Rise To Success: Nike
Economic Genius or Selfish Robber
Barons?
Background
• I began this research project to try to
understand how a corporation evolves from a
local business into a worldwide corporate
giant.
• Why do some companies fail within a year,
and others shoot to the top of their respected
market?
Why Nike?
• I chose to take an in depth look at Nike to
understand their unprecedented rate of
achievement.
• More intriguing than Nike’s rise to success,
was their ability to reacquire their position
atop of the sports apparel world, even after
they lost their dominance in said market.
History of Nike
• Nike was created by Bill Bowerman, the University of
Oregon track coach during the 1950’s, and a University of
Oregon Distance runner, named Phil Knight.
• Knight was a distributor for Onitsuka Shoe Co. (Asics).
Bowerman liked the shoes so much he became Knight’s
business partner. Knight sold the shoes out of the trunk of
his car, and Bowerman would use the shoes to run
experiments on.
• With the help of Jeff Johnson (A former runner) Nike set up
their first retail store, under the name of Blue Ribbon
Sports. Blue Ribbon sports would become Nike in 1971,
around this time Nike was creating their own shoes
separate from the Onitsuka tiger model they distributed.
History (Cont.)
• Nike innovated the running shoe by implementing a “Waffle”
traction pattern.
• Nike chose a young runner named Steve Prefontaine to endorse
their product.
• Prefontaine passed away at the age of 24, already holding 7
American track and field records.
• Nike entered the 1980’s on a roll with the creation of Nike Air
technology. Although in the mid 80’s competitors overtook Nike in
the athletic apparel market.
• Nike, dangerously close to failure, signed an NBA rookie Michael
Jordan, thus invigorating the company and setting them back on the
track to success.
• In the 1990’s Nike truly became a World corporation as they began
sponsoring Elite athletes from all over the world.
Nike Today
• Today Nike is based in Portland, Oregon
• They are the leader in sports apparel and
athletic footwear.
• So how have they achieved so much success?
Economics and Nike
• A major factor of a corporations success is
economic growth. Economic growth plays a
large role in a company that sells luxuries such
as Nike
• Economic growth is the measurement of the
economic success of a country. Economic
growth is similar to a nations GDP.
• Nike most likely was able to succeed due to a
prosperous United States’ economy
U.S. GDP and Nike
• Due to the possibility of a connection between
the U.S. economy and the success of Nike, I tried
to find a connection between the U.S. GDP and
the success of Nike during the companies early
years.
• In the early 1970’s the U.S. was still prospering
from the economic golden age that took place in
the U.S. during the 1950’s and 1960’s.
• In the later 70’s the U.S. economy would falter
but Nike would still succeed.
U.S. Economy in the 1970’s
• Despite a mediocre econommic status entering
the 1970’s, must of the decade was spent in a
recession for the U.S.
• This recession was caused by a variet of reasons
such as: The conclusion of the Vietnam war, a
worldwid oil crisis, and inflation in the U.S.
• Despite the poor economy, a young Nike
corporation thrived in the unfortunate
conditions. Their success can be attributed to a
variety of reasons, with the main being their
ingenious Marketing policies.
Early Nike Marketing Techniques
• Fortunately for Nike, a “Fitness Revolution” was taking
place in the U.S. around the same time that Nike began
mass producing athletic apparel.
• Nike would take advantage of this “Fitness revolution”
by creating a sense of mythology with exercise and
athletics.
• Athletes were built up to be “Gods” and these “Gods”
wore Nike apparrel. Why not Outfit yourself in the
garment of the Gods?
• Nike appealed to many in the late 1970’s and early
1980’s because Nike could provide them with natural
beauty. Beauty through exercise.
Early Advertising
•
In Nike’s early advertisements, they appealed to religious and spiritual ideas, by
appealing to religion they could create the idea that talented athletes are “Gods”.
In this Ad, Nike creates a sense of mystery by surrounding the dark silhouette of a God
like runner in smoke. The lack of
In this ad, Nike portrays a young Michael Jordan as a supieror being, soaring over
a city skyline. What apperrel is he wearing? None other than the brand new Air Jordan
1, with Nike Air technology. Nike is attempting to convince the consumer that the best
Athletes in the world wear Nike, why shouldn’t you?
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Many believe this Nike Ad to be one of their best.
One reason for it’s brilliance is the uniqueness of the photograph. No one had
ever seen a shoe like the one photographed above.
By creating the first Air Max Shoe, Nike wanted to change the running shoe
forever,
The slogan “Nike-Air is not a shoe” intrigued viewers of the Ad, In later Ads, Nike
would follow their initial statement of “Nike AIR is not a shoe, with the response
“It is a revolution”
• The “JUST DO IT.” Slogan is often associated with the Nike
corporation as a whole.
• It is simple, yet inspiring, and accusatory at the same time.
• Nike is pretty much saying to stop making excuses and do
whatever you need to do to live a more successful life.
• The “JUST DO IT” slogan has become more than a catch
phrase, it has become a way of life.
Innovation
• Nike would not be able to achieve success if it
were not for the numerous innovations they
introduced into the world of athletic apparel.
• Nike reinvented the track shoe, the running
shoe, the basketball shoe, and many other
clothing items associated with athletic
apparel.
The Waffle Sole
• The waffle sole was one of Nike’s first innovations.
• Bill Bowerman created the sole, using an everyday waffle iron
made for use in the kitchen.
• Bowerman made the shoe to help provide an advantage for
the athletes at the University of Oregon.
• The waffle sole would be used on the “Moon Shoe”, the
Waffle trainer, and many track shoes.
Nike Air
• Nike air was an advanced new cushioning system invented
by M. Frank Rudy in 1979.
• It was first implemented on the tailwind running shoe.
• Nike Air is essentially pressurized gas encapsulated in a
polyurethane casing.
• Nike has heavily patented the revolutionary cushioning
system and it has been implemented in some of their most
popular shoes, including the first air Jordan.
• Nike has further improved the Air Cushioning system with
the creation of Zoom Air.
• Zoom Air is a cushioning system that consists of thousands
of synthetic fibers encapsulated in a plastic capsule.