About Nike Inc.
Nike Inc. is one of the top manufacturers of sportswear, creating, developing, marketing, and selling sportswear, accessories, equipment, and services. The multinational corporation operates worldwide and is the leading brand in sportswear. It has set new benchmarks with its iconic marketing campaign, which directly targets customers.
The corporation uses a variety of communication channels and approaches in its promotions, taking into account the dynamics of the athletic goods sector. It includes direct marketing, sales promotions, public relations, personal selling, and advertising in its promotional mix (Raval & Reddy, 2023). These strategies and techniques serve specific functions in connecting with the intended audience and maintaining the brand’s market leadership in footwear, apparel, accessories, and equipment.
Direct Marketing
Direct marketing presents information about a business, its goods, or its services to potential customers through various media. It is a focused form of advertising in which consumers identified as potential customers are offered information that might interest them. It may use brochures, flyers, social media ads, and other materials to reach the targeted clients. Direct marketing is distinct from other forms of advertising in that it operates without an intermediary. Nike is an excellent example because it uses conventional marketing techniques like billboards, personalized magazines, and website content to spread its messaging rather than advertising on TV or in print media.
Nike Inc. employs advertising to reach a wide range of potential customers worldwide. This component of the marketing communications mix increases brand recognition and purchase likelihood by promoting the company’s brands and athletic items to consumers. Nike’s communication mix involves delivering its message to its target audience through a variety of media. Its promotional mix, for example, combines public relations, sales promotions, direct marketing, personal selling, and advertising. The company has frequently sponsored athletes to increase brand awareness and reach customers interested in athletic and leisure footwear, apparel, and equipment.
Types of Unethical Pricing Practices
Two types of unethical pricing practices include predatory pricing and collusion. According to Stiving (2019), Predatory pricing involves a business with a strong market position using that advantage to sell below cost to compel competitors to close operations. Once rivals have left, the business can raise prices without restriction. Walmart is an ideal example, having been accused of predatory pricing to establish a dominant position in the retail industry. The business has a history of setting prices so low that smaller rivals are unable to compete and are driven out of business.
Different types of collusion may be morally right or wrong depending on the context. Explicit collusion, for example, occurs when competitors collude to maintain high prices (Stiving, 2019). In this situation, it is unethical for the companies involved to profit at consumers’ expense. An example of explicit collusion is the world domination of oil prices by entities such as the Organization of the Petroleum Exporting Countries (OPEC).
Nike has not violated any ethical pricing principle since it employs a value-based pricing approach. The value-based strategy allows the corporation to set prices based on customers’ perceptions of the brand’s value. As a result, it concentrates on providing high-quality products at high prices while delivering the best possible client experience (Raval & Reddy, 2023). This method indicates that the maximum price buyers are willing to pay for the company’s products, such as sports clothing, shoes, and equipment, is justified.
Article Reviewed
Luo & Zheng’s article (2023) discusses the social media, branding, and tailored marketing strategies Nike uses, applying the 4Cs theory. The findings of this study show that the company is committed to meeting customers’ unique needs through personalized, customized products. Additionally, it actively engages with customers via social media and cultivates a positive, healthy brand image to build their trust and loyalty (Luo & Zheng, 2023). The company’s key strengths are targeting strategies, market segmentation, pricing, promotional, and communication strategies.
Promoting ethical norms and values such as respect, accuracy, integrity, and consumer fairness is an excellent marketing strategy. According to the authors, Nike’s success is mainly attributed to selling high-quality products, sponsoring professional athletic teams and celebrity athletes, and charging higher prices to push perceived product value.
The high pricing policy, for example, is an ethical practice based on developing and maintaining a series of factors that consumers care about. Typically, maintaining brand image and social media marketing are strategic marketing approaches adopted by top brands to make customers pay higher prices for a better product experience and stronger brand recognition.
The results show that customers are very conscious of the quality of the services they receive and that their behavior is influenced by advertisements, shopping experiences, and others’ recommendations. In reference to Nike’s value-based pricing approach, the study offers a valid explanation of how one brand can attract clients despite charging premium prices.
Regarding these observations, it can be said that efficiency and quality are concerns for these consumers, and they pay no attention to costs, which is consistent with ethical pricing covered in this unit and other research (Teimouri et al., 2021). The authors’ perspective reflects Nike’s consistent commitment to honest pricing, as it directly promotes and sells products tailored to clients. Despite charging high prices, Nike’s pricing strategy is ethical because customers are willing to pay.
References
Luo, Z., & Zheng, S. (2023). Analysis on Nike’s marketing strategies based on 4C theory. Advances in Economics Management and Political Sciences, 36(1), 174–179.
Raval, H., & Reddy, N. (2023). A study on marketing strategies adopted by Nike in reference to the athletic footwear and apparel industry. International Journal of Business and Management Invention, 12(10), 12–17.
Stiving, M. (2019). Identifying ethical practices in pricing. Pragmatic Institute.
Teimouri, H., Gharibi, J., Hosseinzadeh, A., & Pooya, A. (2021). Designing an ethical targeted marketing model by identifying factors affecting customer clustering. International Journal of Ethics & Society, 3(3), 61–70.