International Business

Company Profile
 • Created in 1971
History at a • Philip Knight and Bill Bowerman
glance • American sportswear company
History of the Nike Swoosh
What??
Not everyone SRC
thinks like
me???

NIKE: a mix of national

value and cultural
differences
 Geographic: North America, Europe,
01 Middle East, Asia

Sociodemographic
Teens
11-45 years old 02
Increasing number of females

Psychographic
03 all kind of athletes as well as fashion lovers
Creating a sense of belonging
 Premium brand

High quality and innovative technology

Positioning
Ambitious company satisfying the market
by products related to sports

Advertisement and reputation creating a

sense of inspiration, confidence and
belonging
 Nike’s
diagnosis
 Socialist System – Bureaucracy – Central
Political vs Local Forces – Commercial Risk – No
Political Involvement

CPI rate: 3% (+1%) – Income Tax Rate 45%

Bank Rates: Increasing – Reserve
Economic Requirements 9X – Level 2 Banks: Imposing
limits

Corruption – Human Rights – Ghost Kids

Social Language Barriers – Race Discrimination

PESTEL China
Lack of Venture Capital
Technological Online Payment System

Water Pollution - Biodegradation

Environmental MEE Regulation – Government’s pressure
to go green – Cotton’s quality: all time low

Join-Vs are a must – labour law

Legal compliance – little experience in
drafting commerce legislation
 PESTLE CHINA - OPPORTUNITIES

- Health Consciousness - Innovative Production Capacity

- Demographics: Age structure & Population - Infrastructure
- E-commerce influence - Sustainable Textiles
- Collectivist Culture - Renewable Energy

- Income Tax Law

- Cheap Labour - NPC’s New Amendments
- Production Cost ECONOMY - VAT has decreased
- Wholesalers LEGAL
- Middle Class
- China’s Garment Industry
- Balance of garment trade: $396 HML

- Stable environment
- Business friendly
- Less trade barriers - Superiority in ressources
- Lots of FTAs - Air pollution significantly reduced
- New Silk Road
- Power decentralised
 Positive US government policies that foster
business growth. US government accuse of
Political corruption that can affect the political
stability of the country

1st economy of the world

Economic World’s largest sportswear market

325 millions of unhabitants

Social Increase interest of women to sports

PESTEL USA
Increase use of apps
Technological Increase of ecommerce sales

Growing trend of green product

Environmental Eco firendly sportswear brand

Legal No entry barrier

 Many Foreign Direct Investments Playing a
Political key role in the European Union (one of the
leading member states

Increasing market (+4.3%)

Economic Lower purchasing power

54% of the population like to wear

sportswear daily
Social 62.5% have decreased their spending

PESTEL France
86% of individuals use the Internet
Technological Increasing second-hand retailers’ websites

Growing trend of green product

Environmental Many environmental laws

Easy way to create a company/subsidiary

Legal Many health and safety regulations
 Main marketing strategy:

• Adapted standardization:
International • Minor, but effective
Marketing • Cultural specific tendencies
• SRC: appropriate domestically
designed marketing mix
• International Pace: UPPSALA
 Products: constantly innovating,
newsworthy technology

Marketing Mix
Promotion: expensive, but
effective; collaborations with
athletes, highly presented on Social
Media
Innovation
 Product Innovation
Custom motor and gear train
Endure up to 32 pounds
Modifies itself
Reduces tension
More comfortable
 Marketing Innovation

Social • One step ahead competitors

• Advertisements deliver a message of feeling
inspired
media • Pioneer of UGC

Open • NIKE+
• Workout plans,running track, tips, milestones

service • Builds relationship between brand and

costumer
Environmental innovation

Transformed
supply chain
Adapting
environmental
challenges

Use of
biodegradable
textiles

SUSTAINABILITY
 Nike’s direct and
distribution strategy

• Focusing on direct selling

• DTC provides higher margins

• DTC sales increased

• 13% increase through Nike

Direct
Consequences of direct distribution strategy

Eliminates Intermediary Expenses Reduces distribution channel options

Increases direct consumer contract Raises fulfilment costs
Internationalization Path
 COUNTRIES n. SUM NOW 1233 COUNTRIES n. Supply Distribution
United States 273 AVERAGE 20,55 China 96
China 98 SUM 2012 756 United States 56
Turkey 93 DELTA 63,09% Taiwan 50
Russian Federation 64 Vietnam 30
France 55 Others 20

China United States of America Vietnam Others

JV
 Societal Social Dumping
consequences of
NIKE
international
expansion Environmental dumping
 Conclusions

Leader of the sportswear market

Indentify each opportunity in each country
Adapted standardization strategy
Many products innovation
 A more ethical manufacturing process
Social and environmental issues

Recommendations
A more environmental friendly
manufacturing process

Change the US dependency Take a stand against

counterfeiting
Cucullo Elio – Alex Hupcuzi – Melina Kleiner – Noémie Meney – Frenki Qirjako – Mathilde Vignon