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How Nike Is Building Brand Equity

3650 words - 15 pages

How NIKE is building Brand Equity
1. Brand Equity: introduction
Brand equity is defined as “the differential effect of brand knowledge on customer response.” Three elements of this definition need to be emphasized. The most critical element is differential effect or “differentiation.” Without this, a brand is not different from the next one, and therefore, can never seek a premium. In some instances, differentiation is easy to create (e.g., automobiles, breakfast cereal, etc.), whereas in other instances this can be much more challenging (e.g., gasoline, bottled water). Regardless, however, it is equally important to strive for differentiation. The next element is brand knowledge. Your ...view middle of the document...

e., a price-cost differential above “normal”).

3. How brand create Equity: a case study of Nike
4.1. Company’s Profile
Nike Corporation was incorporated in 1968 with the name of Blue Ribbon Sports. And in 1978 it became Nike. In their thirty-four year history, Nike has primarily been in the business of designing, developing, and marketing athletic footwear, attire, equipment and accessories, а lot of companies go out on a limb when it comes to business decision or management strategies with Nike Corporation.
Nike is а powerful company. Nike Corporation is a well managed company in а striking industry, the company has a strong brand image, and they are effectively capturing the value shaped from their savings. Modern superior ways to make products are significant in today's Apparel companies, both to be efficient and to be able to make hi-tech products. Nike is dependent upon high technology in their effort to stay ahead of their competitors and create products. These technologies are found within computers, used to create, design and develop the products and machines that actually make the shoes.
Besides these main areas of technology such a large corporation also uses a lot of diverse technology such as accepting programs on computers, intranet within the headquarters and not to forget Web page technology for their web page. They have а extremely developed Web site used for marketing and sales purposes. (Carty 2001 34-47)Nike primarily competes in the footwear industry, a subset of the consumer cyclical sector. The major competitors of Nike are Reebok and Adidas, but any company that sells athletic and leisure footwear, apparel, or sports equipment could be considered а contestant too. Competition within the footwear industry can be very strong and change quickly due to rapidly changing customer preferences and technology. With an active industry such as Nike, it can be challenging to sustain a competitive advantage.
Nike positioned itself in an industry where are virtually no substitute products. Runners, walkers, basketball players, football players, and virtually every person...
4.2. The mythology behind Nike name
Nike was the name of a Greek Goddess in the ancient Greek culture. She was the goddess of victory and helped the rightful to succeed. Her wings swooshed and so does the feather she kept in her hand. Her attributes were also associated with the force and speediness. This is the story that the logo and the brand name of Nike tells us. This famous sportswear company is named after an ancient Greek goddess of victory, and her sisters were the goddesses of force and strength and her brother was the god of rivalry. She bestowed upon fame and glory to those who achieved victory. If you think, isn’t this what Nike (the shoe company) does to successful athletes? They give them the fame and glory by signing them up for their marketing and advertising campaigns while bestowing everything they wear with the swoosh...

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