Discuss about the Marketing Mix of Nike.
Nike is a very famous brand and it is also very popular and strong in marketing strategies. There is total 8 P's of marketing mix (product, price, promotion, place, people, process, physical evidence and partnership) that is applied by the Nike to promote their products in the market. The marketing mix of Nike is explained below:
Product in the Marketing mix of Nike
As we know, Nike is offering huge varieties of products like shoes, clothes and sports equipment’s and all these products are the top products of the Nike. Nike started selling its products in the year of 1979 and this company starts with the sale of athletic bags, sports clothes, etc. The top selling product of Nike is Running shoes. Apart from this, they also in the distribution of cricket shirts, baseball and tennis sports items, skates, hockey sticks, ice-skates and other sports equipment’s (Gregory, 2016).
Price into the Marketing mix of Nike
Nike as a brand offers a high price for the product and this pricing is based on the target customers. The target customers of Nike are those who are financially sound and capable to pay more prices for the quality of product. Nike is so famous and popular brand of sports items that people ready to pay more dollars because of the quality of products. The pricing strategies that adopted by the Nike is Value based pricing as compared to the other shoe retailers who offer low price products. Nike currently uses the same strategy as the customers of Nike indicated that what matters to them most is the quality of the products not the prices of the products (Ahmed, Brohi, Bhutto, & Abbas, 2016). The prices charged by Nike are based on the services it offers to their customers and also the reasonable prices of the competitors whose quality of products is matchable to their own products like the prices of Adidas and Reebok.
Place in the Marketing mix of Nike
Nike is distributed its products across the world and it sells its products with the help of multi brand stores, independent stores and the licensees. Looking at the numeric figures, Nike has around 20,000 retail stores in almost 200 countries across the globe. Nike is providing production facilities in Asia and other operational facilities across the world. Nike is still planning to open more stores to reach the customers worldwide and to increase the number of buyers (Elda & Alice, 2013).
The outsourcing strategy is adopted by Nike with China from the countries like Vietnam in Asia to reduce the prices of products and also Nike is also focusing on the online distribution of products by using online advertising strategies. For the distribution of the products in all the places of countries, Nike has many outlets and some of the major outlets are like: -
Nike Town outlets: - These are shops located in the big cities of the country to serve the target customers.
Flagship Stores: - Nike has signed a contract with the multi brand stores who will help in the selling of the products of the Nike.
Nike ID: - Nike also has the online store which provides its services to all the customers around the world.
Independent stores: - In the international market, there are many independent stores of Nike (Goi, 2009).
Promotion in the Marketing mix of Nike
Nike is very good at attracting the new customers and maintains the existing customers and promotion of Nike products is best because Nike advertise its products through commercials, celebrities and social media. Nike introduced in the market taking into consideration all the Marketing environment that is known by the people and Nike never does the promotion for the prices as it always uses the popular celebrity or an athlete for the promotion of its Shoes and clothes. The brand ambassadors of Nike are almost from the sports background like Tiger Woods, Lebron James, Roberto Carlos. The customer’s expectations are automatically increases about the Nike shoes by doing the advertisement through celebrities (Deng, 2009).
Nike also provides sponsorships for many events like Golden West and Hoop it up Event. The brand image of Nike is very strong and this is the reason of its success and its highest revenues. Nike uses the Integrated marketing communication (IMC) for the promotion of shoes and these strategies involve: -
- Advertisement through, newspapers, ads by the athletes
- Personal selling by the staff of the company in the retail stores
- Direct marketing by appointing the sales people who promote the products in the sports organizations and individuals.
- Sales promotion by offering coupons, discount and many sales offers.
- Public Relations is the technique of promoting the products like by organizing charity events and workshops.
- Social media websites by uploading the images of their products (Pour & Nazari, 2013).
People in Marketing Mix of Nike
There are two categories of people in the marketing mix of the Nike as one is the employees of the Nike and other are customers of Nike in the target market. Customers are very important for the success of Nike as the company is focused only on the niche customers and to generate more business it is important to find out the demand of the people for the products offered by the Nike.
Nike consists of well experienced and educated employees who deliver the customer services. Nike provides training for the management and sales people for delivering the best quality of services and also offers bonuses and rewards to their employees on the basis of their performance. The employees of the Nike are the best source to get the feedback from their customers regarding the quality of products (Singh, 2012).
Process in the Marketing Mix of Nike
The process and system of delivering the services of Nike to the customer is very effective as it has a great distribution channel, fast and speedy production activities and best execution of the services. The entire process of manufacturing the shoes and the way it is presented in the retail stores of Nike are the components of the Nike. The customers of target market do not care about that how the business is running, but they are attracted towards the services and working of the Nike brand stores.
Physical evidence as marketing mix of Nike
Nike has a great brand image and presence and establishment of Nike brand exists and doing well in the marketplace. The brand image of Nike is that much strong that when people think of sports, then one brand comes into the mind of the customers and that is Nike. Nike marketing leaders and its brand image have shown the physical evidence and psychological evidence in their market (Lam, Schuler, Adams, & Hubert, 2014).
Partnership in the marketing mix of Nike
Nike has done partnerships to promote their products and to drive the innovation. Nike is in partnership with the firm named as Apollo Global management for the purpose of supply chain of clothes in America. This is the strategy to promote the brand and generate higher revenues. Nike has been also in partnership with LLamasoft for the innovation and sustainability of the products. This is the strategy of Nike to manage their supply chain activities and make a good brand image in the market.
