One of Nike’s supporting intensive growth strategies is market development. With its strong marketing strategy, Nike Inc. has been successful in stretching its reach globally. Nike has an organizational culture that encourages human resources to behave in ways that address business objectives. Nike is the number one footwear brand works with different top suppliers. Amy Montagne, VP/GM, Men’s, is a 15-year NIKE veteran, most recently leading the entire global category portfolio as VP/GM, Global Categories. Uzzell is also a member of the Executive Leadership Council and the Florida A&M University Foundation Board. Cost leadership strategy used by Nike also supports this intensive growth strategy as it allows the organization to minimize the costs and use existing infrastructure to launch new products. G. Scott Uzzell, President & CEO, Converse, Inc., joined NIKE, Inc. in January 2019 from The Coca-Cola Co. where he most recently served as President, Venturing & Emerging Brands Group (VEB), leading the identification and development of a portfolio of high-growth brands for The Coca-Cola Co. Uzzell began his career within sales and marketing for companies such as Procter & Gamble, Coca-Cola and Nabisco, before returning to Coca-Cola in 2000 in the Strategy & Planning division. Leadership Defined provides all of us — across geographies, business units, functions, roles and levels — a clear, consistent understanding of how to lead at NIKE. The management employs strategic management components such as vision, environmental analysis, strategy creation, strategy implementation, and strategy assessment (Nike, Inc., 2009). Nike’s Strengths – Internal Strategic Factors. Results of Nike's new Customer Experience distribution strategy in place for over a year in a study by Euromonitor. Parnell, J. Nike's Strategy to Become the Leader in their Market. Aligning against the new consumer construct, Amy Montagne becomes VP/GM, Men’s. An intensive strategy shows how a company grows. To enhance corporate leadership, Nike has established Strategic Leadership Team, chaired by CEO Mark Parker. Nike works to keep their supply chain and production costs as low as possible; however, that is the extent of their cost consciousness. The cost leadership generic competitive strategy empowers Nike to penetrate markets based on product affordability. In this strategy, the company grows by increasing sales revenues in existing markets. Driving continued growth across the NIKE, Inc. brand portfolio, Craig A. Williams, President, Jordan Brand, and G. Scott Uzzell, President & CEO, Converse Inc., join NIKE’s Executive Leadership Team reporting to John Donahoe. Nike’s Code of Conduct is an integral component to our sourcing strategy and how we determine the suppliers Nike will continue to engage and grow our business to create a lean, green and equitable supply chain. However, market penetration is just a secondary intensive growth strategy because the company already has significant presence in the global market. New technologies enhance the products and set them apart from the competition. Nike Inc.’s generic strategy (based on Michael Porter’s model) is appropriate for its diverse product lines, ensuring competitive advantage. Thus, Nike’s strategy is an integrated cost leadership and differentiation. Glazer, R. (1999). Dess, G. G., & Davis, P. S. (1984). Market Penetration. Sarah Mensah succeeds Grebert becoming VP/GM, APLA. Differentiation StrategyNike incorporates a business level strategy that most resembles a differentiation strategy. Configurations of governance structure, generic strategy, and firm size. Organizational Structure Characteristics (Analysis), Nike Inc. Five Forces Analysis (Porter’s Model), Nike Inc. 5. Strategic management is a technique that Nike, Inc. has been able to apply to determine how it is performing in its current position and how its future should be. With the strategy, Nike intends to ramp up investments in e-commerce and technology, as well as simplify its “consumer construct” of men’s, women’s and kids’ businesses. NIKE, Inc. announced a series of senior leadership changes today supporting the company’s Consumer Direct Acceleration (CDA). Also, Nike’s differentiation generic strategy provides unique products. It reflects employee voices, is There are a few different choices in the marketplace for buyers to obtain athletic shoes, apparel and the like, however Nike's products are distinct for a variety of reasons that enable them to derive economic profit from other means than simply controlling costs. But what it’s just done for the entire apparel industry is both surprising and enlightening. To enhance corporate leadership, Nike has established Strategic Leadership Team, chaired by CEO Mark Parker. The generic competitive strategy of differentiation helps the company enter new markets, based on product attractiveness. (1997). This has greatly helped the managers to lay a plan for the organization and take it where they want it to be. The following are the generic competitive strategies implemented in Nike's combination strategy: Cost Leadership Strategy 2. Nike Inc.’s generic strategy for competitive advantage emphasizes product mix diversity. We use cookies for website functionality and