Marketing techniques Essay
The businesses and products I chose happened to be, Nike and their Mercurial football boots, and Sony and their PS3 gaming console. I chose these products because I think they are both reasonably diverse, and in their time, both these products have experienced a range of sections within the product life cycle. For example, due to Nike’s football boots having to be constantly refreshed and renewed due to high competition, they have experienced, each sector, a number of times. In contrast, the Sony and their PS3 have also experienced similar experiences. For example, due to this specific console being one of the most successful and exclusive gaming consoles of all time, the overall competition has been reasonably low, and due to this, this certain product has seen the product life cycle at a very different perspective by experiencing each sector at a much slower rate.
The diagram presented above dictates the process in which businesses go through, when marketing. Every business will follow this strategy when they advertise and market a product in order to gain the most sales, and to generate a substantial amount of profit. For example, the first stage of this Product Life Cycle is the Development. This stage entitles a business to conjure up a selected idea, in which they will later hope to produce as a product and then sell. The development stage is where the business will discover the blue prints of their product and how they will later market it. In other words, the development stage provides a foundation for the selected product as it will be built as a prototype to be later sold to the public in order to increase sales and profits. This certain stage is very secretive within any organisation. Other businesses do not want to let their competitors have knowledge of what they’re producing, in case they steal and release the idea before, and generate a mass of publicity, sales and profits. The next stage is referred to as the introduction stage; this is where the business launches its completed product for the first time.
This certain sector is vital as it will later determine how successful the product is, and whether it should be develop further. Within the Introduction stage, sales begin to grow slowly if the product begins to generate publicity, this is usually due to the lack of knowledge people have about your product, and it is also due to the lack of advertising. However, a business may not want to advertise straight away, as they may waste money on advertising a product that their piers may not essentially want or need. Therefore, business tend to use the certain advertising scheme, known as informative advertising, this includes small processes in which a business can build their products reputation or publicity. If this section of the product life cycle is successful, businesses can later develop on their products, thus enabling them to create further marketing schemes, beneficial to them, in regards to their sales, profits and annual turnover.
The next stage within the Product life cycle is, Growth. This is where a business’s product begins to increase in sales, rapidly. This is due to increased demands, and the fact that all the business’s persuasive marketing schemes are working, thus increasing sales and profits. The growth sector within this product life cycle basically classifies how successful a business is, by being within the growth sector; this indicates that the business’s product is successful and popular. The fourth and pen ultimate stage is known as the Maturity stage. This is where a selected product, created by a business begins to sustain profits, and generate sales slowly.
This stage takes place after the growth stage, due to many factors such as an increase in product competition due to the publicity of your product, as well as an increase in advertising due to businesses trying to sustain the success of their product. After this stage, comes the final stage, or otherwise known as the Decline. This stage entails a business’s product to begin to drop in sales, reduce in publicity and popularity, it begins to lose its appeal and competition becomes stiffer and bigger, therefore fewer units are sold. At this stage, advertising is either halted or completely stopped, and possibly the production of the item may decrease in activity in order to retain money and boost the production on other marketing schemes/ideas. Brand: Nike, Inc.
Nike, Inc or Nike is a very popular and successful business that originated in the early 70s. This business firstly began, known as Blue Ribbon Sports in 1964, however, 7 years later saw them changing their name into what we know them today as; Nike Inc. This organisation specialises in sports apparel and accessories. This sport based business sells items within sports such as Football, Rugby, Golf, Basketball, Cricket, tennis, athletics and pretty much every other sport. However, I feel they are extremely notorious for their very professional and popular football boots. For example, Nike have earned international success and have worked with the likes of Ronaldinho, Ronaldo, Cristiano Ronaldo, Didier Drogba, Neymar, Zlatan Ibrahimović, Mario Balotelli, Wesley Sneijder, Wayne Rooney and Landon Donovan in regards to promoting their Football related range of goods. However, in regards to my product, Nike has formed many advertising schemes with players such as Zlatan Ibrahimović (left) and Cristiano Ronaldo (right).
