Pestle Analysis NIKE 2019 - Nike Case Study | The Rise of Nike | MyAssignmenthelp
Summary
TLDRIn this insightful video, marketing expert Mark Salinger from assignmenthelp.com dives into a detailed PESTLE analysis of Nike, the world's largest athletic footwear and sports gear supplier. He covers political influences like government support and challenges like U.S. sanctions on Iran, economic factors affecting Nike's growth, social trends emphasizing fitness, technological advancements in IT infrastructure, environmental efforts to reduce carbon footprint, and legal issues including tax evasion and marketing practices. The analysis aims to provide a comprehensive understanding of external factors impacting Nike's market presence and global expansion.
Takeaways
- 🏆 Nike's brand value in 2019 was $32.4 billion USD, with a net income of $4.03 billion USD, making it the world's largest supplier of athletic footwear and sports gear.
- 📚 Originally founded as Blue Ribbon Sports, Nike was established by Phil Knight and Bill Bowerman on January 25th, 1964.
- 🔍 Political stability and government support are key to Nike's growth, with favorable tax agreements and infrastructure support, but political issues like U.S. sanctions on Iran have posed challenges.
- 💡 Nike's marketing strategies, including the 'Just Do It' campaign, have faced backlash, particularly when associated with controversial figures like Khalid Kaepernick.
- 💼 High political lobbying expenditures, such as the $750,000 spent in 2016, indicate Nike's efforts to navigate political challenges and maintain market presence.
- 📈 Economic factors like the growth of developing markets and stable developed countries have positively impacted Nike's business performance.
- 🌐 Nike's success in managing growth and revenue from 2005 to 2018, despite minor fluctuations, highlights its resilience in the face of economic challenges.
- 👥 Social factors such as increased awareness of fitness and sports, along with rising individual wealth in developing countries, influence the demand for Nike's products.
- 🛠️ Technological advancements have allowed Nike to automate operations, reduce labor costs, and integrate mobile technologies to enhance consumer engagement.
- 🌿 Nike's commitment to environmental sustainability, as evidenced by its ISO 14001 certification, includes using organic cotton and focusing on carbon footprint and waste management.
- 📖 Legal challenges, including gender discrimination lawsuits and tax evasion allegations, have been obstacles for Nike, affecting its brand image and operations.
Q & A
What is the brand value of Nike in 2019?
-The brand value of Nike in 2019 was 32.4 billion US dollars.
What is the net income of Nike worldwide?
-Nike's net income worldwide is 4.03 billion US dollars.
What was Nike formerly known as before the brand name change?
-Nike was formerly known as Blue Ribbon Sports.
Who established Nike and when was it established?
-Nike was established by Phil Knight and Bill Bowerman on January 25th, 1964.
What types of products does Nike offer?
-Nike offers athletic footwear, apparel, athletic support equipment, and accessories.
How does the political environment affect Nike's business processes?
-The political environment affects Nike's business by influencing factors such as government policies, international tax agreements, and infrastructure support, which can create opportunities or impediments for growth.
What economic factors have positively contributed to Nike's growth?
-Economic factors such as the rapid growth of developing markets, stable economies in developed countries, low labor costs in Far Eastern countries, and outsourcing policies have positively contributed to Nike's growth.
How does the social factor of increasing individual wealth in developing countries impact Nike?
-The increase in individual wealth in developing countries allows Nike to cater to consumers with higher purchasing power, offering safer products and marketing campaigns that emphasize product safety and quality.
What technological advancements has Nike harnessed for its operations?
-Nike has harnessed advanced IT infrastructure, online technology for contactless payments, automation in operations, and integration of mobile technologies to reach out to consumers and enhance its digital presence.
How does Nike address environmental factors in its product development?
-Nike addresses environmental factors by following the ISO 14001 standard for product development, monitoring its carbon footprint, managing waste, using organic cotton, and ensuring the recyclability of its shoes.
What legal challenges has Nike faced in terms of gender discrimination and work conditions?
-Nike has faced legal challenges over gender discrimination and hostile work conditions, as well as charges for tax evasion and scrutiny over its marketing practices.
How can assignment help.com assist with case studies involving companies like Nike?
-Assignment help.com provides in-depth and accurate analysis of case studies, helping students understand complex business strategies and achieve success in their marketing classes.
