Strategic Management Analysis of Nike

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Castronuevo, Jan Clark
Meer, Regginald
Young, Johnedel
Quintero, Arvin
Dioneda, Jefrick

September 18, 2009

Section 1 - Executive Summary
Back before the Swoosh logo and long before the days we were called Nike, there was Blue Ribbon Sports (BRS). It was the company Phil Knight, our founder, and legendary track coach Bill Bowerman created in 1964 to provide athletes with better shoes. Their first year sales totaled around $8,000. It wasn’t until 1971 that BRS introduced the concept of the Greek winged Goddess of victory—Nike. In December 1980 we went public. Nike employs more than 33,000 people globally. Our Nike World Headquarters located in Beaverton, Oregon is home to more than 7,000 employees. Phil Knight was a talented middle-distance runner from Portland, who enrolled at Oregon. Before there was the Swoosh, before there was Nike, there were two visionary men who pioneered a revolution in athletic footwear that redefined the industry. Bill Bowerman was a nationally respected track and field coach at the University of Oregon, who was constantly seeking ways to give his athletes a competitive advantage. He experimented with different track surfaces, re-hydration drinks and – most importantly – innovations in running shoes. But the established footwear manufacturers of the 1950s ignored the ideas he tried to offer them, so Bowerman began cobbling shoes for his runnersof 1955 and competed for Bowerman’s track program. Upon graduating from Oregon, Knight earned his MBA in finance from Stanford University, where he wrote a paper that proposed quality running shoes could be manufactured in Japan that would compete with more established German brands. But his letters to manufacturers in Japan and Asia went unanswered, so Knight took a chance. Nike does more than outfit the world’s best athletes. We are a place to explore potential, obliterate boundaries, and push out the edges of what can be. We’re looking for people who can grow, think, dream and create. We thrive in a culture that embraces diversity and rewards imagination. We seek achievers, leaders and visionaries. At Nike, it’s about bringing what you have to a challenging and constantly evolving game. At Nike, every employee brings inspiration and innovation to our business.  And others have also taken notice. In the last three years, we’ve been named to Fortune Magazine’s 100 Best Companies. For the last two years, we were named to Business Week’s Top 100 Best Places. Nike’s portfolio also includes the companies Converse Inc , Nike GOLF , Cole Haan Holdings, Inc., Hurley International LLC, and Umbro Ltd. From 1972 to 1982, Nike relied almost exclusively on print advertising in highly vertical publications including Track and Field News. Most of the early advertising was focused on a new shoe release, essentially outlining the benefits of the running, basketball or tennis shoe. In 1976, the company hired its first outside ad agency, John Brown and Partners, who created what many consider Nike's first 'brand advertising' in 1977. A print ad with the tagline "There is no finish line" featured a lone runner on a rural road and became an instant classic. The success of this simple ad inspired Nike to create a poster version that launched the company's poster business. In 1982, Nike aired its first national television ads, created by newly formed ad agency Wieden+Kennedy, during the New York Marathon. This would mark the beginning of a remarkably successful partnership between Nike and W+K that remains intact today. The Cannes Advertising Festival has named Nike its 'advertiser of the year' on two separate occasions, the first and only company to receive that honor twice (1994, 2003). Nike also has earned the Emmy Award for best commercial twice since the award was first created in the 1990s. The first was for "The Morning After," a satirical look...
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