QUESTION 2

Nike, with its famous "swoosh" logo, is one of the world's most recognized brands. While Nike sells a broad range of apparel and sports products (including a recent move into golfing equipment, with Tiger Woods endorsements backing up the line), over half of Nike's $10 billion in sales is generated by shoes. Nike spends tens of million of dollars advertising all over the world to sell such leading-edge athletics shoes as $ 160 Vince Shox and $ 200 Air Jordans. So, when Foot Locker, Inc, Nike's largest retail channel member canceled order for $250 million worth of its shoes, Nike was beside itself. Its massive consumer advertising and expensive celebrity product endorsements were not very impressive to Foot Locker, because all that heavy consumer pull promotion was not moving the merchandise off the shelves fast enough to satisfy Foot Locker. If more major retailers follow Foot Locker's lead, Nike could be in for some very serious impacts on its growth and profit potential.

Questions?

1.Do you think Nike's emphasis on pull promotion might have to be modified to keep giant retailer such as Foot Locker happy?

2.How might Nike change its promotional strategies to enhance retailer support for the company's product.