When you hit the age of 40, will everyone in the world know who you are? The founders of Nike have worked hard at building their brand for 40 years, and they have been extremely successful. They have built huge, worldwide brand awareness.
Nike is probably most familiar to the public for its athletic shoes. However, it also produces other athletic gear, such as clothing and equipment. It makes those products not just for "real" athletes but for all of us, or as Nike likes to say, "For the athlete in all of us." Nike does not challenge its customers to become pros - it challenges its customers to "Just do it."
Nike prides itself on innovation and it uses celebrity athletes to endorse each new product line. The athletes help persuade shoppers that the shoes may help them perform better. An example is Michael Jordon's Nike Air shoes: The implication is that if you wear these light and bouncy shoes, perhaps you can play basketball as well as Jordan.
Nike employs the "opinion leader model." If you can convince those "market mavens" (as opinion leaders are also sometimes called) that you have got a good thing, they will adopt it and become fiercely loyal, energetic supporters and vocal proponents. Later adopters fall in and buy, and sales can skyrocket, as Nike's have.
Nike considers premier competitive athletes to be their opinion leaders. The athletes lead by modeling. By simply wearing the shoes or other Nike gear, an athlete endorses the brand, sending a message that tells consumers, that at least one top athlete thinks Nike is doing something right.
Nike perceives the athletes as more than just promotional material. It seeks feedback on its shoes to see what these excellent, knowledgeable, and presumably very picky athletes like and don't like. It uses the feedback to improve its product. For Nike, product is central and promotional messages follow.
Of course, customers don't need to be professional athletes. If you like Nike's spokesperson, you will think favorably about the Nike brand. In a sporting good store or in shoe store, the hope is that those positive attitudes make you gravitate toward the Nike shoe section, even if looking for a good shoe for another sport, such as tennis or walking.
The Company and the World
Americans love baseball, football and basketball. But the world's favorite game is soccer.

 

Nike, located in Oregon, had to switch gears a bit to appeal to the global consumer, who is far more likely to love soccer than American baseball. How did it proceed? Same old Nike story: Find top soccer players, find out what they look for in an excellent shoe, make such a shoe and then get some of the athletes (and some entire teams) to wear the shoes and endorse them. If you shoe the players, they buying public will follow.
The Company Now
Why does Nike continue to sponsor sporting events? Its brand awareness is nearly 100 percent, and that's true throughout the world. Why spend the money?
First, the company is always looking to expand. It wants to grow new young customers into the product line to start their customer lifetime value with Nike. It wants to grow its share of dollars from each customer-that is, Nike would like all the sneakers in your closet to be Nikes.
In addition, positive publicity and continued advertising help to strengthen existing brand equity, building goodwill. A company never knows when it's going to need this. Nike was accused of poor labor practices when it was found to have paid very low wages to workers abroad. This hit Nike and its image hard. Nike recovered by fixing the problem and rebuilding the slightly tarnished brand image. In a sense, Nike has suffered from its own success. Most companies as big and omnipresent as Nike will sooner or later take a few hits from critics. If you continue to advertise and build goodwill in the marketplace, customers' attitudes may be inoculated against the hits, making it easier to fix problems before they overtake the brand.
Nike is tough. The company can take pressure. Rolling Stone magazine listed the Nike swoosh among the top American icons. Now that's cool.
Questions:
1. With Nike's inclusive definition of an athlete, what would you say Nike's segmentation and targeting strategies are?
2. Based on Question (1), does Nike could sustain in long run with the current strategies? If so, why or why not?