Various political conflicts can always make customs related processes difficult, or prevent imports and exports. Nike has also benefited from cooperation with government initiatives in terms of transparency in the global value chain; one example of this lies in membership of the Clinton administration’s 1997 Apparel Industry Partnership (Wagner, 20… This is an important step for eventually devising a strategy that can effectively manoeuvre the competition to maximize a firm's chances of sustainability and profitability. The PESTEL framework can be used to analyse how the most important forces in the international environment can affect large and global businesses. For Nike, some of these are: Nike sells a well-respected medium range product, so they are less vulnerable to economic factors than others, but nevertheless here are some of the Economic variables: Public Relations has never been more relevant than today. Nike also gets the opportunity to use valuable information based metrics thanks to technological advances, allowing for them to optimize targeting and production, and maximize revenue. In Nike’s case, the following sociocultural external factors are most significant: In developing countries, Nike has opportunities to tap consumers with increasing individual wealth. Public Relations has never been more relevant than today. Nike’s business performance depends on the state of economies where it sells its athletic footwear, equipment and apparel. This component of the PESTEL/PESTLE Analysis model identifies the technological conditions that lead to significant change in the remote or macro-environment of companies. Nike Inc. must address a variety of opportunities shown in this PESTEL/PESTLE Analysis. In this article, we’ll be discussing Nike’s standings and potential future through the lens of a. Gillespie, A. On the other hand, Nike receives much criticism for its dubious production processes. The company also has opportunities to rapidly grow by increasing its operations in high-growth developing countries. To maintain its position in the athletic shoes market, Nike Inc., must address the opportunities and threats based on the external factors that shape the conditions of its remote or macro-environment. The increasing sustainability strategies of firms threaten Nike by imposing more pressure for increased sustainability efforts throughout the industry. As a company that produces and sells physical goods, Nike is, however, always subject to changes in tax and manufacturing laws. Favourable Policies of US governmentThe policies generated by the government have huge impact on the business proceedings especially … The United States, Nike’s ‘home country’ so to speak, has fantastic policies for growth which are especially valuable to this corporation. Social media allows things to blow up or whittle away faster than ever. The following technological external factors affect Nike Inc.: The increasing R&D investment among firms threatens Nike, as these competing firms aim to develop more technologically advanced sports shoes, equipment and apparel. In the estimation of some observers, Nike has benefited considerably from the growth-orientated policies of the US government, which has maintained low interest rates, currency exchange stability, and internationally competitive tax arrangements (Whitehead, 2012). A good social status means a lot for modern corporations, so. Its swoosh symbol is easily recognized by everyone. Founded as Blue Ribbon Sports in the year 1964, it was officially named as Nike, Inc on 30th May, 1970. The level … PESTLE Analysis of Nike Looking at the political, economic, social, technological, legal and environmental factors surrounding Nike will allow the choice of business strategy to be seen much more clearly. PESTLE standing for Political, Economic, Social, Technological, Legal and Environmental. In the case of Nike and its sports shoes, apparel and equipment, the following ecological external factors are notable: Expanding environmental law creates opportunities for Nike to improve its environmental and sustainability programs, which are currently recognized as among the best in the industry. Political factors are especially important to the backend of a company — the part we don’t normally see. Of course, there are only a few factors which affect Nike with regard to this, but they are worth stating: That’s a wrap for this PESTLE analysis of Nike. PESTEL analysis of the macro-environment. The PESTLE/ PESTEL/ STEEPL Analysis for in-depth analysis of all external factors specifically, political, economic, social, technological, legal and environmental, highlighting their consequence on Nike's business model, marketing and growth strategy 7. Nike has captured approx. For GDPR compliance, we do not use personally identifiable information to serve ads in the EU and the EEA. PESTEL analysis provides great detail about operating challenges NIKE, Inc. will face in prevalent macro environment other than competitive forces. Gratitude in the workplace: How gratitude can improve your well-being and relationships L – LegalLets look at each of these macro-environmental factors in turn.All the external environmental factors (PESTEL factors) Here’s the swot analysis of Nike as follows; Strengths of Nike Sub Brands. T – Technological 5. Organizational Culture Characteristics: An Analysis, Burger King PESTEL/PESTLE Analysis & Recommendations, Whole Foods Market PESTEL/PESTLE Analysis & Recommendations, Tesla, Inc. PESTEL/PESTLE Analysis & Recommendations, Microsoft Corporation’s PESTEL/PESTLE Analysis & Recommendations, Unilever’s PESTEL/PESTLE Analysis & Recommendations, Nike Inc. Operations Management: 10 Decisions, Productivity, Verizon PESTEL/PESTLE Analysis & Recommendations, Nike Inc. Nike’s revenues are to some extent dependent on the low cost of labour in Far Eastern countries. This component of the PESTEL/PESTLE Analysis model identifies the economic concerns that affect the remote or macro-environment of the business. That is why you need a PESTLE analysis of Nike brand. It is an acronym which when expanded includes six factors when the company is contemplating to launch or upgrade a service or a product. This component of the PESTEL/PESTLE Analysis model deals with governmental influence on the remote or macro-environment of businesses. 