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)