A PROJECT REPORT ON Sales & Distribution Channel of

SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENT OF MBA PROGRAM (2010-2012)

SUBMITTED TO: Dr. RANJAN UPADHYAYA FACULTY - WISDOM

SUBMITTED BY: DEEPA JAISWAL Roll No.:7943

TABLE OF CONTENTS
S. no. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Introduction History Vision & Mission NIKES presence in India Products offered by Nike SWOT Analysis Marketing Mix Marketing Strategy Corporate Social Responsibility Value Chain System Sustainable Supply Chain NIKE Channel conflict case analysis NIKE in news References TOPIC Acknowledgement Page No. 3 4 5 11 12 17 21 23 25 26 29 36 38 42 43

ACKNOWLEDGEMENT
I am very thankful to all those who have enabled me to successfully complete my project on Sales and Distribution of Nike Incorporation. I would like to express my sincere gratitude to Dr. Ranjan Upadhyaya Senior Faculty (WISDOM) Banasthali Vidyapeeth, Banasthali without whose support and encouragement I would not have achieved what I have today.

Deepa Jaiswal (7943) M.B.A.-III Semester WISDOM Banasthali Vidyapeeth

INTRODUCTION
Nike, Inc. is a major publicly traded sportswear and equipment supplier based in the United States. The company is headquartered near Beaverton, Oregon, which is part of the Portland metropolitan area. It is the world's leading supplier of athletic shoes and apparel and a major manufacturer of sports equipment, with revenue in excess of US$18.6 billion in its fiscal year 2008 (ending May 31, 2008). As of May 2010, it employed more than 34,400 people worldwide. Nike and Precision Castparts are the only Fortune 500 companies headquartered in the state of Oregon, according to The Oregonian. The company was founded on January 25, 1964 as Blue Ribbon Sports by Bill Bowerman and Philip Knight, and officially became Nike, Inc. on May 30, 1978. The company takes its name from Nike, the Greek goddess of victory. Nike markets its products under its own brand, as well as Nike Golf, Nike Pro, Nike+, Air Jordan, Nike Skateboarding, and subsidiaries including Cole Haan, Hurley International, Umbro and Converse. Nike also owned Bauer Hockey (later renamed Nike Bauer) between 1995 and 2008. In addition to manufacturing sportswear and equipment, the company operates retail stores under the Niketown name. Nike sponsors many high profile athletes and sports teams around the world, with the highly recognized trademarks of "Just do it" and the Swoosh logo.

HISTORY
Nike's Heritage NIKE, pronounced NI-KEY, is the winged goddess of victory according to Greek mythology. She sat at the side of Zeus, the ruler of the Olympic pantheon, in Olympus. A mystical presence, symbolizing victorious encounters, NIKE presided over history's earliest battlefields. A Greek would say, "When we go to battle and win, we say it is NIKE." Synonymous with honored conquest, NIKE is the twentieth century footwear that lifts the world's greatest athletes to new levels of mastery and achievement. The NIKE 'swoosh' embodies the spirit of the winged goddess who inspired the most courageous and chivalrous warriors at the dawn of civilization. (from Nike Consumer Affairs packet, 1996) The Swoosh The SWOOSH logo is a graphic design created by Caroline Davidson in 1971. It represents the wing of the Greek Goddess NIKE. Caroline Davidson was a student at Portland State University in advertising. She met Phil Knight while he was teaching accounting classes and she started doing some freelance work for his company. Phil Knight asked Caroline to design a logo that could be placed on the side of a shoe. She handed him the SWOOSH, he handed her $35.00. In spring of 1972, the first shoe with the NIKE SWOOSH was introduced.....the rest is history! (from Nike Consumer Affairs packet, 1996) A brief history of Nike The Nike athletic machine began as a small distributing outfit located in the trunk of Phil Knight's car. From these rather inauspicious beginnings, Knight's brainchild grew to become the shoe and athletic company that would come to define many aspects of popular culture and myriad varieties of 'cool.' Nike emanated from two sources: Bill Bowerman's quest for lighter, more durable racing shoes for his Oregon runners, and Knight's search for a way to make a living without having to give up his love of athletics. Bowerman coached track at the University of Oregon where Phil Knight ran in 1959. Bowerman's desire for better quality running shoes clearly influenced Knight in his search for a marketing strategy. Between them, the seed of the most influential sporting company grew. The story goes like this: while getting his MBA at Stanford in the early '60s, Knight took a class with Frank Shallenberger. The semester-long project was to devise a small business, including a marketing plan. Synthesizing Bowerman's attention to quality running shoes and the burgeoning opinion that high-quality/low cost products could be produced in Japan and shipped to the U.S. for distribution, Knight found his market niche. Shallenberger thought the idea interesting, but certainly no business jackpot. Nothing more became of Knight's project.
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Cut to 1963. Phil Knight traveled to Japan on a world-tour, filled with the wanderlust of young men seeking a way to delay the inevitable call of professional life. Seemingly on a whim, Knight scheduled an interview with a Japanese running shoe manufacturer, Tiger--a subsidiary of the Onitsuka Company. Presenting himself as the representative of an American distributor interested in selling Tiger shoes to American runners, Knight told the businessmen of his interest in their product. Blue Ribbon Sports--the name Knight thought of moments after being asked who he represented--was born. The Tiger executives liked what they heard and Knight placed his first order for Tigers soon thereafter. By 1964, Knight had sold $8,000 worth of Tigers and placed an order for more. Coach Bowerman and Knight worked together, but ended up hiring a full-time salesman, Jeff Johnson. After cresting $1 million in sales and riding the wave of the success, Knight et. al. devised the Nike name and trademark Swoosh in 1971. By the late '70s, Blue Ribbon Sports officially became Nike and went from $10 million to $270 million in sales. Katz (1994) describes the success via Nike's placement within the matrix of the fitness revolution: 'the idea of exercise and game-playing ceased to be something the average American did for fun,' instead Americans turned to working out as a cultural signifier of status. Clearly, the circumstances surrounding the shift are not this simple; it is one of the aims of this project to discover other generators of popular attention to health. If Nike didn't start the fitness revolution, Knight says, "We were at least right there. And we sure rode it for one hell of a ride" (Katz, 66). The 80s and 90s would yield greater and greater profits as Nike began to assume the appearance of athletic juggernaut, rather than the underdog of old. "Advertising Age" named Nike the 1996 Marketer of the Year, citing the "ubiquitous swoosh...was more recognized and coveted by consumers than any other sports brand--arguably any brand" (Jensen, 12/96). That same year Nike's revenues were a staggering $6.74 billion. Expecting $8 billion sales in fiscal 1997, Nike has targeted $12 billion in sales by the year 2000. Few can question Nike's financial hegemony. But nearly $7 billion in revenues clearly begs the question, What sells these shoes? It is my assertion that Nike's power to sell comes from deep-rooted yearnings for cultural inclusiveness and individual athletic accomplishment. These seemingly paradoxical desires collide in consumers hearts and minds and produce the unyielding zeal for Nike shoes and apparel. Unfortunate effects of this zeal can be found in the rash of Nike apparel killings in 1991 and the profusion of Nike collectors and webpages designed around the company's products. Nike appeals to these disparate elements of Americans' personalities through an advertising philosophy that is, at once, simple and sublime. In addition, Nike's practice of top-level athletes promoting their products appeals to countless ages and creeds as a way to identify with and emulate their athletic heroes. These forces work powerfully upon the individual consumer, but one should not lose sight of the cultural context in which the individual moves.

