Primary Research into a Sports Business Organisation
Primary Research into a Sports Business Organisation
With the current high competition being witnessed in all industries, companies are now faced with new challenges to build new marketing strategies that can guarantee that they retain or increase their share of the market. To achieve this, companies can undertake market research which is a process that involves gathering of information, recording and analyzing the info. This process involves gathering information concerning competitors and customers that stem from the market. Market research is very fundamental in monitoring the companies' sales and product performance. It may also help organizations get vital information that aids in expansion to untouched markets. (Barney, 1991)
To address this subject, the study paper will carry on, along the subsequent field: a sports company will be selected and analyzed for reasons of theoretical clarity; SWOT analysis will be utilized to analyze the company in details, and market strategies among the Nike company will be discussed at length; and lastly 'the way forward' in terms of a conclusion will get offers for
Nike is definitely an international company dealing along with a range of sports equipment such as shoes, shirts, t-shirts and Jerseys for a variety of sporting activities including, football, athletics, basketball, cricket, tennis, skateboarding and golf. Nike is reasonably limited company that sells well branded and expensive products which known for their own superior high-quality. Nike is well known for the trademark 'just do it' and it relates to the sporting spirit. This business has extra than 500 factories in over 45 countries that are contracted to produce these gifts. With this extended production capacity, the company has elaborate marketing strategies that has created it entirely possible that the company to realize its goals and objectives (Nike, 2008)
Company logo; source: http://www.nike.com/
Table 1: Summary of important involving Nike Incorporated, adapted from: Nike (2008)
Key peoplePhilip Knight, co-founder, chairman
Mark Parker, CEO and president
IndustrySports equipments, sportswear, apparel and accessories
RevenueUS$16.326 Billion (2007 FY)
Net incomeUS$1.492 Billion (2007)
Employees30,200 (January, 2008)
Slogan Carry out It
Nike Corporation is really competitive company, as its market share can corroborate. Mr Phil Knight the Founder and Nike CEO may be quoted as stating that 'Business is war without bullets.' Nike Corporation has a strong dislike of its competitors. For instance in the Atlanta Olympics, Nike declining sponsoring the games, Reebok went on and put in many of expenses in sponsoring the card games. Nonetheless Nike did sponsor good athletes and achieved expensive coverage. (The Washington Post, 2007)
Nike Corporation do not own factories, and thus it cash is not tied up in buildings or manufacturing employees. From using it Nike a good exceptionally lean organization. This company has an effective research and development strategy, as proved by its ever evolving and inventive product scale. The company has built a strong image of high quality products may priced in the best price possible. In cases there is price increase, and items can cheaply be made elsewhere (with similar or superior specification) then, Nike will shift its production centre to it location because it's a global corporation.
Nike Corporation has an internationally brand image, and simple fact is that leading sports brand image global. Its renowned 'Swoosh' is instantaneously recognisable. (The Washington Post, 2007)
Though Nike has diversified the range products they manufacture, the revenue of the company still are heavily established its market share from footwear products. This may leave Nike susceptible if for some reason the company's market share of shoes are eroded. Nike also depends a lot on the retailer sector which is tremendously price essential. Even though, the company have their retailer outlets known as Nike Town, it derives much revenue from outer retailers. Nonetheless an associated with this revenue from retailers is lower, since retailers seem to behave newsprints . by offering minimum profit margin. The margins apparently get constricted because retailers attempt to give a little of reduced pricing competition pressure from the company. (Bakan, 2004)
The company has opportunities in Product development which provides Nike some thing chances to take advantage of new creams. Even though Nike brand is intensely defended by the company who really trust that Nike brand image is not a fashion concept. It is clear that many consumers who purchase Nike products do not all the time purchase items to join sports; many islands buy as the trend, specially the youths. Thus one can argue i know fashion image in the youth population. This builds its own opportunities for the company, considering a product might become unfashionable in order to it wearing out i.e. customers require to their shoes or boots. (The Washington Post, 2007)
There also exists the chance in developing products like sunglasses and jewellery. Higher than normal value products seem in order to become connected higher profits versus the company main line. (The Washington Post, 2007)
Nike may also develop its business along international market, building on its well-built global brand image popularity. Today, many international markets host the disposable earnings to expend on premium priced items and expensive sports supplements. For instance, emerging global markets like China, Hong Kong and India are developing a new wealthier generation of buyers. In addition there can also coming global sports events like the Olympics games to take place in China and the ecu football championship where enterprise has a good market chance support its global trade. (The Washington Post, 2007)
As your global company Nike is duly exposed to international environment of forex currency trading. The company purchases and sells its products in diverse currencies and thus expenses and margins can not be steady over prolonged a chance. This exposure can imply the business could be manufacturing its products and/or selling them without making profit. May faces all international methods.
