Week 3 Market Segmentation Essay

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NIKE: A LOOK IN TO WHAT MAKES
IT TICK
INSERT NAME
MKT/571
STEVEN KRAUS

Nike: A Look In to What Makes It Tick HISTORY January 25, 1964 was a monumental day for Bill Bowerman and Phil Knight (FundingUniverse, n.d.). This was the day they founded Nike, a now multi-billion dollar corporation, reporting $7.4 billion in revenues for 2014 (Nike, 2014). Nike’s early success is attributed to “delivering performance to the best athletes” (Elliott, 2013, para. 6). Nike is a sponsor of many professional sports teams, as well as, the distributor of athletic apparel and footwear. It distributes brands such as Jordan and Kevin Durant (KD), which bring in $200 and up per pair of shoes. These brands are favored by individuals throughout the world, and are some of the main reasons for Nike’s continued success.
DEMOGRAPHICS
As evidenced in the earlier paragraph, much of Nike’s target market is athletes. From professional basketball players to professional golfers, Nike outfits athletes with apparel and footwear that are said to improve player performance. Nike markets to consumers throughout the world, in pretty much every age group imaginable. From newborn to those born a century ago, male or female, Nike provides something for everyone. For the younger generation, the constant release of sneakers considered to be “hot” keep them coming to Nike for their sneaker needs. For the older generations, Nike provides more sensible, comfortable, and affordable footwear. Additionally, in hopes to reach a different market sector, Nike purchased Hurley International in 2003, which is a teen lifestyle brand, focusing on athletes in the fields of surfing, skateboarding, and snowboarding (Reference, n.d.). Nike also added Cole Haan to its list of subsidiaries, “which designs, markets and distributes luxury shoes, handbags, accessories and coats” (Nike, 2010). Nike strives to and does market to every individual in the world.
GEOGRAPHIC
In 2007, the U.S. was Nike’s biggest market, with China figuring to be the second largest market (Holmes, 2007). Nike holds a global market share of about 37 percent, making it the largest marketer of athletic footwear (Reference, n.d.). In 2009, Nike looked to reorganize into six geographies, including: “North America, Western Europe, Eastern/Central Europe, Greater China, Japan and emerging markets” (Cheng, 2009). Previously it focused on four markets: U.S., Asia Pacific, Americas and Europe, and Middle East and Africa (Cheng, 2009). In 2009, China had taken over Japan as Nike’s second-largest market, who along with Eastern Europe, generates more than half of Nike’s sales outside of the U.S. (Cheng, 2009). Nike has positioned itself to reach as many consumers as possible. As of May 31, 2012, Nike had approximately 826 retail stores throughout the world (Siemers, 2012). In addition to the over 800 retail stores, Nike reaches consumers through an e-commerce site, through thousands of retail accounts, independent distributors, and licensees (Hoovers, n.d.).
PSYCHOGRAPHIC
Nike provides sports apparel that can be used in a variety of sports, including basketball, football, running, golfing, and baseball, just to name a few. Professional athletes such as Tiger Woods, are seen at many sporting events proudly wearing Nike apparel. Many athletes sport Nike products because they are said to enhance performance. Professional athletes look to be at the top of their game, and performance enhancing apparel is an “acceptable” method for doing so. In addition to performance enhancing products, Nike delivers products that are sporty and comfortable for those to which that matters, and products that are stylish and trendy for others. There are some consumers who simply want a name brand product at an affordable price, and Nike has something for those consumers as well.
BEHAVIORAL CHARACTERISTICS Nike’s mission statement is: “Bring inspiration and innovation to every athlete* in the world.
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