nike strategy: indian context
DESCRIPTION
The presentation tries to capture an overview of Nike's Strategy from a students's point of view.TRANSCRIPT
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GROUP NO. 2
Group Members:Elizabath Paul
Saranya SNeha Raj
Abdul Nafiy AShipin P
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Can you recognise this?
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HOW WE PROCEED?
Birth of Nike Inc.Company Strategies
Marketing StrategyManufacturing StrategyInnovation StrategyBusiness StrategyHuman Resource Strategy
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BABY TO GIANT
• Nike, Inc. is an American multinational corporation engaged in the business of footwear, apparel, equipment, accessories and services.
• Born as Blue Ribbon Sports in 1964 by Bill Bowerman and Phil Knight and officially became Nike.
• The Nike brand is valued at $10.7 billion, making it the most valuable sports brand.
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COMPANY STRATEGY
• Nike is listed among the best marketed brands.
• Nike’s strategy has kept it as the most valuables sports brand
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MARKETING STRATEGY
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1. REGION-WISE SPORTS CONCENTRATION
• Nike follows a strategy of concentrating in sports which is widely followed in a particular region.
• In India Cricket is widely followed, so Nike has endorsed the brand called Nike Cricket.
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2. SELLING STRATEGY
a) Nike Stores– Nike stores are the flagship direct retail outlets of
Nike. – Nike Stores are strategically located in the busiest
and most posh commercial areas of major towns and inside big malls.
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b) Counters in High-end Retail Outlets– Nike follows the Store-within-a-store concept
inside Fashion retail outlets like Lifestyle and Central.
– This helps Nike to capture customers who wish to satisfy all their apparel needs under one roof.
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3. Promotional Strategy
a) Sponsorship of Teams and Players– Football (Clubs): Manchester United, Arsenal,
Barcelona– Football (National Teams): Brazil, England,
Netherlands, France– Cricket: India
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b) Nike Sponsored Events– Nike sponsors major sports events like
Marathons. For example: The Nike We Run 2014, Bangalore Marathon is scheduled this month.
– Nike has an advantage to sell apparel for this marathon as it has given a common dress code for the event.
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4. PRICING STRATEGY
• Nike follows a prestige pricing strategy. • This strategy is widely successful because of its
brand value and brand loyalty. • For example: Volkswagen has 15 times
turnover of Porsche, but in profit margin Porsche has 7 times more than Volkswagen.
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MANUFACTURING STRATEGY
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1. LOW-COST CONTRACT MANUFACTURERS
• Due to its Supply Chain capability Nike has concentrated its manufacturing hub in low-cost countries like China, Vietnam.
• In India, Nike procures widely from garment producing hubs like Tirupur.
• The advantage of this for Nike is that they get products made cheaply due to the economies of scale experienced by these low-cost contract manufacturers.
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2. PATENTS
• Nike uses patents to protect their innovations and brands.
• For example: Nike Dri-Fit, Nike Stay-Cool, Nike Free and Nike Flyknit.
• These patents not only protect their innovations but also create a quality perception and brand value in the minds of consumers.
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•Dri-FIT is a high-performance, microfiber, polyester fabric that moves sweat away from the body and to the fabric surface, where it evaporates.
• As a result, Dri-FIT keeps athletes dry and comfortable.
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INNOVATION STRATEGY
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1. EXTENSIVE R&D
• Nike R&D comes up with constant innovations in sports goods and these come in at the right time.
• For example, Cristiano Ronaldo has unveiled his 2014 world cup boots, the Nike Mercurial Superfly.
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2. INVOLVING PLAYERS IN INNOVATION
• Nike gets athletes involved in their innovations.
• This helps them to customize products according to their needs and in turn bring new products to the customers with these innovations.
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3. COUPLING TECHNOLOGY WITH SPORTS
• Example: Nike+ is a Sports tracking equipment which involves a sensor kept inside a shoe.
• Technology enhances the brand value of the firm.
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BUSINESS STRATEGY
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1. ACQUISITIONS
• Nike acquired Converse for US$ 309 million. This would allow Nike to try a “buy rather than build” strategy and to develop leisure shoes separately from the hard-core Nike sports image.
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2. FINANCIAL STRATEGY
• Nike proposed to buy back $8 billion of its class B stock in 4 years. This strategy will generate long-term profitable growth and strong cash-flow and will deliver value to shareholders.
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HUMAN-RESOURCE STRATEGY
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1. TAKING CARE OF LABOUR OF CONTRACT MANUFACTURERS
• Nike as a part of its responsibility takes care of the health and education of labour working in the Contract Manufacturers.
• Nike can influence the wages provided by the contract manufacturers as the wages are influenced by the prices they pay to these manufacturers.
• Such a sustainability strategy will add to the brand value of Nike
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• Can you guess the biggest but the simplest strategy of Nike?
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Nike THANKS TO ALL