Product: Nike Mercurial Vapor
This certain product is a very popular and renowned piece of sports apparel. This certain product is linked with football, as they are, a selected type of football boot. This variation of football boot comes in many shapes and sizes, this enables the product to appeal to all different, acquired tastes, and overall this will help the brand Nike Inc, reach out and attract customers. However, my reasoning for choosing this brand would be its placement within the product life cycle, due to increased and increasing competition, businesses such as Nike Inc have to constantly refresh and renew their produce, in order to maintain customers and as a business become more appealing and modern/stylish.
Therefore, I believe these products fluctuate between growth and Maturity, for example, due to the competition, new boots are brought out every couple of months or year, this causes older boots, and their predecessors to be regarded as “old”, “boring” or “out of fashion”. Therefore, each boot only has a selected amount of time, until the next big style or football boot gets released. Like I mentioned before, I believe this product is mainly situated within the growth sector, as each boot only obtains a selected amount of time to succeed and become appealing, until the next brand gets released; therefore, it’s time to mature and become a cemented item is limited.
Brand: Sony Corporation
Sony Corporation, or Sony, is a very successful and popular Japanese multinational corporation that specialises in electronics, game systems and game entertainment. Sony is one of the leading providers of game entertainment in today’s society; they have produced some iconic titles/products like the PS1, the PS2, the PS3 and its most recent addition, the next generation of console, known as the PS4. These gaming, entertainment systems have altered and revolutionised the way we play virtual games, and they have truly made their mark on gadget history. Sony is a Japanese business that began in 1946, its name, at the time stood as Tokyo Tsushin Kogyo, however, since 1958, this iconic brand has been referred to as Sony.
Product: Sony, Play station 3
The product I will be using during this task will be Sony’s, award winning creation/product, known as the PS3. I believe this product has been very, very successful, and I think I it will be an ideal product to evaluate and analyse. For example, seeing as this certain console is one of few gaming entertainment systems to be released in the modern era, the competition is reasonably low, therefore, its time during the product life cycle has sustained and gradually evolved into being a product within the Maturity sector. However, due to recent events, a new range of console appeared, formed by the same brand; Sony.
This new range of gaming console is referred to as, the next generation of gaming entertainment, and this specific console is known as the Sony PS4. This PS4 was released into stores and gaming retailers on such dates as the 15th of November 2013 (for North American Citizens), the 29th of November 2013 (for European Citizens) and 22nd February 2014 (for Asian Citizens); and as of March 2nd 2014, this product has already sold as many units as 6 million worldwide. Because of this, the Sony PS3 will eventually fall into the declining sector within the product life cycle, due to decreasing demand, decreasing popularity and a decrease in advertising and production. This certain factor is one prominent reason why I have chosen this product to feature within my coursework.
The promotional process within a business is where an organisation would advertise a selected product to either inform existing customers of new modifications to their products, or to advertise a new product they have just created and finished. The methods and messages business use when displaying their products are very important, as it can overall determine the outcome/success of the product. For example, businesses want to sustain and attract new and existing customers by using persuasive and informative promotional materials, and if their promotional schemes do not achieve this substantial amount of money can be lost, thus negatively affecting the business and potentially damaging the business. There are many forms and ways in which business can promote their products for example: Advertising – Through TV, radio, magazines, newspapers, internet Direct selling – directly approaching and “targeting” customers, e.g. public speakers, telesales, door salesmen Direct Marketing – Leaflets, mailshots, emails
Point-of-sale – selling point stands, free samples, vouchers, offers Incentives – loyalty cards, bonus points or point systems i.e. these exist on many crisp and cereal selling brands Public Relations – Ensuring the organisations name is well known and grown or growing publicity. Catchy slogans, and brand names or e.g. sponsorships like Nike’s Cristiano Ronaldo sponsorship deals Sales Promotion – special offers, deals, sales to attract customers All these ways are commonly used by business in order to boost the publicity and overall speculation on their product, as every business needs to achieve a certain amount of customers, in order to generate profit. As well as these promotional ideas/methods, businesses also use certain features like AIDA. This stands for (A) Attraction, (I) Interest, (D) Desire, (A) Action. This diagram is used to represent a customer’s approach to reviewing a product. For example, when seeing a advert that appeals to them, these (potential) future customers will have a mental review of the product, and over a period of time, this AIDA process should unravel and take its formation.