1957

Bill Bowerman is quietly building a track-and-field empire at the University of Oregon in Eugene. Phil Knight, a middle-distance runner on the U of O track team, begins a relationship with Bowerman that will change sports and fitness.

1965

Jeff Johnson becomes the first full-time employee of Blue Ribbon Sports, the company Knight and Bowerman form to distribute Tiger shoes in the United States.

1968

The Cortez, made to Bowerman's specifications, becomes Tiger's best-selling shoe. "A tiger hunts best when he's hungry." -Bill Bowerman

1973

Steve Prefontaine, who never loses a race in four years at the U of O, embodies the competitive spirit of the new NIKE brand.

1974

The Waffle Trainer featuring Bowerman's unique Waffle outsole, becomes the best-selling training shoe in the country.

1977

NIKE establishes Athletics West, a "safe house" for world-class athletes to train for Olympic competition.

1978

John McEnroe signs his first endorsement contract with NIKE. The match is a natural.

1979

The Tailwind shoe introduces NIKE-AIR cushioning to the world.

1981

Alberto Salazar wears NIKE shoes on his way to a new world record in the New York City Marathon.

1983

Promotion reaches new heights (and sizes) with billboards, part of the Olympic Cities Campaign.

1984

Joan Benoit wins the first women's Olympic Marathon in Los Angeles.

1985

A young NBA Rookie of the Year signs with NIKE. AIR JORDAN is born.

1987

The Air Trainer High defines a new fitness phenomenon, cross-training. The Air Max shoe gives the world its first view of NIKE-AIR cushioning. Visible excellence.

1988

Bo Jackson emerges as the world's greatest athlete. The Air Stab shoe reveals a new technology, the Footbridge stability device.

1989

Andre Agassi explodes onto the tennis scene with an aggressive look and style of play.

"The commitment is to be a global company - one management, one theme, one value, one ethic around the world." -Richard K. Donahue Just Do It becomes a call to action for a generation of fitness enthusiasts. 1991

Huarache Fit technology changes the rules about footwear design. The Women's Print Campaign earns unanimous critical and popular praise for its realism. Mike Powell shatters a 23-year-old record with a long jump of 29' 4 ".

1992
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NIKE assumes the lead in apparel technology with NIKE F.I.T. fabrics, built for comfort and protection during high-intensity outdoor workouts. In an Olympics marked by surprise, Quincy Watts accelerates out of the pack to take the gold medal in the 400 meters. An exclusive agreement between NIKE and The Athletics Congress puts every USA Track & Field team in NIKE competition gear for the rest of the century. Six NIKE athletes help win the Olympic gold medal in basketball. Long-time NIKE athlete Lynn Jennings becomes the first athlete to win three consecutive World Cross-Country Championships. She follows the feat with an Olympic medal.

1993

First visible in the Air Max running shoe in 1987, NIKE-AIR technology goes a step further in 1993 offering 30 percent more cushioning than ever before and an unprecedented view of the Air-Sole unit. Michael Jordan leads the Chicago Bulls to three straight NBA championships, a third MVP title, and his seventh consecutive scoring title before retiring. NIKE's Reuse-A-Shoe breaks ground by recycling old athletic shoes into material for resurfacing sports courts. He corrals more than 50 major league records before injury ends the 27-year career of Nolan Ryan at age 46.

1994

NIKE launches P.L.A.Y. - Participate in the Lives of America's Youth - a call to action for everyone to help kids get and stay active. Romario is one of 10 flamboyant soccer players representing Brazil and NIKE in winning the 1994 World Cup. The Air Deschutz sandal is the best-selling shoe in the company, leading NIKE Outdoor on its path to category dominance.

"We make sure the product is the same functionally whether it's for Michael Jordan or Joe American Public." -Phil Knight 1995

Pete repeats at Wimbledon. Monica Seles is back...in the U.S. Open finals. Cal Ripken, Jr. breaks Lou Gehrig's record for consecutive games at 2,131. Jerry Rice becomes the all-time leader in reception yardage. German tennis star Michael Stich joins the Nike ranks. Mark Allen wins his sixth Ironman Triathlon. Nike sponsors the USA Women's Basketball Team. Hideo "The Tornado" Nomo is named Rookie of the Year.
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1996

Nike signs nine of the top ten NFL draft picks. Nike Golf hooks up with Nick Price, Michael Campbell and Tommy Tolles. The Nike skate debuts at the NHL All-Star Game. Dallas does it again. Picabo Street wins the World Cup Downhill. Kenya runs away with the World Cross-Country Championships. 70,000 fans see Jorge Campos lead the Los Angeles Galaxy to victory in its MLS debut. Uta Pippig redefines courage at the Boston Marathon. Damon Stoudamire is named Rookie of the Year.

Evolution of Nike Logo

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MISSION
To bring inspiration and innovation to every athlete in the world.

VISION
Innovate for better world. Unleashing potential through sport. In the last two years, Nike has invested $100 million worldwide in community-based sports initiatives. By 2011, NIKE is expected to invest another $315 million. These investments will be used to give excluded youth around the world the chance to play because as access to sport can enhance their lives. Nike will provide products, resurface playing fields, support community-based programs, and help young people create their own communities. This is all will be the NIKE Let Me Play commitment. Three core values of the company are honesty, competitiveness, and teamwork. Despite its size, Nike operates with a minimum of hierarchy. As a result, there is a lot of collaboration and consensus decision-making. Commonly held values are imperative in such a matrix organization.

