Nike’s advertising strategy in China

Company Profile

Fair. When Phil Knight founded Nike in 1964 with $500, he never dreamed that it would become the largest sports shoe brand in the world today. This article will reveal the mystery of Nike's growth process, and focus specifically on the key to Nike's success in the 1990s - new product development strategy.

In 1972, Knight and Bowerman finally invented a shoe and decided to make it themselves. They contracted production tasks to Asian factories with cheap labor and named the shoes Nike, after the Greek god of victory. At the same time, they also invented a unique logo Swoosh (meaning "swish"), which is extremely eye-catching and unique. This mark is found on every Nike product.

In short, Swoosh is the logo of NIKE

Early days of creation: 1960s-1970s

When it comes to the history of Nike, we must go back to 1958. The founder at the time, Phil. Knight was just a track and field player at Oregon State University. During practice, he often complained to his coach Bowerman that the United States had never produced a pair of really good sneakers. Knight majored in accounting and returned to his hometown to teach in Portland after graduation. In 1964, Knight and his coach Baoermen invested US$500 each to establish a sports shoe company, named Nike, which comes from the Greek and means "victory".

In the early days of the company, Knight used his connections in the sports world to travel to various track and field sports venues and set up stalls to sell his running shoes. The products at that time were purchased from Japan, and he often believed that sports shoes designed in the United States must have unlimited potential. In the early 1970s, Knight began to implement the idea of ??designing his own shoes. After careful research and investigation, he found that the market demand was enough to support him in establishing his own production line. However, in the end, it was decided to rely on Japan's production experience. In 1972, Knight signed its first contract with Japan to officially produce completely American-designed Nike sneakers.

In the following years, the yen continued to appreciate and labor costs rose, making the cost of producing shoes in Japan increasingly high. At this time, Nike had accumulated a stable foundation of overseas production experience and expanded its reach to manufacturers in other countries. In order to reduce production costs, Nike moved Japanese production lines to South Korea and Taiwan in 1975, where labor costs were relatively low. After the cost has dropped significantly, Nike has more abundant resources to engage in research and development and marketing activities.

Nike's expansion of foundry manufacturers from countries with low labor costs was a revolutionary initiative in the industry at the time. Nike is well aware that the production of shoes requires intensive labor, so it is inevitable to seek overseas OEMs with low labor costs, and there is no room for change. Despite this, overseas OEM still has its risks. Due to the distance and cultural differences between different countries, quality control is more difficult. Therefore, when Nike places large-scale orders to OEMs, it often goes through a very careful evaluation process to ensure that the finished product meets Nike's quality standards.

During this period, Nike's strategic focus was completely focused on: 1. Establishing the best overseas production operation model; 2. Explaining new designs and styles to OEMs; 3. Maintaining quality standards

Facing difficulties and striving for ZTE: the 1980s

In the early 1980s, Nike made great profits and continued to play the role of a professional manufacturer of sports shoes in the United States, but it did not own any of its own in the United States. production factory. Soon, the number one competitor, Reebok, came up. Founded in 1981, led by founder and CEO Paul Fireman, it emerged as a dark horse and launched sports shoes with novel designs and strong momentum, successfully sweeping some markets. By the mid-1980s, Reebok was able to compete with Nike in fierce competition. In 1987, Reebok reached a higher level, with sales of US$991 million and a share of 30%, ascending to the throne of the sports shoe market leader, followed by Nike with US$597 million and a share of 18%.

In the battle for hegemony between Nike and Reebok, the problems and opportunities lie entirely in the changeable and design-oriented nature of the target market. In other words, what young people (teenagers, young adults) buy is not just sports shoes, but also the "fashion sense" represented by the shoes themselves. Both shoe giants have realized that if they want to expand the market, they must transfer the original concept of professional sports shoes to the broader market of "fashion-seeking" teenagers and young adults. Reebok seized the opportunity and took the lead in entering this golden market, using superior products and aggressive public relations activities to hit Nike hard. Reebok CEO Philmont once publicly criticized Nike: "Knight is just a shoemaker. He always thinks he is a great athlete." Knight responded contemptuously: "The reason why I hate Reebok is because its R&D system is basically a counterfeit machine."

