Nike Vs Adidas Case Study

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Answer To Question 1:

Nike and Adidas are the biggest multinational corporations that manufacture ,develop and design shoes, clothing and accessories. They made an innovation in the sportswear sector , Created products which helped athletes all around the world to level up their performance .Therefore ,over the past years the competition between them escalated and each one of them is trying to increase its profits and market share .

Here are some brief profiles of these two companies:

Adidas is a German multinational comapny, was established in 1949 by Adolf Dassler . That designs and manufactures clothing, accessories and shoes. It is the largest sportswear manufacturer in Europe and the second biggest in the world. They sell a
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is a leading company in the sportswear and sport equipments, they have loyal costumers so we can apply premium pricing policy.It is a type of pricing which involves establishing a price higher than your competitors to achieve a premium positioning. You can use this kind of pricing when your product presents some unique features or high quality , or when the company has a unique competitive advantage compared to others. For high-end products such as athletic shoes which created by collaborating with sport stars( for example air Jordan shoes) we can set high prices .Many factors will help to promote this line of shoes .First of all ; it’s limited edition and we sell it at the begging of the basketball season ,Second we rely on Jordan’s fan base and costumers who love sports and follow the trend. Beside this line of shoes have a high quality and good design .

Second pricing policy we can apply in Nike,Inc. it’s called price skimming in this pricing strategy the company sets a relatively high initial price for new product or service at first, and then make the prices go low over time .This type of pricing attract customers who search for good products for less cost . For example : middle class families such as mothers or students who wear sneakers shoes every single day because they are comfortable and affordable
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And this combination of pricing policy will make Nike dominate the market by making wide range of options , variable prices and high quality products.

Answer To Question 3:

A. When the whole sector of the market is occupied by the little number of big corporations or firms who control the market share and take the leadership. This type of market is called oligopolistic market where only a few players dominate the industry and they control the market price. they usually determine the prices of products . For example cell phone carriers sector, only few companies operate the market so as result they have fixed prices for their services .So that is mean there is a set limit for just how low prices can go, forcing consumers to pay high prices no matter what.

As said, this type of market structure is oligopoly only the advanced and large corporations can be present . So it would be challenging for small company to enter the market and compete with them. unless they have competitive advantage or special service to provide.

B.The benefits of this market

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