertising

United States Greater China

- Online Clearance Sale- use of Social Network- >17 million on [1]- ~3 million on [1]- >0.3 million on [2]

- WeChat- e.g. Nike Sports Festival Game

[1] Edwards, J., A Breakdown Of The Top Retailers On Facebook, Twitter. Retrieved from http://www.businessinsider.com/a-breakdown-of-the-top-retailers-on-facebook-twitter-and-pinterest--by-the-numbers-2012-11?op=1[2] http://www.socialbakers.com

Monday, 31 March, 14

PROMOTIONReason for Use of Social Network:

- Web 2.0- Digital Marketing- Targeting Teenagers & Youngsters

Monday, 31 March, 14

PROMOTIONSponsorshipSponsorship

United States Greater China

- Focus on Athletic Spirit, Desire of exercising- Enhance Reputation- Seldom mention characteristics of products

- Focus on Athletic Spirit, Desire of exercising- Enhance Reputation- Seldom mention characteristics of products

- Allyson Felix- Kobe Bryant

- Liu Xiang- Li Na- Yi Jianlian

Monday, 31 March, 14

PROMOTIONReason for Sponsorship:

- Establish Emotional Contact

[1] Nike Just Doesn’t Do It With Lost Sales Year in China, Bloomberg News. 2013. Retrieved from http://www.bloomberg.com/news/2013-07-16/nike-s-lost-year-in-china-serves-as-cautionary-tale.html

Monday, 31 March, 14

EVALUATION & SUGGESTION

Monday, 31 March, 14

PROBLEMSUnited States Greater China

- Over-dependence on “Sports Hero” [1]

- Wrong Focus- Changing consumers’ taste- Parental Culture

[1] One Of Nike's Core Strategies Is In Danger. Retrieved from http://www.businessinsider.com/is-nikes-hero-athlete-strategy-in-jeopardy-2013-2

Monday, 31 March, 14

SUGGESTIONS- STP:

- Segmentation:- Expand to 2nd/3rd-Tier Cities

- Targeting:- Target on Youngsters [1]- Develop subsidiary, e.g. Adidas NEO

[1] Nike Just Doesn’t Do It With Lost Sales Year in China. Retrieved from http://www.bloomberg.com/news/2013-07-16/nike-s-lost-year-in-china-serves-as-cautionary-tale.html

Monday, 31 March, 14

SUGGESTIONS- STP:

- Positioning:- High price- Care about labor rights

Monday, 31 March, 14

SUGGESTIONS

United States Greater China

Price Lower Price

Product Quality ControlLabour Rights More diverse style

Monday, 31 March, 14

SUGGESTIONS

United States Greater China

Place Direct Retail StoreLower price pressure

Use existing popular platform

e.g. TaoBao

Promotion Focus on wide range of products Sponsor Traditional Media

Monday, 31 March, 14

CONCLUSION

Monday, 31 March, 14

CONCLUSION- Good Marketing Strategies in USA- Emotional Contact- Good brand image

- Ineffective Marketing Strategies in Greater China- Targeting- Product- Lead to Bad Sales revenue

Monday, 31 March, 14

CONCLUSION- Focus on Footwear market- Increase presence of others products- Target the “RIGHT” people

Monday, 31 March, 14

THANK YOU

Monday, 31 March, 14

Q & A

Monday, 31 March, 14