In order to counter Reebok's provocation, Nike made a determined effort to invest huge sums of money in the research and development of new products. The most popular classic product is the "The Nike Air" in the late 1980s. shoes). Critic John Horan once expressed his opinion on Nike gas shoes in a special issue of the American sports industry: "In fact, it is a simple and easy-to-understand shoe-making technology. It only needs to inject air into the sole, that is, It forms a flexible insole, that’s all.” Nike gas shoes were not officially launched until the early 1990s and achieved unprecedented success. Therefore, the 1980s was a time when Nike was facing difficulties and striving for resurgence. During this period, Nike suffered fierce competition in the market, which also established the strategic focus of future new product development and design.

Reaching the Peak: 1990s

Nike gas shoes were launched with great fanfare, and they spent millions of dollars to hire NBA superstar Michael Jordan as the product spokesperson. , engaged in various marketing and advertising activities, and set a new high in the history of sports goods sponsorship, which is the envy of the world. The advertising appeal bundled Nike gas shoes with Jordan's image and his almost magical basketball skills. Since then, Nike has gradually regained its lost ground in the market. Reebok, forced by the situation, hastily launched the "Reebok Pump Shoe" to challenge the situation, using the NBA's second most popular star Shaquille O'Neal (Shaquille O' Neal) as the spokesperson, but unfortunately the trend is over. At this time, Nike's share increased from 25% in 1989 to 28% in 1990, while Reebok fell from 24% to 21%. This counterattack was surprisingly successful, making Nike deeply realize that promotion is indeed the most powerful magic weapon for the brand. Therefore, in the following years, Nike continued to increase investment in this area. For example: Nike in 1995 Sports Marketing (Sports Marketing) spends up to 1 billion US dollars, and Reebok spends nearly 400 million US dollars.

Nike's sports marketing

Following Michael Jordan's sponsorship activities, it signed the golf superstar Tiger Woods at a sky-high price. In 1996, it signed a contract with the Brazilian Football Association The football team signed a ten-year contract worth US$200-400 million, setting a record for the highest price in world football sponsorship activities, including buying the television rights for the Brazilian national team's five world-class championships. Since then, the Nike hook logo has appeared in many TV broadcasts of the World Golf Series, the 1998 World Cup, and the 2000 Sydney Olympics.

Although sports marketing is the main force of Nike, it also attaches great importance to brand communication. From the 1980s to the 1990s, Nike firmly grasped the pulse of the target market - youth, personality and challenging reality. All Nike products particularly highlighted its "hook-shaped" brand logo, and at the same time developed "Just Do It" The communication theme, accompanied by the advertising slogan "Win Your Way", was endorsed by the world's top sports stars, and it quickly captured the hearts of teenagers around the world.

Nike's products are not cheap. The price of a pair of sports shoes in the United States can reach as high as 100 US dollars. This high-price strategy has won a lot of profits for Nike, but it has also brought great trouble. Some American civil groups have launched protests and forced Nike must raise the wages of shoe-making workers in overseas factories. Although Nike is not a hard-hearted person, business is still business after all, and Phil Knight has no intention of giving in.

After the unprecedented success of gas shoes in the market, Nike has deepened its efforts in new product research and development. In just one year, more than 300 new styles have been launched in the US market. Nike declared: "Technological product research and development is one of the key factors in Nike's success. We are sparing no effort in developing new shoemaking materials, fibers and modern designs." To put it another way, the driving force that prompts Nike to concentrate on the research and development of new products lies in the behavioral attitude of target consumers seeking innovation and change. In fact, Nike is not the only one in the industry that attaches great importance to the research and development of new products. In order to capture the young people's pursuit of fashion, many well-known brands have no other choice but to continuously introduce new products.

During the 1990s

The backbone of Nike’s marketing – the depth and breadth of market research on teenagers was unmatched by other brands in the sports shoe market, which gave Nike its dominance The rate continued to grow, climbing to 43% in 1996 (Reebok 16%), and sales in the US market alone exceeded US$3 billion.