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NIKES PRESENCE IN INDIA

NIKE has been present in India from 1996 and headquartered in Bengaluru. India is a cricket crazy nation, NIKE understood the importance of cricket and in December 2005, it tied up with coaching schools like the BCCI's National Cricket Academy. Now NIKE became official kit sponsor for BCCI Indian Cricket Team. By paying Rs.196 Crores (Rs.1.6 Bn) to BCCI, NIKE wrested the rights to become the kit sponsor upto 2011. The first "Just Do It" cricket ad also made its appearance during the Champions Trophy." We want to look at what drives the passion for cricket in India. We aim to connect emotionally with our customers," - Sanjay Gang opadhyay, marketing director, Nike India. Target Market: 1. 2. 3. 4. 5. Nike is targeting young people in India. Paying attention to other popular games in India. Partnership with the All India Football Federation in March 2006. Signed on India's leading football star Bhaichung Bhutia Entered into a deal with Bhupathi Tennis Academy

The target market of NIKE is the urban youth with the brand proposition competition to Lifestyle. The principle consumption centres namely the metros are also a potential target market.

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TYPES OF OWNERSHIP:
1. Licensing 2. Franchising 3. Own Subsidiary

MARKET SEGMENTS
Geographic segmentation
Density: Urban and semi-urban cities

Demographic segmentation
1. 2. 3. 4. Age: 16 to 35 Income level: >Rs. 15,000 Social class: Upper middle, lower upper and upper class Gender: Male and female
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Customer Profile: 1. 2. 3. 4. 5. Athletes Gym regulars Sports enthusiasts Brand freaks Image seekers

Segmentation, Targeting and Positioning of Nike

Nike has been in the market for a long period now. Thus it has already sought out the STP analysis that it would use to promote and sell its products.

Market Segments:
The market segments that Nike can mainly differentiate are high, medium and low end customers with varying income levels. Thus, Nike needs to segment on various fronts such as economic, demographic, geographical differentiations. Economic segmentation: High, medium and low income levels that can be clubbed with their lifestyles of high, medium and low end customers.
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Demographic segmentation: The company can segment the market into age, gender and class segments. Geographical segmentation: The company can segment the market into segments of north, west, east and south in India.

Target Market:
The company needs to target the market as per the brand image and equity in different markets. Thus, the company has targeted the market of high-end, high income level between the age of 16- 55 with a pan India location. Thus the market segment it is targeting is quite essential to differentiate itself from its competitors i.e. Reebok, Puma, Fila and local brands like Bata.

Positioning:
The brand Nike has positioned itself in the minds of the consumer as a high-end product which is quite costly but gives the value for money with its service, quality and designs. All this analysis provides Nike with the customer satisfaction and thus loyalty that it needs to achieve high volumes and profitability. Sportswear major Nike is way ahead in the race for leadership in sportswear. It shot to a 40 per cent share of the US sportswear market -- the biggest in the world -- which gives it a lead in the global market, even though Adidas leads in Europe. But the head start hasn't helped the global sports brand in the Indian market so far. And that's despite the huge brand awareness the brand enjoyed in India even before it set up shop here in 1996. According to retail consultancy KSA Technopak, while Reebok has a 45 per cent share, Adidas has 30 per cent and Nike accounts for just 25 per cent of the Rs 375-400 crore branded sportswear market. How did the swoosh lose its sheen? The biggest hurdles for Nike in India were its entry model and its lack of aggression. When the global sports majors entered the Indian market in 1995-96, government policy dictated that they had to have a local partner.

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Nike agreed to an exclusive distribution agreement with a Delhi-based trading firm Sierra, in early 1996; Adidas signed up a licensing agreement with Bata for retailing at its huge network of stores; only Reebok entered India as a subsidiary with a 20 per cent equity stake by Phoenix, a distribution and trading firm and Reebok's distribution partner.

Financial Information:
Revenue: US$19.2 billion ( FY 2009 ) Operating Income: US$1.87 billion ( FY 2009 ) Net Income: US$1.49 billion ( FY 2009 ) Total Equity: US$8.69 billion ( FY 2009 ) Employees: 30,200 ( 2008) Nike has contracted with more than 700 shops around the world and has offices located in 45 countries outside the United States. Most of the factories are located in Asia, including Indonesia, China, Taiwan, India, Thailand, Vietnam, Pakistan, Philippines, and Malaysia.

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PRODUCTS OFFERED BY NIKE

Nike produces a wide range of sports equipment. Their first products were track running shoes. They currently also make shoes, jerseys, shorts, baselayers, etc. for a wide range of sports, including track and field, baseball, ice hockey, tennis, association football (soccer), lacrosse, basketball, and cricket. Nike Air Max is a line of shoes first released by Nike, Inc. in 1987. The most recent additions to their line are the Nike 6.0, Nike NYX, and Nike SB shoes, designed for skateboarding. Nike has recently introduced cricket shoes called Air Zoom Yorker, designed to be 30% lighter than their competitors'. In 2008, Nike introduced the Air Jordan XX3, a high-performance basketball shoe designed with the environment in mind.

Nike sells an assortment of products, including shoes and apparel for sports activities like association football, basketball, running, combat sports, tennis, American football, athletics, golf, and cross training for men, women, and children. Nike also sells shoes for outdoor activities such as tennis, golf, skateboarding, association football, baseball, American football, cycling, volleyball, wrestling, cheerleading, aquatic activities, auto racing, and other athletic and recreational uses. Nike is well known and popular in youth culture, chav culture and hip hop culture for their supplying of urban fashion clothing. Nike recently teamed up with Apple Inc. to produce the Nike+ product that monitors a runner's performance via a radio device in the shoe that links to the iPod nano. While the product generates useful statistics, it has been criticized by researchers who were able to identify users' RFID devices

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from 60 feet (18 m) away using small, concealable intelligence motes in a wireless sensor

network.

In 2004, they launched the SPARQ Training Program/Division. Some of Nike's newest shoes contain Flywire and Lunarlite Foam to reduce weight. On July 15, 2009, the Nike+ Sports Band was released in stores. The product records distance run and calories expended, keeps time, and also gives runners new programs online they

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could try running.

The 2010 Nike Pro Combat jersey collection will be worn by teams from the following universities: Miami, Alabama, Boise State, Florida, Ohio State, Oregon State, Texas Christian University, Virginia Tech, West Virginia, and Pittsburgh. Teams will wear these jerseys in key matchups as well as any time the athletic department deems it necessary.

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SWOT ANALYSIS
Strengths:

Nike is the worlds no. 1 shoemaker. It designs and sells shoes for a variety of sports including baseball, golf, cheerleading, volleyball, tennis and football. Nike uses a Make to Stock customer order which provides a fast service to customers from available stock. Nike operates Nike Town shoe and sportswear stores, Nike factory outlets and Nike Women shops. Nike sells its products throughout US and in more than 180 countries. Nike is strong at research and development, as is evidenced by its evolving and innovative product range. They then manufacture wherever they can produce high quality product at the lowest possible price. Nike is a global brand. It is the number one sports brand in the World. Its famous Swoosh is instantly recognizable, and Phil Knight (Founder and CEO) even has it tattooed on his ankle.

