Business Question

1Nike, Inc.: Driving Business Opportunities
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Nike, Inc.: Driving Business Opportunities
Value Proposition
NIKE Inc. (NKE) is an international corporation that focusses in the design,
development, promotion, and sale of sporting footwear, clothing, equipment, devices, and
services. Though mainly proposed for sporting drives, a important number of its products are
also used for recreational or leisurely pursuits. Nike’s value proposition centers on the principles
of availability, inventiveness, and personalization appealing to a diverse customer base by
focusing on a large market and providing high-quality items that give good value. Nike offers
top-tier athletic equipment for those engaged in high-performance sports, whilst non-athletes
may choose more relaxed and fashionable alternatives Chen, 2024). Nike ensures the convenient
availability of its items via brick-and-mortar locations, online platforms, and social media
channels for the purpose of sales.
Profitability
NIKE released its the third quarter revenue numbers for the 2024 financial year, covering
the period from December 1, 2023, to February, 2024. The corporation reported an income from
operations of 1.2 billion dollars, reflecting a 7% decrease compared to the same quarter of the
previous year (Nike, Inc., 2024). The total sales remained unchanged compared to the previous
year at $12.7 billion. The company’s profits before taxation and interest, which is a measure of
competitiveness for the company’s various areas, decreased by 5% year over year to $1.4 billion
(Yahoo Finance., 2024). The brand division accounts for more than 97% of the organization’s
overall sales (Yahoo Finance., 2024).
SWOT Analysis Strengths
Strengths
1. High brand awareness
Weaknesses
1. Poor labor practices
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2. Huge customer base globally
3. Strong stakeholder relationships
(Huang, 2023)
Opportunities
1. Growing developing markets globally
2. Innovating footwear demand market
3. Improving diversification
4. Introduce better business integration
2. Huge financial liabilities
3. Medium to low diversification
Threats
1. Changing foreign exchange rates
globally (Nica et al., 2024)
2. High competition
3. Counterfeited products
Nike is an extremely well-known global brand, illustrious by its distinctive and
effortlessly pronounceable name, rendering it easily identifiable (Huang, 2023; Chen, 2024).
According to the Interbrand international brand rankings study, the company holds the 9th place
with an estimated value of $67.9 billion (Nica et al., 2024). Nike has an enormous client base of
millions of individuals globally who faithfully embrace the company’s fashion trends,
aggressively engage in Nike-sponsored procedures, and generously offer constructive criticism.
Its market capitalization has reached $141.7 billion in its first quarter, owing to its enormous
appeal (Nike, Inc., 2024).
Product Singularity
The Eco-Fly Performance Running Shoe is a cutting-edge design that prioritizes both
sustainability and performance. The upper is crafted from Flyknit technology utilizing recycled
polyester, while the midsole incorporates materials from recycled athletic footwear and
manufacturing waste. This shoe is engineered for easy disassembly, enhancing its recyclability
without compromising on key performance attributes like breathability and temperature
regulation. The blue ocean strategy here lies in creating a unique market space that combines
high-performance athletic wear with uncompromising sustainability. The company will attract
environmentally conscious consumers and set new industry standards by being the leader in this
niche, setting itself apart from competitors that might only concentrate on performance or
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sustainability. The new product is a market leader in eco-friendly sportswear and distinguishes
itself from rivals through recycled materials creative use and high-performance design
components, forging a new market niche that values both environmental responsibility and
athletic prowess.
New Product Projections
The new product improves Nike’s profitability since it targets the expanding market in
eco-aware customers who value sustainability without compromising performance. Nike can set
itself apart from rivals and draw in a devoted following using its creative sustainable products
and dedication to eco-friendly design. This product will see a rise in sales and market share as it
complies with worldwide trends toward sustainable living and its special disassembly feature
makes recycling simpler and eventually lower production costs since, also, carving out a new
market niche in the eco-friendly sportswear industry, Nike’s strong brand image and marketing
skills will contribute to raising awareness and demand and improving overall profitability.
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References
Chen, Y. (2024, May). A Relevant Analysis of Nike and its Marketing Strategies. In 9th
International Conference on Financial Innovation and Economic Development (ICFIED
2024) (pp. 426-434). Atlantis Press.
Huang, H. (2023). Strategic and Financial Analysis of Nike Based on the Harvard Analysis
Framework. Highlights in Business, Economics and Management, 23, 1012-1020.