to combat advertising fraud. The following are the generic competitive strategies implemented in Nike’s combination strategy: Nike’s cost leadership generic strategy sustains competitive advantage based on costs. *, “We are announcing changes today to transform NIKE faster, accelerate against our biggest growth opportunities and extend our leadership position,” said John Donahoe, President & CEO, NIKE, Inc. “Now is the right time to build on NIKE’s strengths and elevate a group of experienced, talented leaders who can help drive the next phase of our growth.”, A shift to a new, simpler consumer construct of Men’s, Women’s and Kids will allow NIKE to create product with deeper insights and drive even greater specialization through performance sport and sport lifestyle. Organizational Culture Characteristics: An Analysis, Nike Inc. SWOT Analysis & Recommendations, Nike Inc. Operations Management: 10 Decisions, Productivity, Nike Inc.’s Marketing Mix (4Ps/Product, Place, Promotion, Price) - An Analysis, Nike Inc. PESTEL/PESTLE Analysis & Recommendations, Nike’s Promotional Mix (Marketing Communications Mix), Puma’s Generic Strategy, Intensive Growth Strategies & Competitive Advantage, Puma’s Organizational Culture & Its Characteristics (An Analysis), Puma’s Mission Statement and Vision Statement (An Analysis), Burger King’s Generic & Intensive Growth Strategies, PepsiCo’s Generic and Intensive Growth Strategies, Toyota’s Generic Strategy & Intensive Growth Strategies, Puma’s Organizational Structure & Its Characteristics (An Analysis), Ford Motor Company: Generic & Intensive Growth Strategies, Harley-Davidson’s Generic & Intensive Growth Strategies, About Nike – The official corporate website for Nike, Inc. and its affiliate brands, Generic Strategy (Porter's Model) & Intensive Growth Strategies. Founded in 1964, Nike Inc. has grown to become one of the biggest players in the global athletic shoes, apparel and equipment market. In conjunction with Denson's decision to retire, the Company also announced strategic changes in its executive management team as part of the Company's long-term organizational strategy to align the business to continue to drive growth. Description of marketing strategies applied by Nike Air Force 4.1 Challenges Forcing Nike to Focus More on Marketing Sportswear is defined primarily as apparel and footwear made for sports participation, though is now also includes casual clothes worn by people for daily activities (E. Ko, C. R. Taylor, et al., 2012). Nike’s secondary intensive growth strategy is market penetration. Miller, D. (1992). A suitable strategic financial objective based on this intensive growth strategy is to increase Nike’s market share through cutting-edge technologies integrated in the design of sports shoes, apparel and equipment. Nike Success. All Geography leaders report to Heidi O’Neill, President, Consumer and Marketplace. Alongside product development, the company applies the market development intensive growth strategy by investing in new technologies to penetrate new market segments, such as segments composed of bodybuilders. For example, the company integrates cutting-edge designs for its shoes. Whitney Malkiel, VP/GM, Women’s, is a 17-year NIKE veteran. Nike has set business plans through strate… Disclosure: I own shares of NKE For years, US sports gear maker Nike, Inc. (NYSE:NKE) has delivered superior sales and earnings performance, handsomely … A. For example, Nike increases its stores and retailers in the United States to sell more athletic shoes to American consumers. Here's the leadership strategy Nike's CEO uses to make employees smarter. Announces Jim Scholefield As Chief Information Officer June 04, 2015 – In this role, Jim will be responsible for leading NIKE, Inc.’s technology strategy to support the company’s future growth. Prior to joining Nike in 2007, Andy held leadership roles in strategic planning, mergers and acquisitions, financial planning and analysis, operations planning, investor relations, and tax at The Walt Disney Company. They believe each employee holds great potential. Whitney Malkiel becomes VP/GM, Women’s. The leadership changes, combined with a strategic alignment of NIKE’s operating model against the CDA, will create even greater focus and agility that will be enabled by a nimbler, flatter organization in service of consumers. November 14, 2015, 7:30 AM. Prior to NIKE, Grebert worked in marketing and finance roles for Unilever and The Coca-Cola Co. Sarah Mensah, VP/GM APLA, most recently served as VP/GM, Sportswear in APLA. The main of the Nike Company is to produce lowest cost and distributes to suppliers in the industry. Craig A. Williams, President, Jordan Brand, joined NIKE, Inc. in January 2019 from The Coca-Cola Co., where he most recently served as SVP, The Coca-Cola Co., and President of The McDonald’s Division (TMD) Worldwide and was responsible for growing brands and beverages categories. The sportswear giant announced today that, aligning with its … 2015-11-14T15:30:00Z The letter F. An envelope. This generic competitive strategy helped the company regain its competitiveness, especially against Adidas. For example, Nike enters new markets in Africa and the Middle East to increase its shoe sales revenues. Pricing strategy: Nike has value based/price leadership strategy that offers the customer with the price that customer value so it has high prices for its products as it has niche market to serve with Prior to joining NIKE, Montagne held roles in allocation, planning and merchandising at Gap Inc., Mervyn’s and Walmart. Overall, NIKE emphasizes the key differentiation strategy on its branding, customer services, product quality and innovations. Ann Hebert and Angela Dong will remain the VP/GMs, North America and Greater China geographies, respectively. These leaders will report to Michael Spillane, who becomes President, Consumer Creation.