Nike. Factors Affecting Nike’s Success. Business & Marketing Essay

Nike
Name
Institution
Nike
Nike started operations in 1964, even though it was formerly known as Blue Ribbon Sport. The company’s headquarters are in Oregon and was founded by Bill Bowerman. Nike is renowned for manufacturing innovative and high-quality products. It also relies on innovative technologies and materials to come up with new products. Over the year, the company has been marketed by high raking teams and sorts athletes such as Tiger Woods, Michael Jordan, and Roger Federer (Constantine, 2018). Nike relies on a geographical divisional structure so that it serves its global markets better. This means it has a global corporate leadership which consists of corporate managers who are in the company’s headquarters. For instance, the marketing group handles the company’s marketing campaigns that are released worldwide. The company also has semi-autonomous geographic decisions which are divided into segments depending on the regional market. The regional divisions include Japan, Greater China, Central, and Eastern Europe, North America, Western Europe, and emerging markets (Araujo et al. 2018). The company also has two global divisions for brand licensing and Converse. The Converse division deals with managing the Converse brand, and the brand division handles brand licensing. The company has over 19,000 retailers and operates worldwide in over 170 countries (Araujo et al. 2018). Nike is the leading manufacturer of sporting goods worldwide.
The company relies on a combination of subsidiaries, licensees, and independent distributors who sell its products. All of the products manufactured by the company are a result of its research and design efforts. This has ensured that it has a large market for its products in different sports ranging from wrestling, volleyball, tennis, hiking, and aquatic activities. Since its establishment, the company has continued to grow while diversifying its business. It purchased other brands, including Converse, Haan, Bauer, and Umbro (Araujo et al. 2018). The company created the Nile ACG brand in 1996, which focused on extreme sports like mountain biking and snowboarding. Nike is an international company that develops, manufactures, sells, markets, sporting apparel, accessories, footwear, equipment, and services. The company has also started selling sports technology such as high-altitude watches and compasses, and heart-rate monitors (Araujo et al. 2018). Even though the products are mainly designed for athletic use, they can also be used for the leisure of casual activities.
Factors Affecting Nike’s Success
The first key factor in the organization’s external environment, which will affect its success, is the economy of a country. The economy is an essential factor that influenced the demand and supply of a product, which will directly affect the company. For instance, if the economy grows, then the company will gain profits since it will have the resources to make shoes while also meeting the demands of the economy. If the economy declines, then the company might have difficulties with its supply chains and even the manufacture of the products. Another economic factor is inflation rates (Brohi et al. 2016). In cases of high inflation, Nike will have difficulties operating, and it can also make losses since it might be forced to pay higher salaries, and other costs will also be high. The changes in interest rates will also impact the company’s operations. This economic factor determines the interests in loans and whether the company can get funding to remain operational. Nike relies on the performance of the economy in each country where it sells its products. The company has an excellent opportunity to sell its products in economically stable states (Brohi et al. 2016). For instance, the United States has a stable economy, which has been vital for the company’s success, and it will still be a factor that influences the company in the future. It also has a chance to grow in developing countries that have good economies, but a slowdown of the economy can be a threat since it will negatively affect the company.
The second key factor is technological changes. The company depends on technology to come up with innovations and designs. Some of the changes include technology adoption rates. If people are not willing to adapt to new technologies, then some of the products might not have a growing market base. Technology also includes new products or services. Since the company depends on technology, if new developments do not occur then, the company will not make new products. They will have to rely on older technologies, which could be viewed as obsolete by the market (Brohi et al. 2016). This is a threat and also an opportunity for the ...