Nike Swot Case Study

Nike, INC

Nike is the world's leading supplier of athletic shoes, apparel, major sportswear, and equipment supplier based in the United States. Nike's headquarters are located near Beaverton, Oregon, a suburb of Portland. Nike operates in more than 160 countries across the globe. ("About Nike, Inc.", 2011). With profits that exceed 18 billion dollars in revenue in 2010 Nike continues to be a dominating force to it completion. Nike is also a large employer and including supplier, shippers, retailers, and other service provider, they employ nearly one million people. Throughout the paper, the writer will history and conduct a SWOT Analysis outlining the strengths, weakness opportunities, and threats that Nike faces as the worlds leading athletic apparel company.

History

Nike was original formed as Blue Ribbons Sports in 1962 by Philip Knight a track athlete and his coach Bill Bowerman. Both Knight and Bowerman initially invested five hundred dollars and placed their first order of three hundred pairs of shoes. In the beginning they sold shoes ot of their trunk, while maintain full time jobs. In the late 1960s the business relationship with Blue Ribbon Sports was not working out so Bowerman and Knight were ready to move from being a footwear distributor to designing and manufacturing their own brand of shoes. With the move from distributor to manufacture the famous "swoosh" was born. The swoosh was created by a student at Portland State University by the name of Carolyn Davis. In 1971 the name Nike was adopted as the name of this new venture. With the new logo, name and design in reached out to what would be their first spokesperson who was Steve Prefontaine a track and field star. Nike footwear line debuted in 1972, at the U.S. Track & Field Trials. Prefontaine represented Nike until his tragic death in 1973. In 1980, Nike became a publicly traded company. This was a time of transition, and Knight stepped down as president from 1983-1984, he however remained the chairman of the board and CEO. Today, Nike is constantly seeking new ways to develop the best athletic products and meet the needs of their consumers. The company has continued to expand and have potential growth in China. They have also struck a deal to become the official sponsor of the National Football League (NFL) beginning in 2012.

Strengths

Nike has an innovative and evolving product range with a large portfolio of products. They produce quality product at the lowest possible price. Nike is also a global brand which makes their famous "swoosh" instantly identifiable. It is a common practice of Nike to use A-List celebrities in their advertisement campaigns. If the price for manufacturing goods rises, Nike simply moves operation. Nike currently has offices in 160 countries. Offering their product worldwide gives them the ability to venture into many different rebranding opportunities with successful results.

Weakness

Revenue for Nike is highly dependents on footwear products. They also to some degree have to rely on retailers pushing/promoting the sale of their product. Nike products are considered expensive and, it is difficult for the third world and Asian countries to afford. Lack of diversification in products increases dependence on fewer products. Social groups have criticized their brand for paying low wages to workers, and violation of overtime and child labor laws. The work conditions have that the workers face has also been cause of concern. For awhile, Nike refused to disclose information about their partnering companies. Nike's competition also tends to offer consumers cheaper product which pressure Nike into offering products at a lower cost. Just as having star endorsements may be a benefit to advertisement for Nike, too many stars endorsements could cause the opposite effect. Consumers like to be able to relate to the person that is attempting to sell them a product.

Opportunity

Nike has the opportunity to enter into untapped markets. They could make efforts to reduce pollution generated by manufacturing plants. They could also make their products more affordable in Asian and third world countries to increase market share. Nike could also lean more toward establishing itself as a fashion brand as opposed to and athletic brand, as not all consumers of Nike participate in sports. This creates an opportunity for the consumer to more frequently replace the product when it goes out of style as opposed to when it wears out. Nike could also increase product line by jewelry or sport associated cosmetics. Nike could also use global marketing events that could support brands such as the World Cup and The Olympics.

Threats

Nike's competitors are becoming more aggressive and are making high quality product that are he taking away from profits from Nike. Because of business operations in other countries some of their profits could fluctuate due to currency value. Nike has received bad press in the pass for unethically taking advantage of labor markets in places such as Indonesia. Specifically Nike has been accused