nike jordan marketing intelligence report final
TRANSCRIPT
Printing:Nike JordanMarketing Intelligence ReportKayleigh Fyfe | 12032909 | Scanning The Digital Environment
IntroductionThe purpose of this report is to provide marketing intelligence on the sports brand „Nike‟, and
its sub brand „Jordan‟. The report will analyse the organisations environment and highlight
factors which may affect the planning and implementation of a digital marketing strategy.
This is an undirected viewing of the brands online environment within the US market place.
The report aims to identify the customer‟s needs and wants, anticipate any arising problems
or trends, and to provide direction for the brand to increase customer satisfaction from a
digital perspective.
Micro Environment
The Customer
The Nike Jordan consumer is
predominately male; though products are
available for women, girls and boys the
wider range is not designed for them.
This is evident when comparing the
general internet population to the
audience Nike reaches. Figure 1
identifies the male gender between the
ages 25-34 as Nike‟s largest audience.
Figure 1 also displays that the age range
18-24 is above the internet average for
this reason this report will concentrate on
the millennial males within the US.
Marco Environment
Summary
Goldman Sachs (2012) reports that the Millennial generation had the largest population in US
history at 92 million. Millennials came of age within a time of digital and technological
transformation, making them “the first generation of digital natives and their affinity for
technology helps shape how they shop.” (Goldman Sachs, 2012)
The Millennials online consumption is higher than the Non-Millennial. The way in which they
interact with brands has moved away from the typical marketing avenues such as TV and
Radio. The masses are embracing mobile devices so marketing channels have expanded to
online advertising text messaging, social media and mobile apps to name but a few. Appendix
A displays the digital platforms and the usage from both Millennials and Non-Millennials
The digital world allows for the consumer to have more information to hand that assists them
in their buying decisions. The transparency of brands product, quality, price and service are
imperative factors that Millennials consider before committing to a purchase. Figure 2 displays
how the digital natives actively seek out more information than other audiences.
The information that is readily available
for the consumer can be outside of the
brands control. “Millennials are talking
about products and services online, being
influenced and influencing others. This
generation considers the opinions of
fellow consumers to be more credible
than traditional advertising.” (Taken
Smith, 2012) They are a generation that
is no longer swayed solely by the
marketing message, word of mouth and
consumer reviews are an important
aspect to consider.
Competitive PositionThe Porter Five Forces model identifies the competitive forces within the industry that affect a
company‟s profitability. Figure 3 highlights the five basic forces and the state of Nike Jordan‟s
competition.
The above analysis draws attention to three main factors that present both a moderate and
strong force.
Threat of Substitute Products - The internet allows customers to have more access to
information and source competitively priced substitutes. Nike Jordan‟s target audience are
actively seeking this information and though Jordan have a strong brand presence, loyalty
to brands are no longer a dominating factor for the Millennial consumer.
Goldman Sachs (2012)
reported that only 8% of 25-34
year olds surveyed strongly
agreed with the statement
„When I shop, I always try to
buy branded products‟. Figure
4 shows that in comparison to
the Non-Millennial, price has a
significant influence on their
purchase decision.
Bargaining Power of Buyers - Not only are the consumers searching for value but since
the digital age they now have a new set of expectations when it comes to the digital
experience. Appendix A reveals that both Millennial‟s and Non-Millennial‟s are using
branded apps to receive marketing messages and make their purchases. It‟s imperative
that functionality and ease of use if of a high standard for all Nike‟s online asset‟s. In a site
overview from Alexa.com (2016) 51% of websites loaded faster then Nike.com. However,
the internet also provides Nike Jordan with a global platform to market their goods and
continue to increase the amount of individual buyer‟s.
Engage
% Active Hurdle Rate Fan Engagement Repeat Conversion
Convert
Conversion Rates Leads and Sales Revenue and Margin
Act
Bounce Rate - 27.08 Avg. Pages per Visit - 8.49 Avg. Visit Duration - 4.43m
Reach
Audience Share - 68% Category rank - #1
This report focused on three competitors
offering similar basketball products and
analysed their digital platforms and usage.
Adidas, Reebok and Under Armour were the
chosen competitors. Figure 5 is adapted from
Smart Insights (2010) RACE planning
framework and included figures that were
readily available about Nike.com in order to
benchmark themselves against the competition.
Nike.com performs well and dominates the
audience share out of competitor‟s domains.
