Marketing audit of Nike Inc.
Order Instructions:
Just wanted to mentioned that this paper is the continuation of 111486, it will be critical to take into account that this paper will continue from that paper , the writer must reread that paper to be able to write this paper as you will realized below that it requires some information from the previous paper on this topic. It is important that the writer follow the instructions as indicated by using each of the 6 titles as sub headings.
• Marketing Audit
Conduct an interview with the individual you identified in your chosen organization for the purpose of this week’s assignment. She or he should be an individual who understands the organization’s overall strategic use of marketing activities to achieve competitive advantage in the marketplace and is willing to meet with you to discuss these initiatives, but need not be a high-level executive. Complete the task environment audit from information gathered in your interview.
• Note: If this is the only opportunity you will have to meet with this individual, then you should also include the topics presented in Week 3 during your interview. You will not need to turn in that written portion until the end of Week 3, but you should take advantage of the time you spend in your interview to gather all necessary information. Be sure to ask the individual at the conclusion of your interview if you may contact her or him by e-mail if you have follow-up questions.
Task Environment Audit
Each of the following main areas needs to be addressed as part of this audit, but the questions listed are only guidelines as to the type of information that you are interested in gathering. It is important to cover each particular topic, but in a way that is most meaningful for the organization that you have selected. Keep in mind the role of the marketing information system as it relates to record tracking, marketing intelligence, data management, etc. If the company does not utilize a MIS, find out how they are tracking information.
1. Markets
• What is happening to market size, growth, and profits?
2. Customers
• What are the customer segments?
• How do customers rate the company and its competitors on reputation, product quality, and price?
• How do different customer segments make their buying decisions?
3. Competitors
• Who are the major competitors?
• What are their objectives, strategies, strengths, weaknesses, and sizes?
4. Distribution and Dealers
• What are the main trade channels for bringing products to customers?
• What are the efficiency levels and growth potentials of the different trade channels?
5. Suppliers
• What is the outlook for the availability of key resources used in production?
• What trends are occurring among suppliers?
6. Facilitators and Marketing Firms
• What is the cost and availability outlook for transportation services, warehousing facilities, and financial resources?
• How effective are the company’s advertising agencies and marketing research firms?
Write a summary (2–3 pages) of your findings and analysis, using each numbered item as a heading for your paper. You should also review the scholarly literature so that you are able to include a description of the significance of the marketing audit in your completed Praxis Paper. You may also wish to review the scholarly literature to help you gain insights into any of the major issues you identify for your selected organization.
Resources
• Marketing Management
o Chapter 3, “Collecting Information and Forecasting Demand”
This chapter describes the components of modern marketing information systems (MIS) designed to assist a marketing manager in gathering necessary company information to be used in decision-making. The chapter also discusses the importance of monitoring outside environmental forces that could potentially affect a business.
o Chapter 4, “Conducting Marketing Research
Article
o D’Esopo, M., & Almquist, E. (2007). An approach to mastering the marketing mix. Business Strategy Series, 8(2), 122–131. Retrieved from ProQuest Central database.
In this article the authors describe how structural equation modeling, historical analyses, and in-market experiments can be used to analyze marketing investment patterns.
• Hauser, W. (2007). Marketing analytics: The evolution of marketing research in the twenty-first century. Direct Marketing, 1(1), 38–54. doi:10.1108/17505930710734125
By using advances in technology, such as data mining, and other marketing analytics, the author argues that companies can be much more effective in researching marketing issues and problems.
• Lee, N., & Broderick, A. (2007). The past, present, and future of observational research in marketing. Qualitative Market Research, 10(2), 121–129. doi:10.1108/13522750710740790
This article reviews the history and philosophical debates surrounding the use of observational research in marketing and then describes how technology has allowed observational research to expand beyond just qualitative research.
• Reppel, A., Szmigin, I., & Gruber, T. (2006). The iPod phenomenon: Identifying a market leader’s secrets through qualitative marketing research. Journal of Product & Brand Management, 15(4), 239–249. doi:10.1108/10610420610679601
A problem with online marketing research is how to account for those individuals who do not use the Internet. The authors in this article present a possible solution to this dilemma.