This is a process in which many businesses follow, in regards to promoting and releasing their product/ideas so they can identify what techniques to use, when advertising and promoting their products. For example, firstly comes the Attraction of the product, businesses want to represent their newly formed product as a new revolutionary item that will benefit someone in every way, where it’s needed. Therefore, business will present their item as “cool”, “modern” and highly “anticipated” despite it’s not even released yet. This is in order to obtain the focus of customers and to gain their attention to their product. The success rate in which businesses do this will determine how many people will feel encouraged to buy your product, an increase of this will overall benefit the business and generate them with increase/grown profits. Secondly comes Interest, this is where business aim to achieve the focus and publicity of their product. Because of this, businesses want people/customers to gain an interest to their product, they want people to feel they need and have to purchase it.
If a business successes within this stage, this could impact the business in a number of positive ways. For example, an increased amount of people interested within your product could mean, an increase in profits, and this will most certainly benefit a business. Businesses do this by containing people within their adverts or promotional materials looking happy with the product, or featuring famous figures in order to promote how stylish a product can be. Like I briefly mentioned, businesses want customers to feel the need to have their product, this stage is referred to as the Desire stage, this is where business feature many promotional materials in order to obtain the attention of customers and make them feel the need to want to buy and purchase their product. Again businesses can do this through featuring famous figures like Cristiano Ronaldo in order to promote their new product.
By doing this, many fans of these famous figures may feel desired into purchasing the product as they deem it as stylish or maybe they just feel loyal to the role model/celebrity who promoted it. Finally features the stage/section known as Action. This the physical side to this AIDA cycle, for example Action is where the customer/reviewer will eventually purchase the good and use it/consume it for its purpose. Within this cycle, businesses don’t really have to do anything more at this stage, the customer has bought their product, all the business can do now is wait and assume the certain client has grown fond of their product, thus potentially forming them into an existing customer/loyal consumer. What are the promotional techniques used by your businesses? Within the two businesses I have chosen, there are multiple promotional techniques. Within the paragraphs displayed below, I will present this and eventually outline their strengths, weaknesses, and comparison with competitors and their differences. Nike Inc, Mercurial Vapor:
For this selected product, I found many promotional schemes, however, I commonly found promotional processes within the advertising side of promotion, and these TV advertisements included famous footballers like Cristiano Ronaldo and Zlatan Ibrahimović in order to boost the attraction of their product as well as the desirability. For example, some screen shots/links of the adverts collected:
Cristiano Ronaldo: https://www.youtube.com/watch?v=MWVYwppLPdE https://www.youtube.com/watch?v=_mdgTR5ZyDs
Zlatan Ibrahimović: https://www.youtube.com/watch?v=pqVk1FHYeFY https://www.youtube.com/watch?v=7SBnk3lKzzg
Within this set of Nike commercials, I thought the real strengths and positive aspects had to be the way in which they want people to perceive their products. For example, within each advert/promotional technique, they indicate how their style of football boot could change the way in which you perform, and how it can alter your abilities. For example, within the Cristiano Ronaldo adverts, it depicts Ronaldo, running through a whole team, easily with such pace, the advert then finished with the simple statement of: Be fast. Be Mercurial. This would indicate to customers that their special brand of football boot could enhance their abilities and the way they perform on the football pitch. For many football fans, and aspiring football players, these factors may be very important and this may encourage them to buy the item as they desire the certain traits these products supposedly provide. This is also a good way of advertising, because when people purchase this variation of football boot, it’s another way of advertising, however it’s free.
For example, potential customers may see other people wearing the advertised boots, and this may cause them to feel jealous due to them knowing what the boots supposedly provide trait wise, as well as the fact, their favourite footballer may be the cover of that certain brand, therefore they could feel further experiences of jealousy. This factor is very important because, in modern day football, the competitiveness between aspiring players may be extremely high, therefore each player wants/needs a certain factor such as new boots that may pose them with an “advantage” over everybody else/their opponents. Overall this will encourage more people to purchase Nike’s product as the certain products may feel increasingly desired, thus potentially increasing their profits and reputation.
