Kadee Anja Quincey Corey Kathleen
Nike’s Reputation • • • •
Consumer Loyalty Innovation Cutting Edge Research and Development The Incorporation of Technology
History • First incarnation began in 1964 under the name “Blue Ribbon Sports”
History • Originally, Nike focused solely on athletic shoes • They have since expanded to include apparel, sports equipment, and other accessories in 170 countries around the world. • Subsidiaries include Umbro, Cole Haan, Hurley International, and Converse.
Our Research Objectives • Demographics indicate the majority of Nike’s customers are young professionals. • Given that data, we want to determine if it would be profitable for Nike to introduce a Business Casual Men’s Shoe into their product line.
Sales by Key Distribution
Sales Volumes for Key Items
Market Share / Market Rank • Nike has over 30% of the athletic footwear makers market worldwide 35%
30%
25%
20%
15%
10%
5%
0% Nike
Addidas
Puma
New Balance Reebock
Asics
Skechers
Converse
K-Swiss
Other
Running Shoe Market - 2008 70%
60%
50%
40%
30%
20%
10%
0% Nike
Asics
New Balance
Other
Athletic Shoe Brands Bought in Past 12 Months : Fall 2010-2011 Brand
Sales past 12 months % of Total Industry
Nike
$44,505,000
19.3%
New Balance
$26,304,000
11.4%
Adidas
$16,802,000
7.3%
Sketchers
$12,977,000
5.6%
Puma
$5,402,000
2.3%
Other
$124,426,000
54.1%
Total Industry
$230,416,000
100%
Current Brand Marketing • • • • •
Switched from print and television -> online Social Media Nike +, Nike Fuel Band Online communities “We want to inspire consumers to seek out our content” – Simon Pestridge, UK marking chief
Current Brand Advertising • 2000- advertising was split from one sole agency to multiple • Specialize in new technology • Increase their social and digital media efforts • Past 3 years, 40% spending decrease on television advertising • 2010- Nike spent $800 million on “nontraditional” advertising
Current Advertising Strategy • May 23, 2010: Nike launched a commercial shot by Oscar-nominated director and aired via • Nike Football’s Facebook Page • Reaching 8 million viewers a week • Viral-video record • Features soccer players sponsored by Nike
Why Nike Football Video? “less about hero worship and more about consumer-driven conversation�
-Former Nike Executive
Target Audience
Demographics Men Race: White Graduated college No college Age 25-34 (non-gender specific) Age 35-44 (non-gender specific) Occupation: Professional and related Occupation: Sales & Office House Hold Income $75,000-$149,999 House Hold Income $30,000-$39,999 Census region: South Now married Have children 12-17 years old Have children <6 years old Home owners Value of home $200,000-$499,999
% of 100 52 68.7 29.9 38.7 25.2 22.4 16.5 17.3 9.9 8.9 36.6 50.7 26.5 24.7 64.7 25.9
Psychographic Information • Nike consumer: – Heath conscious – Fitness driven – Concerned with wellbeing – Improve physical condition – Active in online communities, fitness forums – Goal driven – Overcomes challenges
CATEGORY/COMPETITION
Five Year Growth History • Nike’s sales have increased.
Growth Continued â&#x20AC;˘ Current Stock is : $96.52 USD and is down -.2 %
Category Life Cycle Stage â&#x20AC;˘ Nike is in the growth stage.
Information on Key Competitors Nike is number one in the market when looking at revenue compared to competitors.
Annual Sales Volume • Nike’s Annual Sales total is $24,128 million dollars.
Market Share/Market Rank 5 Year; Nike
Earnings from 1990-2012
Current Brand Positioning • Nike associates with high level athletes. • Nike is number one in performance. • number one in its industry of fine sporting equipment. • Nike overtakes some of the other major brands such as Reebok, Adidas, UnderArmor and Puma. • Nike has 346 retail outlets across the US. • Also, the company operates 106 Cole Haan stores, 51 Converse factory stores, and 18 Hurley stores in the US.
Why? Business Casual Shoe â&#x20AC;˘ Reasons for market research (product or service)
Focus Group Results • Opinions Nike brand; value, durability, brand hype, athletic and pricey. • Nike being high performance which equals a better experience, quality clothes and it is the top of the line sports apparel. • Traditional style shoe and colors (black, brown and tan). • Price not exceeding $130 for a pair. • Buying Nike products at; outlet stores, Macy’s, DSW and Sports Authority. • Monday through Friday, semi-casual. • No Nike swoosh logo visible.
Shoe-1 • Shoe #1: After the initial negative response participants explained they – Loved the shoe style just not the color. – They liked the clean look of slip on.
Shoe-2 • Shoe #2: Positive. They liked leather/style. – Clean cut and sophisticated. – This group believed an entry level professional would wear these shoes.
Shoe-3 • Shoe #3: Older age group. – Boring, conservative, – Plain but they did like the color. – Didn’t stand out.
Type of Research, Why? • • • • •
Self-administered survey 16 questions Females were filtered out Most efficient: time and money Disadvantage: lack of probing, participant cannot ask surveyor question
Research Objectives: TOPICS • 1. Measure the percent of males ages 18-30 would purchase a business casual shoe from Nike. • 2. Measure the percent of males ages 18-30 who needs a business casual shoe. • 3. Measure the preference of materials that customers like to see in a business casual shoe.
Research Objective Cont. • 4. Determine the age bracket of males who are more likely to purchase a Nike business casual shoe. • 5. Measure the age bracket who is more willing to purchase a Nike business casual shoe between the price ranges of $75-125 • 6. Measure the age bracket that is more willing to purchase a Nike Business casual shoe between the price ranges of $125-200?
Research Objective Cont. • 7. Measure the age bracket who is more willing to purchase a Nike Business causal shoe between the price ranges of $200-275? • 8. Measure the percent of males who currently purchase a business casual shoe that prefer a rounded or square silhouette/details? • 9. Measure the percent of current Nike customers between the ages of 18-30 who purchase Nike products for the style rather than the comfort. • 10. Measure the percent of males who purchase a Nike business casual shoe that would prefer the swoosh logo visible when worn.
Data Collection and Why? • Surveymonkey.com • Mass and individual messages containing survey link • Facebook, emails, twitter • Awareness email to urge participation • Self-administered
Sampling Plan and Why? • • • •
Non-probability sampling Convenient sampling Judgment based, gender (males only) 1430 N. Dearborn Ave. building lobby
Final Sample
Interesting Characteristics â&#x20AC;˘ Out of the total 66 responses, 47 male participants currently own business shoes.
Interesting Characteristics Continued
Interesting Characteristics Continued
Interesting Characteristics Continued
Interesting Characteristics Continued
Interesting Characteristics Continued â&#x20AC;˘ More than half our participants purchased their last business casual shoe less than a year ago. â&#x20AC;˘ If Nike release a business casual shoe 3/4th of participants would expect to pay anywhere from $75-$124 dollars.
SUMMARY OF RESEARCH FINDINGS
Research Objectives Findings
Research Objective Findings How often do you wear your business casual shoe?
Research Objectives Findings The most important trait in a business shoe
Research Objectives Findings
Research Objectives Findings
Research Objectives Findings
Survey Error • • • • • • •
Random sampling error Non-response error Administrative error Sponsorship bias Interviewer bias Prestige bias Threat bias
Survey: Recommendations • Increase participation to meet or exceed quota • Incentive for completed surveys • Different locations for better representative sample
Nike: Recommendations • Expand product line adding a business casual shoe • Males ages 17-24 willing to pay $75-$124 • Comfortable, leather, rounded toe box shoe • Nike Swoosh not visible • Online promotion