What are some advantages the company Nike has?  

Expert Answers

An illustration of the letter 'A' in a speech bubbles

One of Nike's main advantages is longevity. Nike was founded in 1964 and almost immediately helped revolutionize the entire sportswear industry. One of the ways in which Nike has been particularly savvy has been in recruiting famous athletes as spokespeople for its products. This has been a costly—and sometimes risky—strategy for the company. In the fall of 2018, Nike signed former San Francisco 49er football player Colin Kaepernick, who became famous for kneeling during the national anthem before every football game as a form of protest against police brutality and racism in general. Kaepernick's decision to kneel resulted in much controversy, including some who boycotted the NFL itself, so Nike's decision to sign him was deemed a dangerous idea by many. Sure enough, a firestorm of criticism followed the ad rollout. However, Nike's management team clearly abides by the quote originally attributed to PT Barnum: "There's no such thing as bad publicity." And yet even with some boycotting Nike (and even burning their shoes!), the company's bold move paid off; many Kaepernick supporters saw the ad as evidence of Nike taking an important stand on a very divisive issue. The stand paid off in the bottom line, too. In late 2018, Nike enjoyed substantial growth in Europe, China, Africa, and the Middle East. Another advantage Nike has is it's nimbleness and willingness to listen to what consumers want. In fact, the company launched several new products in 2018 and later reported that 80% of its sales growth revenue was from these recent launches.

Approved by eNotes Editorial Team
An illustration of the letter 'A' in a speech bubbles

As a large multinational corporation, Nike has many advantages over its competitors.  Because of its large size, it is able to secure many of the factors of production at lower rates than its competition.  This includes the cost of paying labor in factories located in under-developed countries in Asia.  

Probably the biggest advantage that Nike has is name recognition.  Through careful marketing, and the use of celebrity athletes, the company reaches the important 15-29 demographic.  This tradition began with Michael Jordan in the 1980's.  Because of name recognition, the company is able to charge more for their products than the competition, which can in turn be used for further marketing.

The scope of the company is another important advantage.  The company is no longer just a line of athletic competition shoes.  Nike offers a large variety of equipment, running gear, branded clothing, and uniform options.  The variety of product allows Nike to reach a large customer audience, which in turn, increases revenue. 

Video on the Globalization of Nike, YouTube reference link.

Approved by eNotes Editorial Team

We’ll help your grades soar

Start your 48-hour free trial and unlock all the summaries, Q&A, and analyses you need to get better grades now.

  • 30,000+ book summaries
  • 20% study tools discount
  • Ad-free content
  • PDF downloads
  • 300,000+ answers
  • 5-star customer support
Start your 48-Hour Free Trial