Brand Management: Nike Case Study

Introduction

In general, brand management describes marketing, advertising, overall placement, distribution, and design of the companys products and services that substantively contribute to the development of the brands personality. However, this term is also related to the perception and perceived values created by a company and its relationship with consumers. This paper includes the evaluation of Nike, an outstanding sports apparel and footwear corporation, and its response to the customers behavior affected by a global trend of climate change.

Evaluation of Nike

Brand History

Since the companys foundation, Nike, Inc. has focused on discoveries and innovations in its sphere in order to provide products of high quality to athletes all over the world. It was founded in 1964 by Phil Knight, the track athlete of the University of Oregon, and Bill Bowerman, his coach (Ahmed, Abbas, and Brohi, 2016). Originally, the company was called Blue Ribbon Sports, and it operated as a distributor for Onitsuka Tiger, a Japanese shoemaker (Ahmed, Abbas, and Brohi, 2016). After the opening of its first retail store in California in 1966, Knight and Bowerman expanded their business in various regions across the United States (Ahmed, Abbas, and Brohi, 2016). In 1971, Blue Ribbon Sports became an independent company with a new name and its own logo, Swoosh, that imitated the goddesss wing, and released its own footwear line (Ahmed, Abbas, and Brohi, 2016). Eventually, Nike took the leading position in the countrys athletic market through multiple marketing communication ways that contributed to the customers awareness about products.

Current Positions

In the present day, Nike, Inc. is a multinational corporation with a wide arrangement of products that are available across the globe. Over the past several years, it has increased its revenue from 16$ billion to 24$ million, with 19% of the footwear market share (Forbes, n.d.). It is currently based in Beaverton, Oregon, and includes such brands as Nike, Jordan, and Converse (About Nike, n.d.). The company defines its principal business activity as the design, development and worldwide marketing and selling of athletic footwear, apparel, equipment, accessories and services (NIKE, Inc., 2018, p. 55). Nike, Inc. distributes its products through corporation-owned retail stores, digital platforms, and a substantial number of independent licensees, sales representatives, and distributors in the majority of countries all over the world. Virtually all apparel, equipment, and footwear of Nike, Inc. are produced by independent contractors both in the territory and outside the United States.

There are six main categories of products NIKE Basketball, Running, the Jordan Brand, Training, Football, and Sportswear (NIKE, Inc., 2018). The company additionally markets footwear and sports clothes that are designed for children.

Nike, Inc. releases multiple products for recreational and athletic uses such as baseball, cricket, American football, tennis, lacrosse, volleyball, wrestling, walking, skateboarding, and other outdoor activities. Moreover, it sells a specific line of accessories and equipment that includes sports balls, bags, bats, gloves, socks, eyewear, digital devices, protective equipment, and timepieces (NIKE, Inc., 2018). In general, the company aims to expand its positions in the market and the relevance of its brand through innovative development techniques. In addition, Nike has obtained a strong name or title in the market of running basketball and football categories in North America and central and Eastern Europe (Ahmed, Abbas, and Brohi, 2016, p. 3). Moreover, it works in cooperation with world-class partners in order to expand opportunities for children, adolescents, young adults, retired athletes, and their communities. The companys strategy implies constant development and market exploration for retail effectiveness and customer satisfaction.

Companys Mission and Heritage

The company defines its goal as the unconceivable motivation, passion for sport and innovations, and enthusiasm to do all possible things in order to expand the potential of every person. The official statement of Nikes mission sounds to bring inspiration and innovation to every athlete in the world. If you have a body, you are an athlete (About Nike, n.d., para. 1). According to the companys statement, the world of athletes is united in the joy of movement, and the inspirational power of sport helps to overcome differences and breaks down barriers worldwide (Nike Careers, n.d., para. 1). Nike, Inc. believes that its team diversity serves every customer individually, accelerates innovation, and supports creativity. The company focuses on inclusion and diversity throughout its business and corporate culture to empower its employees to realize their full potential and create breakthrough innovations for athletes (Nike Careers, n.d., para. 4). In addition, Nike, Inc. embraces different perspectives of its high-performing team as every member may bring unique ideas and experiences.

Throughout its history, the company aimed to create groundbreaking sport innovations, increase the sustainability of its products, build a diverse and creative global team, and positively influence living and working communities all over the world. It pursues to continue its legacy of exceptional quality and innovative thinking to develop various products for athletes of every level of ability to reach their potential (Ahmed, Abbas, and Brohi, 2016, p. 4). Nike, Inc. aims to provide access to sport for every child and adult. In addition, the corporation creates business opportunities for Nike to avoid competition and provide the brands value for its shareholders.

Brand Perception by Consumers

Nike may be currently characterized by-products that are well-known all over the world, effective advertisement campaigns, and positive views shared between consumers, their families, and friends. After purchasing the brands footwear, equipment, apparel, or accessories, customers experience their quality and remain satisfied (Ahmed, Abbas, and Brohi, 2016). Moreover, the athletes commitment to the brand may be explained by the corporations focus on inclusive culture. This aspect implies equal opportunities for all adults and children, regardless of their age, gender, ethnicity, sexual orientation, socioeconomic status, and location. In addition, Nike attracts consumers who pay particular attention to the sustainability of manufacturing and products as the company uses innovative materials, such as recycled leather fiber, to avoid a negative impact on the ecology. That is why the majority of customers feel that they got comfortable, environmentally friendly, and good-looking products.

