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Nike Company’s Marketing Principles and Practice


Branding is a marketing concept that refers to the process of creating a unique name for a product with the view of differentiating it from the substitutes offered by the rivals. The reason for branding a product is to make it easily identifiable by customers. It may help a company to create loyal customers in the end. To popularise a brand name among customers, a company must advertise the good through the most suitable media (Kotler & Armstrong 2010).

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Nike produces a wide variety of sportswear, which it distributes to different countries around the globe. Over the period in which the company has been operational, it has acquired a strong brand image, which has given it a strong competitive advantage over the rivals. Its products are widely acceptable all over the globe, as evidenced by the high number of customers the company controls. The company has customers around the globe, including women, men, teenagers, and children who are loyal to the corporation because of the established strong brand equity. Customers tend to buy the company’s products, provided they are Nike-branded. Originally, the firm’s products were exclusively Nike-branded. However, today, the company sells its products under other sub-brands, which include Nike+, Hurley, and Converse (Brohi et al. 2016).

Product Strategy

A product strategy refers to a roadmap, which describes an organisation’s vision regarding a product or service (Shank & Lyberger 2014). The roadmap describes what a company intends to achieve through the product in question. Nike’s mission statement describes the company’s roadmap as ‘to bring inspiration and innovation to every athlete in the world’ (Bonchek 2013, para. 6). Based on the highlighted mission statement, it is clear that the company intends to innovatively introduce superior products, which it will supply in the world market. The mission is achieved in part, as evidenced by the high sales realised by the business from different countries.

The profits are attributed to the superiority of its products as compared to those of its rivals. The company also outsmarts its competitors in the area of technical superiority, hence further positioning it way ahead of them. By employing technology, the company has successfully managed to increase its customer experience, a situation that has boosted its competitive advantage. Technology is mostly used in the areas of advertisement and customer service.

Innovation is at the heart of the company’s operations. The company recruits and strives to retain the best talents to promote innovation. The most innovative employees are rewarded to encourage them to come up with new ideas to advance its product strategy. Through innovation, the company managed to introduce different types of sports garment into its product line.

Promotional Strategy

As stated previously in this paper, the company has a strong brand equity, which is mostly derived from its provision of superior-quality products. However, in as much as the quality of the firm’s products is highly linked to the strong brand equity, the company’s aggressive marketing strategy also contributes to the strengthening of its brand. One of the promotional strategies advanced by the company is big-name endorsements. The strategy involves promoting the firm’s products through celebrities. For example, in 2013, the company sponsored Rory McIlroy who was the then best golf player in the world (Brohi et al. 2016).

The use of such stars to promote the firm’s products is a major strength since they command a huge public following. Additionally, sponsoring such stars paints a picture of a company that cares about its customers. Other than celebrity endorsements, the company uses promotional events to advance its products. For instance, it sponsors various events that aim at enlightening customers about its products. Other promotion techniques include advertising, sales promotion, direct marketing, public relations, and personal selling. The contemporaneous use of the listed forms of advertising to promote sales is informed by the fact that customers prefer different forms of advertising due to their varied literacy levels.

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Nike’s Organisational Culture

The company has a distinctive culture that is characterised by highly skilled and talented workforce. The firm has a code of ethics that binds all stakeholders and employees. In additional to the strong corporate culture, the company usually engages in corporate philanthropic works as a way of marketing its products. In the contemporary society, people are more attracted to firms that tend to give back to society, as opposed to profit-focused businesses.

In this regard, companies are increasingly sponsoring philanthropic works to convince their customers to embrace them. One of the CSR works by Nike is the use of sports as a way of promoting the health of the participants (Shahriar 2015).

In the recent past, physical exercise has been linked to healthy living. This connection underscores the need to embrace exercise and consequently Nike’s organisational culture. Nike sponsors numerous tournaments for all genders as a CSR strategy. Besides, the company utilises the value concept to maximise its market share. Under the concept, it strives to satisfy each customer by offering high-quality products. This goal is achieved by recruiting the best employees and maintaining a continuous training programme to keep employees updated about the emerging issues and technology.

The Role of Marketing Strategies and Programmes in Achieving Nike’s Objectives, including Ethical Considerations

Nike’s primary objective is to become the global leader in the supply of sporting garments. Although competition is stiff in the industry, the company has managed to fulfill this goal. It is now one of the leading suppliers of sports clothing. One of the marketing strategies that have facilitated the achievement of the stated objective is the differentiation approach that is evident in the company. The strategy involves making a product or service different from that of the rivals in terms of quality (Brohi et al. 2016). The strategy is directed at making a product or a service attractive to customers. It may be a source of competitive advantage for a firm.

The type of strategy adopted by any company regarding differentiation depends on the industry. It mostly involves distinct features, durability, and good customer relations. A favourable differentiation strategy leads to the creation of a good brand image, which may increase the profitability of a firm in the end. By producing high-quality products, Nike has managed to create a sense of strong brand equity among its customers. Consequently, it has gained much acceptance from its customers who tend to buy its products just because they are Nike-branded. As it stands now, the company’s products are widely used in almost every country in the world. This situation is an indicator that Nike will achieve the objective of becoming the global market leader in the end.