Weaknesses:

The income of the business is still heavily dependent upon its share of the footwear market. This may leave it vulnerable if for any reason its market share erodes. The retail sector is very price sensitive. However, most of its income is derived from selling into retailers. Retailers tend to offer a very similar experience to the consumer. So margins tend to get squeezed as retailers try to pass some of the low price competition pressure onto Nike.

Opportunities:

Product development offers Nike many opportunities. The brand is fiercely defended by its owners whom truly believe that Nike is not a fashion brand however consumers that wear Nike product do not always buy it to participate in sport. In youth culture especially, Nike is a fashion brand. This creates its own opportunities, s There is also the opportunity to develop products such as sport wear, sunglasses and jewellery. Such high value items do tend to have associated with them, high profit The business could also be developed internationally, building upon its strong global brand recognition. There are also global marketing events that can be utilised to support the brand such as the World Cup (soccer) and The Olympics.

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Threats:

Nike is exposed to the international nature of trade. It buys and sells in different currencies and so costs and margins are not stable over long periods of time. Such an exposure could mean that Nike may be manufacturing and/or selling at a loss. This is an issue that faces all global brands. The market for sports shoes and garments is very competitive. Competitors are developing alternative brands to take away Nikes market share.

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MARKETING MIX
1. Product: Nike offers a wide range of shoe, apparel and equipment products, all of which are currently its top-selling product categories. Nike started selling sports apparel, athletic bags and accessory items in 1979. Their brand Cole Haan carries a line of dress and casual footwear and accessories for men, women and children. They also market head gear under the brand name Sports Specialties, through NikeTeam manufactures and distributes ice skates, skate blades, in-roller skates, protective gear, hockey sticks and hockey jerseys and accessories.

2. Price: Nikes pricing is designed to be competitive to the other fashion Shoe retailer. The pricing is based on the basis of premium segment as target customers. Nike as a brand commands high premiums. Nikes pricing strategy makes use of vertical integration in pricing wherein they own participants at differing channel levels or take part in more than one channel level operations. This can control costs and influence product pricing. 3. Place: Nike shoes are carried by multi-brand stores and the exclusive Nike stores across the globe. Nike sells its product to about 20,000 retail accounts in the U.S. and in almost 200 countries
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around the world. In the international markets, Nike sells its products through independent distributors, licensees and subsidiaries. The company has production facilities in Asia and customer service and other operational units worldwide.

4. Promotion: Promotion is largely dependent on finding accessible store locations. It also avails of targeted advertising in the newspaper and creating strategic alliances. Nike has a number of famous athletes that serve as brand ambassadors such as the Brazilian Soccer Team (especially Ronaldo, Renaldo, and Roberto Carlos), Lebron James and Jermane ONeal for basketball, Lance Armstrong for cycling, and Tiger Woods for Golf.

Nike also sponsors events such as Hoop It Up and The Golden West Invitational. Nikes brand images, the Nike name and the trademark swoosh; make it one of the most recognizable brands in the world. Nikes brand power is one reason for its high revenues. Nikes quality products, loyal customer base and its great marketing techniques all contribute to make the shoe empire a huge success. Indian soccer team captain Baichung Bhutia is the new brand ambassador of Nike.

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Marketing strategy
Nike promotes its products by sponsorship agreements with celebrity athletes, professional teams and college athletic teams. However, Nike's marketing mix contains many elements besides promotion. These are summarized below.

Advertising
In 1982, Nike aired its first national television ads, created by newly formed ad agency Wieden+Kennedy (W+K), during the broadcast of the New York Marathon. This was the beginning of a successful partnership between Nike and W+K that remains intact today. The Cannes Advertising Festival has named Nike its Advertiser of the Year in 1994 and 2003, making it the first and only company to receive that honor twice.

Nike also has earned the Emmy Award for best commercial twice since the award was first created in the 1990s. The first was for "The Morning After," a satirical look at what a runner might face on the morning of January 1, 2000 if every dire prediction about the Y2K problem
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came to fruition. The second was for a 2002 spot called "Move," which featured a series of famous and everyday athletes in a variety of athletic pursuits.[41] In addition to garnering awards, however, Nike advertising has generated its fair share of controversy.

CORPORATE SOCIAL RESPONSIBILITY

In an effort to further industry sustainability efforts, NIKE, Inc. released its Environmental Apparel Design Tool. Based on Nikes Considered Design Index, the release of the tool aims to accelerate collaboration between companies, fast-track sustainable innovation and decrease the use of natural resources like oil and water. Designed and built by Nike over seven years with a six million dollar investment, the software-based Environmental Apparel Design Tool helps designers to make real time choices that decrease the environmental impacts of their work. Recognizing the decline of natural resources and the need to move to a low-carbon economy, the tool is a practical way to rate how apparel designs score in reducing waste and increasing the use of environmentally preferred materials while allowing the designers to make real time adjustments. Nike is committed to open innovation and welcomes others building and improving on this tool. This tool is about making it simple for designers to make the most sustainable choices right at the start of the product creation process. Over the past four years it has proved to be invaluable at Nike and has helped us create products with a higher sustainability standard, said Hannah Jones, Vice President of Nike Sustainable Business and Innovation. By releasing the tool we want others to improve on it and we hope to inspire further collaboration to create global industry standards for a level playing field, encourage widespread industry adoption of sustainable design practices and have more sustainable products available for the consumer.

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Source: http://www.nikebiz.com/responsibility/community_programs/let_me_play.html

Nike supports different types of programs around the world, including the Bowerman Track Program, Jordan Fundamentals, Let Me Play, Nike School Innovation Fund, and Reuse-AShoe and Nike Grind. Nike also established a Foundation to improve the lives of adolscent girls in the world's developing countries.

The Bowerman Track Renovation Program was set up in honor of Bowerman's lifetime contributions to the sport of running. He was the co-founder of Nike. It is a worldwide program that provides matching cash grants to community-based, youth-oriented organizations for refurbishing or constructing running tracks. The program distributes about $ 200,000 in matching grants each year.

Besides, the Jordan Fundamentals Grant Program was found in 1999. It arises out of Michael Jordan's belief that education is the key to build commitment among our youth. The program supports public secondary schools that serve economically disadvantaged students and is created to reward impressive teaching and instructional creativity.

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Let Me Play is another part of Nike's community programs which provides access to the benefits of sport to all young people. During the last two years, Nike invested $ 100 million worldwide in community-based programs to enhance their lives through the access to sport.

