Date: March 12, 2013
To: Clifford Torng- Marketing Director for Nike/Jordan Brand From: Matthew Carini
Subject: Analysis of and Recommendations for Nike and its Jordan Brand
The Jordan brand could not have a better parent company than Nike who has been able to dominate the sports industry since its founding in 1972. Nike’s decision to sign Michael Jordan to a sneaker contract was one of the smartest things the company ever did. Drafted by the Chicago Bulls in 1984, and thirty years later his Brand is doing better than ever. Royalties themselves generate Michael $60 million annually. The selective distribution method the brand uses gives much added value to select styles of Jordan’s sneaker line and keeps consumers begging for more. The brand does not stop at sneakers. Jordan merchandise consists of apparel, footwear and accessories for all. (Badenhausen, 2013)
Michael’s ability to maintain a connection with fans has done the brand wonders. However he is no longer in the spotlight. To make up for this, the brand continues to attract sports best athletes to represent and sign with Jordan. Some names include Carmelo Anthony of the New York Knicks and Chris Paul of the L.A Clippers. The Jordan Brand makes a point to always be associated with the best. The next big star is always being signed by Jordan.
As long as Nike is thriving and seeing growth, this means good things for the Jordan Brand. In this brand equity report my intention is to communicate (1) how the Jordan brand is specifically doing in terms of financially, popularity and its contribution to Nike, (2) tell of the recent investments and additions to the brand and (3) uncover challenges the brand faces in the coming years. These Challenges will be supplemented with solutions in an attempt to overcome them.
THE PRESTIGIOUS JORDAN BRAND
Michael Jordan’s “Q” score is 43 (Badenhausen, 2013). To put this in perspective, Albert Einstein’s was a 56. “Q” score measure the awareness and popularity of a celebrity, brand or show. Basically, everyone knows who Michael Jordan is. The Jordan Brand has been Nike’s biggest profit driver due to effective and appropriate promotion and advertisement. For instance, Spike Lee’s unintentional marketing has given the brand priceless value. Lee is an avid supporter and fan of particularly the Jordan Brand sneakers (Madden, 2012). Jordan makes sure to affiliate with the best athletes from all sports, from Derek Jeter in baseball to Maya Moore of the WNBA. The Jordan brand is everywhere appearing in each and every sport setting.
NIKE’S INCREASING VALUE, EQUITY AND GROWTH
Nike is currently listed at 26 on Forbes most powerful company’s list, providing security to the Jordan Brand (Madden, 2012). The widening product lines and successful marketing have been able to increase market share. The company saw an increase in market share of 2% from 2006-2009. According to a leading consultancy firm, Nike is ranked 25th in terms of brand value. The company is now worth 14.5 billion, a 6% increase year to year (Madden,2013).
Financials: The faltering economy has not affected Jordan like it has most brands. While other high end footwear saw decline in sales particularly in 2009, Jordan saw double digit gains.
▪ Annually Jordan brings in alone, revenues over $1 billion.
▪ Since the Retirement of Jordan, Nike sales have doubled around the world.
▪ In 2012 Fiscal year Nike returned $.21 return to its investors.
▪ Nike Revenue Increase of nearly $4 Billion from 2011-2012.
▪ Mark G. Parker plans to have revenues increase to 30 billions by 2015- an increase from 24 billion; remaining very confident in this goal.
▪ Jordan accounts for 71% of the basketball shoe market while Nike holds 22%. Adidas and Reebok account for 3% and 2% respectively.
WHERE JORDAN IS SPENDING ITS MONEY
The investment project’s of Jordan are crucial to the growth and continued success of the Brand. Most of...
Bibliography: 1. Madden, L. (2013). Day 14 of Jordan Brand 's XX8 Days of Flight: Michael Jordan 's 'Last Shot, ' Ferrari and Kicks. Forbes.Com, 1.
2. Madden, L. (2012). Spike Lee is Still the Best Nike Jordan Brand Pitchman. Forbes.Com, 54.
3. Madden, L. (2012). Jordan Brand Gaining Speed With NASCAR. Forbes.Com, 16.
4. Madden, L. (2012). Russell Westbrook Joining Jordan Brand is a Smart Move. Forbes.Com, 21.
5. Kirby, J. (2011). China hits the hardwood. Maclean 's, 124(2), 41.
6. Badenhausen, K. (2013). How Michael Jordan Still Earns $80 Million A Year. Forbes.Com, 25.
7. AIR JORDAN GROUNDED?. (2013). Advertising Age, 84(3), 6.
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