Company Overviews of Nike and Reebok
In 1964 in Oregon, Phil Knight and Bill Bowerman join together to make a new enterprise; each contributed about $500 to the partnership. The company started bringing low priced and high tech athletic shoes from Japan to replace the German domination of athletic shoes in the industry. In 1971, a graphic design student created the Swoosh trademark for a $35 fee. In the same year Jeff Johnson, Blue Ribbon Sports’ first employee, made his most durable contribution to the company in coming up with a new name, Nike, after the Greek goddess of victory. NIKE is the world's #1 shoemaker and controls over 20% of the US athletic shoe market.
Reebok
Reebok’s ancestor-based company came from the United Kingdom and it was founded for one of the best reasons, to give athletes the best running shoes. Around 1890, Joseph William Foster made some of the first known running shoes with spikes in them. By 1895, he was in the process of making shoes by hand for top runners. Before long he started the fledgling company J.W. Foster and Sons and were exposed to international clientele with distinguished athletes. The company became known as Reebok, named for an African gazelle in 1958, when the founder’s grandsons started a companion company. Reebok’s products are available in more than 170 countries and they are #2 in the U.S. shoe making market.
External Analysis
The footwear industry is a complete package so the different stages of shoe design and manufacturing interact seamlessly. This means that design departments and supply chains can operate on different components within the same product family; it reduces the opportunity for error resulting in efficient and highly profitable production. For the first six months of Nike’s current fiscal year, they brought in $816.9 million in revenue, with a 35 percent increase over the same period a year ago. Meanwhile, the core Nike business grew from $5.26 billion to $5.89 billion, a 12 percent increase. As for Reebok Brand, worldwide sales in the 2004 fourth quarter increased 18 percent to $817 million. From the numbers we can see that the athletic shoemaker industry is profitable and both companies are very competitive. With that said, we will now go on with discussing some of the basic factors that helps the industry to grow in profitable way.
Existing Rivalry
Jockeying among existi...
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... that the economy will begin to slow due to the slowly rising interest rates, athletic shoes and apparel, which Nike provides seem to continue to be of high demand. Moreover, the fact that Nike has very strong brand loyalty and a worldwide customer-base will help them to continue to prosper over the next three to five years and far beyond.
Reebok
Reebok, while not currently as stable as Nike will probably grow over the next three to five years also. We don’t believe that they will have quite the success of Nike. However, they are pretty well anchored in at the number two spot with Adidas being the only real close competition. Reebok also will feel the affects of any possible economic slowing, but only if that actually happens, and it will not break the company anyway. Reebok too provides for a highly demanding industry, driven by the next big offering from a company. Furthermore, Reebok has fairly strong brand loyalty and a worldwide customer-base as well, just not quite as strong of brand loyalty or as large of a customer-base. As previously stated, Reebok will probably not reach the levels of sales that Nike currently does, but will still do well for themselves in the future.
I think Nike has been in the lead for a long time just because people are more aware of Nike.
Since its creation, Nike has proven itself as a popular brand and it has created niches by selling products such as footwear, apparels and various types of sports equipment. This paper will attempt to trace the product development of Nike shoes from its origins in conception and design to the manufacturing and production process located in contract factories in developing countries to advertising and marketing of Nike as a cultural commodity and finally, the retailing of the footwear around the world.
Ford held an analysts’ meeting to disclose its fiscal-year 2001 results and most importantly, to communicate a strategy for revitalizing the company. Nike had maintained revenue of about 9 billion since 1997. However, its net income had fallen from almost $800 million to $580 million. Moreover, Nike’s market share in U.S. athletic shoes had fallen from 48% since 1997 to 42% in 2000.
Over the past 37 years, The Nike Brand has evolved into a successful multi-billion dollar corporation. It has also grown to be the world's largest marketer of athletic footwear and apparel. The company’s products are sold in over 180 countries worldwide and 20,000 retail stores domestically. Nike also operates retail stores overseas such as Nike Towns and factory outlets. Although Nike is involved in the design, development, and marketing of the product; the products are manufactured independently. In addition to its wide range of athletic shoes and apparel, the company also sells Nike and Bauer brand athletic equipment, Cole Haan brand dress and casual footwear, and the Sports Specialties line of headwear.
One thing I like about Nike is how accessible it is. You can find Nike products just about anywhere such as Nike outlets, Dicks Sporting Goods, Khols, Macy and other big department stores, as well as online. Some companies don’t make it as easy to find and buy their products which can be a struggle. I hate when I’m in need of a certain product but companies limit their access, and I can’t get what I need when I need it. Nike makes it easy to find and buy their products at any
Only a week earlier, on June 28, 2001, Nike had held an analysts' meeting to disclose its fiscal-year 2001 results.1 The meeting, however, had another purpose: Nike management wanted to communicate a strategy for revitalizing the company. Since 1997, its revenues had plateaued at around $9 billion, while net income had fallen from almost $800 million to $580 million (see Exhibit 1). Nike's market share in U.S. athletic shoes had fallen from 48%, in 1997, to 42% in 2000.2 In addition, recent supply-chain issues and the adverse effect of a strong dollar had negatively affected revenue.
