Nike has built the ubiquitous ‘SWOOSH’ (which represents the wing of Nike, the Greek goddess of victory) into one of the bestknown brand symbols on the planet.
The power of its brand and logo speaks loudly to Nike’s superb marketing skills. The company’s strategy of building superior products around popular athletes and its classic ‘Just do it!’ ad campaign have forever changed the face of sports marketing. Nike spends hundreds of millions of dollars annually on big-name endorsements, splashy promotional events and many attention-getting ads. Nike has associated itself with some of the biggest names in sports: heroic images of Tiger Woods, Renaldo,
Ronaldinho and Kelly Holmes made many people who wear the swoosh feel as if they were winners!

Nike’s initial success resulted from the technical superiority of its running and basketball shoes. But Nike gives its customers more than just good athletic gear. As the company notes on its Web page ( ‘Nike has always known the truth – it’s not so much the shoes but where they take you.’ Beyond shoes, apparel and equipment, Nike markets a way of life, a sports culture, a ‘Just do it!’ attitude. The company was built on a genuine passion for sports, a maverick disregard for convention, hard work and serious sports performance.

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Nike is athletes, athletes are sports, Nike is sports. Over the past decade, Nike’s revenues grew at an incredible annual rate of 21 percent. Nike, with a 27 percent share internationally, dominates the world’s athletic footwear market. Nike also moved aggressively into new markets, from baseball and golf to inline skating and rock climbing. Its familiar swoosh logo is now found on everything from sports apparel, sunglasses and footballs to batting gloves and hockey sticks. In 1998, however, Nike stumbled and its sales slipped. Many factors contributed to the company’s woes. The ‘brown shoe’ craze for hiking and rugged, outdoor styles such as Timberland,
Hush Puppies and Doc Martens ate into the athletic footwear business. Nike also faced increasing competition from Adidas, Germany’s venerable sporting goods company, and from clothing designers such as Tommy Hilfiger and Ralph Lauren. In Europe, Nike and Adidas maintain a fierce battle for leadership with about 24 per cent market share each. To make matters worse, college students and consumer groups at home have protested against Nike for its alleged exploitation of child labour in Asia and its commercialisation of sports.

But Nike’s biggest obstacle may be its own incredible success. A Nike executive admits that Nike has moved from maverick to mainstream, and the swoosh is becoming too common to be cool. How can a swoosh be cool when mums, dads and grandmas wear them? According to one analyst, ‘When Tiger Woods made his debute in Nike gear, there were so many logos on him he looked as if he’d got caught in an embroidering machine.’ The world was over swooshed! To address these problems, Nike went back to basics – focusing on innovation and introducing new sub-brands: ‘jumping man’ logo and the ACG [All Condition Gear] line of outdoor and hiking styles. Recent advertising de-emphasises the swoosh, refocusing on product performance and using only the Nike script logo name. However, to win globally, Nike must dominate in soccer, the world’s most popular sport. Elbowing its way to the top in soccer will not be easy. Adidas has long dominated, with an 80 per cent global market share in football gear. Moreover, Nike must deliver worldwide quality, innovation and value and earn consumers’ respect on a country-by-country basis. No longer the rebellious, anti-establishment upstart, huge Nike must continually reassess its relationships with customers. Says its founder and chief executive, Phil Knight, ‘Now that we’ve [grown so large], there’s a fine line between being a rebel and being a bully. [To our customers,] we have to be beautiful as well as big.’1

1. What would you consider Nike’s ‘superb marketing skills’?

2. Why does Nike require these skills to compete in themarketplace?

3. Show how marketing principles and practices will enableNike to satisfy these needs, bearing in mind the company’sdiverse range of product and geographic markets.

4. Give suggestions on how can the company gain maximum benefit from applying the marketing concept?


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