Product Concepts

Nike has a reputation for introducing unique and revolutionary products into the market. Nike actually has a specific area for innovators called "the kitchen" at there headquarters in Oregon where few are permitted access. The Kitchen is considered the brains behind the operation and the "cooks" are responsible for the majority of the new Nike products ranging from the Jordan line to the new Nike ID.


Nike ID is a recent concept that allows you to customize your gear. At first, Nike ID only consisted of shoes which was revolutionary in itself. Consumers had access from either their mobile phone or via Internet to build their own "ideal" shoe from the sole design, to the color of the laces. Nike ID now has it's own separate website that first allows you to choose from a variety of languages all over the world. The next step is deciding what product you would like to personalize; whether it is a t-shirt, an athletic jersey, or footwear, it is all up to the consumer. Once the consumer is finished, he/she then submits their billing and mailing information and within a matter of weeks, their cutsom design is in their possession.

Segmenting and Targeting Markets

Marketing: A new age

The lifespan of magazines and newspaper adds have come to a halt for the shoe industry faster than they ever could have imagined. Now that these marketing strategies have become less effective, marketers have begone searching for new opportunities to get the word out about their brands. Just as things couldn't look worse for these poor marketers, blogs hit the scene. Blogs allow marketers to interact with their target markets on more of a personal level while still maintaining their marketing goals. Blogs are also considered to be entertaining so bloggers don't mind spending the extra time to read the posts and not just look at the pictures. The old marketers would argue "Just because you made a blog doesn't mean people are going to read it," but that's where blog communities come in to play. Once you join the blog communities and contribute to fellow blogs, the traffic of your sight is guaranteed to increase. Someday the blog could reach the notoriety of the top five footwear blogs which bring in an estimated 22 million impressions a month, according to google analytics.

Multi-Segmenting strategy

Although some might assume Nike would only implement one broad target market for all sports lovers, each sport requires a different marketing mix. Football, for example, appeals to the more violent, and "ready for war" mentality. Nike responded to their consumers by creating the "Pro Combat campaign" at the start of this years football season. Who better to advertise the campaign than the leading rusher for last year's NFL season:

Adrian Pereron (photo on right)

Distribution

Distribution is a process that normally includes the producer, one or more wholesalers, and a retailer. Nike's role in the distribution system is the producer aspect. Nike has made plans to expand their current distribution center in Wilsonville, Oregon, and establish a state of the art distribution center in Memphis, Tennessee. The one million square foot building will cost Nike an estimated 107 million dollars. Nike has projected that their investment will save for itself and their retail customers more than 200 million in cost efficiencies, as well as reduced shipping times and increased service capabilities.

Strategic Alliances

Although Nike may be one of the sports apparal and footwear giants, they wouldn't be nearly as successful with out the business partners they have today. One of Nike's more recent partnership agreements was with the Apple company. Nike and Apple introduced a product that syncs your running shoes to your ipod. A sensor is placed inside the shoe in order to record the different running variables such as distance, time, pace, and even calories burned. A receiver is attached to the ipod which allows the runner to check the status of his or her run at any time on the face of the ipod or just listen in to the periodic audible feedback that is transmitted through the headphones.
The product creates sales and marketing opportunites for both companies involved. The faithful Nike runners that were on the fence as to which MP3 player to buy have now made up their minds and the current ipod users have that much more reason to purchase those Nike Air Zoom's they always wanted.

Consumer Buying Decsions in U.S.

Even though the factors influencing consumer buying decisions in the U.S. are obviously much less diversified than the entire world, The United States is the most culturally diverse country there is. Because America varies in culture as much as it does, there are many different target markets. In each target market such as golf, cycling, or basketball, Nike has found an icon within the sports to market their product. The best in the business in regards to golf, Tiger Woods, is sponsored by Nike. Every time we see Tiger pump his fist, we also notice the swoosh logo branded on his hat. Nike can advertise their product through newspaper adds or T.V. commercials but people react more to what they see than what they hear. The performance of Nike sports icons influence the consumers on the fence of two products and lead by example that Nike truly is the best in their field.

Consumer Decision Making

Nike sells to one hundred and sixty countries worldwide. Each country has different cultures and different values that come with it. Nike has adjusted to these conditions and now sells products in varying sports such as tennis, lacrosse, cricket, ice hockey, track and field, handball, and rugby among many others. Considering soccer or futbol is the most popular sport around the world, Nike has focused their efforts in improving their sales in this category. Nike currently sponsors some of the most infamous soccer clubs in the world including Manchester United, Barcelona, or the Brazilian national team. These sponsorships serve as reference groups for consumers and to build a global awareness of the Nike products.