The corporation should invest more money in research and innovation since this is what has helped them to make a product that rivals their competitors. At the same time, it is imperative for them to improve their machinery for cheap labor costs which will help the company increase its production allowing it to meet the demand in the market. By improving production leading to lower costs of making shoes, apparel, and equipment, Nike will achieve higher demand assuming a quality product is maintained in that process. They will stand a better chance of competing in the industry (Hill, 2009). The organization is already in a better position for meeting the demand, customer taste, and needs. The company should improve quality by focusing on developing lightweight products that are more durable compared to those offered by the competitors. Also, Nike can keep up their success by continuing to reinvent and improve their items and continue to meet the current demand by using new technology. It can also use the Internet to communicate with consumers (Hill, 2009). By developing new technology, Nike will allow the customers to suggest and design their shoes online. To achieve this goal, it is fundamental to enhance areas such as their website to make it more user-friendly. Finally, the company should pay attention to small startup organizations that enter the
Just as it says in the text, Nike is predestined to be the front-runner in the industry. After all, the company is named after the Greek goddess of victory!
Nike’s positioning in the market has more of a mass appeal compared to their main competitor Adidas who strive to make products for elite athletes. The positioning strategy for Nike is currently working at a satisfactory level as Nikes global annual sales between 2013-2014 was reported as 27.8 billion (Statista, 2014) compared to Adidas’ 19.95 billion (Statista, 2014). The global market for sports apparel is expected to grow at a compound annual growth rate of 4% between 2012-2019, Nikes compound annual growth rate during 2010-2012 was 12.3% which is an excellent result as the brand’s growth was larger than the market as well as outgrowing Nike’s closest competitors Adidas, Puma and Asics (Forbes,
It wasn’t until 1999 when Nike suffered a great loss. It was the Death of co-founder William “Bill” Bowerman at the age of 88. The company Nike continues to grow opening stores worldwide. From just having two men trying to create better and lighter running shoes for their athletes at the University of Oregon, they created a multi-billion dollar company that has taken the world by storm with their innovative and well thought out products. Nike has now expanded their style in the industry from running many other sporting goods.
Nike will need to showcase our differentiating elements of the company as runners are very brand loyal customers. Even so, Nike has 60% of the market currently. You mentioned that you feel we can improve in this area, so this is what we’re going to do: massively increase innovation and development for our running shoes, and increase brand reputation. Nike has been a historic leader in running technologies. Recently we released the electronically tied running shoes, just like from the movie Back to the Future. We need to continue to push boundaries and see what new technologies can do to revolutionize the sport. The second focus for this market is to increase our presence in specialty running stores and in third party eCommerce sites. Making sure Nike is seen and heard by this market is going to increase our success with them. Dedicated runners were found to go to specialty running shops more often than making any purchases online. Nike needs to have a bigger presence where the customers actually
Nike’s Asian operations had previously continued to soar generating US$300 million in 1994 in revenues to a whopping US$1.2 billion in 1997. However based on the Asian economic crisis, this had adversely affected revenues, while regional layoffs were inevitable. Nike also performed well in the European market generating about US$2 billion in sales and a good growth momentum was expected, however, some parts of Europe were only slowly recovering from an economic downturn. In the Americas (Canada and the U.S.A.), Nike experienced a growth rate for several quarters. The U.S. alone generated approximately US$5 billion in sales. The Latin American market at this point was exposed to economic volatility; however Nike still saw them as a market with “great potential for the future”.
Nike Inc. was founded in 1962 by Bill Bowerman and Phil Knight as a partnership under the name, Blue Ribbon Sports. Our modest goal then was to distribute low-cost, high-quality Japanese athletic shoes to American consumers in an attempt to break Germany's domination of the domestic industry. In 2000 Nike Inc. not only manufactured and distributed athletic shoes at every marketable price point to a global market, but over 40% of our sales came from athletic apparel, sports equipment, and subsidiary ventures. Nike maintains traditional and non-traditional distribution channels in more than 100 countries targeting its primary market regions: United States, Europe, Asia Pacific, and the Americas (not including the United States).
Nike, Inc is one of the leading companies in the world that is known for its brand of athletic footwear, apparel, equipment and accessories.
The Nike Company is a manufacturing as well as retailer type company. There are 800 worldwide factories for Nike brand and products. It is true that most of the Nike brand apparel is manufactured out of the United States. It’s all happen due to independent contract manufactures those are situated in different 34 countries. Nike is the one of the largest seller of athlete footwear and athlete apparel in the modern world.