More so sports shoes and wear market is amazingly competitive. The business model formulated by Phil Knight (co-founder of Nike) in the earlier days (high quality product produced using a low-priced) will now be usually applied by Nike competitors and as a result to a point it is very little more a foundation for prolonged competitive advantage strategy. Additionally Competitors such as Reebok and Adidas are developing substitute brands to capture your able to send market share locally and globally. (Egan, 2007)
As previously mentioned in weaknesses section, the retail segment is becoming increasingly more price competitive, this eventually implies that consumers are seeking about for the top deal. Thus if one store is charging a certain price for the pair of sports shoe, the consumer might check out counter look at the price of that particular pair of sports shoe in another store downtown and compare the prices, and effortlessly find the store offering that pair cheaply. This sort of buyer price sensitivity is considered to be a prospective external threat to business. (Egan, 2007)
Most companies, organizations and institutions today are using SWOT analysis as a strategic method/tool for evaluating their strengths, Weaknesses, Opportunities and Threats with reference to strategic planning. SWOT analysis identifies the bodily and mental factors that determine the achievements a small-business has specified by its objectives and goals. First, it specifies the internal factors i.e. strengths and weaknesses of Nike Company. Secondly, it categorizes the external factors that have been identified to boost or hinder the achievements of the company especially re growth and expansion. These external factors are the opportunities and threats. (Anthony, 1998)
Strength could be defined to be a particular skill or distinctive competence that a company can accomplish relatively much better than other companies especially its competitors and which the organizations have and contributes to the achievements of the stated goals or desires. (Proctor, 2000)
A weakness can be defined as any aspect for this company might be hinder company from attaining its objectives or goals. Usually, it covers the firm's assets, resources, and capabilities
An opportunity in and that means you can be defined every single event, development, or a function of the external environment which creates conditions which favourable or advantageous into the business in relation to a nominated objective or set of goals for you to become attained. It is an attractive venture regarding your company's operations which if exploited will lead a new significant upward change with desired results such as increase in profits margins and rate of growth. (Michael, 1985)
A threat on the other hand is an environmental development or event which can have problems or challenges attending hinder the achievement of organizational objectives, for example, competition, high interest rates, government legislations, declining real income while others. (Anthony, 1998)
SWOT analysis offers vital information which is helpful in relating distribute resources and ability all of the competitive business environment the a company operates. Thus SWOT analysis is suitable for environment seek out.
Marketing secrets to Nike
Nike has adopted marketing mix, which is marketing strategy employs using of '4 Ps' is actually not product, promotion price and incorporate. These four aspects always be the ones which are used in a lot of companies. Each aspect is very important and plays a big role in marketing methods. Marketing is many are a company and Nike has managed to full associated with it in as a world number enterprise in sports wear (Hampy 2006).
This can be an object or service that your particular company produces or manufactures particularly on large scale with precise amounts (Bakan, 2004). Nike has an amazing collection of merchandise that it sells towards the market, this include shoes, clothes and apparel helpful for sporting escapades. The products take care of different sports like basketball, road running, tennis, soccer, athletics is actually more friends. Nike products are meant for men, women and children. The actual is renowned for its hip hop culture and supplies urban fashions when it comes to of . In order to boost its products quality, Nike together with Apple Corporation. produced the Nike+ line of products that have enough money to monitor how a jogger is performing through an invisible device is definitely place the particular shoes can be then relating to the iPod nano. For implementing this Nike in a position to to market its providers retain its market share (Hampy 2006).
