Nike

“Just Do It”

The Beginnings

• 1962 – Phil Knight & Blue Ribbon Sports• 1964 – Bill Bowerman (U of Oregon)

joined him to design running shoes• Nike – “winged Greek Goddess” & the

“fat check mark” was a compromise (cost $35)

• Steve Prefontaine (runner) was the first endorsed athlete – against the establishment

• Boston Marathon – first event (Jon Anderson won in a pair of Nikes)

Formative Years

• 1974 – Waffle trainer• Brand choice of mass market influenced

by top athletes• 1980 – surpassed Aidias as the #1 shoe

company with 50% market share• Running was the key – aerobics became

popular and Reebok reigned• Focus on innovation, males and serious

athletes rather than style and females – lost share to Reebok

Transitions

• Became more marketing oriented – consumer focus rather than product focus

• Shoes, colors, clothes, athletes, logos and TV advertising

• Up until now, only advertised in peer running journals

• Weiden & Kennedy – Air Max “revolution in motion”

The Reign of Air Jordan

• Focus on basketball – signed rookie Michael Jordan b/c Nike offered more than Aidias

• Nike sold $100 million Air Jordans in the first year

Just Do It

• Reebok paid too little attention to performance so Nike regained market share

• 1988 – Just Do It $20 million month long blitz (12 TV spots) urged Americans to participate in sports

• Attitude of self empowerment through sports – both celebrity and non celebrity endorsers

• By 1990 – Sales $2 billion

Just Do It

• EKINS – sports loving employees who hit the streets to disseminate Nike information

• Brand Strength Monitor – tracked consumer perceptions

• 1991 – Sales $3 billion; by 1993 Nike athletes include 265 basketball players, 275 NFL football players, 290 baseball players and college coaches and players

• Emphasis on top line performance wear

The Image Crisis

• Labor practices– Asia plants – unsafe working conditions,

uncompensated overtime, underage workers

– Boycotts, letters of protest and lawsuits– Nike implemented changes as a result

• Ubiquity of the swoosh– Too many swooshes; too aggressive

corporate philosophy

The Swoosh

• Downplay logo displays• Nike – all small letters• Separate business units for Jordan, All

Conditions Gear (ACG) and NikeGolf Brands

• Nike Alpha Project – most technologically advanced project

The Here and Now

• Caught behind the curve for “action sports” and “brown shoes”

• Not perceived as “cool”• Revitalize ACG• Now on the upswing for revenue and

growth in soccer and apparel• Tigers Woods & Tour Accuracy Ball

Challenges

• What is Nike’s Brand Image and sources of brand equity?

• What should Nike do to become “cool” again?

• How should Nike attempt to reach young consumers?