mpany, affecting retention rates of employees leaving Nike, following to an effect in employee morale. This suggests that Nike, will need to change this strategic direction to be at a competitive advantage and maintain their lead in the market.
Furthermore, Nike can improve their strategy with a renewal of their lifecycle. Renewal is inevitability in the lifecycle of an old organisation, for example, Nike bringing out a new line of shoes. Starting out with the introduction (Miller and Friesen, 1984), where new shoes are released in the market with advertisement for customers to recognise. Then, growth of the new product where customers willing to pay the price and sales are slowly increasing. Next, is the maturity where sales from the shoes are at their highest and stock is low. Lastly, in the lifecycle there’s a decline period of the shoe range decreasing in popularity. The drivers of change in this sector from looking at the lifecycle are the growth in emerging markets, especially in China where markets are developing from the customers with a desire in sport (Forbes, 2015).
The Ansoff matrix (Figure 8) portrays Nike’s growth in their existing market and also shows the direction set for Nike’s organisation strategy. Nike’s market penetration is increasing due to them opening new retail stores in the global market, this would show that Nike’s strategic direction is to increase their market presence globally. Product development is Nike’s most intense growth strategy because of their ability to create products using technology and other factors to enhance sales and make competition in the market. The market development allows Nike to enter new markets like China with the product development, as total sales in China increased to 20% (Jiang, 2018). Diversification is Nike’s least growth strategy as it can be seen as a financial risk, if the product doesn’t sell in the new markets. However, to improve they could sell a wider range in products.
In Nike’s Corporate Social Responsibility statement, they have shown their reduction in waste to be environmentally beneficial. Footwear and apparel have decreased by 2.5% in their carbon footprint per unit in 2017 (Sustainable Business Report, 2017). This shows that Nike have been influenced by the environment and are willing to change, by adapting to the needs of the environment and being sustainable. Also, 96% of finished goods from Nike footwear manufacturing waste was recycled and converted into energy (Sustainable Business Report, 2017). Nike will need to continue to focus on minimising their environmental footprint in the future so that their business strategy is to succeed. This links to Carroll’s CSR pyra