The other objective that Nike seeks to attain revolves around achieving sustainability of profits by offering quality products while being the cost leader. Nike strives to achieve market leadership by supplying premium products at reduced prices. The company’s products, which are among the selling items in the fast fashion industry, have facilitated its rapid growth (Brohi et al. 2016). Given that Nike mainly sells outsourced goods, suppliers are the main determinants of the success of the low-price strategy.

To achieve price reduction, the company uses its large size and bulk purchasing to bargain for discounts from its suppliers, leading to reduced operations costs. In turn, the reduction in the operations costs facilitates the lowering of the product prices for customers. The strategy has worked well for the company in the past, owing to the suppression of new entrants, a situation that has reduced competition. The online-based marketing strategy has also been specifically influential in lowering the company’s cost, thus facilitating the low pricing of its goods. Compared to other forms of marketing such as radio and print media, online marketing is not only cheaper but also allows the company to reach more customers.

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Lastly, according to the firm’s mission statement, the company strives to instil a sense of innovation and inspiration to each athlete around the globe (Aaker 2012). The stated purpose is achieved by innovatively producing a wide variety of sports garments, which it sells in different parts of the globe. The diversity of the company’s products ensures that each person across the world finds his or her choice. The production and supply of a wide range of products are informed by the view that the company views everybody as an athlete. Besides, Nike’s garments contain inspirational texts, which create the perception that everyone is a winner.

How Marketing Concepts and Principles are used in Nike’s Daily Organisational Operations

The 7Ps in Nike

Nike heavily relies on the concept of marketing mix to realise good profits in the backdrop of the stiffening competition in the sports garments industry (Brohi et al. 2016). In terms of products, the company’s brand is a major source of its competitive advantage since its commodities have gained high customer acceptance across the world. Nike manufactures a wide variety of sports garments, which include shoes, apparel, and equipment and accessories (Shahriar 2015). In terms of promotion, the high amount of sales achieved by Nike is largely attributed to its effective employment of the right promotional mix.

The company has an extensive promotional strategy that seeks to enlighten customers about the existence of its products through advertising, personal selling, direct marketing, sales promotions, and public relations. The place component of the marketing mix refers to the point of sale of the company in question (Kotler & Armstrong 2010). Nike strives to bring its products at the most convenient locations for easy access by customers. To achieve this goal, the company distributes its products through retailers, Nike’s official online store, and Nike-town retail outlets.

Price is an important component in marketing since it determines the turnover and profits of a firm. Nike employs value-based pricing strategy, which implies that it assesses customers’ perception of the value of its products to determine the retail price (Aaker 2012). Given that its customers perceive the products part of the marketing mix include all stakeholders that a business interacts with directly or indirectly (Riaz & Tanveer 2012).

In Nike, the main stakeholders include customers and employees. The company engages in thorough research before penetrating into a new market to ensure that it has enough customers to support its growth. The company boosts its employees’ morale by paying them competitively and rewarding new ideas meant to improve customer experience. The aspect of physical evidence refers to the proof that a company physically exists and that customers can access its goods and services at their convenience. This aspect of marketing mix is evident in Nike since the company has physical stores in many parts of the globe from which customers can access the company’s products (Shank & Lyberger 2014).

Process denotes the ability of a firm to offer services to its customers, handle conflicts, and/or predict and mitigate an unforeseeable contingency. In Nike, this aspect is achieved by recruiting highly qualified personnel and defining the role of each employee.

STP in Nike

Segmentation can be done demographically, geographically, or psychographically. Demographic segmentation method is based on age, gender, marital status, financial standing, career, education, religious convictions, culture, and ethnicity. Segmentation based on customer demographics is evident in Nike since the company strives to maintain the operations costs as low as possible to lower the prices of its garments (Brohi et al. 2016).

Under the geographic segmentation variable, the market is divided into various segments based on ecological units such as countries, states, districts, cities, or regions. Given that Nike operates in different countries around the globe, it has to brand its goods differently to cater for the needs of the different regions. Under the psychographic purview of market segmentation, Nike targets athletes who tend to value light sporting garments. Using this segmentation tool, the company identifies people with similar traits before producing special sportswear for them. For example, the company produced the Nike Air Jordan shoe for basketball players only. In terms of behavioural segmentation, Nike regards the consumer behaviour as an important aspect of market segmentation. The company manufactures different types of garments in large numbers during mega sporting events such as the world cup (Shahriar 2015).

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Targeting refers to sorting the market segments based on their potential to make the company profitable. Segments that have the greatest potential are selected and prioritised. Much of the marketing efforts are directed to these segments to exploit them fully. In Nike, targeting is based on the analysis of the profitability of each segment and designing different types of garments for each (Shank & Lyberger 2014). For example, Nike has different types of shoes for different types of sports such as Air Jordan for basketballers, Nike Free for trainers, and Nike View for walking among others.

Market positioning refers to the proposition of a product based on the customers’ perceptions of the value of the concerned commodity. In Nike, positioning is done by considering the tendency of customers to buy its goods, as opposed to those of its rivals. Since the company focuses on creating real value, positioning is high (Shahriar 2015). The next step involves creating a marketing mix for each market based on the characteristics of customers in each segment.

