Differentiation is a defendable strategy for earning above average returns because: I. [�0�e���wlo� ��4����!� �dE�,Jt�[ The differentiation strategy of Nike is quite competitive so Nike should ensure any international marketing strategy it applies should enhance its superior brand name. <> endobj • Differentiation: wtp , soc (Goldman) • Cost Leader: wtp , soc (Enterprise) • Dual Advantage: wtp , soc (McDonalds) Value wtp soc 15.834 Marketing Strategy. Nike’s differentiation strategy is to establish the company as the standard in athletic wear. 4.0 RISKS OF NIKE’S CORE MARKETING STRATEGY. In contrast, Nike, Inc. uses the Leader R&D strategy as detailed below. Examples of the successful use of a differentiation strategy are Hero Honda, Asian Paints, HLL, Nike athletic shoes, Apple Computer, and Mercedes-Benz automobiles. Nike emphasize on key elements such as design of products , High quality products, brand advertising and product development Nike … <> Each segment is carefully examined in terms of physical capabilities, sociological needs, and design preference. <> Brand differentiation happens when a product or service matches superior performance with an important customer benefit, according to Phillip Kotler and Kevin Lane Keller. '��ȹ|�F8>����GN��^(����7�����ͯ���4p�I��f2Ut�l'S�M� �O�i������Í��ҋ�I�P��D��a5���˼-��hr�`j�eYL���7yc92��L%2���m7x����$p���8�ߜ��޾��ɣ̜�Px"����{�(�y�$�-�|��l�8 �xO��|�o�-M��Q�'��> S�g2�5�v��Ð$�� ��:� r���4ڮY�m4/���Be�aр��qYD� Nike Air technology incorporated in the running shoe and with the completion of the IPO some of Nike’s major businessmen had decided to step away from the company. It is a division of the famous shoe brand, NIKE. Nike’s customers consist of both armature and pro athletes who use the shoes in sporting activities. �y(�D�ƥx(���n���gpT�Qt &�X8@j���b!v�uLv��� �],Į��e�����/ NIKE COMPETITIVE STRATEGIES Nike has a combination of two strategies: • Best cost provider strategy. endobj <> Specifically, this case demonstrates that much of Nike’s success with its differentiation strategy has been possible in part due to its outsourcing strategy. This can contain info accumulating for the objective of the market segmentation and product differentiation that can be applied to modify publicizing efforts or determine that aspects are observed as a prior to the consumers. Apple has been a market leader, initially in the PC market and now in the smartphone domain. While Nike has retained its focus on great quality, sustainability is also become an important focus down its production and supply chain. <>/ExtGState<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/MediaBox[ 0 0 612 792] /Contents 23 0 R/Group<>/Tabs/S/StructParents 2>> Being present in footwear, sports equipment, clothing and many others Nike uses differentiated targeting strategy.Produc… When a firm pursues differentiation strategy, it attempts to become unique in the industry, by offering those products and services, which have value to the customers. Results of Nike's new Customer Experience distribution strategy in place for over a year in a study by Euromonitor. endstream ���N�bJ!v��_91@ <> 23 0 obj Branding play a key role in differentiation strategies as it allows a company to become synonymous with quality as well as a price point. endobj Page 4 of 9 of authors such as Prahalad & Hamel (1990), Stalk, Evans & Shulman (1992) and Hall (1994). Product differentiation strategies are the well-thought out and purposeful set of actions you take to highlight aspects of your product or service that are unique and most relevant to your customer. The following are the generic competitive strategies implemented in Nike’s combination strategy: 1. 2.The marketing strategy of Nike. It also gives endless chances for customer segmentation and product differentiation, the pillars of any marketing strategy. endobj •Objective 2: Discuss how to design business portfolios and develop growth strategies. Nike always was the good competitor for the other companies continuously. II. endobj stream Two Simple, But Critical, Points • your strategy should be based on the strengths that differentiate you from competitors, your resources. <> endobj x��X[O�J~G�?�cR��W_$��r�#Z*8��I�����Ŀ?3k;�Il�=j�ę�v��o.����f�db������d�H�pwr[,�ܾ,ӓ�d��͊��fuo��_i2M˳3�x ���L*gT�Y�@A��x��������GB0��v����?�s�"�a&��'��t¼:}�Q6>֣�t�n�|@����)����8�}�O6�M�����Li\,Y(w���e2�#K|���DjM ���4y��*����}n�d�wk�����!��fK2��w�2�!