Nike SWOT & PESTLE Analysis

ID : 5286353| Sep 2020| 15 pages

COMPANY PROFILE -Nike

Business Sector :Sports Goods

Operating Geography :North America, United States, Global

About Nike :

Nike, Inc. is an American multinational corporation that was founded in the year 1964 as blue ribbon sports by Bill Bowerman and Phil Knight, went on to become the world’s largest manufacturer of sport shoes, apparels and accessories. It is headquartered in Washington County, Oregon, U.S and the retail stores are named as Niketown. Nike's core business model is the design, development, production, and global marketing and sales of footwear, apparel, equipment, accessories, and services. Nike is the largest seller of athletic footwear and apparel in the world, as of 2019. NIKE Brand offers its products mainly in six categories viz., Running, NIKE Basketball, the Jordan Brand, Football (Soccer), Training and Sportswear. The company sells its goods through NIKE-owned retail stores and digital platforms. The company also markets products designed for recreational uses such as American football, baseball, cricket, lacrosse, skateboarding, tennis, volleyball, wrestling, walking, and outdoor activities. Nike's key success factors are its impeccable efforts in research, design, technical innovation, and development.
Nike Inc.’s mission statement on its official website reads “Our mission is what drives us to do everything possible to expand human potential. We do that by creating groundbreaking sport innovations, by making our products more sustainably, by building a creative and diverse global team and by making a positive impact in communities where we live and work.” The Company strives “To bring inspiration and innovation to every athlete in the world.”
Nike's unique selling proposition or USP lies in being the world's largest manufacturer and seller of athletic shoes and apparels. It is also one of the most renowned and valuable companies with its brand valued approximately 32.4 billion U.S. dollars in 2019. NIKE, Inc. includes the Nike, Converse, Hurley, and Jordan brands.

Nike Revenue :

$39,117 million - FY ending 31st May 2019 (y-o-y growth of 7%)
$36,397 million- FY ending 31st May 2018

Competitive Analysis of Nike

SWOT

PESTLE

Titled after the Greek goddess of victory, Nike's foremost purpose is to provide athletes with outstanding commodities that boost their sports performance. Nike is the largest sports footwear, apparels, and equipment company in the world which endeavors to design products that help to improve athletic performance, lessen injury and maximize comfort. Following is the analysis of all the pertinent internal and external strategic factors of Nike that contribute to the trajectory growth of the company. The SWOT Analysis of Nike Inc. illustrates the company's key strengths and opportunities from its external environment that can be consolidated to further strengthen the company. The report also manifests intelligence on Nike's internal weaknesses and external threats that can cripple its growth.
World's No.1 and largest shoemaker, innovative and diversified product portfolio, strong core and side brands, loyal and large customer base, global presence, strong R&D and technical innovations, low manufacturing cost, influencing marketing strategies, etc., are just a handful of the several strengths of Nike.
These factors also serve as core competencies to Nike and lend it a competitive advantage. Despite all the quintessential strengths of Nike, the company faces trouble from some of its inherent weakness. Nike has always been targeted for labor issues like child labor, low wages, in-equal pay on a gender basis, toxic work environment, sexual harassment, etc. These internal weaknesses have damaged the brand reputation. Though Nike's merchandises are mainly designed for an athletic use a considerable percentage of the products are worn for informal or leisure purposes. This grants the company a great opportunity to target audiences who utilize Nike's products not only for sports purpose but also as a fashion trend. The athletic footwear, apparel, and equipment industry, as a whole, is extremely competitive on a worldwide basis; therefore, Nike faces stringent competition threat from its top rivals like Adidas, Under Armour, Puma, etc. Another major threat Nike encounters from the counterfeit products that extensively affect the revenue and reliability of the brand.
The SWOT analysis for Nike is presented below in a nutshell followed by the detailed analysis:

Strengths	Weaknesses
1. Healthy balance sheet with strong financials 2. International presence 3. Follows a “Make to stock” model focusing on fast track availability of product for customers from available stocks 4. Highly innovative products and strong research and development base 5. Follows a “ Low cost high quality” 6. Recognized three times as “top 100 companies to work for” 7. Branding product through top athletes of the world.	1. High reliability on shoe manufacturing for maximum revenue , makes the company vulnerable to market share erosion of shoe products 2. Price sensitivity of the retail model with upcoming competitors like Reebok and Adidas and no self owned retailers the profit margin might get reduced
Opportunities	Threats
1. Scope of development in projecting Nike as a fashion brand 2. Expansion of branding focus through sunglasses , sportswear , equipment and accessories 3. Enhancing branding through sports academy	1. Upcoming competitor brands 2. Common Business model like “ Low price High quality” followed by other competitors 3. Revenue subjective to currency variations due to Global presence increases cost of product

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Detailed SWOT Analysis of Nike

Strength

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Weakness

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Opportunity

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Threat

1. Highly dependent on sports: The sporting goods industry is highly dependent on sports. If one sport becomes popular and the Company sells equipment for it, the revenues will automatically rise. However if the Company produces shoes and equipment for a sport that loses popularity, then it will incur heavy losses. Nike has to constantly monitor the market for popularity of sports and big events like the Olympics, to ensure higher sales.

2. Intense Competition: Nike faces intense competition from the top players in the sporting goods segment such as Adidas, Under Armour, Puma and Fila. The business is based on innovation and new technology, which is often copied by other rivals. Often the rivals can create similar technology at the same as Nike or earlier, which will impact the Company’s profits.

3. Foreign exchange and market risk: Nike operates in different countries, and as such deals in different currencies. Any fluctuations in currency, economic downturn or deteriorating consumer sentiment can have an impact on Nike. The Brexit has also caused the UK Pound sterling to slump against the USD. Further many Asian currencies such as the Turkish Lira and the Indian Rupee are at lows against the USD. These developments may significantly impact Nike’s bottom-line.

The Sports apparel industry caters the necessary apparel, footwear, and accessories required during sports and workout sessions. Apart from this basic objective, the industry is further designing apparel and footwear suitable for the athleisure purpose. The most trending athleisure apparel and footwear includes sneakers, tights, shorts, yoga pants, leggings, etc. Besides athletes, sportswear is becoming a more considerable part of people's everyday wardrobes. Due to these trends, the industry has observed extensive growth surges in the past few years and is anticipated to grow exponentially even in the future.
The PESTLE / STEEPL / PEST analysis report is a structure to explore the impact of external factors on the macro-environment that influences business of The Nike company. The PESTLE analysis is a useful technique to study the impact of influencers on Nike's business model and business case study. The PESTLE analysis addresses all the pertinent external factors particularly political, economic, social, technological, legal and environmental, their consequence on the sports apparel and footwear industry and extensively on Nike.
The unpredictable global and local, economic and political conditions have perpetually affected the international trade of many manufacturing and service sectors, and the sports footwear and apparel industries, as a whole, are not immune. Nike's international operations are subjected to various political and economic risks like foreign and domestic trade policies, accessions in import duties, anti-dumping measures, safety measures, political instability and terrorism. Nike also faced legal issues when lawsuits were filled by female employees on the company for: violating equal pay act, sexual harassment and misconduct in work environment.
Athletic wear and athleisure clothing are gaining popularity due to increasing health consciousness, the importance given to physical well being, and various other social and demographic factors.
Technical innovation through intensive research and development have added to the success of Nike. Its footwear and apparels are designed to provide maximum comfort and safety to the athletes and improve their performance.
To minimize environmental impact, Nike is focused on reducing its carbon footprints, recycling, reducing water consumption, etc. Nike Grind is a 25 year old and successful initiative of Nike to recycle its surplus production materials and athletic footwear which are further incorporated into new Nike footwear, apparels and even outdoor play surfaces.
The PESTLE / STEEPL / PEST analysis for Nike is presented below in a nutshell followed by the detailed analysis:

Political	Economical
1. Potential trade war due to political differences	1. Impact of currency fluctuations
Social	Technological
1. Increase in trends such as body fitness and yoga amongst millennials	1. Popularity of digital devices such as smartwatches and wearables 2. Digital innovation and automated solutions to redefine customer experience
Legal	Environmental
1. Strong compliance standards for suppliers	1. Managing environmental impact of operations 2. Developing sustainable products

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SWOT & PESTLE (combined)
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Detailed Pestle Analysis of Nike

Political

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Economic

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Social

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Technological

1. Popularity of digital devices such as smartwatches and wearables: Digital devices such as smartphones and wearables have changed the outlook of the health and fitness industry. These technologies are motivating customers to adapt the innovations. Adidas has collaborated with Fitbit to enter the wearable segment, however it hasn’t tasted much success in recent times but is aggressively looking to expand in the segment. Nike has partnered with Apple watch in a successful partnership. Nike needs to work on more innovations and strategic partnerships to cement its foothold in this segment.