The products produced by Nike are very different as named above. At first, it was just produced shoes alone, but, as technology changed and demand increased, then made practical for this to expand to plenty of cash (Hampy 2006). The characteristics of the firm's products are very well defined to the needs of the consumers; the packaging of the product is recognised as attractive to entice the customers to discover the products. Nike believes the quality of some is perfect, that is, it may be the quality to suit with the prescription on the product inside market certain it can maintain its consumers who are not misled with the misrepresentation of the qualities featuring a competitors such as Reebok and others (Hampy 2006).
Nike associated with athletic shoes
Promotion includes all communications that a company uses in marketing its products. Currently has four different elements in promotion; this includes advertising, point of sale, word of mouth and pagerank (Brown 1993). If a credit repair professional incorporates all of the four elements then a certain level of crossover occur. Nike has greatly used this marketing mix to the full virtue. It has incorporated all usual aspects of promotion which as seen the company capture and retain an important share within the market.
As discussed earlier, Nike has entered in sponsorship deals a variety of celebrity sports personalities and professional teams who utilized to bring attention to Nike health supplements. The company has sponsorships agreements with Ronaldhno, Christiano Ronald and Wayne Rooney, in football. In basketball this company has Kobe Bryant and Vince Carter, while more affordable Lance Armstrong in riding a bike. In golfer the corporation has a sponsorship cope with Tiger Woods, while in tennis it has Roger Federer. All this sports personalities and lots of other are used to market the company products (Hampy 2006). This method of marketing has got the best bargain to the company has many customers need to be recognized by their favourites sports personalities hence having the company's products. The company has several adverts that can be purchased in the media and throughout the internet which used to advertiser a lot more claims products. It should be noted that advertisement is a very powerful advertising tool that played with to create more promote for the website.
The amount that a client pays for a certain unit is its asking price. This amount is scheduled by various factors which includes product identity, competition, market share and the perceived value of the product by the buyer (Doyle 2000). Nike has focused on producing quality products which has a premium prices. Though, products of this company evidently be using a higher price, this is they the expertise of the products generally high. Premium pricing out of your company furthermore a marketing strategy that is working. Nike has adopted on subsequent pricing in order to enable product reach its marketing demands. Premium pricing will be the the uniqueness of the corporation product is determined such as a fixed price. For Nike pertaining to being able get the market share, it begun with the application with the penetration pricing whereby, when the company achieved the market share, it increased the actual cost of its product (Hampy 2006).
This stands for, location where the merchandise from a strong are found and invested in. This in many cases talks to distribution channels of the company which could be physical stores or even virtual stores found during the internet (Doyle 2000). Nike Company has managed to create an involving distribution channels that has ensured that it is products reach a wide market. Nike has built a large network of promoting its products; this has ensured that customers can to easily get products from the. The company has independent distributors, subsidiaries and licensees in other countries who sell the actual products. From the United States Nike have many outlets to market its accessories. Nike channels of distribution are considered to end up being the best and have been played a significant role increase of cash. For example, the 'NIKE Towns' which tend to be found in main cities in america. Nike either uses the direct or even if the indirect channels that is, supplying to the consumers directly or through wholesalers (Hampy 2006).
Nike's competitive advantage
The company has an aggressive advantage ultimately sports wear market over its main rivals on the inside industry (Hampy 2006). Will be because the marketing of Nike may be efficient and effective in their jobs constant good measures that includes; frequent monitoring of other competitors products, constant improvement of its products quality to fulfill the ever increasing market demands, provision of social support and community projects such as providing scholarships to needy students and sponsoring sports events several parts for the world and employing sound financial management techniques as well as constant evaluation and control measures of the company.
Chart 1: The chart below shows Nike Company's stock boost in percentage to be able to is competitors and even the S& P500 index; source http://blogs.indews.com/cgi-bin/bg/mt-tb.cgi/13
An analysis of a company's bodily and mental environment remains an vital aspect of a company's strategic planning method. With cut-throat competition being associated with the markets, a company has arrive up with strategies that will make it maintain its market share. As Kotler, Philip, Keller and Lane (2005) observes, today's business world is very competitive. Nike is reasonably very capable in most aspects from the business. Nike has had the capacity to get and remain at the top through good marketing mix and product mix.
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