Nike Analysis

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Since being founded in 1962, Nike has grown from a small fledgling shoe retailer into a world-wide corporate giant. During its first year, sales for Nike were $8000, but as of November 30th, annual sales for Nike were over 12 billion dollars. (hoover) Although Nike already dominates the sporting world, there are many opportunities for growth. According to our research, key strategic challenges facing Nike are increased competition from Adidas with their technological shoe, the Adidas One, and a potentially fatal inability to enter a new growth market such as the extreme sports market. Our recommendations to help Nike confront these challenges consist of developing a product to remain competitive with Adidas, and also an aggressive…show more content…
Along with ensuring dominance in the high-tech shoe market with a new product, we also recommend that Nike make an aggressive move into the extreme sports market. Harvey Lauer, president of American Sports Data states ¡°these new sports are an authentic slice of the wider youth culture and not just a fad¡± (Raymond). ¡°Youth culture consists of over 58 million Americans between the ages of 10 and 24. Horizon Media Research estimates its annual buying power to be more than 250 million dollars.¡± (American demographics, Raymond) To cater to the youth culture, ESPN holds a summer and winter X-games each year. These events create an opportunity for Nike to gain exposure by advertising to the youth culture. Established companies such as: Billabong, Burton, Birdhouse, Element, and K2 already understand the importance of advertising to the youth culture to gain a slice of their 250 million in spending power. Nike can use its strength in promotion to compete with these companies and muscle its way into the market. X-games competitions include skateboarding, snowboarding, rollerblading, BMX, wakeboarding, luge, and other extreme sports. ¡°Each year the X-games draw hundreds of competitors, thousands of fans, and millions of television viewers¡± (Marshall). According to an article in the Columbian, by John Marshall, since 1997 to present, snowboarding has grown by 87 percent and skateboarding by 57 percent. These statistics show

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