• Schibrowsky, J., Peltier, J., & Nill, A. (2007). The state of Internet marketing research: A review of the literature and future research directions. European Journal of Marketing, 41(7/8), 722–733. doi:10.1108/03090560710752366
After reviewing research studies on Internet marketing research, the authors of this study identify the three most researched areas: consumer behavior, Internet strategy, and Internet communications. They also discuss current trends in online marketing.
• Van de Ven, B. (2008). An ethical framework for the marketing of corporate social responsibility. Journal of Business Ethics, 82(2), 339–352. Retrieved from http://www.springer.com/social+sciences/applied+ethics/journal/10551
SAMPLE ANSWER
Introduction
Nike, Inc is a multinational enterprise that designs and manufactures foot wares, sports apparels, equipments and other accessories. Its major subsidiary is Converse Inc which mostly designs and also distributes casual foot ware, apparels and other accessories. Hurley International designs markets and distributes sports ware for youth and other action sports.
Markets
The major market segments of Nike Inc are mostly located in North America, Western Europe, Japan, China and other emerging markets. The markets have been expanding globally as well as the volume of sales. In 2013, the operations grew by 11% as a result of the popularity of the Nike brand and all the segments except China registered improved sales in the year 2013. In the same year the total sales turnover were $20.117 billion while the assets and liabilities for the same period were $17.584 and 6.428 billion respectively. The total market capitalization for Nike Inc. amounted to $64.75 billion in 2013. The inventory turnover for the same period was 4.3 compared to the previous year which was 4.3. The total revenue for Nike Inc for the year ended 2013 amounted to $27.8 billion
Customers
North American is the leading market segment in terms of sales volume which is followed by the emerging markets and China. The other markets are Western Europe, Japan and Central and Eastern Europe. Most of the segments make majority of their sales through wholesale outlets. Nike Inc products are highly rated both by its direct competitors like puma, Reebok or Adiddas and its customers. The Nike’s + sports band is a type of shoe that is universally rated as one of the best basketball shoes globally. It records or provides the distance covered when running and also the time taken. Nike brand is also common with the youth culture especially the urban fashions.
Competitors
Nike Inc is the leading company in footwear industry and it controls about 47% of the entire footwear industry while Reebok and Adidas control 16% and 6% respectively. Reebok is the second largest manufacturer of footwear in the US after Nike Inc. Adidas market capitalization for the year 2013 was 15.55 billion while its quarterly growth rate is 2% compared to Nike’s 11% for the same period. The total revenue for Adidas for the year ended 2013 amounted to 18.59 billion as compared to Nike’s $27.8 billion for the same period. Nike’s operating margin was 0.13 compared to 0.07 for Adidas for the same period while the earnings per share were 2.93 and 2.2 for Nike and Adidas respectively. The gross operating margin was 0.45 for Nike compared to 0.49 for Adidas. (Nike, 2014)
Adidas is enjoying one of the fastest growths in brand expansion. Their positive attributes have been shielded from any form of bad publicity by the two largest brands that are Nike and Reebok. (Van de Ven, 2008) They adjusted and expanded their manufacturing operation strategies to specialized outsourced services in the early 60’s from Germany to cheaper economies in Asia. But their greatest weakness is that they still do not have an operation code of conduct for outsourced agencies like Nike and Reebok. (Nike Annual Report, 2013) Adidas is currently considered to the worst employer in footwear industry and it’s largely due to its subcontracted or outsourced work in outsourced factories in Asia. (Van Dusen, 1992)
Distribution and Dealers
The largest earners for Nike Inc are the wholesale distributors which control majority of its sales volume. The inventory turnover or efficiency ratios for the year 2013 was 4.3 compared to the previous year which was 4.3 while the total revenue for the year ended 2013 amounted to $27.8 billion. Nike has outsourced most of its manufacturing business to China and other parts of Asia. Nike Inc also operates thousands of retail outlets in North America and also in other selected countries globally. The future ordering service or program facilitates the retailers to receive advance orders from customers and deliver them when they are due. In 2013, 87% of all the US sales were made under this program. (Kotler & Keller, 2012)