���P����^ Nike Strategic Analysis 11 divided our business into three different demographics: Men, Women, and Children. (by outsourcing and most of their products are manufactured outside the United States ,and by economic of scale) • Broad differentiation strategy. (by outsourcing and most of their products are manufactured outside the United States ,and by economic of scale) • Broad differentiation strategy. ----- To follow its mission, NIKE’s managers are concerned with elaborating on the strategies listed below: • Functional-level strategy: is directed at improving the effectiveness of operations within the company. x��X�o9~G��#T��3�_R�Dh��I�Z]�>Д��z��p����.�˂��wJ��������gl�����nq���f�����">���?��?�/�����b�zX�o���IC�-_�����|9�{�@ Nike’s Triple Double The Consumer Direct Offense is fueled by Nike’s Triple Double strategy: 2X Innovation, 2X Speed and 2X Direct connections with consumers. For example, if your product is more expensive than the competitor selling the standard product, and the consumer doesn't see the added value in your product, they'll likely choose the cheaper option. The history of Nike’s marketing strategy is interesting in itself. By focusing on their product line, they are able to produce high quality products that meet customer expectations. endobj NIKE COMPETITIVE STRATEGIES Nike has a combination of two strategies: • Best cost provider strategy. 4 0 obj Product Development; Amazon’s third, supportive intensive strategy for business growth. Starting from its Swoosh logo to the famous ‘Just Do it Slogan’, these are important factors differentiating it from its competitors. Read More. 2 0 obj Pages 32 This preview shows page 13 - 20 out of 32 pages. One of the R&D choices is to be either a leader or a follower. <> Nike, Inc. is a marketer of sports apparel and athletic shoes. Nike faces many risks when they use their core marketing strategies to achieve their goals and these risks can come from both internally and externally environmental circumstance. Nike uses psychographic segmentation variables to make its offerings more attractive to the target customers. differentiated strategic change that companies created new revenue growth. Their latest boots, of course, are made of the most perfect materials. �̴��_zQ�"?�oc5*[����y�M\�!� �ju�*�����ܬ:M����5��1A�|�w Therefore Nike tries to portray a brand image of quality and performance. Another big part of Nike's product differentiation strategy is its relationships with its customers. For example, the company integrates cutting-edge designs for its shoes. %PDF-1.5 It insulates a firm from competitive rivalry by creating brand loyalty; it lowers the price elasticity of demand by making customers less sensitive to price changes in your products. The company is ranked as the top seller of sports shoe and clothing. Uploaded By ankitaghsh. 8 0 obj Innovation is one of the ways of Nike for going ahead and providing new technologies for all kinds of goods they create. New Balance is using a differentiation strategy in order to gain market competitiveness and increase the success of their market penetration. endobj Nike’s differentiation strategy is to establish the company as the standard in athletic wear. GWo$�ґ�4�EiA�t �n���l�0�\#����� endobj <> Nike, strategy, product differentiation, innovative and outsourcing. A company's brand differentiation strategy tends to evolve from its strengths. A strategic objective based on this intensive growth strategy is to implement an aggressive marketing campaign to attract more consumers to Amazon’s e-commerce website. Nike’s Triple Double The Consumer Direct Offense is fueled by Nike’s Triple Double strategy: 2X Innovation, 2X Speed and 2X Direct connections with consumers. This article will give you unearth some interesting facts as to how well the brand has performed in the past, how it managed to ward off its competitors like Pune, Nike and what has been the strategy, be it the business strategy or marketing strategy of Adidas, that made it come out stronger than ever. endobj Click To Tweet. This is how they work, the design is super innovative and this does not only refer to the boots. 9 0 obj To follow successfully the differentiation strategy Nike decided to focus on investing in their R&D department: they focus on individual benefits such as newest technology of producing clothes that let the skin breathe, footwear specific structure allowing to avoid or reduce injury and get the maximum comfort, new electronic devices helping people to stay healthy and active. Nike was started in 1964 by Bill Bowerman and was originally called Blue Ribbon Sports, but was later changed to Nike in 1978. Nike Inc. has been dealing with many sports starts, Michael Jordan to name one, in order to promote its products through its marketing strategies; and overall part of the business. Nike also incorporates the "cool" look into all types of shoes and merchandise. 