Introduction: Company Overview
NIKE, Inc. (NIKE) is one of the “world’s largest designers, marketers and distributors of athletic footwear, apparel, equipment, and accessories for a broad variety of sports and fitness activities.” The company Operates in the Americas, Europe, the Middle East, and Asia. Nike is headquartered in Beaverton, Oregon and had 62,600 employees as of May 31, 2015 (NIKE, Inc. SWOT Analysis, 2016).
Apparel, Footwear, & Accessories Market Overview
The global apparel, footwear, and accessories market has grown moderately in recent years. In 2014, the global footwear market had overall revenues of $289,725.8 million, which was 4.8% rise between 2010 and 2014. The Asia-Pacific and the US markets grew at a CAGR of 7.9% and 3.1% respectively in the same period. The market is expected to reach a value of $347,454.6 million by 2019, which represents a 19.9% increase since 2014. Furthermore, industrial estimates indicate 2% growth of the global athletic footwear market to reach $80billion by 2018. Nike has a strong brand portfolio and a wide geographical coverage so; it is well poised to explore the available opportunities in the global footwear industry (NIKE, Inc. SWOT Analysis, 2016).
Competitors in the Industry
The industry has strong competitors in the US and globally. NIKE competes with well-established international firms with an array of product lines in athletic and leisure footwear, apparel and equipment. “Adidas, ASICS Under Armour, Reebok, VF Corporation, PUMA, and Li Ning are some of the company’s greatest competitors” (United States Securities and Exchange Commission, 2016). For instance, Adidas offers a range of athletic and sports lifestyle products through Adidas, Reebok, and TaylorMade brands. The key brands cover the footwear and apparel categories, providing both performance and lifestyle products. On the other hand, the TaylorMade brand is a market leader in metalwood sales in the golf industry. NIKE competes with other vertical retailers such Uniqlo and lululemon, who distribute apparel for healthy lifestyle activities, for instance dancing, running, and yoga (NIKE, Inc. SWOT Analysis, 2016).
Peculiarities about the Apparel, Footwear, & Accessories Market
The industry is highly dependent on the use, trends, and lifestyle demands of consumers. Athletes are some of the largest consumers in the industry. They settle for products that enhance their athletic performance, and reduce injury while training, playing, competing, or performing. Lifestyle is a factor associated with the young generation (Vecchi, 2017). Therefore, successful organizations focus primarily on the three stated factors to gain customer satisfaction.
How Nike Contributes to the Peculiarities of the Industry
According to Euromonitor International (2017), the industry’s growth has slowed and this has led to massive job cuts. However, amid such challenges, NIKE registered a 6% growth in revenues in the FY2017. The growth originated from the emerging markets, precisely China. Further, the company holds more than 45% of the share in the United States footwear market. NIKE, Inc. SWOT Analysis (2016) report acknowledges that the company invests extensively in R&D programs that are solely consumer oriented. NIKE utilizes research committees and advisory boards comprised of coaches, trainers, athletes, equipment managers, orthopedists, and podiatrists who, through consultation with the firm, assess designs, concepts, and materials used to manufacture products and ensure compliance with the standards. Nike trades under four different brands namely NIKE, Jordan, Converse, and Hurley. The first three brands account for more than 50% of the US athletic footwear market. Jordan is used for basketball while Converse is for lifestyle. On the other hand, Hurley offers action sports apparel and support youth lifestyle. Innovation has played a significant role in the launch different types of high-quality products in the recent past such as LeBron 12, Kobe 10, Kyrie 1 for basketball players.
Conclusion: Is the market Stable or Declining?
The Apparel, footwear, and accessories market is not declining but has registered slow growth in the past three years. The expert projections stated above indicate that the industry may reach $347,454.6 million by 2019. However, innovative organizations with the ability to turn opportunities into strategic objectives will survive and stay relevant.
Euromonitor International. (2017).Nike Inc. in Apparel and Footwear. Retrieved from http://www.euromonitor.com/apparel-and-footwear
NIKE, Inc. SWOT Analysis. (2016). NIKE, Inc. SWOT Analysis, 1-8.
United States Securities and Exchange Commission. (2016). Form 10-k: Annual Report for NIKE Inc.
Vecchi, A. (Ed.). (2017). Reshoring of Manufacturing: Drivers, Opportunities, and Challenges. Springer.