*. * Nike is successful because it has some of the best, if not the best, marketing in the world. Porter’s (1980) generic strategies as determinants of strategic group membership and organizational performance. Its swoosh symbol is easily recognized by everyone. On the other hand, Nike’s intensive growth strategy reflects the company’s focus on innovation to develop the business. Executive Summary: Constant innovation has been the byword for Nike's success.This case study analyses the ever-evolving marketing strategies adopted by Nike to become a … This article may not be reproduced, distributed, or mirrored without written permission from Panmore Institute and its author/s. panmore.com/nike-inc-generic-strategy-intensive-growth-strategies McCallester Dowers becomes VP/GM, Kids. As it forges ahead with its new digital-focused business strategy, Nike Inc. is making a series of leadership changes. Currently, Uzzell serves on several boards, including the SC Johnson Company and the Greater Boston Chamber of Commerce. Market Development. Nike implemented this intensive strategy in its early years, such as when it introduced apparel and sports equipment to its product mix. The mid1980s Nike had fallen off the pole position of being the industry leader. ... Statistics on Nike's Leadership. A generic strategy, according to Michael Porter, defines how a business achieves and maintains its competitiveness. Read full article. This type of strategy includes two or more of the generic strategies from Porter's model. He also led the Global Kids category, and then had a leadership role in Jordan Brand, before moving into his role with APLA. Employees are the biggest asset of a firm; without its employees, a firm can never prosper and without skillful employees, the firm will go bankrupt within years. Nike did not say when Hill and Sprunk will depart the company. Grebert joined NIKE in 1997 in Melbourne, Australia, and served in marketing leadership roles in Australia, Asia Pacific, and EMEA. * The marked paragraph contains forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially. Nike’s primary intensive growth strategy is product development. Although the brand is big on positivity, Nike motivates employees as well. Malkiel most recently served as VP/GM, Specialty Categories (Golf, Tennis, NIKE SB). This strategy involves developing new businesses to achieve growth. Competitive Advantage Through Information-Intensive Strategies. A strategic objective linked to market penetration is to increase Nike’s market presence by increasing the number of authorized retailers. From 2015 through 2020, Andy served as Nike’s EVP and Chief Financial Officer, a role that also included leading the company’s strategy function. Nike assumes the moral high ground by arguably foregoing its leadership position for the sake of the greater good. Diversification can support Nike’s generic competitive strategy of differentiation through new businesses that supply materials for product innovation in the athletic shoes, apparel and equipment business. Shana Lebowitz. How a Strategy Change Led to Nike’s Formation 1) Both the manager and employees play a key role in formulating a firm’s strategy. To keep its position and competitive advantage, Nike must ensure that its generic strategy and intensive growth strategies are always suited to current business conditions. A strategic financial objective based on this intensive growth strategy is to improve Nike’s financial risk by entering other industries. This style of leadership leads to relationships of trust and respect. For GDPR compliance, we do not use personally identifiable information to serve ads in the EU and the EEA. In the late 1990s, Nike reduced costs and the selling prices of its athletic shoes and other products. A financial objective based on the differentiation generic strategy is to maximize Nike’s profit margins, such as on new sports shoes. Compete with yourself not your colleagues.” Nike’s leadership and top management style can be characterized by the team management approach. As it forges ahead with its new digital-focused business strategy, Nike Inc. is making a series of leadership changes. Copyright by Panmore Institute - All rights reserved. Business Level Strategy: Nike's Generic Strategy (Porter's Model)Nike Inc. uses a combination strategy for its competitive advantage. Nike is making changes to its senior leadership team and expects employee layoffs as part of its new digital-focused business strategy. “Heidi and Andy’s leadership has been instrumental in both evolving and driving Nike’s strategy … Nike is famous