Contemporary Issues and their impact
There are many issues that can be faced by the Nike at the time of marketing and there are some important things that need to consider while implementing the marketing strategies. The contemporary issue that may found in the way of Marketing of Nike includes corporate social responsibility, social media interactions and technology developments because of globalization. These issues are explained and their impact on the marketing of the Nike.
CSR: - The corporate social responsibility of Nike is to focus on the environment by not harming it with their production activities. This is the social responsibility of Nike to focus on the manufacturing of the sports shoes without causing any damage to the environment. As per the marketing mix of promotion, the company maintains some public relations by organizing the events in charity organization and it’s a social responsibility of the company that out of the revenues of the company, a few amounts are donated to the charitable institutions and this is done for a philanthropic purpose, for the welfare of mankind (Connor, 2010).
Ethical concerns: - Nike may face some ethical issue if employees will not treat fairly by the company and if they are not given with initiative to come up in front and work for the company. It is observed from the studies that the Nike is not offering good environment and attractive wages to its employees and the employees also went to initiate a protest in Vietnam and this affects the sales of the company. Nike needs to focus on retaining its employees and making them feel an integral part of the company so that they can work for the company enthusiastically and with full zeal (Murphy & Mathew, 2001).
Social media interactions: – The social media interactions may cause a serious problem for Nike as the social media news channels may broadcast some unethical news on the TV or newspaper that may put down the image of the company and also distracts the customers. The negative news about the company will affect the marketing of shoes and sports items.
Advancement of technology and Globalization: - Nike has witnessed a great change since past few decades in all the countries. For Nike, there are no clear threats of entry of competitors in economies which are still not developed. Moreover, customers who have been used to good quality products cannot change to new brands easily since people from different parts of the world have been recommending products from this company. The marketing mix of price is applicable here as the quality matters to customers but not the price.
In addition, with the development of technology and globalization, it may be possible that competitors provide almost same efficient product, with low price, as the copyrights and fake products with the same name are introduced and this may confuse the customers and may create a serious issue for Nike. Thus, there is a strong need for the Nike to consider charging high costs for their services to promote quality of their services (Ziek, 2013).
Impact: – It is an obvious thing that these contemporary issues will have the negative impact on marketing if no attention is given to these small things. These issues will have a great impact on the consumer behavior of the Nike. As it is very important for every organization to understand what they actually think about the company and they will be satisfied and happy. Talking about the CSR and ethical concerns they are the main factors that help in improving the brand image of the company and will show the positive image of the Nike. Apart from this, the negativity against the Nike may affect the sales and give advantage to the competitors like Reebok, Adidas and Puma etc. If once the brand image of Nike goes down because of these ethical issues, then it will directly affect the Sales and revenue of the company and decrease the customer base (Mujtaba, Cavico, & Jones, 2005). There are many chances that people may shift to other brands if the brand image of the Nike goes down.
As discussed earlier about the issues that can be faced by the Nike at the time of promotion, there must need to take some corrective actions and some key points should be kept in mind for the successful marketing activities: -
1. For Nike, it is very important to maintain its brand image. As a result of which, Nike should need to stay away from the controversies and interactions with the social media to avoid the situation and maintains a good image in front of the people.
2.The brand promotion is also done by doing something for the welfare of the society as it is a social responsibility of every organization.
3.The People in the Nike should be given a proper working environment as the employees are the main source for the promotion of the products like Shoes, clothes and sports equipment’s (Newell, 2015).
4.The prices of all the products like running shoes, clothes, athletic accessories, etc. need to be reduced to attract more customers.
5.The production houses should be located away from the city in future to save the environment.
6.While introducing a new product in the market, the target area should be customer satisfaction and for this the value and demands of the customers should well studied and focused on.
7.The solution to these ethical issues would be effective marketing techniques, realizing the long term life time developments. Another way to solve this problem would be to come up with ways that are less formal and those that consume less time.
8. here is a need for the Nike to fasten up their internal management and make the learning process regarding the needs of the customers properly explained to all employees (Epstein, Buhovac, & Yuthas, 2010).
9.There should be a team effort by the employees of the Nike as every person should share the knowledge he or she has with others so as to collectively learn more quickly and also to get better and efficient results by these practices and methods.
10.ike should cope-up with new technologies to sustain in the market and doing well as compared to the other competitors.
As this report was all about the marketing Mix of Nike and all the 8 P’s are described in detail and the impact of the ethical issues evaluated with recommendations. Thus, it is concluded that Nike is the best brand in the category of shoes, apparels and all sports accessories and it just needs to focus on the public relation and social responsibility to remain the world’s best brand. All the marketing Mix elements like product, people, place, price, promotion, partnerships, physical evidence and process should be kept in mind while promoting the products. Nike need to focus more to attract new customers and should put some efforts to reduce the cost of the products.
The customers of Nike are attracted because of its variety and fast service of launching new stock and taking care of the new trends and tastes of the customers. Apart from it, the Customers of Nike do not care about that how the business is running, but they are attracted towards the services and working of the Nike brand stores. Till now, Nike is the best and popular brand for its quality and customer services.
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