I also feel strength of these advertisements is the involvement/featuring of worldwide known sports figures like Cristiano Ronaldo and Zlatan Ibrahimović. Many young people interested within sports and football idolize over certain role models like these players, therefore, when these people see the Nike adverts featuring them, they feel obliged to purchase the certain piece of sports apparel in a way of supporting their role model. Therefore, Nike can use this to their advantage by exploiting how these players “benefit” from their products, and how it will reflect on their customers. For example, many fans and expiring footballers may feel, that wearing the same football boot as Cristiano Ronaldo or Zlatan Ibrahimović will grant them with their abilities and skill. Because of this, Nike’s advertisements can easily attract more customers by featuring these great athletes, thus potentially boosting their profits due to increased attraction and desirability.
Within these adverts, I felt it was very hard to find a significant weakness; however, I came to the conclusion of their adverts potentially degrading people. For example, due to the adverts representing how football players could be boosted/enhanced by the certain football boot, certain people who may desire the item, however can’t afford it may feel, when they play football, they do not have enough skill or power when on the pitch in comparison to people wearing these advertised boots. Because of this, many people may feel degraded, and they may also feel potentially weaker as a footballer, and this could potentially have a negative effect on Nike due to some people possibly feeling depressed about their abilities when being reminded of their products and their brand faces like Ronaldo and Zlatan Ibrahimović. Therefore, Nike may suffer some reductions in customers, therefore a decrease in overall profits.
Comparisons with competitors:
When comparing to competitors, I believe Nike is probably at the best stage, I believe Nike is at the top of their game. For example, I think the way in which these commercials are conducted, represent these products with style, professionalism, power, speed, agility, and skill, precision. Because of this, I believe Nike’s target audience has been expanded for example, due to the professionalism and smart appearance of these products and their commercials, elder customers may also be enticed to purchase the products, as well as young, aspiring players.
I also feel Nike made the correct choice when choosing players like Cristiano Ronaldo when advertising their products. For example, over the past couple of years, Ronaldo has accomplished many individual and joint awards and has successfully earned his place as the one of the best, if not the Best player in the world. Because of this, more people may have been enticed to buy Nike’s products, thus potentially booting their profits and overall reputation.
Sony, Play Station 3:
Again, with this certain product, I found Sony Corporation used many promotional techniques in order to advertise their product, especially within television, posters and billboards. For example:
Links: https://www.youtube.com/watch?v=YyTlxHwuPZY – Long Live Play Michael
https://www.youtube.com/watch?v=gqkNPcUMffU – PS3 Baby Commercial
Within these Sony, PS3 commercials/promotional material, I found that theses commercials had many aspects about them that were positive. One of these was the engagement to the audience a special individuals that are avid console gamers. For example, within the Long Live Play commercial, a group of gaming characters formed in order to celebrate the background character known as Michael who controlled their stories, as he PLAYED their games. I believe this is a positive effect as certain people may recognise these gaming characters, therefore they already obtain some variation of emotional attachment to them, because of this, more people may be attracted to Sony’s products. For example, by seeing characters from certain games they have played may trigger many good memories of these people playing these games when they were younger.
Because of this, they may feel encouraged to buy the console in order to recap on old memories, because of this, and increased amount of people buying Sony’s products will mean, and increased amount of profits, thus benefitting Sony in a number of ways. Another strength could be the suspense during the commercial. For example, the Long Live Play commercial depicts a group of characters speaking and celebrating about this person called Michael, however, customers watching the commercial don’t’ actually get told who this Michael is and why he’s important until the very end. I believe this is a very good promotional technique as this may cause customers having to watch the entire commercial as they are curious to whom Michael is, and by that time, they are drawn in and notified of the brand “Sony – PS3”. This suspense could ideally cause more people to remember the commercial, and overall these factors could increase the amount of people who will buy Sony’s products, thus increasing their profits further.