Similar Web (2016) identifies that within the
sports shopping category the website it ranked
number one in the US, with its nearest
Rivalry Among Existing Competitors - The digital environment allows an existing brand
to easily launch new products, connect and become closer with the customer without the
physical assets such as stores.
competitor Under Armour ranking at number nine. There are however some aspects where
Nike are under performing, traffic sources displayed in Figure 6 and 7 show they under perform
in generating leads from both social networks and referrals.
We identified earlier that Millennial‟s utilise social media sites for product reviews, to be under
performing in these areas is troubling. A key trend that Nike Jordan is also missing is coupons and
rewards.“Millennial‟s are likely to purchase more from, feel more loyal to and tell their networks
about brands that offer reward incentives.” (Ferguson, 2012) Figure 7 identifies Under Armour as a
strong performer when gathering traffic through these avenues.
Intermediaries Chaffey and Smith (2013) recognises that intermediaries can have help drive traffic through to an
organisations website. Though it is important to note that some of Nike Jordan intermediaries are
retailers, where the sale will start and end outside of Nike.com domain. Appendix B displays Nike
as being the top online athletic shoe merchant in the US holding 31.7% of the market share.
However its displays in second and third position are retailers Amazon and Zappos.com both of
which not only stock Nike Jordan„s but products from the competitors. Similar Web (2016) website
analysis indicates that both of these retailers audience visit time is longer and they view more
pages.
Polictical
• Social media blocked in some countries
Economic
• Economic crash in US
• Price comparison websites
Social
• The acceptance and appreciation of different cultures
• Different cities support different teams and players
Technological
• Big data
• Cross channel marketing
• Pay options expanision
Legal
• Data protection
• Copyright infringement
• Paid bloggers disclosing promotion of product
Enviromental
• Paperless
• Green IT
Nike Jordan Strengths – S
Strong brand affiliates
Existing customer Base
Brand perception
Weaknesses – W
Intermediaries
Cross channel marketing
Social media
Slower interface
Opportunities – O
Traffic source expansion
Reward or coupon scheme
New wearable product
SO strategies
1. Create rewards those who review
products
2. Refine remarketing strategy
through email and web
3. Launch wearable products through
sub brand Jordan to provide
access to big data
WO strategies
1. Introduce reward scheme for app
users only
2. Refine social media strategy to
increase click through rate
Threats –T
Aggressive competition
New competitive products
ST strategies
1. Utilise brand affiliates to reengage
audience
2. Add value to product purchases
WT strategies
1. Improve web speed and
functionality
2. Increase social media presence
3. Integrate sub brand Jordan
effectively on Nike platforms
Nike Jordan is not only influenced by
internal environment but the external
environment has several factors that
can affect their digital approach.
Figure 8 highlights those factors and
identifies some of the obstacles there
to face.
Social – A factor to consider here is that the US basketball teams fan base is not just because
of their success but their location. Slice Intelligence (2016) identifies the top four NBA player
shoes as Nike Air Jordan, Nike Kobe, Nike Lebron and Under Armour Curry. Appendix C
displays how team preference can shape the products demand and affect the online revenue
from city to city. Jordan is shown to dominate New York and Los Angeles but rival Under
Armour, hold the market share in San Francisco by almost 10%.
Technological – Wearable “gadgets are rapidly multiplying, and within five years there could be
half a billion devices strapped onto, or even embedded in, human bodies.” (Austin, 2015) Nike
have a number of different wearable products on offer including Nike + Basketball, though not
yet embedded in the sub brand Jordan it is still a focus for the future if they are to stay ahead of
competitors. Data captured from these gadgets could provide insights that allow for more
targeted marketing messages but as Austin (2015) acknowledges there are security issues with
the privacy of the data collected and this could in turn breach the legal requirements of data
protection.
Economical – Nike Jordan‟s target audience are earning less than other generations. Ferguson
(2012), reports that 34% of Millennial‟s earn under $25,000 a year. However, they are still
spending contributing $600 billion “to the $6.5 trillion spent annually by US consumers.”
(Ferguson, 2012) Rather than considering price comparison as a want from this generation
Nike should consider this as a need for them to fulfil purchase in the given climate.
The objective of this report was to
provide marketing intelligence on the
Nike Jordan brand and analyse both
the micro and macro environment.
