Nike’s cost leadership generic strategy sustains competitive advantage based on costs. However, customer-oriented brands such as Nike have been able to command customer loyalty. 9200 Words 37 Pages. The brand is well known for its stylish and great quality products. So, the brand has heavily invested in research, innovation, and marketing which has helped to bring the best designs to the market right before its competitors. Nike offers give away to customers, tickets, sales, sponsorships and … In addition other sportswear manufacturers also expand their portfolio. So, Nike’s diverse product range caters to varied customer segments. As such, Nike has mainly focused its strategy on innovation to rival its competitors. To export a reference to this article please select a referencing stye below: If you are the original writer of this essay and no longer wish to have your work published on UKEssays.com then please: Our academic writing and marking services can help you! When it comes to product quality, supply chain, or sustainability, the brand has kept a strong focus on accountability, social responsibility, and most importantly, ethics. Besides the Jordan brand, other subsidiary brands that Nike owns are Hurley and Converse. Show More . In the late 1990s, Nike reduced costs and the selling prices of its athletic shoes and other products. With this in mind, Nike has invested in research and development to know more about the customer’s taste and fashion trends. Nike is a customer-oriented brand that knows its customers in all aspects. Porter’s model helps to understand the sources of Nike’s sustainable competitive advantage over its rivals. In the U.S Nike has seven important distribution centers, five in Memphis, Tennessee, and one in Indianapolis, Indiana, and another in Dayton, Tennessee. Competitive advantage is something that separates the company from other competitors in the same industry. Besides, it outsources most of its production. VAT Registration No: 842417633. The buyers of sports footwear and hence their thinking have changed in the past decade. They know everything about sports and are often athletes themselves and, of course, know Nike’s products inside and out. After takeover both the companies Reebok and Adidas have strong position to compete with Nike in North America. Its prices are a bit high as compared to other competitors but it has made many sales than th… We’re supporting our suppliers in developing predictive, agile, resilient and integrated HRM capabilities. The United States provides that largest market for the Nike brand accounting for over 40% of its total sales and accounting for a total of 392 retail stores. From simple essay plans, through to full dissertations, you can guarantee we have a service perfectly matched to your needs. Customer incentive programs are one of the successful programs within the organisation (Nike, Inc., 2009). To gain the strongest competitive advantages is the major concern for Adidas, because it has to compete with giant competitors like Puma, Nike, New balance and others. A wide product range helps in targeting a larger customer base. Customer experience, customer trust, and customer engagement are among the many factors that when they collaborate they significantly affect brand equity. Do you have a 2:1 degree or higher? The product might be as good as, or better than, the competitor’s; but as long as the consumer perceives the product to be not superior or not different from others, the product can’t become successful. Related. It achieved competitive advantage by adding value in its products. the United States, the Americas, Asia Pacific and Europe, Middle East and Africa (EMEA). Coupled with global marketing strategies, Nike can dominate the global athletic footwear and apparel market. Today, Nike is a multinational brand that is recognized for its premium quality products that are reasonably priced. It is also recognized as the biggest brand in designing, developing, and marketing of sportswear, apparel, and accessories. In order to achieve practical guidance, some theoretical tools will be adopted. It offers products in six main categories. Bearing in mind that customer preference changes fast, there is stiff competition among brands. The company has a great distribution network which … Company has strong growth potential for 2017. A larger customer base is a significant strength for the Nike brand as it sets it apart from the rest as an exceptional brand. Apart from them, it is investing in sustainability and the creation of sustainable products to increase the popularity of … A recommendation is for Nike Inc. to prioritize investment in product development to ensure competitive advantage. While the U.S remains its core markets, its supply chain and distribution network is spread globally. Nike successfully fought against this socio-political issue and wisely maintain its brand name. The brand has successfully utilized social media and marketing campaigns to target more customers. To attract more customers, nikeid.com allowed them to design and personalise their brand resulting more than 3, 00,000 unique visitors a day. The brand heavily relies on demand generation expense. distributors, licensees and subsidiaries innearly 200 countries. Competitive advantage is what makes an entity's products or services more desirable to customers than that of any other rival. Marketing has played a major role in making the Nike brand a global brand. The products come in excellent design and quality. For instance, it has robust retail, distribution network, and inshore and online promotions. Two key aspects of this strategy include their large-scale brand recognition and product innovation. They remain flexible, and … Even though difficulties in entering the new market because of the single currency and the trade rules, consumer sales outside of the United States exceeded sales in the United States in 2003 with only 43% of the company’s sales coming from the US. It is obvious Nike is a global brand that has widely spread retail stores across the world. Competitive Advantage. The brand has built several sources of competitive advantage which include technology, marketing, supply chain as well as product design and quality. Its large economy supports it in distribution and marketing over its rivals. By altering marketing to the customer needs, Nike has been the most successful player in the past and continues to be today. The firm has product design capability, which is due to its highlyefficient integrated research laboratories. People are increasingly looking for stylish and durable sports, athletics, and leisure products. 