In 2007 Nike established the Nike School Innovation Fund, a $ 9 million, five-year commitment to support major school districts in Portland, Beaverton and Hillsboro, USA.

Since the beginning of the Reuse-A-shoe program in 1990 Nike has recycled more than 21 million pairs of worn-out athletic shoes. These shoes and other scrap material left over from the manufacturing of footwear are ground up and purified to become a material the company called Nike Grind. This advanced recycling technology turns Nike Grind materials into everything from basketball and tennis courts to tiles for gym floors, playground surfaces and more.

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NIKE VALUE CHAIN

Manufacturers / Suppliers Consistent with its original strategy, NIKE outsourced virtually all of its footwear manufacturing to low-cost Asian or South American manufacturers. By 1999, the primary locations for NIKE production were Indonesia, Vietnam, Korea and China. Managing its global supply chain was a core strategic advantage for NIKE and all its operations were geared towards ensuring smooth integration with contract manufacturing. The company worked with hundreds of manufacturing partners in order to develop long-term, trusting relationships. Manufacturing partners did not necessarily provide the cheapest production, but for the most part, they delivered consistent, timely shipments of goods that met NIKEs high quality standards. The partners were willing to invest heavily in capabilities to manufacture new designs or features, knowing that production levels would be high enough to offset the investment. NIKE generated all its own new product ideas and managed the design process in-house. Once a design was perfected, a manufacturer would begin the eight-month product cycle process of developing volume production capabilities in all the relevant sizes. Once production was fully on-line, NIKE could expect orders to be fulfilled within 90 days, plus an additional 30 days for shipping by sea freight. Product Lifecycle Getting a new athletic shoe model on a store shelf could take 15 to 18 months, from initial planning to final product distribution. Volumes were determined far before shoes arrived at consumer outlets, requiring careful forecasting from NIKE and its merchants. A typical new NIKE shoe had a market life of 3 to 6 months from introduction to depletion of inventories. Because the product life was so much shorter than the production cycle, it was not possible to adjust production runs to meet unexpected levels of consumer demand. As a result, NIKE did not try to match supply of any given shoe model with demand, preferring instead to set Conservative production targets and then begins designing the next generation model. A typical NIKE factory produced between 2,000 and 3,000 pairs of shoes in a day, implying a production run of about three months for a line that would sell 200,000 shoes. It was difficult for NIKE to make money on smaller production runs, although the company did produce some specialty shoes at considerably lower volumes.

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Retail Sales Channel NIKE utilized a large in-house sales force to sell its products through a number of different types of stores multi-sport general athletic department stores, specialty athletic department store retailers and general-purpose shoe stores. Despite the company's origins selling shoes straight to track runners from the back of Phil Knight's car, NIKE had not been very interested in direct-to consumer sales. The company did not have a meaningful catalog or mail-order business and had opened only a handful of its own stores, called NIKE Towns. Even these NIKE-owned stores were seen more as a marketing and brand-building effort than a meaningful source of sales. The retail market for athletic footwear and apparel was extremely fragmented. The top ten sporting goods retailers represented a mere 14% of total U.S. sales. Because these retailers were so small, they had been slow to implement sophisticated technology to track purchases and inventory, leading to frequent stockouts and misallocations of inventories. NIKE had

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suffered in the past from imperfect information concerning retailers' inventory levels and was hopeful that better methods of inventory monitoring would be found. NIKEs 40% market share in U.S. athletic footwear gave it additional influence with the merchants who carried their products. The company encouraged advance planning from its retail partners nearly 90% of the orders it received from retailers were for future deliveries nine months out. As a result, NIKE was able to plan manufacturing and distribution far in advance to meet its guaranteed future sales. NIKE was also able to negotiate favorable contract terms with its retailers, including display characteristics, inventory levels, and other details that affected the consumer experience. The company distributed most of its own products from its factories to retail stores or retailer distribution centres. The distribution process was extremely complex; a retailers monthly order of 300,000 pairs of shoes could involve over 50 different models being shipped to 100 different locations. In the late 90s, NIKE invested over $1 billion in several large regional distribution centers to replace its numerous smaller centers. NIKE also started providing discounts to retailers who managed their own distribution right from the NIKE Factory, thus avoiding the need to go through a NIKE distribution center at all. NIKE tried to keep inventories to a bare minimum and managed over 5 inventory turns a year. Direct Sales Channels In 1999, NIKE owned and operated 13 NIKE Town superstores, typically located in extremely high-traffic, upscale shopping neighbourhoods. The first NIKE Town store was opened in Portland in 1990 and was described by its designer as a cross between the Smithsonian, Disney World, and Ralph Lauren. While a broad range of NIKE footwear and apparel was sold (at full retail price), the layout of the store and the merchandise selection made it as much a showcase of NIKE products as a retail store. The Portland store was quickly followed by an even more ambitious project in downtown Chicago. The Chicago store, a 70,000 square foot operation located in some of the most expensive real estate in town, quickly became the citys largest tourist attraction as 7,500 visitors a day flooded in to see the two-story mural of Michael Jordan and try NIKE shoes out on the miniature basketball court. The NIKE Town stores were not run to be independently profitable, or even to be major selling channels for NIKE products. Instead, they were a showcase for NIKEs newest or most innovative product lines, an opportunity to strengthen ties with consumers, and an extraordinary brand advertising opportunity. The stores also carried hard-to-find products or specialty items not available from typical retailers. Another source of sales at NIKE Towns were souvenir items, such as the Michael Jordan paraphernalia sold at the Chicago store. Initially, retailers were wary of the concept, fearing they would lose sales to NIKE Town stores, but their fears were eventually allayed as the companys intentions became clearer. There was a sense within NIKE that the NIKE Town stores had not lived up to their full retail potential due to efforts to appease retailers concerns about competing directly with NIKE. In addition to the NIKE Town stores, NIKE operated 53 outlet locations to liquidate overstocked or outdated inventory. This channel provided the company with a convenient means of disposing excess inventory without giving up too much control of the brand. Prices