for taking a leadership position on the field and in the marketplace. This type of strategy includes two or more of the generic strategies from Porter’s model. Shana Lebowitz. Disadvantage of the cost leadership strategy is lower customer loyality, the reputation of the company may also result in the producing low quality of the product and rebrand itself with a good reputation with leadership. These risks and uncertainties are detailed from time to time in reports filed by NIKE with the Securities and Exchange Commission (SEC), including Forms 8-K, 10-Q and 10-K. Nike Inc. uses a combination strategy for its competitive advantage. To drive this focus, NIKE will streamline its organization, including its Corporate Leadership Team (CLT). In product development, these products remain attractive despite changing consumer preferences. Merchant, H. (2014). This strategy facilitates the company’s growth by targeting new markets or market segments. Like most companies, Nike inspires and influences employees to take challenges. This intensive strategy involves the introduction of new products to grow sales revenues. Previously she has held the roles of VP/GM, Global Women’s, VP/GM, Global Merchandising and also held positions of increasing responsibility in North America, Running, Women’s Training and Sportswear. The CDA, announced in June 2020, is a new digitally empowered phase of NIKE’s strategy to unlock long-term growth and profitability. Nike Inc.’s Mission Statement & Vision Statement (An Analysis), Nike Inc. Carl Grebert becomes VP/GM, EMEA, succeeding Bert Hoyt, who will retire from NIKE later in 2020 after 22 years with the company. Click here to read the full article. Nike Air technology incorporated in the running shoe and with the completion of the IPO some of Nike’s major businessmen had decided to step away from the company. A strategic financial objective under this intensive growth strategy is to increase Nike’s profitability by entering new markets in Africa and the Middle East. The corresponding intensive strategies grow Nike’s global sports shoes, apparel and equipment business. NIKE, Inc. (NYSE: NKE) announced today that Charlie Denson, NIKE Brand President since 2006 and a 34-year veteran of the brand, will retire in January 2014. This team is responsible for directing NIKE, Inc.'s mid- and long-term strategy. NIKE’s clear strategy moving forward, its leadership’s high confidence in the brand and deep customer loyalty put it on solid footing to prosper as it emerges from the pandemic. Operational model changes to fully align against the CDA are expected to lead to a net loss of jobs across the company, resulting in pre-tax one-time employee termination costs of approximately $200 million to $250 million.*. Nike asks it players (employees) to work by two principals above all others, “Honesty first, and competition second. Prior to joining NIKE, Dowers had over a decade of experience in the North America retail industry. Nike has captured approx. Leadership Defined — NIKE, Inc.’s leadership framework — gives us a common set of behaviors to achieve this, together. Nike, Inc. Meanwhile, Nike outsources its manufacturers in the low cost countries to keep a low cost leadership advantage. A strategic objective based on the cost leadership generic strategy is to grow the company’s competitive advantage through new technologies to reduce production costs. However, the saturation of Nike stores and retailers around the world means that this intensive strategy has only a supporting role in the company’s growth. He also served as NIKE’s VP, Global Retail Brand and held roles in global retail marketing for both Sportswear and Basketball. He then served in General Management roles of increasing responsibility in Northern Europe, Germany and Japan. *, The leadership changes, combined with a strategic alignment of NIKE’s operating model against the CDA, will create even greater focus and agility that will be enabled by a nimbler, flatter organization in service of consumers. Prior to his tenure at Coca-Cola, Williams spent three years in the eye care industry with CIBA Vision Corp. in global marketing. Here's the leadership strategy Nike's CEO uses to make employees smarter. This type of strategy includes two or more of the generic strategies from Porter's model. Prior to the APLA role she served as the North America VP/GM, Jordan Brand. Nike is one company that revolves around motivation. McCallester Dowers, VP/GM, Kids, most recently served as VP/GM, Kids, North America. He also spent seven years with Kraft Foods Inc., working in brand management and new product development, and five years in the U.S. Navy as a Naval Nuclear Power Officer. Diversification. Manufacturing: As I've covered in previous posts, Nike puts a huge emphasis on low costs and high reliability… New evidence in the generic strategy and business performance debate: A research note. Nike Reshuffles Marketing Leadership Amid Reports of ‘Behavior That Is Inconsistent With Our Values ... Not a Problem When You Put a Contextual Marketing Strategy in Place . The generic strategy trap. Varadarajan, P., & Dillon, W. R. (1982). Intensive growth strategies: A closer examination. 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