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Nike, SWOT Analysis Example

Pages: 1

Words: 224

SWOT analysis
Strengths

Well-established global brand

Well-established business reputation

Global sponsorship of the major sport events

The use of contract factories outside the U.S.

Huge investments in research and development

A well-developed sense of marketing

The use of exclusive raw materials

Weaknesses

The lack of product diversification

Strong competition

The lack of information about factories

Cheap labor exploitation scandals

Child labor controversies

Opportunities

Globalization of markets

Scientific approach to product development

Accessories

Brand recognition

 

Threats

Global trade and currency exchange losses

Competition

The lack of sustained competitive advantage

Price sensitivity

Ecological issues

The use of cheap labor force

Economic recession

Nike is well-known for its established reputation and global brand recognition. The company seeks to preserve and expand its market presence through active sponsorship of the major sport events and huge investments in scientific research and development of its footwear. Unfortunately, Nike is not secured from reputation pitfalls: Nike brand is often associated with workforce exploitation and the use of child labor in third world countries. These scandals present the major threat to Nike’s reputation. Globalization provides Nike with virtually unlimited expansion opportunities, while scientific approach to product development and brand recognition add their value to Nike’s current market position. Nevertheless, Nike should be particularly cautious about globalization and its global expansion threats, including currency exchange losses and increased price sensitivity. In conditions of the economic recession, the company must work to create unique products, which will help Nike to sustain its competitive advantage in the long run.

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