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and quality were both controlled directly to minimize impact on the core brand, rather than relying on other liquidation channels. THE SPORTING GOODS E-COMMERCE LANDSCAPE The on-line market for sporting goods in 1999 was chaotic. A variety of types of competitors were eager to join the internet frenzy traditional sporting goods retailers, manufacturers focused on selling direct to consumers, and new start-up companies formed to take advantage of the new opportunities on the internet. Complicating matters was the emergence of Global Sports, Inc. (GSI), an internet start-up with an innovative outsourcing-based business model. Traditional Retailers Virtually every significant sporting goods retailer had established some type of web presence by late 1999. Several retailers, such as Foot Locker and Copeland's Sports had established web businesses on their own, typically offering a full range of products at prices similar to what was charged in their stores. These real-world retailers were able to leverage their existing brands and operational capabilities to offer extensive shopping experiences. Footlocker.com, for example, offered over 14,000 products from 150 different manufacturers at prices equal to or lower than in-store prices. Footlocker.com also offered in-store returns of on-line purchases, easing the burden on the customer. In 1999, six of the 20 largest sporting good retailers, including The Athlete's Foot and The Sports Authority, signed deals with Global Sports Interactive, the internet division of GSI, to manage not only their websites but also their complete e-commerce operations. According to these deals, GSI handled the design, order fulfilment, processing, shipping, and business development involved with the retailers' internet businesses. The participating retailers simply chose their product lines and pricing strategy and generated web customers, but GSI managed the rest of the process. By developing a common sporting goods e-commerce infrastructure for its multiple retail partners, GSI claimed to lower drastically the costs associated with electronic commerce. Each retailer collaborated with GSI in decisions related to its brand presentation, website and ecommerce operations. NIKEs Direct Competitors NIKEs competitors, the other leading athletic footwear and apparel manufacturers, faced similar dilemmas and problems related to their own e-commerce strategies. Because these competitors were smaller and less powerful than NIKE, they were even more reliant on their traditional retail partners for sales. These companies possessed little or no experience selling goods directly to the consumer market and treaded lightly in their initial forays into ecommerce. By late 1999, virtually all of NIKEs major competitors (Adidas, Converse, Reebok and New Balance) had established websites with detailed product information, store locators, and editorial content on selected athletes or events. Each competitor, however, took a slightly different approach to the strategy and operation of its e-commerce capabilities. Converse
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offered no ecommerce functionality or specific information on acquiring its products on-line. Adidas and Reebok each offered limited product lines at full retail prices to their internet customers. New Balance adopted a hybrid approach, allowing customers to select any current product and then directing them to the websites of its affiliated retailers (both real-world and internet-only) who carried that product. NIKEs competitors were generally more willing than NIKE to allow retailers to sell their products over the internet. The competitors did not exert as much control over the end retail experience as NIKE did and granted more flexibility to their internet retail partners. Reebok allowed both on-line only and bricks-and-mortars retailers to offer their full product lines (frequently at discounted prices) on their websites. New Balance was slightly more protective of both product offerings and pricing, but not nearly to NIKEs level of excluding internet retailers from entire product lines. Adidas was the only major competitor who had taken a similar position to NIKE, severely restricting sale of product online. Pure On-line Start-ups As in many other consumer segments, sporting goods attracted a number of internet entrepreneurs seeking to take advantage of the new technology to exploit the inefficient cost structure of traditional retailers. These internet endeavours included full-range retailers (such as fogdog.com) and highly specialized niche players (such as lucy.com, focusing on women's sports or chipshot.com, selling custom-made golf clubs). In addition to the internet retailers, many sports media concerns were eager to leverage their viewer base into e-commerce customers. ESPN.com, a division of Walt Disney Corporation, and SportsLine.com (partially owned by CBS) each had avid followings among sports fans due to the content they had been able to leverage from their media conglomerate owners. Each of those companies were making major pushes to convert their website viewers into purchasers. NIKES INTERNET STRATEGY Other Internet Sellers (Non-NIKE) As new on-line retailers were created and traditional retailers launched their own internet initiatives, NIKE was bombarded with requests from merchants to sell NIKE products online. Initially, the company was extremely hesitant, worrying that the NIKE brand value would be diluted by careless internet retailers. "We saw a lot of online retailers who were not putting the right emphasis on product presentation," explained Mary Kate Buckley. "Our bricks-and-mortars partners offer a convenient location where customers can feel the product quality and try products on we were concerned that over time if everyone is selling the same thing online, the only difference would be price."1 NIKEs traditional retail partners were anxious to expand into on-line sales, but NIKE moved cautiously, allowing its largest retail partners to sell NIKE products on their websites, provided they maintained the same standards enforced at the stores. Foot Locker and Copeland Sports (through its shopsports.com division) each started selling NIKE products, but Copeland quickly learned that NIKE's concerns were to be taken seriously. In the summer
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of 1999, NIKE stopped selling to shopsports.com, explaining that "they were not meeting our marketing standards." Although NIKE resumed sales to shopsports.com shortly thereafter, the company's point had been made to retailers. By the end of 1999, NIKE had approved ten of its bricks-and-mortar retail partners to sell NIKE products over the internet. The company remained unconvinced, however, that all those retailers would be able to deliver acceptable service levels, and continued to monitor their performance carefully. Some internet sellers were able to acquire NIKE products from other retailers' overstocks and other unofficial channels. Once these goods had passed from the hands of NIKE-authorized retailers, NIKE no longer had any say over how the products were marketed or priced. Because NIKE handled its own international distribution and managed inventory liquidation through its own outlets, however, the company saw less of these after-market resales than other manufacturers. In addition, NIKE strictly enforced sales agreements with retailers and actively policed the web for offenders. Fogdog Deal In September of 1999, NIKE signed a deal with internet sporting goods retailer Fogdog Sports that allowed Fogdog to sell the entire NIKE product line on its website. Fogdog was given exclusive access (among internet-only sellers) to the NIKE product line for six months in return for warrants to buy up to 12% of Fogdog's shares at a pre-IPO valuation. Fogdog Sports was founded in early 1998 (originally as SportSite.com) to sell athletic gear directly to consumers over the internet. The company was the evolution of a web design and ecommerce company started in 1994 by three graduates of Stanford University. In 1998 the company attracted venture capital financing from VenRock Associates and Draper Fisher Jurvetson. In September of 1999, after negotiations with NIKE had begun, Fogdog hired Tim Joyce, formerly VP of Global Sales at NIKE, to be its new president. Fogdog had repeatedly requested to carry the NIKE product line, only to be rebuffed by NIKE, like every other internet retailer. In the end, Fogdogs pricing policy of respecting manufacturers recommended minimum prices and reputation was attractive to NIKE. Fogdog was able to point to three years of consistently executing its pricing policy. Due to its ownership stake, NIKE had an incentive to make the deal work for both sides and agreed to treat Fogdog like any other major account, including preferred prices, joint promotions, and information sharing. Fogdog also received other special considerations from NIKE, such as product images for display on the fogdog.com website, product and sales data sharing, and unusual return privileges. As part of the Fogdog deal, NIKE agreed not to sell to other virtual retailers including those sites managed by Global Sports, Inc. for at least six months. This promise was sure to anger some of NIKEs most important bricks-and-mortar partners, such as The Athletes Foot, which relied on NIKE for 40% of their footwear sales. Michael Rubin, the young CEO of GSI, commented on the channel conflict that NIKE faced: "Our six partners are all among NIKEs top 20 accounts. NIKE needs to support them, and they need to be on the internet in order to survive in the 21st century." nike.com