2. Digital innovation and automated solutions to redefine customer experience: Digital transformation is reinventing of how businesses operate, especially in the consumer-centric sectors such as sports apparel. It is bringing in new channels to leverage untapped value of customer relationships, improve customer experiences and collaborate more effectively with them. Nike has relentlessly focused on digital transformation in recent times with initiatives in digital membership, personalization, streamlined shopping experiences and connected products. Leveraging digitization, Nike has started same day delivery in Berlin in 2018 and plans to start the same in London and Paris. The company has also built a digital studio in Shanghai where it is connecting with its customers using WeChat and Tmall. The company’s Nike+ apps Reserved for You service is also converting customers 40 times more than the traditional channels. The company is continuing strategic shift to digital which will be one of its biggest growth drivers in the future.

Legal

This section is available only in the 'Complete Report' on purchase.

Environmental

This section is available only in the 'Complete Report' on purchase.

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This is the sample complete report which will give you a glimpse of what your complete report will cover after purchase.

Free Summary Report

This report contains the table contents only. In case you need the complete report please purchase using the buy options displayed.

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SWOT & PESTLE (combined)
Complete Report
USD 12.53

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On purchase, the report will reach your email inbox within minutes. At rare times, a slight delay not exceeding 4 hours might be caused.

WHY BUY THIS REPORT?

DELIVERY AND FORMAT

WHY CHOOSE US?

1. The SWOT and PESTEL analysis report of Nike Inc. presents the complex internal and external factors affecting Nike's brand, its operations, business model, market strategy and growth trajectory.
2. The SWOT analysis evaluates the strengths and opportunities that Nike holds and how it strategizes itself to succeed its weaknesses and threats in its operating external environment
3. The report confers intelligence on the external analysis, comprising the opportunities - low hanging fruits which can be harvested to achieve further growth and expansion and some pertinent threats that threaten to hinder the growth of the company
4. The Report covers compelling initiatives that were taken by Nike, to stay ahead of its competitors and adversaries and attain a competitive edge in the industry.
5. The PESTLE analysis of the Sports Apparel and Accessories Industry helps to distinguish the factors that compel and restrain the retail market.
6. The PESTLE/ PESTEL/ STEEPL Analysis for in-depth analysis of all external factors specifically, political, economic, social, technological, legal and environmental, highlighting their consequence on Nike's business model, marketing and growth strategy
7. Abstract information on Nike's business diversification, deriving its key business segments and highlighting its major competitors
8. A concise window into of Nike’s headquarters, turnover, revenue, and subsidiaries. This is followed by a comprehensive company analysis to obtain perspicacity into company information, company profile, business model, business plans and marketing strategy
9. Analysis of Nike's market position, mergers and acquisitions, strategic partnerships and alliances, that the company endorsed, and the business aims or synergies that were achieved with them
10. Interpretation of Nikes USP or unique selling proposition, mission statement, and vision statement. With a peek into Nike's key success factors, performance indicators, core values, value propositions, and core competencies.
11. Discussion on Nike's business model, extending to the analysis of key business segments and business case study

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Nike

Comprehensive SWOT & PESTLE Research Reports

Nike SWOT & PESTLE Analysis

COMPANY PROFILE -Nike

Business Sector :Sports Goods

Operating Geography :North America, United States, Global

About Nike :

Nike Revenue :

Competitive Analysis of Nike

Detailed SWOT Analysis of Nike

Strength

Weakness

Opportunity

Threat

Detailed Pestle Analysis of Nike

Political

Economic

Social

Technological

Legal

Environmental

WHY BUY THIS REPORT?

TABLE OF CONTENTS

DELIVERY AND FORMAT

WHY CHOOSE US?

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