3. <> Nike: Sourcing and Strategy in Athletic Footwear This case gives students an opportunity to examine the costs and benefits (pros and cons) of vertical integration and outsourcing as vehicles for achieving a firm’s strategic objectives. Nike's marketing strategy has succeeded in sustaining a global brand while many of their competitors have come and gone from the spotlight. %PDF-1.5 Apple has been a market leader, initially in the PC market and now in the smartphone domain. As a result, its products have become the favorite of the serious athlete. Strategy Formulation Introduction ... For example, Nike has successfully identified itself not only with professional athletes, but with those who want to be part of the athlete world. <>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/Annots[ 11 0 R] /MediaBox[ 0 0 595.32 841.92] /Contents 4 0 R/Group<>/Tabs/S/StructParents 0>> endobj Phil Knight even decided to take a break in the 83-84 year, although he was still chairman and CEO. �J�@O2� #�x\�{^�u�w9����Zh-��]|I����QJ���4V����^�8q���)q�{���~����p���pD�?��Ob�{�w���{�l endobj Moreover, successful differentiation strategy of a firm may attract competitors to enter the company's market segment and copy the differentiated product (Lynch, 2003). Nike’s product line is not wide: they offer athletic shoes, workout clothes and a very limited number of additional products. Leadership Practices in The Post-Bureaucratic Era 1575 Words | 7 Pages. Differentiation strategy is nothing but to differentiate the product or service. TL������w6���m9E����mQv��9��c("�ڲ�>\]�\Sz_]~~�I�^��sC�#�.����� b��� Cz���@��D�΄� Q�'�� ���� �@"�I��(AȔ�BЬ1�?��Ra�PTk��~(�5�ʀnu��; \�=Ɠ�����; ]m_v����dWhW�ؓ]9�]-P�a��ye]��v�����l�ʭ.������ֲ�V�|�e�c|lF���'8/� Ӈh*x����fA��`Sf�:��������/��F�h"RL��&{7�H�gQ�]�c3�%M^��Y6��������ر��)���� 21 0 obj Companies that have succeeded with a differentiation strategy include Apple, BMW, and Nike. Nike’s Pricing and Business Strategy. ���dR.0��|/��Epf��g>��xE��O����Q�e��Ub���F�R����t���.��9�HxT���*��4��6U����UTףzvqCY68�5AX��l���Rj3eN�SXd4.�����Cۀ;������&t�+7P� Y�$'��j4����/��4. stream �oe��)uVN"ɚǝʱ�$�R�Ž�|���5m�Ț������> ��Q�6�l��a\um74��֮O9Ҟ�\`o/�R1CJ�\��X��Q�o��SF�*F~�j�vl]Eh� ���:W_�t0�V�m�nF��l����tP�s}ɹ��+��+zv�?љ>ms2k> Strategy used. The inception of the company strategy of Nike was born when was Phil Knight was still a university student. Differentiation strategy is one of three Porter’s Generic Strategy; others are cost leadership and focus. We realize that the team-mentality that captured the spirit of athletics in the late 1980's and early 1990's has been replaced by a sense of individualism. With Nike manufacturing products with its cost effective business strategies through factories in the developing nations, criticisms regarding its abuse of child labor have affected its popularity to an extent. Nike is very well known for high quality and premium prices and Reebok is also a strong brand but it provides high value with a lower premium. 13 0 obj Advertisement : Corporations that depend on technology for their success are becoming increasingly concern with the development of R&D strategies that complement business-level strategies. 5 0 obj Global Marketing Strategies. 18 0 obj endobj @����h�hКJ�/"� � ����zU�:�0�y��Vڠ��ت�O«�V���m5���(�4�|���V�Da����P����vx�-��k>����+Q m�+�~���4�S���� endobj stream .Xl������^vx�P&�o�شG�J&�Q��H&�)�����pF "�R�1R(�U��X�b�4�nN�ĥ�� �E���+��ɸ�\��M�#S�S24��Iw�� 9 gέG���S^>%��[!7[�*a-�jI�O���dW3���-�c���V*��7X�X��63 � z�X#Zp�p%�Y��0��Զ%�&ѭ�f� �Cz�^��A���C� 16 0 obj <> The combined cost leadership and differentiation generic strategies boost Nike’s performance in the global industry. The big risk when using a differentiation strategy is that customers will not be willing to pay extra to obtain the unique features that a firm is trying to build its strategy around. 2 0 obj endobj Like many companies that have embarked on a sustainable business strategy trajectory, Nike quickly learned how to convert health and environmental challenges into competitive advantage, not just cost savings. 19 0 obj ���4%[P�+~f�gZEG�"�_�c���q1��&�� R���V���:�.� ��������:f֖��fuɪ�p��zI�$�ኬI �=ᤆ�1���Q Download Full PDF Package. Today, Nike not only distributes its products do… �I~Lc��n6���ްJ�؏��B�B4\>���%ⱉ������*qL��|V" �I׵*ͩ�!71{�+���Z�U��,υ4?��a�'Q��i����c[�%��Jf��-nΐ]�B�y*�iLŷ5�0� ���V;��PW��u�n�vV�W�\3�=K'/-����p�F:ix:Y���6��tb�rI�N)X!Qzy��I�+�;v��PE�S&�Rp4�9C�;M2+�c�x��L:�4I�rמ�J�b4W�:��.�l�A��9L��K0�0ϸ���M�ϰQ���cq 10 0 obj 7 0 obj Nike Success. 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