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Nike Market Segment Analysis

3103 words - 13 pages

Team Project – Part 2
Team 5 – Hawkeye Marketing
Stephanie Jensen
Moyin Li
Joseph Snyder
Yuqi Sun
Wenzhe Zhang
Introduction to Marketing
University of Iowa Tippie College of Business
03 April, 2016

Nike Segments Consumers by Athletes and Non-Athletes
In a time when most things are no longer in simple black and white, Nike remains binary by segmenting its consumers into two distinct, opposite categories: athletes and non-athletes. While these segments are particularly broad, there’s a reason for it: it would be impractical to target the two groups in the same way. To successfully reach the company’s target markets, Nike employs differentiated marketing strategies. Athletes are ...view middle of the document...

Almost all of these athletes come from the high school (ages 14-18) and youth categories (ages 6-13), with 7.8 and 13.5 million participants, respectively (Kelly). While professional and collegiate athletics dominate the areas of sports news and popular culture, they make up a very small portion of the total number of athletes. The Bureau of Labor Statistics estimated that there were just 13,700 professional athletes in 2014, and the National Collegiate Athletic Association (NCAA) stated in a 2015 report that there were a total of 482,533 participants in the 2014-2015 academic school year across all divisions and sports. The gender split is relatively even, with a slightly higher number of males than females. For example, in 2015, 57.8% of high school and collegiate athletes were male, and 42.2% were female.

The needs of consumers in the athlete segment are substantially different than the needs of consumers whose use of the athletic footwear is of a more casual nature. On the surface, it may appear that needs are similar, because the different segments of consumers are concerned with similar qualities such as durability, comfort, function, and style. However, athletes tend to evaluate such qualities with a higher degree of granularity. For example, a shoe must hold up well over repeated, often daily training sessions or competitions. Similarly, comfort is not evaluated in the same way a casual wearer would evaluate comfort; an athlete needs a shoe that is comfortable enough to train and compete in so it will not distract or hinder their athletic performance. The function and performance characteristics of a shoe mean something much different to an athlete than they do to a more casual consumer. An athlete is specifically looking for a product that can improve their performance by allowing them to run faster, remain flexible, or maintain their footing on the playing field. However, athletes still value the style of their footwear as well, with a desire to look good while they perform or match colors and styles of their uniform.
With the vast majority of athletes being under the age of 18 years old, the family lifecycle can be narrowed down to just a few groups: dual-earner married couples with children (19% of all U.S. households), single-earner married couples with children (8% of all U.S. households), and single parents (9% of all U.S. households). According to a 2014 report by the U.S. Census Bureau, median household income for married couples was $81,025, while a weighted average of the incomes for individual male and female householders was $41,130. The median annual income for all households in 2014 was $53,657 (U.S. Census Bureau). While married couples were higher than the median and individual householders were below the median, we believe that most of Nike’s customers lie above the median for total numbers. This is largely due to the fact that married couples make up a larger percentage of households. Also, Nike’s products,...

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