Nike - Case Analysis

Case Report - Nike

Introduction

Many of us know Nike for the clever maketing campaigns, celebrity athelets, "swoosh" logo, and "Just Do It!" slogan. In 1963 the world's largest athletic shoe company was founded by Philip Kight and Bill Bowerman for $500 apiece and a handshake, and today has over $9 billion in revenues.

After several years of record breaking performance Nike's global labor practices were brought to the attention of the public as early as the 1990s. Which included publishings in Harper's magazine that a Nike subcontractor paid woirker's just under 14 cents an hour. Other reports include a CBS 48 Hours report on the physical abuse of Vietnamese workers, which supervisors beating employess with shoe parts when production problems arose.

On April 24, 2000 Philip Knight a former University of Oregon track and field star, announced that he would no longer donate money to the University. Which was a result of the University's intention to join the Worker's Rights Consortium, which was formed by student activist in the anti-sweatshop movement, who were concerned with the ethnical responosibilitie of purchasing goodds manufactured overseas.

SWOT

Strength

Many of Nike's strengths lie in the firms marketing, design, research and development abilities. Nike developed cutting-edge products that met the needs of serious atheletes, while setting fashion trends in the process. Researchers conducted extensive research and testing to define human movement and create perfromance enhancing and injury-reducing products.

Another great strength of the apparel giant include Marketing. From inceptiion marketing had been a critical part of Knight's vision. The founder defined Nike as a marketing oriented company. Which prompted Nike's aggresive marketing campaigns with celebrity athletes idolized by fans everywhere, which included Mia Hamm, Tiger Woods and Micheal Jordan. This combitation of hot new products, and aggressive marketing pushed nike to become the largest athletic shoe company by 1991.

Weakness

Although a leader in athletic appareal and footwear, nike has never actually manufactured any actual products itself, and relies heavily on outsourcing production. In 2000, Nike had contracted with over five hundred different factories to produce their line of products, which included Tae Kwang Vina (TKV). When global practice of Nike's subcontractors came to light, Nike was held responisble for the poor and degrading working conditions their subcontractors provided workers. This negative press severly damaged their reputation and changed the entire perception of their target demographics.