In comparison to the Nike commercials, I felt there were more negatives within these certain promotional methods, especially within the first commercial I watch, the PS3 baby commercial. I feel there were certain negative, such as how vague the promotional method was, for example, I don’t feel and can’t seem to analyse any form of message or purpose into why Sony depicted a baby doll, glancing at their product and making a series of different noises. If anything I believed this certain commercial was quite weird, and if I were to watch this commercial, my initial reaction would probably deter me from buying this product,, as I found little about the product itself, and the way I think the commercial was conducted was very strange and dysfunctional. I believe this would overall be a negative effect in regards to Sony. For example, if people are deterred from buying you product, due to your commercial, this could result in reduced sales and ultimately a decrease in your annual turnover.
I also find, within the Long Live Play commercial, if you were new to gaming and unaware of some of the figures within the production, the advert wouldn’t really appeal to you, therefore the way Sony aimed to increased sales through this promotional method may not work as well as hoped. For example, how do you expect to connect with some of the characters when you’re un aware of their story/history? Ultimately this could affect the turnover and sales created through this product and it could mean less people may purchase Sony’s products, thus potentially affecting their profits. However, in relevance to my last point, it could also be perceived as a positive, for example, if some people are unaware of certain characters, this may leave them questioning their purpose, and why they’re there.
Because of this, people unaware of this information may feel the need to purchase a games console and some related game titles in order to find understand why certain characters were within the commercial. Due to this, businesses like Sony who sell gaming systems may receive increased sales due to people new to games, and are searching for a correct platform to play on. Overall this would positively affect Sony as sales may increase, as well as profits, thus benefiting the company economically. In comparison to their competitors I feel Sony don’t feel the need to input as much effort into their advertisements. They seem to focus on sales promotions within shop windows like Game or Game Station. I also feel Sony withdraw from increased advertising as it costs money, and they seem to find leaving their customers without that many details, It might give them an increased chance in regards to buying the console as the negative effects of the product may be unknown until purchased, this is beneficial to Sony as again, more sales mare be generated, thus a potential increase in profits.
Pricing Strategies Used
Pricing strategies is another word for the structure, and how businesses decide to sell their goods, and depending on these products, the type of pricing may change.
Nike, Mercurial Vapor:
The first pricing strategy I think Nike use in regards to this specific product happens to be the strategy known as Promotional Pricing. This is where businesses provide offers, and sales on their certain products. And in Nike’s case I believe this is exactly what they do, for example, considering the competition for this variation of product is very high, businesses like Nike have to constantly circulate new products and new Mercurial Football boots, otherwise, their competitors will receive the upper hand and potentially an increase in customers due to less competition and other competitors not releasing new, updated stock. So, businesses like Nike release new stock/products like Mercurial Football boots in order to maintain their customers interest, therefore a majority of their older stock falls into the category of sales, deals and special offers.
For example, Nike cut down this special type of Mercurial Football boot down from £55.00 to £43.00, a £12.00 price decrease.
Nike also follows the pricing strategy of Price Skimming. For example, when Nike first releases a new rendition of the Nike Mercurial Football boot, the price is initially, extremely high. I believe they do this because they know people would pay so much, just to stay up to date and modern in regards to the latest range, I also believe they do this because they know they are going to later decrease the price, therefore they initially sell their products at an extremely high price, just to take advantage of the limited time it’s going to be that price for to ensure they may generate a major profit per unit, thus potentially increasing their sales and overall increasing their profits.
The screen shot displayed above represents how much Nike initially release their Mercurial Vapor range at, later this price will decrease as new boot ranges will circulate, and this certain style will eventually go decrease in fashion/popularity.
Sony, Play Station 3:
The Sony PS3 has been around for around for around 7 – 8 years now, therefore the pricing strategies Sony used may or may not have changed during the products long lasting existence. Over that period of time, the Sony PS3 has been altered, re-mastered and perfected, therefore the pricing has obviously had to be changed, and considering the release of the new PS4, the Sony PS3 price has probably fluctuated at an even greater scale. One of the price strategies the Sony PS3 withheld was, Price Skimming. Sony needed and has used this strategy due to the products huge market life. In order to generate and receive the most sales/turnover, Sony needed to keep the price as high as they could until something like the PS4 appeared. For example, since its release, the Sony PS3 has maintained a price between £400 – £150, therefore within that 8 year product life bracket, Sony has only cut the pricing down from around £250, and like I mentioned before, Sony did this in order to generate the highest amount of sales/turnover in order to sustain a substantial amount of profit.