Welcoming a new era: 2000

Looking at the entire 1990s, Nike's rapid development has two main directions: 1. Expanding global sales and achieving substantial growth; 2. Developing non-shoes Sports products, such as: sportswear and sports equipment, etc.

In 1996, Nike's total global sales reached US$9 billion, making it the world's largest sports product manufacturer. In the late 1990s, Nike suffered a brief setback as teenagers gradually regarded sports shoes as fashionable casual shoes. In addition, Asia fell into an economic depression, which was also a serious blow to Nike, causing inventory overflow. However, Nike authorities are still very optimistic about future development. Phil Knight has stepped down as president of Nike Group, and the CEO's reins have been handed over to Tom Clark. Clarke takes over. The new CEO also gave a wonderful description of the company's future development:

"Nike is growing very fast. Once we encounter an economic downturn, we will need some time to adjust. Please don't forget, we are a team. Nike people have high self-esteem, and the company's operations are long-term and sustainable, not just to make everyone clap their hands and be happy in the next few years."

Indeed, Nike's sports products and clothing. , whether it is R&D technology or brand marketing, it is possible to set off another wave of climax in the global market at any time and continue to maintain its number one position in the world.

Analyze the key points in the development of new product strategies - lead consumers, don’t let consumers lead the way

The first step in examining Nike’s success in developing new product strategies is still We cannot escape from the basic principles of marketing – grasp the pulse of the market, understand customer needs, and create new products that cater to and satisfy needs. But everyone must understand one thing: when developing innovative new products, the biggest problem is that consumers do not actively request the new product in advance. In other words, you have to lead the consumer, don’t let the consumer lead you.

You can recall that in the early 1970s, before conducting research and surveys on new customer needs, how many consumers would actively request products such as video recorders, fax machines, and microwave ovens? Creative companies can often Make good use of their rich imagination to discover unclear consumer needs and be at the forefront of consumer trends, rather than just being a follower of what others say.

To explore market opportunities, in addition to having a deep understanding of consumer needs, lifestyles and desires, you also need to have some creativity to succeed.

Who would think that there is no market for pocket translators that meet the language barrier needs of tourists? How do companies get the original idea for this need? The answer is to find ways to get close to and observe the customers with the most demanding needs, and to have further contact with them. For example, Mitsuha of Japan displayed music equipment in London, allowing outstanding European musicians to experience the most advanced music hardware in person. The purpose is not only to learn more about customers, but also to showcase advanced product technology.

Because Nike can fully understand young people’s needs for sports and casual shoes, understand their lifestyles and realistic psychological desires, it can develop creative new products, communication appeals and promotional activities, from start to finish. They are always at the forefront of creating consumer trends, and Nike's reputation as the world's number one is not unwarranted.

NIKE 360° Nike Classic

NIKE 360° was opened by Indonesian boss James and his four brothers. The company name is UCCAL. In Shanghai, it is also called Heguang Clothing Co., Ltd., and its subsidiaries include st.jhon, kuhel and jocky. .In the past, we mainly represented U2 and G2000.

360° means all-round, which actually means selling everything. Because retro style is more popular, there are more retro things.

Nike's head office has many licensed production areas, such as Jiangsu and Guangzhou in our country, Indonesia, Vietnam in Southeast Asia, etc.

The difference between NIKE and NIKE 360°

Difference 1 : The requirements for display are different. The easiest thing to see is that nike360’s dolls can only have half a body. They also like dimmed lights.

Difference 2: Different styles of clothes, nike360 mainly sells Casual series, while Nike is a sports series. It is very likely that half of the goods coming out of the same factory are for nike360 and half are for nike.

So the difference between them is not that the manufacturers are different!

To put it simply, the difference between nike360 and nike is the difference between ADIDAS clover and sports ADIDAS, one is casual and the other is sports.

The corporate brand was compiled by the World Brand Lab. Ranked 44th in the 2006 "Top 500 World Brands" list. The company ranked 499th in the 2007 "Fortune" ranking of the world's 500 largest companies.

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