Nike's Value Chain Essay examples

2443 Words 10 Pages
STRENGTHS

Strong management team and good corporate strategy in both North American and overseas markets

First movers advantage in e-commerce

Brand recognition and reputation

Trademark "Just Do It"

Diversity and variety in products offered on the web (footwear, apparel, sporting equipment, etc.)

Strong control over its own distribution channel

Strong customer base

Strong financial position with minimal long term debts

Innovative designs in footwear enabling consumers to design their own shoes online

Brand reputation and recognition

Diversity and variety in products offered on the web (footwear, apparel, sporting equipment, etc.) Adidas even offers items not available in its retail stores
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Furthermore, the information, such as demographics and preferences, collected from directly selling to the end consumers should be used to market new goods and products.

PORTER'S FIVE FORCES

Barriers to Entry - Low

Due to the large scale of both Nike and Adidas, these firms are able to control their costs to retain performance advantage over emerging competitors in the industry. Their web sites are more sophisticated and enticing to browse, both contributed to their large marketing budgets. The capital injection into web site development is high and must be updated frequently with new promotions and added features to attract online shoppers. There are many proprietary product differences in the industry therefore brand identity has an immediate competitive advantage. The Nike and Adidas brand is well renowned globally and plays a major role in consumer decision making. Selling footwear online is highly competitive; however, barriers to enter into this e-commerce industry are quite low. The capital requirement for setting up an online shop is comparatively lower than setting up a traditional bricks and mortar establishment. Therefore, the online footwear industry is highly abundant with hundres of online merchants. Switching cost is low for the consumer, and may occur frequently depending on consumer preference and other factors affecting consumer buying decision, (i.e. price

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