Words of Wisdom:

"Here I am,take me as I am or suffer as you are and live with out my love." - Linwy

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  • Date Submitted: 01/28/2013 12:48 PM
  • Flesch-Kincaid Score: 34.4 
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1.What business model and strategies is Nike pursuing?In the case scenario it has been provided that Nike’s amazing growth camefrom its business model which has always been based on two functionalstrategies :a)Creation of state of the athletic shoesb)Publicizing the quality of the shoes through dramatic guerilla stylemarketingSince Nike was competing in such an industry which was mature in business lifecycle and naturally, there was immense competition to attract and retain thecustomer in order to increase profitability. However, Nike did not play price warsin that competition since it would reduce profitability for industry and the playersin it. Nike, to combat, the competitors followed nonprice competition strategy inorder to maintain and increase its market share and profitability.Product development (improving product design): Generally, the state of the artrefers to the highest level of development which is somewhat related to productdeveloment. Because product development means the creation of improvedproducts. Here,Nike focused more on product quality to differentiate in theindustry. Nike followed this strategy to maintain and increase its relativecompetitive position in the expanding market and as a result, its market sharesoared in 1998. In the same year, when Nike confronted a sudden decline insales, it came up with its new line of shoes for soccer market and perfected theirdesign over time which really turned out to be profitable step. Developing theproduct became again crucial for Nike which reflected with the advertisingmessage that soccer shoes are sleeker and fit the foot more snugly. As a result,they made profit out of it. So, Nike put efforts on product design for each marketsegment it is serving including the acquired ones whether it be the althleticshoe, dress shoe, athletic apparel etc. Still it is focusing more on develping newand improved products in new segments so that it can maintain and increase itsupward trend in ROIC.Market penetration (...

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