Sony have also used the pricing strategy known as promotional pricing, for example, since Sony and their consoles involve features such as buyable accessories and games, Sony seem to release the occasional deal which involves a mix of a variety of games, certain gaming related accessories and obviously, the console itself. These deals appeal to many people as they receive the highly anticipated console as well as many other beneficial features. However, businesses like Sony use these added features in order to boost people’s encouragements as they believe the deal is better than it actually is. This is beneficial to the business as it overall could result into increased sales/profits due to deal prices and bundles potentially being sold for more than the individual console.
This then leads me on to my next and final pricing technique, for example, business use the pricing strategy known as Psychological pricing. This is where businesses sell products at a price to deceive customers and trick them into thinking it’s cheaper than what it really amounts to. For example, many businesses sell items ending in 00.99, this is due to it seeming like it’s much cheaper than the price following it, for example, people feel they’ve received a great deal off an item for £19.99 instead of it being £20.00, despite it’s one penny less, your eyes deceive you and it seems to look like a much smaller number/price. For example, in regards to Sony, their PS3 has been usually sold at a price ending within 00.99 in order to trick and deceive people, thus causing Sony, to generate an increased amount of money, thus boosting sales and potentially enlarging the business’s profit.
As you can see, this certain retailer has applied this strategy on order to generate a increase within each unit sold. This will overall benefit Sony as more money will be generated within their company, causing them to receive a positive cash flow.
Nike is business that specialises within sports apparel and sports related accessories, therefore you will find most Nike goods within common Sports retailers. For example, popular European stores like Sports Direct, JD sports and the Nike shop will supply these related goods as they are all featured within the same business sector – Sporting and Leisure activities. These products produced by Nike are supplied within these stores as Nike is a multinational brand, and it’s becoming increasingly popular, therefore, over the past couple of years, the demand for Nike produce, such as Mercurial Football boots has increased.
Because of this, businesses like Sports Direct and JD sports want to sell their goods as Nike will cause them to generate increased profits due to increase popularity of Nike products and increasing demand for the certain stock, supplied by Nike. This is beneficial to both stores, for example, Nike will receive money through the selected stores Nike stock sales as a percentage of this money will be generated and transacted to them, as long as Nike provide these businesses with suitable and updated stock. The only negative I can picture could be the certain percentage of the money Nike might receive, for example, this percentage may be quite low, and therefore it might actually negatively affect Nike as they may spend more money manufacturing and transporting the goods than what they receive in return.
Sony, Play station 3:
Since Sony and their PS3 is categorized as a gaming entertainment system, the stores that usually sell this product are gaming retailers like, Game, HMV, Game station, and CEX, however, since PS3 became a worldwide product, they have gradually been sold within basic superstores like Tesco, Wall mart, Sainsbury’s, Morrison’s, ASDA and Waitrose. Again, due to the products speculation and overall success, these businesses decided to get in touch with Sony and sell their produce (PS3) as they were certain its success will provide them with increased sales, and overall profits. Many businesses like Tesco also bought the stock in order for more people to enter their stores, fro example, by increased amounts of people entering a Tesco in search for a PS3, they may buy a certain drink or product provided by Tesco, and because of this Tesco and other superstores selling the PS3 may have also generated increased product/stock sales and well as potential increased profits.
Much like the positive effect presented above this will also overall benefit Sony, as an increased amount of businesses wanting to sell their produce, will mean an increase in funding and overall boost in the finances within the organisation as more money will be externally inserted within the company. The only negative again could possibly be an insufficient amount of money to compensate for the immense amount of demands from businesses wanting to sell Sony’s products, however their funding/money should cover it, thus evading this problem and providing Sony with no real negative issue in regards to this problem.