Climate Change as a Global Trend

Climate Challenging

In the present day, climate change may be regarded as one of the most essential global trends that will retain its relevance and significance in the foreseeable future. In general, climate reversal and global warming refer to the change of weather patterns due to the increase in average global temperatures. Not only natural events but human activities, such as the emission of greenhouse gases and fossil fuel use, substantively contribute to potentially catastrophic outcomes for the planets climate. People are highly responsible for water and soil contamination, the depletion of the ozone layer, and the greenhouse effect that cause the melting of Arctic and Antarctic glaciers and the rise of sea levels.

Climate change dramatically influences ecological networks, ecosystems, wildlife, human populations, communities, and individuals all over the world as well. Extreme weather events cause floods, tornadoes, droughts, wildfires, sandstorms, and other natural disasters. The planets ecosystems suffer from freshwater scarcity, massive deforestation, desertification, the extinction of endangered animal species, and the decrease of genetic diversity. Climate change has a highly negative impact on peoples ability to produce physically necessary products and food. Floods and droughts are traditionally regarded as the main causes of havoc with crops that substantively affect food prices. In addition, due to climate change and erratic weather patterns, people may suffer from various infectious diseases, such as malaria, dengue fever, hepatitis, and bacteria diarrhea.

Impact of Climate Change on Companies and Customer Behavior

It goes without saying that global trends substantively influence peoples behavior, especially in the sphere of consumption and service. According to researchers, the consideration of indirect environmental problems like climate change, or excess use of resources leads to a sense of powerlessness and negative attitude towards authorities responsible for antipollution measures (Umpfenbach, 2014, p. 6). However, the motivation to improve or protect the environment is not defined as the key motivation for individual pro-environment behavior. The majority of people who consider particular issues related to climate change are frequently motivated by a sense of justice or their desire to avoid waste, promote health, save money, and perform appropriately in front of others (Umpfenbach, 2014). Sociologists explain the fundamental driving factors of behavioral changes by the peoples essential intentions or needs, such as protection, affection, subsistence, understanding, creation, participation, identity, leisure, and freedom.

Meanwhile, the belief that insufficient pro-environmental steps, such as turning out lights or the separation of waste, may have a highly positive impact on substantial pro-environmental behavior is empirically unsupported. According to recent studies, there are no correlations between a person undertaking a green behavior and undertaking another, or correlations were very weak (Umpfenbach, 2014, p. 6). However, costumers are crucially influenced by social norms and other people, and the impact of particular information may be increased by social pressure, for instance, by the sales assistants persuasion. In addition, the refusal to act like peers may be highly stressful for a prevalent number of consumers, and all forms of marketing, such as promotion, advertising, product placement, and packaging, have a substantial influence on peoples behavior and form social norms. In general, due to climate change caused by human activities, customers started to consider the products materials and the sustainability of manufacturing.

Nikes Response to Climate Change

The area of sport has experienced the negative impact of climate change as well. The negative consequences of erratic weather patterns include the increasing number of hydration stops during competitive races and the canceling of a substantial number of events due to wildfires and heat warnings (Kinder, n.d.). It goes without saying that Nike, Inc. understands the significance of the companys contribution to the planets preservation. According to Noel Kinder (n.d.), Chief Sustainability Officer, the corporation is determined to take climate actions the only way Nike knows how with an athletes mindset of adaptability, persistence, relentlessness, and determination (para. 7). The companys concept that focuses on the sustainability of products and manufacturing to satisfy consumers and minimize climate change includes the following activities:

By 2025, Nike has a mission to power its owned facilities with totally renewable energy;
By 2030, the company aims to reduce carbon emissions across its global supply chain by 30% (Kinder, n.d.);
Nike has elaborated the guide Circularity: Guiding the Future of Design, which implies workbook share principles of design and manufacturing in the industry of sports apparel and footwear;
The company has launched several programs that were created for the conversion of waste into playgrounds, courts, running tracks, and new products (Kinder, n.d.);
Nike diverts one million plastic bottles annually from landfills to recycle them and produce materials for the brands Flyknit shoes and jerseys (Kinder, n.d.);
The company diverts from landfills almost 100% of its footwear manufacturing waste.

As the change of customer behaviors due to climate challenges is predominantly characterized by peoples particular attention to sustainability and recycling, Nike, Inc. has an appropriate response. For instance, the corporation has launched Nike Grind which implies a collection of recycled materials originating from Nike manufacturing scrap, unsellable products, and worn-out sneakers (25 years of Nike Grind, n.d., para. 9). Used materials are collected in order to be processed and used by Nike and its partners who share the companys vision concerning sustainability and zero waste. Leather, textile, scraps of rubber, plastic, and foam left after Nikes manufacturing are collected from all factories across the globe to be regenerated into innovative premium materials.

Conclusion

In the present day, Nike, Inc. is a multinational corporation with a wide arrangement of products, brand heritage, well-defined missions, effective advertisement campaigns, and positive views shared between consumers, their families, and friends. The company defines its goal as the unconceivable motivation, passion for sport and innovations, and enthusiasm to do all possible things in order to expand the potential of every person. It goes without saying that global trends substantively influence peoples behavior, especially in the sphere of consumption and service. In general, due to climate change caused by human activities, customers started to consider the products materials and the sustainability of manufacturing. As a response, Nike focuses on the sustainability of products and manufacturing to satisfy consumers and minimize the environmental crisis.