Nike ( Marketing Channel)

2584 Words Aug 12th, 2012 11 Pages
University of Essex
Business School

BE-532 Marketing Channels

Nike- Channel Strategy and Conflicts.

Individual Report

Submited to:Dr. Antonello Romano

Name:Virena Georgieva

Student ID:0948588

Introduction

The main market quality athletic footwear, clothing, sportswear and equipment supplier in U.S. is NIKE. The company’s name, which in fact means in the Greek goddess of victory, has been market leader since 1964. Philip Knight, co-founder and chairman of NIKE, has been running this form for over 48 years and focused on few core corporate areas- SCM (Supply Chain
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While relying on its hundreds producers, the large apparel company had an aim to create long term trusting affiliations. The process of generating new models and designs was being done in-house. After the design is created, the product lifecycle will continue around eight months before the production was moved online. Furthermore, it takes approximately nineteen days for final orders to be made.

NIKE was not so interested into reaching the “end consumer” rather than considering retail sales. The distribution, in addition, was tremendously compound. Monthly 300,000 pairs of shoes might engage 50 different models being shipped to 100 different locations. The company had created “in-house-power” which had been selling their products in specialty athletic department store retailers, multi-sport general athletic department stores and general-purpose shoe stores. NIKE also had many own individual shops which were more deliberated on brand-building instead of selling products. Those were called NIKETowns which in 1999 they were 13 overall in comparison with NIKE 53 outlet stores. The powerful firm which had gained over 40% market share in the United States was giving them additional influence on merchants. The product lifecycle could take more than a year and a half. On the other hand, the market life for a NIKE shoe was half a year. The firm decided that it is inappropriate to attempt equivalent the demand for a model with the supply. Imperfect information

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