Porter's Five Forces - Nike

Extract

[...] This is to maintain Nike's high standards. If a supplier does not adhere to these high expectations, Nike can easily withdraw and move production elsewhere. This has a massive impact on the supplier as losing a contract with such a large significant company can be devastating. Job losses and a tarnished reputation are only a few ways that it would affect the supplier. Through their numerous suppliers and having a strong influence over them, Nike is able to keep their costs low and their profits high. [...]

[...] Although there are many substitutes, Nike's products have performance strength and customers are picky with their choices. For instance, buying the best shoe for the most comfortable run, or the best protection and stable performance on the field and off. People are mostly fitness and health focussed and they are constantly seeking products and brands that support this lifestyle best. As such a well-established brand, Nike are also dependable and if someone is looking for a product that will keep them safe and help them achieve their health and fitness goals, they look no further than the “swoosh”. [...]

[...] Through their constant analysis and developments, it enables Nike to offer products that appeal to the customer's core needs. Market research and regular product development give Nike the advantage of producing top performance sportswear and sports shoes. Substitute products would find it difficult to compete with the performance of Nike products at the same price range. With such a powerful advertising campaign and marketing budget, it would be ambitious for any rival to try and compete at the same level. [...]

[...] It gives hope to customers and keeps competitors fighting to keep up. Their variety of products allows them to target all the various sports and capture a greater market share. Having bought out companies such as Jordan, Hurley and Converse, they are able to maintain their strong stake in the market with a variety of products for their customers. One of Nike's aims is to sell a specific lifestyle that appeals to a diverse group of people. The brand is associated with health and feeling good while exercising. [...]

[...] Nike Porter's 5 Forces Analysis As part of their brand strategy and constant analysis within their business, Nike have adopted Porter's 5 Forces Analysis. The 5 forces are a study conducted on external threats according to their competitive intensity and influence over the company. This enables Nike to assess the threats such as competition, customers and substitute products and focus on how to maintain their strength and profitability in the market accordingly. I. Nike's Competitive Rivals Nike is faced with some strong competition in the sportswear industry. [...]