Nike Inc.’s marketing mix (4Ps) determines profitability and growth in the sportswear and equipment business. The company’s marketing mix refers to strategies and tactics to execute the marketing plan, with focus on products, place, promotion, and price (the 4Ps). Nike’s marketing mix involves athletic and leisure products. For example, the company sells shoes for professional basketball athletes. However, these products are marketed to all customers for athletic and leisure activities, based on Nike’s mission and vision. This 4P evolves with the dynamics of the sporting goods industry. This evolution enables the business to use its marketing mix to respond to market trends, such as changes in the American market for footwear. Nike’s marketing strategies fine-tune the 4Ps to respond to local, regional, and international market trends.
Through its marketing mix, Nike Inc. strengthens its capabilities to protect its business from competition. The company uses its 4Ps to compete against various firms in the footwear, apparel, and athletic equipment markets. For example, Nike operates in the same markets as Adidas, Puma, Under Armour, and ASICS. The Five Forces analysis of Nike shows that these firms engage in aggressive competition and impose challenges to the company’s marketing mix and related marketing strategies.
Nike’s Products
This element of the marketing mix enumerates Nike’s organizational outputs offered to target customers. This 4P includes a wide variety of products and numerous sporting goods brands that define the company’s product mix. The following categories represent Nike’s products:
- Footwear
- Apparel
- Equipment and accessories
Shoes are the most popular products from Nike Inc., although the company’s overall marketing strategy gradually adds more product lines to strengthen the product mix. For example, the company now offers running shoes, tennis shoes, and shoes for a variety of other sports, including cricket. Nike also sells apparel, such as jerseys, shorts, and related products. Furthermore, the company’s marketing mix includes product lines for accessories and equipment, such as golf clubs. These products are available under a number of the company’s brands, including Air Jordan and Converse. Based on this element of the marketing mix, Nike expands its product mix to address the needs of its target markets and market segments, thereby making the 4Ps more suited to market characteristics.
Nike Inc.’s marketing strategy involves growing the business through market-based changes in its product mix. For example, R&D investments in the sports and leisure footwear business produce new products and enhanced versions of current products, resulting in corresponding improvements in the 4Ps. As Nike’s marketing mix evolves, the business adds or changes its operational processes, such as the manufacturing of shoes, apparel, and equipment for various sports. This evolution also comes with new technologies to improve the product mix and other 4P variables, as indicated in Nike’s generic competitive strategy and intensive growth strategies.
Place/Distribution in Nike’s Marketing Mix
This element of the marketing mix outlines the venues where Nike’s products are sold, accessed, or distributed. This 4P variable optimizes the company’s market reach through a multi-pronged distribution strategy relevant to the sporting goods market. Based on significance in marketing strategy, the following places or locations are used in Nike’s marketing mix:
- Retail stores
- Nike Online Store
- Niketown retail outlets (company-owned)
Retail stores are the most significant places where Nike products are sold because these venues are strategically located and easily accessible in various markets around the world. These retailers include small local and regional stores, as well as large firms, like Walmart. This 4P element also shows that Nike’s marketing strategies enable customers to purchase sports shoes, apparel, and equipment through the company’s online store. In addition, the business operates its Niketown retail outlets, where the company has control of retail sales processes. These company-owned outlets produce business and market intelligence that supports corporate strategic management with regard to Nike’s marketing strategies and tactics for current and emerging products.
Based on this element of the marketing mix, the company has considerable control on the distribution of its products, especially through its online store and Niketown retail outlets, making this 4P variable an option for gathering market information. However, this element of the marketing mix also shows that Nike has limited control on the distribution and sale of its products at other retail outlets.
Nike’s Promotion
Read more: Nike’s Promotional Mix (Marketing Communications Mix)
This marketing mix element involves the tactics that Nike uses to communicate with its target markets and persuade customers to buy its products. Effective promotion maintains the company’s brand image, which is one of the strengths determined in the SWOT analysis of Nike. The following are Nike’s promotional activities, arranged according to significance in the firm’s marketing strategies:
- Advertising
- Personal selling
- Direct marketing
- Sales promotions
- Public relations
Advertising is one of the biggest contributors to Nike’s ability to attract customers. In this 4P variable, the company heavily relies on advertisements, especially those that involve high-profile celebrity endorsers, such as professional athletes and sports teams. Also, this element of the company’s marketing mix includes personal selling through sales personnel who persuade target customers to buy the company’s sporting goods. For example, sales personnel at Niketown retail outlets are trained to use such persuasion tactics.
On the other hand, in the context of the 4Ps, the company’s direct marketing activities involve promoting its products through direct communications with colleges, local sports teams, and other organizations. In addition, in terms of sales promotions, Nike occasionally provides discounts and special offers to attract more customers and generate more sales.
Moreover, this marketing mix includes public relations, in which the company sponsors and provides financial support to organizations, such as community-based networks, to promote its athletic shoes, apparel, and equipment. However, based on the tactics included in this element of Nike’s marketing mix, the business depends on its relations with high-profile endorsers to succeed in promoting its business and products in the international sporting goods market.
Price in Nike’s 4Ps
This element of Nike’s marketing mix identifies the prices that maximize profits while attracting the desired share of the target market. An objective of the company’s marketing strategy is to offer its products at a premium price, although the price points and price ranges account for the conditions of the sporting goods market. Nike’s 4P applies the following pricing strategies:
- Value-based pricing strategy
- Premium pricing strategy
In the value-based pricing strategy, Nike Inc. considers consumer perception about the value of its products. In this marketing mix context, perceived value determines the maximum prices that consumers are willing to pay for the company’s sports shoes, apparel, and equipment. In contrast, the premium pricing strategy uses high prices, based on a premium branding strategy that establishes Nike products as higher in quality and value than competing products. In this 4P variable, the footwear company’s use of advertisements involving high-profile celebrity endorsers is indicative of such emphasis on premium branding.
In using the premium pricing strategy as part of its marketing mix, Nike enjoys higher profit margins and potentially higher sales revenues, as customers associate a premium status with the company’s products. Also, a relevant point is that, based on the PESTEL/PESTLE analysis of Nike, premium statuses and premium prices are linked to the sociocultural and economic trends in the industry environment. The footwear and apparel business adjusts its price ranges and price points according to such trends, to ensure that this 4P variable suits the market. Nike’s marketing mix successfully uses pricing strategies to maximize profits while emphasizing high value in promoting products and brands.
References
- About Nike, Inc.
- Malik, R. (2023). Culture and Its Influence on Elements of Marketing Mix. In Cultural Marketing and Metaverse for Consumer Engagement (pp. 123-130). IGI Global.
- Nike, Inc. – Form 10-K.
- Nike’s e-commerce website.
- Solberg, C. A., & Durrieu, F. (2023). Patterns of international marketing strategy. Journal of Business & Industrial Marketing, 38(7), 1532-1544.
- U.S. Department of Commerce – International Trade Administration – Consumer Goods Industry.
- U.S. Department of Commerce – International Trade Administration – Textiles Industry.