Evaluate the marketing techniques used by a selected business Nike:
After evaluating and analysing Nike and their Mercurial Vapor football boots, I have resulted in a conclusion, and have formatted my final opinion, on their way of marketing. I personally believe Nike used very smart and successful marketing strategies, as the popularity of their business represents how they have globally attracted people to their brands, and sports apparel. For example, in regards to their Product, I believe the way they’ve dealt with the growing/fast competition really functions well within their business. For example, Nike has adapted and became accustom to bringing out and releasing new products, like football boots every couple of months/year in order to sustain the interest of their customers and target audience. For example, they need to sustain each of their products like the Mercurial Football boots within the growing sector in regards to the product life cycle, until the next brand or style of boot gets released.
Without these certain functions, and Nike standardized approach, I doubt the business would be as successful as it has been over the past few years, this certain function has certainly helped Nike achieve success, sales and profits; and these are all very beneficial features within an organisation. Due to these factors, I also believe Nike has breached its customers’ expectations; they have released consistent and fashionable products, much like the rapid production and competition of football boots, and they are definitely one of the best within their selected sector of Sports and Leisure apparel/equipment. This is why I believe Nike could be regarded as one of the best, if not the best football boot producers/retailers within the world, and I believe they are definitely one of the feared businesses, in regards to their competitors like Adidas, Puma, Umbro, Sondico and Warrior.
Secondly, I believe Nike’s Promotional sector is also very effective, for example, as I mentioned previously, I believe the way Nike advertise and present their products is very professional, stylish and smart in regards to their appearance. And because if this, I believe Nike’s target audience is expanded, for example, by appealing to an increased amount of people, Nike’s football boot sales may increase, therefore Nike may even result in an increase within profits; thus benefiting the business further. I also believe Nike conducted their sponsors very professionally and successfully as well. For example, Nike and their range of football boots obtain sponsorship deals with players like Zlatan Ibrahimović and the two time Ballon d’Or winner; Cristiano Ronaldo. I believe these deals have secured Nike’s success, for example, due to players like Ronaldo promoting their produce, an increase amount of people have been encouraged to buy their products, like the Mercurial football boots; thus boosting their sales, revenue and overall, profits. Again, in comparison to their competitors, I believe Nike are the best in their business sector.
For example, the way they’ve conducted each commercial, poster or other promotional source, they do it with certain features that I feel provides them with an edge in regards to attracting and generated desiring customers. Within Nike, I feel their pricing strategies were extremely good / beneficial to the organisation, and I believe, there isn’t any other form of strategy that I would follow, in terms of generating sales, and ultimately profits. For example, I believe the strategies they used were very good, in regards to their products, and how it will function with their target audience/customers. For example, one of the pricing strategies they used was, promotional pricing, this is where business sell their goods by offering certain deals and sales and cutting down the price in order to attract and generate an increased amount of customers.
I believe it was convenient for a business like Nike to use this certain strategy, as the football boot market is very competitive, and new boots will have to be released every couple of months/ year. Because of this, it’s only right if they cut down the price on their other goods by introducing sales, offers and other forms of promotional pricing, in order to attract more customers, and potentially increase sales/profits. Another form of Promotional pricing that Nike conduct is the strategy known as Price skimming. This is where businesses initially release their item at a very high price; however, as it progresses through the product life cycle, this price tends to decrease in order to benefit the business and customers by producing potentially more sales, thus more profits, as well as a cheaper price, therefore increasingly affordable. Again in Nike’s case, this is mainly due to the strong, competitive market. For example, new products like Mercurial football boots will have to be released, therefore the stock referred to as the old stock will slowly come down in price as new products and goods get released.
This will benefit Nike as the cheaper prices could attract more customers, because of this, Nike could face an overall sales increase, and this sales increase could eventually lead to the increase in Nike’s profits. Nike could improve the sales of this by promoting these reductions in such things as Television Adverts or posters, combined with popular retail stores such as Sports Direct. By promoting these reduced offers, more people within their target audience may feel interested to purchase their products, due to this Nike’s sales and overall profit may lead to an increase. Within these advertisements further deals with popular sports personalities such as Cristiano Ronaldo could take place; further promoting these reduced products, ultimately leading to more people having a desire or wanting for these items, resulting in an increase in Nike’s sales and profits. I believe the way Nike sells their produce, like their Mercurial Vapors is very convenient and beneficial to the organisation.