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The nike.com website was initially launched in August 1996 to provide information and entertaining content to NIKE customers. There were no e-commerce capabilities on the site; instead, it reflected a typical NIKE approach to brand building. Different sports received their own separate pages, with tips and advice from NIKE athletes, news and updates on sports events, and detailed product information, including design inspirations and athlete endorsements. Despite the lack of e-commerce and no efforts to drive traffic to the site through advertising expenditures, the nike.com site logged 14 million visitors in 1998. At first, NIKE proceeded with extreme caution on the internet. A plan to sell posters on the NIKE website was considered for nearly a year before being launched during the Christmas 1998 season. Over the next twelve months, however, NIKEs website strategy evolved substantially. In February of 1999, Nike launched a test to sell its high-end Alpha Project line of footwear and apparel. In addition, the website was redesigned to provide a store locator and more detailed product information. In June of 1999, NIKE re-launched a completely overhauled and redesigned website, with greatly expanded e-commerce functionality. NIKE made hundreds of its most popular products available for purchase, all at full retail prices. The June re-launch was the first time the companys senior management seemed to understand the revolutionary importance of the internet. Phil Knight commented to the media that "on-line commerce is a partial return to our original roots of selling products at track meets from the trunks of our cars -- rekindling the direct relationship between NIKE and its consumers." Despite the significant new push into e-commerce, NIKE maintained much of its previous website focus on brand-building and inspirational content. NIKE added profiles on NIKE athletes of all levels, new information on future product development, and innovative new technologies. Many of the web functions were so advanced that some consumers were unable to use them all without downloading various plug-ins. "I wouldnt say were on the bleeding edge of design technology, but I will say were on the bruised edge," said nike.coms creative director.

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Sustainable Supply Chain

Sustainable concepts can be incorporated into business management and operations at many levels: firm management principles, research and development, manufacturing, marketing, customer service, community outreach, and operational logistics, such as procurement and supply chain management. Supply chain management concerns are not new. Nike responded to the National Labor Campaigns boycott in the 1990s by implementing a supply chain management program. Today, Nike publishes sustainability reports containing some of the most detailed supply chain data of any industry. Gap, Wal-Mart, and many other firms have announced or implemented sustainable supply chain initiatives. Implementing and monitoring sustainable supply chain management programs can help any organization mitigate potential legal and market risks.

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The first step in addressing environmental and social concerns within a supply chain is to conduct a life cycle analysis of the product or service at issue. This is not always easy. A company may know its own supplier but not the suppliers of that entity. Determining each resource and process that results in a product or service is the only way to expose potential vulnerabilities. Among others, vulnerabilities include the risk of consumer boycotts, supply interruption, and the inclusion of earlier processes or impacts in lifecycle regulations that are applied to the product or service at issue. A company should ensure that each supplier at least meets the minimum environmental and social requirements applicable in their location. A company should also decide whether to implement minimum environmental and social responsibility standards across their supply chain. If an organization has its own responsibility program or code of conduct, this could be extended throughout the supply chain through voluntary programs or contractual agreements. However, company should seriously consider adopting industry or third party standards instead of enforcing their own minimum standards across their supply chain. If every company enforced its own supply standards, suppliers would not be able to comply with the diverse and possibly conflicting requirements. The benefit of WalMarts recent sustainable product index initiative is its potential to establish a universal minimum standard. Nike is currently working towards a universal standard for the apparel industry. After determining applicable minimum standards, a firm should build capacity with its suppliers to meet those standards. Providing education as well as implementation, monitoring, and reporting assistance will result in better and more reliable supply chain management. If the program is structured as a floor and not a ceiling, the company may even learn from the actions of its suppliers. Companies seeking to reduce potential legal and market liabilities are transforming their own business operations while building capacity in their networks of suppliers to do the same. This is a complicated but rewarding process that can build goodwill with suppliers and customers and provide an additional service to sell to competitors.

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NIKE CHANNEL CONFLICTS CASE ANALYSIS Situation Analysis:

For the past thirty five years NIKE was a company which the management focused on a few core corporate areas namely brand building, supply chain management and sales. The company outsourced its manufacturing to low cost countries like Indonesia, Vietnam, Korea and China. Thus managing its global supply chain became of critical importance to the company and all its operation ensured a smooth integration with the contract manufacturers. The production cycle could take 15-18 months, where as the market life for a NIKE shoe was around 3-6 months. Hence since the product had a much shorter product life when compared to its production cycle time, it was pointless to try match the demand for a model with the supply. This also made customization or customization option not feasible. Hence for each new model conservative production targets were set and then the designing of the next generation line was worked upon. NIKE didnt give too much importance to direct-to consumer sales and sold its product through various retail sales channels. This consisted mainly of retail outlets or retailer distribution centers. Discounts were provided to retailers who managed their distribution from the NIKE factory eliminating bottlenecks at distribution centers. NIKE owned 13 NIKE Town stores and 53 outlet stores in 1999. Both were not the major selling channels for NIKE. The first was used to showcase NIKEs newest product lines and brand building, the second was used to liquidate overstocked or outdated inventory. In 1999, with the on-line retail boom, NIKE retailers started pushing to be allowed to sell these NIKE products on the web. Although by the end of the year NIKE had given permission to 10 retailers to sell online, these online sites were monitored carefully to ensure that the brand quality and image were maintained. In September 1999, NIKE signed a deal with Fogdog Sports to sell the entire NIKE product line on its website. The deal assured that Fogdog had exclusive access to NIKE products for six months during which period no other virtual retailer could buy them. Apart from this, NIKEs official website nike.com also entered the e-commerce arena and made hundreds of its most popular products available for purchase online. The website still maintained its focus on brand advertising and inspirational context though the ecommerce business options were explored. This new situation raised a number of strategic concerns. Firstly, through all these newer developments efforts had to be made to not alienate its conventional retailers. Secondly, their entry into the e-commerce business brought up a lot of operational and organizational issues. Since the company had no prior experience in handling the technicalities of retail management such as remote order fulfilment, packaging and shipping, tracking deliveries, customer service etc. Finally, for the
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first time NIKE was in a position to capture consumer data and analyse the demographics and do relevant market research. Problem Statement In what way should Mary Kate Buckley promote Nike.com to increase profitability and at the same time not cannibalize the sales of other outlets? Objectives: How to cope up with the new role of playing as the direct marketer as a company. How to cope with the six months notice period of the newly agreed upon Fogdog deal. Using the data collected from direct sales to use for future market Alternatives To reduce the dependency on the major retailers to some extent. To avoid using multiple channels, by getting only a retail chain using the product for selling Reduce the marked up price to gain more volumes in the sales To cope up with the six months of notice period, some sales may be redirected from other stores to the worse hit stores. Using the data collected during the direct sales to improve on understanding the behavior and purchasing habit of the customer and thus sharing the same at a later stage with the retailers for their better stoking of the inventory The website may be used to actually refer the customers to the nearest outlet of the company. Action Plan From the case we can know that the company does not sell their goods directly to the end users, between them stands a host of intermediaries who performs a variety of functions. So we for sure can call these as the marketing channels involved in the product or service being made available to the consumers. For developing the distribution channel, the company first has to understand the customer segment that is being targeted and according build on the supply chain backwards. In the case we understand that Nike has an absolute repute of being totally conscious about their quality. Thats why in the beginning of the opening of the e- commerce shops they were taking great interest in the quality and the kind of focus that the websites of these companies were giving into their product. As far as the channel partners are concerned prior to the websites Nike was doing one of the best jobs in the markets. Its business through retailers was too strong. To promote their brand Nike developed the concept of building the Niketown which was first thought to be the killing machine for the retailers of nike shoes because of its far superior location, infrastructures etc. But later the business channels partners understood the real motive of the company behind building that type of robust expenditure maker as a promotional mechanism for the sake of increase in growth. Almost the same type of apprehension is now being created among the retail distribution channels with the e-commerce section of the company. The fear of losing out to the nike website (which is company owned and delivering to the customers directly) is actually making them wary of the situation. The company is trying to utilize the fact that using a direct sales model through the Order procurement trough the websites actually has a much higher rate of profitability though doing away with the retailers was never away an option. From this perspective it can be said that there is chance of channel conflict if the intensions of the company as a whole about the usage of the website as a whole is not clearly stated to the retail outlets. As of now though the sentiments of the retailers have been hurt
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over the Fogdog deal of not being able to for the next six months any inventories from the company, Nike, still an unclear vision over the matter can surely lead into one trying to eat into the piece of pie of the other. If the company, in a bid to increase its profitability, chooses to sell through its website (nike.com) at a price which is lesser than the marked up price of the retailers then surely the question of cannibalizing of the companys product comes into the foray. And it is need less to say that this is so very easy for the company which on direct sales is getting a profit of around an amount which is almost equal to the cost price of it. After speaking about so many things about the eating up of owns share it should also be noted here for a company like Nike which specializes in a footwear touching and feeling the commodity plays a very significant as well as necessary part of business. So though it might be giving out a signal of channels of distribution of goods getting into others territory it is not so. Ever of the the channels here has a very definite and distinct role to play. This is again evident from the fact that the company website although having a customer model from the manufacturers in the developing world, still it has the option of locate a shop nearest to you icon which will help the customer find the nearest brand outlet. But the intensions of the company still lie in the fact of exploring the direct sales procedure to increase in the profitability. The inherent advantages that the usage of the website have are something like helping in cutting down on the sales price, to let everyone access the product models irrespective of the geographical locations etc. on addition foraying into altogether totally new horizon of marketing its goods that will actually help the company reduce the dependence on its retailers and also lead to a better understanding of the needs of the consumers because of the detailed interactions that take place when direct sales takes place. Inventory level that requires to be maintained will also be lowered since the orders will be placed directly and so the company can order as is required. On other hand the problems the company might feel on along run are that of direct sales of this kind will require a very high standard of standardization. Since the customers are not actually feeling and trying out the apparels so a prescribed model would hav to be the same for all the time it is being manufactured for all the aspects of it. Thus a very high finesse has to be reached on part of the manufacturer. Though at an initial stage the company is offering customerization for sales in the long this might not work out well, because it would be too difficult a product to be put in the mainstream. The other major problem is that of since the direct to customer model would not even have a warehouse of the companys own, it would become increasingly difficult to handle any spike in the demand as there would be no buffer stocks for the same. So as of now , though the website can be used as an added mean to reach the consumers, for Nike it would be too difficult to make it a standalone tool for increase the sales, more so considering the product that the company is upto. Since some of the retailers have been hit hard by the company getting into some contracts, they need to be alleviated by giving more sops, like redirecting a part of the sales from the general stores to them by the usage of the websites function of finding the nearest shop. It will surely help to increase the profit considering the fact that the number of internet users are growing and thus such an interface will bring in customers who
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were probably not so keen enough to visit the shops an also those who could not get the right the product they wanted as this tool will help them to know where it would be available. To keep the growth moving with the increase of website visitors, the company also needs to increase the number of retail shops across the geographical locations, so that the website may work as a replica on a functional mode of the Niketown. Also to promote sales through the website so as to keep getting the consumer feedback the company could go for a model in which certain percentage of the business might be done through the website and the rest through the retailers. This division might be done on the basis of the exclusivity of the product. As the company gets a hold on the direct sales part which is still not the domain in which it is not comfortable enough , then it can expand its core competencies on the field of the delivery and logistics and thus increase on the profit margin from not outsourcing everything also letting the brand keeping the quality standards it would like to be associated with whatever the brand Nike does.

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NIKE IN NEWS
1) Nike to set up sustainable venture capital arm October 01, 2011 (USA) 2) Worldwide futures orders up 16% - NIKE September 23, 2011 (USA) 3) Nike announces the addition of Howard Taylor as Managing Director and Vice President of the Nike Foundation September 16, 2011 (USA) 4) NIKE Inc is committed to high standards of consumer and environmental safety for all of our products. August 25, 2011 (USA) 5) NIKE commitment on Zero Discharge of hazardous chemicals August 19, 2011 (USA) 6) As an affiliate of NIKE Inc, Converse takes matters of unfair labor practices very seriously and vigorously supports the protection July 16, 2011 (Indonesia)

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REFERENCES
http://www.marketing91.com/swot-nike/ http://www.marketing91.com/marketing-mix-nike/ http://xroads.virginia.edu/~class/am483_97/projects/hincker/nikhist.html http://en.wikipedia.org/wiki/Nike,_Inc. http://www.nikebiz.com/responsibility/ http://getinterested-csr.blogspot.com/ http://ranodeb.blogspot.com/2007/12/case-analysis-nike-channel-conflicts.html http://www.fibre2fashion.com/news/company-news/Nike/ http://www.rediff.com/money/2006/nov/14spec.htm http://www.scribd.com

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