Nica, I., Chiriță, N., & Ionescu, Ș. (2024). Using of KPIs and Dashboard in the analysis of Nike
company’s performance management. Theoretical & Applied Economics, 28(1).
Nike, Inc. (2024, June 10). SEC.gov.
SEC.gov. https://www.sec.gov/Archives/edgar/data/320187/000032018723000039/nke20230531.htm
Yahoo Finance. (2024, April 6). NIKE, Inc. (NKE). Yahoo Finance – Stock Market Live, Quotes,
Business & Finance News. https://finance.yahoo.com/quote/NKE/
PROJECT OUTLINE for ECO-FLY PERFORMANCE RUNNING SHOE
Project Outline: Eco-Fly Performance Running Shoe for Nike, Inc.
XXXXX
XXXXXX University
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PROJECT OUTLINE for ECO-FLY PERFORMANCE RUNNING SHOE
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About Eco-Fly Performance Running Shoe
The product is a newly designed Eco-Fly Performance Running Shoe. The upper part of
the shoe is made of Flyknit technology using recycled polyester. The midsole is made of
recycled athletic footwear and manufacturing scrap. The shoe is designed with disassembly in
mind, allowing for easier recycling at the end of its lifecycle while still retaining its performance
features such as breathability and temperature regulation.
Goals
i. Introduce the Eco-Fly Performance Running Shoe a leader in the eco-friendly sportswear
sector.
ii. Attract a sizable customer base that is ecologically sensitive.
iii. Establish industry standards for the number of recycled materials used in sports shoes.
iv. Guarantee its design makes recycling easier when it comes time to dispose of it to reduce
the product’s environmental effects.
Target Customer
According to Maida (2024), fitness and sports apparel global market share is expected to
increase by USD 62.3 billion between 2024 and 2028. Throughout the projected period, the
market is anticipated to expand at a CAGR of 4.5% as prominent companies in the sporting and
wellness clothing industry lead the innovation process (Maida, 2024). As such, the new product
is marketed to eco-aware athletes and fitness enthusiasts who have a high standard of
performance gear. Statista (2024), projects that, the market group looks for items that minimize
their effect on the environment without sacrificing functionality. They also value sustainability.
Future Market Insights (2024) research showed that, the target market usually resides in cities,
ranges in age from 18 to 45, and regularly participates in sports like training, jogging, and fitness
programs. The customers have a strong awareness of environmental concerns and like companies
PROJECT OUTLINE for ECO-FLY PERFORMANCE RUNNING SHOE
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that show a dedication to sustainability. According to Maida (2024) research, 36% of persons
between the ages of 18 and 34 have made purchases in order to support businesses’ social stance
indicating that social consciousness is increasingly driving innovation and significant changes in
the footwear sector. Ghimouz et l., (2023), stated that, this presents a significant chance for
companies to capitalize on the growing awareness of consumers and extract value from it. In
order to thrive in the near future, companies must demonstrate a proactive mindset and embrace
their ecological and social obligations.
Market Opportunity
Consumer awareness of environmental issues is driving significant growth in the market
for eco-friendly sporting apparel (Vizcaino & Kettunen, 2023). The new product capitalizes on
this growing market by providing a shoe that satisfies the needs of both sustainability and great
performance. There is a significant possibility to overtake established sportswear companies as
well as newly emerging eco-conscious rivals in the market share of consumers who are
demanding environmentally friendly items due to growing regulatory demands and customer
demand.
Financial Opportunity
There are a lot of financial opportunities with the new eco-friendly performance shoe,
including higher top-line and cash flow revenue. The product is anticipated to generate a positive
cash flow and profit by drawing in a specific market of environmentally aware customers.
Because performance and sustainability may be combined to provide a unique value offer,
premium pricing is possible, which can increase profit margins and by becoming a pioneer in
environmentally friendly sportswear, the firm may draw in strategic alliances and customer
loyalty, both of which will improve financial performance.