Outlines
📈 Nike's PESTLE Analysis Overview
Mark Salinger, a marketing expert from myassignmenthelp.com, introduces a PESTLE analysis of Nike, the world's largest supplier of athletic footwear and sports gear. The company, valued at 32.4 billion USD in 2019 with a net income of 4.03 billion USD, was established in 1964 as Blue Ribbon Sports by Phil Knight and Bill Bowerman. Nike's product range includes footwear, apparel, support equipment, and accessories. The analysis will delve into the political, economic, social, technological, legal, and environmental factors affecting Nike's business strategies and global expansion.
🏛 Political and Legal Factors Impacting Nike
The political environment significantly influences Nike's business processes, with factors such as government policies, international tax agreements, and infrastructure support playing crucial roles. However, challenges like U.S. sanctions on Iran and controversies surrounding the 'Just Do It' campaign with Khalid Kaepernick have posed obstacles. Nike's political lobbying expenses, which amounted to $750,000 in 2016, indicate efforts to navigate political adversities. Legal issues, including gender discrimination lawsuits, tax evasion charges, and marketing scrutiny, have also affected the brand's image and operations.
💰 Economic and Social Dynamics of Nike's Market
Nike's business performance is closely tied to the economic conditions of the markets where it operates, particularly the U.S., which has seen growth and revenue stability despite fluctuations. Economic factors like the rapid development of emerging markets, low labor costs in Far Eastern countries, and outsourcing strategies have contributed positively. Social factors such as increased fitness awareness, individual wealth growth in developing countries, and emphasis on product safety and quality have also shaped Nike's market attractiveness. However, concerns over labor conditions and wage rates in manufacturing countries could potentially harm the brand's image and sales.
🛠️ Technological Advancements and Environmental Stewardship
Nike leverages advanced IT infrastructure and technologies to streamline operations and enhance supply chain efficiency. The adoption of online technologies for contactless payments and the integration of mobile technologies in products have broadened consumer reach. Social media and digital platforms have been effectively utilized for marketing. Environmentally, Nike has adopted ISO 14001 for product development, focusing on carbon footprint reduction and waste management. The use of organic cotton and recyclable materials in shoes positions Nike as an environmentally friendly brand, although the company faces legal challenges and needs to address its environmental impact comprehensively.
Mindmap
Keywords
💡PESTLE Analysis
💡Brand Value
💡Net Income
💡Athletic Footwear and Sports Gear
💡Political Lobbying
💡Economic Factors
💡Social Factors
💡Technological Advancements
💡Environmental Responsibility
💡Legal Issues
💡Marketing Strategies
Highlights
Nike's global brand value in 2019 was $32.4 billion USD.
Nike's net income worldwide was $4.03 billion USD.
Originally named Blue Ribbon Sports, founded by Phil Knight and Bill Bowerman on January 25th, 1964.
Nike is the world's largest supplier of athletic footwear and sports gear.
Nike's products include athletic footwear, apparel, support equipment, and accessories.
Political factors influence Nike's business processes and strategies.
Low interest rates and favorable international tax agreements positively impact Nike.
U.S. sanctions on Iran impeded Nike's growth plans in that region.
Nike's 'Just Do It' campaign faced controversy with Khalid Kaepernick's involvement.
Nike's political lobbying expenditure was $750,000 in 2016, increasing since then.
Economic factors such as growth in developing markets and stable developed countries affect Nike's performance.
Low labor costs in Far Eastern countries contribute to Nike's revenue growth.
Social factors like increased emphasis on fitness and product safety influence Nike's market.
Nike faces challenges with labor conditions and wage rates in factory settings.
Technological advancements in IT infrastructure and online technology benefit Nike's operations.
Nike has integrated mobile technologies and digital platforms for consumer engagement.
Nike's environmental efforts include ISO 14001 certification and use of organic cotton.
Nike has faced legal issues including gender discrimination and tax evasion allegations.
Marketing analysis of Nike and other Fortune 500 companies is available for academic assistance.
Call provided number for expert assistance in marketing case studies.