Nike also sells its products through their own Direct to Customer sales operations by utilizing the services of mix independent distributors, sales representatives globally and other licensees. Nike also operates the NIKETOWNS and other outlets for their employee-only stores. (O D’Esopo, & Almquist, 2007)
Suppliers
The suppliers of Nike are mostly located in Asia and other parts of the world. All the footwear for Nike is manufactured outside the US. China and Vietnam manufacture 36% each of Nike’s footwear production while Indonesia and Thailand manufacture 22% and 6% respectively of the total production. (Nike Annual Report, 2013) Other factories that manufacture for their primary markets are located in Argentina, Brazil, Mexico and India. The major suppliers of Nike’s raw materials which are generally canvas, leather, nylon and polyurethane that is used to manufacture the Air-sole components are from China and Thailand. Since the year 1972, Sojitz International Corporation of America and Nissho Iwai Corporation from Japan have handled the bulk of Nike’s raw materials in the form of importing and exporting the requirements of the major production facilities across the world. They also finance the some of the operations and also handle the transporting logistics for the subcontractors.
Facilitators and Marketing Firms
Nike operates its marketing strategy by sponsoring celebrity athletes, college teams and other international professional teams to market its branded apparels and footwear. Nike has an agency known as the Wieden + Kennedy popularly known as the W+K and its responsible for creating its advertisements on most broadcasting stations and features mostly on the New York marathon and other international events. (Lee & Broderick, 2007) Nike has won several accolades in the international scenes due to its effective advertisement including the Emmy advertisement awards and also in the Cannes awards events. Nike pursues an aggressive marketing policy that favors its quality products. (Hauser, 2007) The core competencies of most footwear industries is to provide quality footwear and they concentrate largely on the research and development of their products while they leave the production and manufacturing operations to outsourced contractors. The main companies form the policies that guide the technological expertise, marketing and distribution networks. These companies gain in the form of reduced capital needs and risks, lower wages and management requirements when they outsource their manufacturing operations.
In conclusion, Nike has adopted several communication strategies to market its products and also to track vital information from the internet and also from other broadcasting stations. (Schibrowsky, Peltier & Nill, 2007) Internet marketing and other email technologies are utilized by Nike to reach potential clients throughout the world. The revenues for Nike Inc have continued to rise despite economic challenges that exist globally
References
Hauser, W. (2007) Marketing analytics: The evolution of marketing research in the twenty-first century, direct Marketing, 1(1), 38–54. Doi: 10.1108/17505930710734125
Kotler, P. & Keller, K. (2012) Marketing management, Upper Saddle River, New Jersey: Pearson Prentice Hall.
Lee, N. & Broderick, A. (2007). The past, present, and future of observational research in marketing. Qualitative Market Research, 10(2), 121–129. Doi: 10.1108/13522750710740790
Nike Annual Report (2013) http://www.annualreportowl.com/Nike/2013/Annual%20Report
Nike. (2014) Strategy, Available at http://www.nikebiz.com/crreport/content/strategy/2-1-1-corporate-responsibility-strategy-overview.php?cat=cr-strategy (Accessed September 4, 2014).
O D’Esopo, M., & Almquist, E. (2007). An approach to mastering the marketing mix. Business Strategy Series, 8(2), 122–131. Retrieved from Proquest Central database.
Schibrowsky, J., Peltier, J., & Nill, A. (2007). The state of Internet marketing research: A review of the literature and future research directions. European Journal of Marketing, 41(7/8), 722–733. Doi: 10.1108/03090560710752366
Van de Ven, B. (2008). An ethical framework for the marketing of corporate social responsibility. Journal of Business Ethics, 82(2), 339–352. Retrieved from http://www.springer.com/social+sciences/applied+ethics/journal/10551
Van Dusen, S. (1992) The Manufacturing Practical
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