Pest Analysis Of Nike

Introduction

Nike is an American multinational corporation that is employed in the conception, development, manufacturing and worldwide merchandising and sales of footwear, apparel, equipment, accessories and services. The company is headquartered near Beaverton, Oregon, in the Portland metropolitan area. It is one of the world 's biggest providers of gymnastic shoes and apparel and a major producer of sports equipment. In addition to manufacturing sportswear and equipment, the company operates retail shops under the Niketown name. Nike sponsors many high-profile athletes and sports teams around the globe, with the highly recognized trademarks of "Just Do It" and the Swoosh logo.

P.E.S.T.E.L

Political

During the year 2011, Nike undertook an

The global athletic products industry is exposed to continuous changes in consumer tastes and technology; if Nike is unable to adjust to these changes quickly, it could sustain losses in its market share. Growing competition from emerging players such as Under Armour and Lululemon Athletica, which concentrate on niche market segments such as performance apparel and yoga-focused apparel, also put a threat to Nike’s share of selected markets. Nike also faces growing competition from local players in emerging markets, who are progressively improving their product quality. Having pronounced that, Nike has a strong brand reputation which likely will go on to propel strong demand for its merchandise. Further, Nike continues to mark its products within an advanced product portfolio, leveraging a particularly strong brand with enhanced marketing

Direct-to-consumer sales rose by 23% in fiscal 2013, as compared to 6% increase in the wholesale channel; hence Nike is looking to beef up its direct channel. Certain big wholesale customers hold bargaining power as they could broaden their partnership with Nike’s competitors or provide their own private label offerings to bring in higher profitability. Bargaining power of end-customers is low as Nike has a very solid brand image and supports an advanced product portfolio. Nevertheless, customers could too prefer other brands owing to factors such as monetary value, advertising, product sponsorship, and switching styles.

Threat Of New Entrants

Significant capital resources are needed for making a new brand as big investments are required for selling and procuring floor space; therefore, this limits the introduction of newer players. Nike enjoys a large stage of mark identification and loyalty, and it will be a difficult for a new actor to match its level. Having read that, we believe more Internet companies could start selling competitors’ footwear, apparel and equipment online as the barriers to entry are low in this concern.

Threat Of Substitute