Transcripts
hi my name is Mark Salinger and I'm a
marketing expert working for my
assignment help.com I'm going to
Enlighten you on how to conduct through
pestle analysis on Nike but before
moving on to the analysis here's a
little background on the company and its
achievements brand value in 2019
globally 32.4 billion US dollars
Nike's net income worldwide 4.03 billion
US dollars
formerly known as Blue Ribbon Sports
established by Phil Knight and Bill
Bowerman established on January 25th
1964.
brand Nike world's largest supplier of
athletic footwears and sports gear
Nike products athletic footwear apparels
athletic support equipments and
accessories
let's move on to talk about a detailed
pestle analysis of the brand
political Factor
business processes heavily depends on
the type of government in a nation an
open-minded government and stable
political environment present promising
opportunities for business and growth
for Brands like Nike
the considerations on the political
factors that positively influenced some
of Nike's marketing strategies include
low interest rates in its Home Country
U.S favorable International tax
agreements receiving government support
for infrastructure but there were many
bottlenecks as far as Nike's growth is
concerned u.s's sanctions on Iran acted
as an impediment for Nike which was
planning to sell its equipments there
the Nike campaign just do it didn't go
very well with a segment of population
owing to the ad being displayed by
Khalid Kaepernick whose past issues with
Injustice and racism raised many
objectionable eyebrows a report by open
Secrets state that Nike's political
lobbying expenditure in 2016 alone was
750 000 and the amount has increased
since then it is quite a huge cost to
mitigate political adversities We
Believe
if taken as a whole Nike enjoys the
opportunities to improve its Market
presence and Global expansion in the
domain of sports footwear apparel and
Equipment other political determinants
which affected Nike are legal framework
for contract enforcement
antitrust laws for apparel Footwear
varying tax rates and regulations Nike
is always subject to such changes
industrial safety regulations
intellectual property protection and
litigation issues ETC
economic factors
Nike's business performance is
influenced by the state of economies
where it sells its Athletic Apparel
Footwear and Equipment primarily the U.S
market as the recent years soar session
troubling most of the brands Nike had
been able to manage growth and revenue
from 2005 to 2018 with minor
fluctuations
some of the economic factors that
positively contributed are the rapid
growth of developing markets relatively
economically stable developed countries
the low cost of Labor in Far Eastern
countries which have kept Nike's Revenue
growing
the policy of Outsourcing to Asian
countries that Nike undertook from 1990s
the markets of the developed countries
like the United States are relatively
stable thereby providing Nike
Incorporated with the opportunity to
continue its stable growth in these
countries Nike has good chances to
penetrate UK Australia and other such
promising markets
social factors
these factors influences the
attractiveness of Nike athletic shoes
apparel and other accessories improving
Collective Consciousness about Fitness
and sports
growth of individual wealth in
developing countries
Rising emphasis on product safety and
better quality in developing nations
Nike has the scope to cater to Consumers
with increasing individual wealth the
organization can develop safer products
and initiate marketing campaigns that
highlight the safety of its sports shoes
equipment and apparel Nike has been
unable to address the working conditions
of labors low wage rates in the
infrastructural condition of factories
in these countries which may lead to
backlash or can cause harm to its brand
image and sales
technological factors
Nike's business changes as per the
Technologies available for business
processes and athletic footwear apparel
and Equipment it uses one of the most
advanced IT infrastructure for its
operations and delivery it uses a model
in which transaction and supply chain
are linked via simple object access
protocol soap and mpps massively
parallel processor system both of which
can be considered the most upgraded
systems Nike has efficiently harnessed
the online technology to ensure
contactless payment Via Mobile phones
major parts of the operations have been
automated with time thereby reducing
labor costs
the company has effectively integrated
mobile technologies and its products to
reach out to the consumers it has also
made a substantial mark on other digital
platforms according to various digital
metrics along with positioning correctly
through social media
environmental factors
Nike had phrased ISO 1400 as its overall
product development Outlook this
provides a boost to Nike's environmental
image it has kept a tab on its carbon
footprint and waste management Nike uses
organic cotton in its product which is
considered environment friendly Nike
shoes are easier to recycle and solve
and use for Nike shoes is about 85 less
than that of tiger and Adidas brand
shoes
legal
Nike has already hit roadblocks many a
times with litigations over gender
discrimination and hostile work
conditions
Nike has been charged many a times for
dodging taxes and several scrutiny has
also happened over its Shady marketing
practices specifically where it offers
discounts
well we have in our marketing analysis
repository many more Fortune 500 and
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