The SWOT analysis shown in Figure
9 identifies the brands strengths and
weaknesses whilst highlighting
attractive opportunities to move the
brand into an even stronger
competitive position. The
recommendations made in the study
combat the threats the business
faces whilst leveraging and building
strengths. Word count 1493
Figure . 1 Nike.com audience demographic
Alexa (2016)
Figure. 2 Comparison between US Millennial’s and Non –
Millennial’s seeking out product review information.
Ferguson (2012)
Figure. 4 Comparison between US Millennial’s and Non –
Millennial’s and which factors make them loyal to a
brand. Goldman Sachs (2012)
Figure. 3 Adapted from Porter (2008) five forces framework to include
Nike Jordan current competitive position.
Figure . 5 Adapted from Chaffey and Smith
(2013) RACE framework to include Nike.com
domain statistic.
Figure. 6 Comparison of Nike.com and its
competitors traffic source statistics from social
networks. Similar Web (2016)
Figure. 7 Comparison of Nike.com and its
competitors traffic source statistics from referral
sites. Similar Web (2016)
Figure. 8 PESTLE analysis of the Marco environment
Figure. 9 SWOT analysis of the Nike Jordan brands digital
environment
Printing:Nike Jordan Marketing Intelligence ReportKayleigh Fyfe | 12032909 | Scanning The Digital Environment
References
• Alexa (2016) Site overview. Available at: http://www.alexa.com/siteinfo/nike.com (Accessed: 1 December 2016).
• Austen, K. (2015) „The Trouble With Wearables‟, Nature, 525(7567), pp. 22–24.
• Chaffey, D. and Smith, Pr. (2013) Emarketing excellence: Planning and optimizing your digital marketing. 4th edn. London, United Kingdom: Taylor and Francis.
• Ferguson, R. (2012) BORN THIS WAY: The Millennial Loyalty Survey. Available at: https://www.aimia.com/content/dam/aimiawebsite/CaseStudiesWhitepapersResearch/english/Aimia_GenY_US.pdf (Accessed: 5 December 2016).
• Goldman Sachs (2012) Millennials Infographic. Available at: http://www.goldmansachs.com/our-thinking/pages/millennials/ (Accessed: 1 December 2016).
• Hanlon, A. (2014) Using the PESTLE analysis model. Available at: http://www.smartinsights.com/marketing-planning/marketing-models/pestle-analysis-model/ (Accessed: 5 December 2016).
• Mirabella, L. (2016) Under Armour’s Stephen Curry basketball shoes rank fourth, survey shows. Available at: http://www.baltimoresun.com/business/under-armour-blog/bal-armoury-under-armour-curry-basketball-shoes-rank-fourth-survey-shows-20160412-story.html (Accessed: 5 December 2016).
• Nike.INC (2015) SUSTAINABLE INNOVATION IS A POWERFUL ENGINE FOR GROWTH. Available at: file:///C:/Users/Zxee/Downloads/NIKE_FY14-15_Sustainable_Business_Report%20(1).pdf (Accessed: 5 December 2016).
• Porter, M.E. (2008) „The Five Competitive Forces That Shape Strategy‟. Review of by HBR Must Reads on Strategy, .
• Simialar Web (2016) Competitive intelligence tool. Available at: https://pro.similarweb.com/#/website/audience-overview/nike.com,amazon.com,zappos.com/*/999/3m?webSource=Total (Accessed: 5 December 2016).
• Similar Web (2016) Competitive intelligence tool. Available at: https://pro.similarweb.com/#/website/audience-overview/nike.com,adidas.com,reebok.com,underarmour.com/*/999/28d?webSource=Total (Accessed: 5 December 2016).
• Stanton, T. (2016) Assists from Jordan, Kobe and LeBron keep Nike.Com ahead of Amazon in athletic shoes - slice intelligence. Available at: https://intelligence.slice.com/assists-from-jordan-kobe-and-lebron-keep-nike-com-ahead-of-amazon-in-athletic-shoes/ (Accessed: 5 December 2016).
• Taken Smith, K. (2012) „Longitudinal study of digital marketing strategies targeting Millennials‟, Journal of Consumer Marketing, 29(2), pp. 86–92.
Appendices
Appendix A – Millennial technology, Ferguson (2012)
Appendix B – Top online shoe merchants, by revenue in the US. Stanton
(2016)
Appendix C – Top five cities for select NBA player shoes, by online
revenue in the US. Stanton (2016)