1st Jan 1970 Brand equity is perhaps the main strength of any brand. As an outstanding brand that prides in the highest popularity and customer loyalty in the sportswear industry, it is no doubt that customer loyalty is a unique competitive advantage that has kept Nike leading its rivals. You can view samples of our professional work here. With strong brand equity, Nike has managed to lead its competitors in the sports industry. Adidas … The Nike brand has a wide product range in the market. The brand sells its products through Nike-owned retail stores, digital platforms, retail accounts, a mix of independent distributors, licensees, and sales representatives in nearly all the countries around the world. Sustainable competitive advantage is when one company’s value creating products are impossible to imitate by its competitors. When required for professional use there is no substitute goods, but as a fashion item there are many other goods that could be purchased. However, competition in the sportswear industry continues to increase each day and Nike has to step up to stay at the top. Nike sensed that scenario and wisely put its eye on EU market. Nike maintained a GuruFocus business predictability rank of four stars, suggesting consistent revenue and … Nike vs Adidas: Market Share . Besides, the brand is deeply connected with athletics and sports and it strives to inspire sports fans across the world. The company has heavily invested in design and quality and employed a greater business strategy that focuses on customer service. As such, Nike has managed to build strong customer trust in the market and with their customers. To keep strong brand equity, Nike has focused on its taste and changing preferences. Reebok, offering more choice of shoe, introducing endorsement by sports personalities, sponsoring sporting leagues. Looking for a flexible role? Marketing Nike Inc. is very good at adapting to the changing markets. From a humble beginning, Nike has managed to build … Further to this, it is having a 10 year deal with NBA, WNBA and MBA development league. These are well established channels. Competitive Rivalry or Competition with Nike … Over time, Nike has maintained a strong supply chain and manufacturing network that has helped keep the brand popular with agility. Reference this. Our academic experts are ready and waiting to assist with any writing project you may have. It is officially sorcerer of couple of university teams and presently assisting them in making their on-field outfits. Due to the strong brand competitive advantage, Nike has been able to increase its market share all over the globe. Reebok deals with NFL for designing and marketing all on-field uniforms. Nike Inc. is very good at adapting to the changing markets. How Nike has become the biggest player of the game? Where the master giant Nike with its ‘JUST DO IT’ punch line directly target famous sports personalities which at the end rose sell significantly. Strong human resources policies and capable, qualified management are essential for all Nike suppliers to be compliant with the law and our Code Leadership Standards. The Competitive Advantage of Nike. Nike is doing what is … As such, a wide product range of popular products has provided a unique competitive advantage for Nike. Nike has a big advantage over its competition, according to Nomura Instinet analyst Simeon Siegel. How it successfully captured almost half of the market in sport sector and still the giant? No plagiarism, guaranteed! *You can also browse our support articles here >. For instance, it outsources nearly all of its production. Similarly, continuous innovations like Air Max range of shoes had widened the gap between Nike and other brands. With well-synchronized manufacturing, retail, and distribution network, Nike can cater to demand better. Besides using online and offline marketing strategies, Nike also uses media releases, sponsorships, and events to market its products. It also utilizes a mix of traditional and modern tools and methods in its marketing strategy. According to the geographic location,Nike has segmented the international market. It affects the business more or less in a negative manner. Incorporated in 1967, Nike has grown throughout the decades to be the number one brand in the selling of sports-wear and apparel across the world. Better yet is that a well-integrated network allows Nike to focus on innovation and deliver high-quality products to the market. Marketing is a major strength of the Nike brand and provides it with a unique competitive advantage in the global sportswear market. The competitive analysis of Nike vs Adidas in pricing is very interesting. Its Swoosh logo is popular and most notable among the numerous brands in the athletic wear industry. Roots to competitive advantage: It is obvious that it wasn’t a red carpet journey for Nike. Company often seeks to achieve both productivity and differential advantages but few succeed. Outsourced Manufacturing Units: Nike receives footwear from more than 140 factories located in 13 countries across the globe. (See appendix 1) Therefore Nike has gained competitive advantage through innovation, of which Nike Sphere is an example. Start with: Competitive advantage simply means what the company is best at. Therefore, customer loyalty is a strong source of competitive advantage. Nike now has over 750 stores, … However, surprise when reviewing its differentiation strategy it . The above graph shows market share of sport shoes sold on 2009.The main players are Nike and Adidas. This generic competitive strategy helped the company regain its competitiveness, especially … Registered Data Controller No: Z1821391. Nike needs to manufacture and sale all its products which has gained patent before the right expires. Branding. But how the brand does manage to dominate the international athletic markets that are very competitive? Nike Competitive Advantage 1089 Words | 5 Pages. NIKE Competitive Advantages Nike as a global company known worldwide that makes a large range of products for athletes including shoes and apparel as well as equipment sustained its competitive advantage through effective knowledge management. Roots to competitive advantage: It is obvious that it wasn’t a red carpet journey for Nike. The high brand equity has seen Nike command stronger financial and market growth for the Nike brand. Nike has various competitive advantages outlined below. This is not an example of the work produced by our Essay Writing Service. Nike’s brands have turn out to be to be very strong as compared to others such as Reebok and Puma. They buy it for the experience, value and the emotional benefit that the particular product provides. We have developed guidance and tools they can use to improve Human Resources Management (HRM) in their factories. Nike has invested in research and development. Equally, it is also paying attention to its pricing, retail, and marketing strategy to deliver the best products to its customers across the world. Copyright © 2003 - 2020 - UKEssays is a trading name of All Answers Ltd, a company registered in England and Wales. Adidas; Adidas formerly known as Dassler Brother Shoes is the designer, manufacturer and marketer of shoes, clothing and accessories. We're here to answer any questions you have about our services. 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