Timeline
PROJECT OUTLINE for ECO-FLY PERFORMANCE RUNNING SHOE
1. Research and development (Months 1 – 6)
2. Production and marketing (Months 7 – 12)
3. Launch and sales (Months 13 – 18)
4. Post-Launch and Expansion (Month 19 – 24)
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PROJECT OUTLINE for ECO-FLY PERFORMANCE RUNNING SHOE
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References
Future Market Insights. (2024, February 10). Sustainable footwear market trends and
opportunities. Global Banking |
Finance. https://www.globalbankingandfinance.com/sustainable-footwear-market-2022outlook-current-and-future-industry-landscape-analysis-2030-2/
Statista. (2024, March 13). Footwear – Worldwide | Statista market
forecast. https://www.statista.com/outlook/cmo/footwear/worldwide
Ghimouz, C., Kenné, J. P., & Hof, L. A. (2023). On sustainable design and manufacturing for the
footwear industry–Towards circular manufacturing. Materials & Design, 233, 112224.
Maida, J. (2024, July 10). The sports and fitness wear market size is set to grow by USD 62.3
billion from 2024-2028, increasing interest in physical fitness activities due to several
health benefits to boost the market growth, Technavio. Yahoo
Finance. https://finance.yahoo.com/news/sports-fitness-wear-market-size211000153.html
Vizcaino, N., & Kettunen, E. (2023). How do the Female Attitudes Towards Sustainable
Branding Influence Purchase Intention in the Sportswear Industry: A qualitative study of
women aged 20-50.
I intend to use the Business Model Canvas (BMC) for my new product to initially create and
develop in its business model and complete some of the components right away, while others
can take more time. I will first develop the value propositions, customer relationships,
channels, and segments. The target market of athletes and environmentally conscious
consumers, the distribution channels through physical retail stores and online sales, the
building of strong relationships through sustainability-focused marketing campaigns and
recycling programs, and the unique value proposition of fusing high-performance athletic
wear with sustainability are all evident and actionable. I will also research more to fully
understand important alliances, resources, critical activities, cost structures, and income
streams. Strategic connections with environmentally conscious partners, supplier
identification, manufacturing procedures, marketing plans, and sustainable sourcing all need
extensive preparation. I will also conduct a manufacturing expense, pricing tactics,
prospective sales figures, and investigating supplementary income streams such as shoe
recycling services and collaborations with fitness applications research. After being
disregarded at first, aspects including significant partnerships and extra sources of income
have emerged as critical for guaranteeing a steady flow of recycled materials and increasing
income prospects. It is also important to understand that, even if the fundamental elements are
apparent thorough preparation and investigation are required to develop a thorough and
successful business model.
Overview
It’s the moment of truth: the first step in introducing the new project to senior management. The
senior management team is located in another state and wants to hear your pitch remotely. They
have given you five minutes to deliver your pitch during a leadership meeting.
Prompt
Create and record an elevator pitch for your new product or service using your project outline as
a guide. In your pitch, be sure to include the following:
• Introduction: Introduce your product or service. Here is where you present your Blue
Ocean Strategy (BOS) to corporate executives and investors. Be succinct. Feel free to
use the art of storytelling. After reading this section, your audience should have a
clear understanding of what constitutes your Blue Ocean product or service.
• How it fits: Here you discuss whether your company has the resources to invest and
develop your Blue Ocean Strategy BOS. Is your BOS within the scope of the
company’s strategic plan or mission (you are allowed to quote the company’s mission
statement). What research have you turned up to support this? Keep in mind what
you already know about your company’s strengths and opportunities in its SWOT
analysis.
Describe how the product or service fits into the overall strategic plan and mission of the
company.
Speculate about whether the product or service fits within the capabilities of the company
based on your research from previous modules (use resources like Marketline.com,
Yahoo Finance, and investor relations pages within the company’s website).
• Justification: Bosses want to know how much money your idea is going to make.
Consider using the company’s financial history to support gains by the company.
Also, what do market trends say about your BOS? Have similar products/services or
industries met with financial success? Additionally, the assignment calls on you to
speculate a return on investment. ROI is a ratio whereby the net profits (return on
investment – the cost of investment) are divided by the cost of the investment.
Please visit this article for more on ROI. You must attempt this.
Justify your suggestion based on the numbers.
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What will be the revenue gain?
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Speculate on an ROI that justifies the project for investors and/or senior
management.
• Enhancing the mission: This section is not asking you to repeat your company’s
mission statement. This section is where you let bosses know whether your BOS will
be profitable. You may want to consider what you already know about the company’s
financial history of profit in conjunction with market forces. You may also want to
leverage research on the financial success of similar products or services.
Explain how the new product or service enhances the company’s overall mission.
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Does it project profitability?
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Support your position with information and data from the company’s 10K (use
resources like Marketline.com, Yahoo Finance, and investor relations pages
within the company’s website).