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Marketing Approaches of Nike and Li-Ning
Marketing Approaches of Nike and Li-Ning

Marketing Approaches of Nike and Li-Ning

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  • Pages: 6 (2971 words)
  • Published: September 25, 2017
  • Type: Research Paper
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1.0 Introduction

Mature marketing approaches bring companies considerable fortune, especially in such a competitive market. Therefore, marketing people play an essential role in planning, decision-making, market segmenting, targeting, pricing and positioning. In the following report, it will explore the marketing theory and practice of two products of two famous companies, the world’s largest sports goods company Nike and China’s popular sports brand Li-Ning.This report focuses on Nike’s basketball shoes and Li-Ning’s running shoes.

2.0 Industry background

2008 Olympic Games took place in Beijing last month, meanwhile, the Olympic spirit is broadcasting everywhere across the world. Increasingly individuals attend sports activities in order to keep healthy. As a result, the sports product industry has developed rapidly over the last two decades. Besides Nike and Li-Ning, there are many competitors such as Reebok, Adidas, Fila and Converse. These companies are the dominant leaders in the marketplace and lead this industry.The sports goods industry expecially footwear manufacturing, is currently experiencing intensive competition.

Nike is one of the industry leaders, “with a 47% market share, followed by Reebok with a figure at 16%, and Adidas at 6%” (Hays, 2000, P. 31). Li-Ning Company Limited is one of the leading sports brand enterprises in the PRC which is one of the most popular sports brand in the world. “It has covered more than 90% market share of the world’s largest market—China, almost every thirty seconds Li-Ning running shoes will be sold” (Hays, 2000, P. 35).This category of running shoes is facing decreasing demand because there is the rising popularity of alternative footwear,

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resulting in more pressure than ever before to achieve high profit through effective global sourcing practices.

3. 0 Company background

Nike company Nike, Inc. is the world's leading sports and fitness company, “with 2000 sales of $9 billion.” The company has made a strong commitment to sustainability in both word and deed over the past several years. 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. (Nike Official, 2008).

Nike has a strong ability of Research and Development, its new style is always fashionable in appearance and professional in function, for example, Nike dunks, Jordan shoes, Nike air force one. Nike has been manufacturing around the Asian region for over twenty-five years and there are over 500,000 people today who participate in the production of their products directly.

Li-Ning company As described on Li-Ning company’s website (2008), LI-Ning Company Ltd. was founded in Guangdong Province in 1990 by LI-Ning who was a Chinese Olympic gymnast. It is one of the leading sports brand enterprises in the PRC. It has its own branding, research and development, design, manufacturing, distribution and retail capabilities. Li-Ning's logo design is based on its own initial letters L and N. The Group's products include sports footwear, apparel and accessories for sport and leisure use which are primarily sold under its own Li-Ning brand (Li-Ning Company, 2008). products of Li Ning sports goods continue to be more popular in China than those of foreign competitors.

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0 Strategic marketing and planning

Most marketing organizations operate according to formal plans. Pride, Thiele, Waller, Elliott, Paladino & Ferrell, (2007) claim that strategic planning is the process of establishing an organizational mission and formulating goals, corporate strategy, marketing objectives, marketing strategy and a marketing plan. Based on Nike Official (2008), the mission of Nike is to be a company that better than all others in the sports footwear industry.They hope to maintain their position by providing high quality and new fashion comfortable footwear to consumers of all ages and lifestyles.

They promise to make their products easily available worldwide through the use of retail outlets and their company web site. Nike’s management believes that their success lies in the hands of our teammates, customers, shareholders and the communities in which they operate. Meanwhile, the vision of Nike is to remain the leader in the industry. They continue to produce quality products that they have provided in the past and meet the ever-changing needs of their customers, through product innovation.In comparison, the primary objective of Li-Ning is to increase its overall market share “from the current 17% to 20% in 3 years time” and defend its first place in China sportswear market against strong competition (Li-Ning Company). To achieve this goal, Li-Ning has to improve the customers’ brand recognition, rationalize market segments and the mission of Li-Ning is through sports, they “inspire people’s desire and power to make breakthroughs.” The vision is to be the world's leading brand in the sports goods industry.

5. 0 Macroenvironmental factors

The organization and its suppliers, marketing intermediaries, customers, competitors and publics all operate in a large macroenvironment of forces that shape opportunities and pose threats to the organization”. The macroenvironment consists of six major forces, they are “demographic forces, economic forces, natural forces, technological forces, political forces, cultural forces” (Kolter, et al, 2006, P. 81).

5.1 Demographic environment

Assessing the demographic environment entails observing and monitoring population trends.The demographic profile includes the size, age, density, location, sex, race, occupation and other statistics of the population (Shank, 1999). The changing age structure of the population is one of the important aspects. Figure 1 shows a diagram in which the ages and sexes for the Chinese population structure. As can be seen from the diagram, there is a large population at the age of 10-50 years old. (U.S. Census Bureau, International Date Base, 2001). The movement of population is also a problem that both of these two companies should consider.

5. Economic environment

The economic environment is another uncontrollable factor for sports marketers to consider. “The purchasing power depends on the income condition and the consumer spending patterns” (Shank, 1999, P.78). As figure 1. 2 showed that, the world’ s economy has grown rapidly in the past twenty years, as a result, people’s living standard and income have increased as well. However, consumers’ spending patterns are more varied.

That means the consumers have different need and tastes. These factors can be a threat to sports shoes companies. . 3 Cultural and social trends Cultural and social trends also influence the market of sports products. Nowadays sports and youthfulness are symbolic of many people’s core

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