Therefore I believe these certain pricing strategies are very effective and this specific range of marketing techniques are very successful in terms of generating the business with increased sales and overall increased profits. Nike has overcome their competitors by formulating certain schemes to override their opponents and receive increased customers, sales and profits. Like I mentioned previously, to strengthen this, Nike could promote their discounted and reduced prices even more. For example, since a new style or variation of their products such as Football boots are renewed monthly in order to maintain a controlling position within the Market, a vast amount of their old products are slightly forgotten about in regards to customers and their target audience. Therefore I think it would be highly beneficial to Nike if they compensated more for the promotion of their older products with reduced prices as it could overall increase the sales of their business, and ultimately lead to increase publicity.
More people would be interested to purchase these promoted items with reduced prices, creating a larger attraction to the Company (Nike) and its products, either new or old. Further promotional materials with sports personalities would also help solidify their position, as certain sporting figures may attract a larger audience to their business, increasing the publicity and knowledge of their products; this would be highly beneficial to Nike as it may result in increased sales, ultimately leading to an increase within profits, further benefiting the organisation. However, if I had to make one improvement I would say the pace at which the company skims the prices off its products. For example, many times I have been looking at popular football boots and noticed how the prices are extraordinarily high.
For example, popular football boots promoted by famous athletes sometimes cost over £200. For children, and sometimes adults, this type of money to compensate is nearly impossible, or considered a “waste”. This high price may result in push factors for people in search for the adequate balance I regards to sporting goods such as football boots, people will look for price, fitting and appearance; and if the price is high, it may deter people from purchasing it, ultimately reducing Nike’s sales, potentially leading to a decrease in profits. By increasing the rate at which these products are reduced, and shortening the period they are sold at a very high price for, more people may be attracted to buying and using the product, thus promoting the business’s content furthermore, and ultimately leading to an increase in profits due to increased customers and sales.
Lastly, within the marketing sector, comes the section known as Place. This basically refers to where the products are actually sold. For example, for Nike this is the common sports retailers like Sports Direct, JD sports and more. This encourages greater sales as the product is widely available. For example, it would be common to provide businesses who have generated success, prior to you letting them sell your specific items. Therefore, it was only beneficial for businesses like Nike to sell their good to businesses like Sports Direct who are very successful and have generated an array of customers in search for products like Nike’s Mercurial football boots. This will benefit them as the business’s success could potentially mean, more people might purchase Nike’s products, like their Mercurial Vapors, therefore Nike would benefit as they could potentially result in an increase within profits, and sales.
Another way Nike may be able to improve the promotion and success of their sporting related goods could be the increase in personal customization, for example, many people buy and purchase products such as football boots to stand out within their selected sport, by allowing your customers to personalize a product, catered to their wants and desires will enable an increased level of individuality. For example, this customisation technique may allow people to feature their own personal initials and colour combinations on their selected Nike products. Also, this certain function should not only be introduced via the internet, but also via located outlets. This would enable people and customers to receive a visual on how their selected product would appear. Certain physical features such as a wider Nike product customisation would potentially lead an increased amount of customers, for example, like I mentioned previously, within their selected sports, people want to stand out, in order to attract attention or an increased chance of remembrance.
Therefore, by allowing people to customize their personal products whether it is tops, shoes, boots, shorts or even tennis rackets, a wider audience may be attracted. Ultimately this may increase Nike’s sales, leading to an increase in their overall profits. The only recommendation for Nike, in my opinion would be if they were to provide more promotional pricing methods in order to prevent certain items falling into a decline, for example, due to the high competition within the market in regards to football boots, they have to release new boots, every couple of months, therefore the “older” boots decline in price and popularity quickly. In order to prevent this, I think Nike should increase the amounts of offers within their football boot range; this will potentially increase sales and even boost profits as an increased amount of people would be encouraged to purchase Nike’s products due to the falling/cheaper prices. Again this will benefit the business as more money could be generated, and this could possibly mean Nike may sell more, thus increasing their overall sales.