Marketing Research

The company’s success is attributed to marketing research, which it undertakes to support its promotion decisions. The company makes a considerable investment in research with the view of gaining information regarding customers and competitors (Brohi et al. 2016). Research is accomplished through surveys on customers and the use of the internet to assess the level of client satisfaction. Online platforms are specifically open for customers to submit reviews about the products.

Relationship of the Marketing Functions to other Functional areas in Nike

One of the departments that work closely with the marketing unit is research and development (R&D). The department is responsible for conducting research pertaining to different issues affecting the company (Aaker 2012).

Nike uses the recommendations from this department to seal the gaps in customer satisfaction to achieve a competitive advantage. Its role in marketing cannot be ignored since it contributes to great ideas regarding the marketing environment. Marketers are responsible for maximising the sales of a firm to achieve reasonable profits. Besides, they play a pivotal role in assisting a firm to penetrate new markets by launching the relevant marketing campaigns to alert customers about the existence of the concerned product or service in the market. Customers have different levels of education. Besides, they exhibit diversity in terms of their demographics.

Hence, the choice of the promotion mix is important to achieve the desired goals. The R&D department often conducts research regarding the new market prior to the penetration of the firm in the new market. Research guides marketers in developing a marketing strategy that best fits a certain segment. Besides, they must continuously consult the R&D department at different stages of the marketing to gain an insight into the effectiveness of the strategy in use. Based on the feedback, the marketing department may either continue with the strategy or make the necessary adjustment to the original strategy to make it more effective.

The other department that marketers need to liaise with is the production unit. The production division is responsible for the manufacture of goods and services that marketers distribute to customers. Therefore, the production department plays a central role in facilitating the marketing of a product. Marketers must market a product, which is available in the market. Otherwise, their efforts will not produce any positive results. Additionally, the product must be available at the most convenient places for customers to access them. It is the duty of production managers to ensure that the product is manufactured in time and distributed to the relevant warehouses and stores. In Nike, the two departments work hand in hand to facilitate the timely delivery of the garments when a customer needs them (Shank & Lyberger 2014).

The production department ensures that the garments are manufactured in time and sent to the relevant selling points. This plan facilitates personal selling since field marketers are able to obtain the goods from the stores. Additionally, it facilitates online marketing since customers can place orders online and/or collect their purchases from the stores.

Next, marketers need to work in collaboration with the human resource department to facilitate the achievement of the marketing objectives. The HRM department is responsible for the recruitment of staffs and organising their training. Other roles include employee motivation, health and safety, and performance management. To achieve success in marketing, marketing teams must be conversant with their roles.

The HRM department plays a central role in the recruitment of best-qualified marketers through a competitive selection. Additionally, they facilitate the training of the marketing staffs to make them more competent. In Nike, the marketing manager works in liaison with the human resource administrator in several ways. Firstly, marketing managers must consult with the human resource bosses when they need new marketers (Brohi et al. 2016).

In such cases, the managers from the two departments hold roundtable meetings with the other relevant stakeholders to create the profiles of the prospective candidates. Once the candidates are recruited into the company, the HR department organises for their orientation to their new roles in the company. In consultation with the marketing manager, the department also sets the salaries of the new staffs. Regarding the continuous training of the marketing staffs, the marketing manager collaborates with the HRM to formulate a curriculum, which is suitable for the marketing staffs based on the accrued experiences.

Lastly, the finance and the marketing departments must work closely to facilitate the marketing of a company’s products. Marketing is an endeavour that consumes a significant amount of finances, which must be approved by the operations manager. Such money is used to finance marketing activities, which include costs incurred during event promotions, allowances for the marketers, and transportations costs among others. In Nike, the marketing department in collaboration with the finance unit formulates the marketing budget to ensure that all marketing activities are adequately financed (Shank & Lyberger 2014).

Additionally, the finance department is consulted when formulating the marketing strategy to be applied by the company. Such consultations are important to any firm since the success of the marketing strategy largely depends on the availability of the necessary resources. Without consulting the finance manager, the marketing department may end up formulating strategies that are impractically executable due to lack of resources. It is important to note that only the marketing strategies whose costs do not exceed the benefits accruing from their use may be approved. This claim underscores the need to consult the operations manager in the process of creating the strategies.

Reference List

Aaker, D 2012, Building strong brands, Simon & Schuster, New York City.

Bonchek, M 2013, Purpose is good: shared purpose is betterWeb.

Brohi, H, Ahmed, R, Abbas, Z, Bhutto, A & Chawla, S 2016, Strategic marketing plan of Nike. Web.

Kotler, P & Armstrong, G 2010, Principles of marketing, Pearson Education, Hoboken.

Riaz, W & Tanveer, A 2012, ‘Marketing mix, not branding.’ Asian Journal of Business and Management Sciences, vol. 1, no. 11, pp. 43-52.

Shahriar, A 2015, Assignment on marketing plan of Nike shoesWeb.

Shank, M & Lyberger, M 2014, Sports marketing: a strategic perspective, Routledge, Abingdon-on-Thames.

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