1. Industry Analysis. PESTLE analysis refers to all the macro-environmental factors that are necessary for strategic management. Murphey, M., & Gause, R. (1974). Nike being number one sportswear in the USA, its profits, turnovers, marketing sponsor ships and advertising surmount all other sports wea… In recent years, there hasn’t been too much of a crackdown on this, but it’s still valuable to consider. Everyday our market is changing the way it is. These forces can have a direct impact on their sales and profits. This has to do with politics of the day prevailing in country. PESTEL or PESTLE analysis, also known as PEST analysis, is a tool for business analysis of political, economic, social, and technological factors. Based on the external factors in this component of the PESTEL/PESTLE Analysis, Nike Inc. has considerable opportunities for product development and business growth. Consumers may choose to switch to lower-end, cheaper products if this were to occur, or even just as a decent level of quality becomes easier to produce. The company was founded on the principle that it would make shoes for anyone who could walk or run and this has been the guiding philosophy behind Nike. The PESTEL/PESTLE Analysis model identifies the external factors that present opportunities and threats in the remote or macro-environment. E – Economic 3. Organizational Structure Characteristics (Analysis), U.S. Department of Commerce. it’s definitely worth considering these factors, PESTLE Analysis: Business Environmental Analysis, Nintendo PESTLE Analysis 2021: Inside the Video Gaming …, Toyota SWOT Analysis 2021: Quick Reference Guide, Tips On How To Manage Your Finances and …, Coronavirus Data Analysis: How the Outbreak may Impact …. These days, he spends his time flipping domain names, writing articles and pursuing other interesting business ventures. Image “Janoski” by Leo Hidalgo is licensed under CC BY 2.0, [1] http://help-en-us.nike.com/app/answers/detail/a_id/113/~/nike-mission-statement, [2] https://en.wikipedia.org/wiki/Nike_sweatshops, [3] http://www.marketwatch.com/story/heres-how-apple-nike-and-others-avoided-620-billion-in-taxes-2015-10-06, [4] http://koin.com/2016/04/19/nike-faces-5-million-class-action-lawsuit/, [5] http://phys.org/news/2011-07-nike-adidas-suppliers-polluting-china.html. Another recommendation is for the company to invest more in research and development (R&D) to tap potential demand for sports shoes, apparel and equipment integrated with advanced computing technologies. Thomas Bush is an English-born writer, entrepreneur, and fitness enthusiast. It is recommended that Nike must pursue a more aggressive approach to international expansion based on free trade policies, with focus on high-growth developing countries. WHO AM I NIKE SWOT PEST ANALYSIS CASE STUDY Joey Goff. Please consider supporting us by disabling your ad blocker. Legal factors are sometimes grouped together with Political factors … Nike’s business changes according to technologies available for business processes and athletic footwear, apparel, and equipment. L is for Legal. UCF Research Guides. In this Toyota SWOT analysis, you will learn about the triumphs and struggles of Toyota, one of the top 10 largest companies in the world. Nike’s brand value as reported by Forbes in 2017 is $15.9Billion. Nike, fully known as “Nike, Inc.”, is a US-based transnational corporation which provides trendy, functional sportswear across the globe. Based on the political external factors in this component of the PESTEL/PESTLE Analysis, Nike Inc. experiences opportunities to improve its market presence and global expansion in the sports footwear, apparel and equipment market. Nike Pestle Analysis So without any due let us understand Pestle Analysis of Nike and have a close look at political, economic, social, technological, legal and environmental factors that affect Nike performance. If you want to learn about the external factors of Nike; check out the pestle analysis of Nike. This component of the PESTEL/PESTLE Analysis indicates Nike’s opportunities to improve the environmental impact of its business. Nike can also adopt new product development strategies to address needs for products for leisure activities. Here are some of the Technological factors affecting it: Legal factors are sometimes grouped together with Political factors in ‘PEST’ analyses, but in a PESTLE analysis — which is what we’re doing — the two are separated. The external factors in this PESTEL/PESTLE Analysis also highlight the importance of improving Nike’s sustainability and employment practices. In this section, we will share with you first of the five pestle analysis … Having been founded in 1964, Nike serves to “bring inspiration and innovation to every athlete in the world.” [1]. Despite being one of the largest sport apparel and accessory companies in existence, Nike has to keep a high guard in its extremely competitive market. Strong Brand Awareness – Nike is one of the most recognizable brands in the world as its name alone is memorable, easy to pronounce, and very unique. Politically, Nike has some interesting issues to contend with. It shouldn’t surprise you to hear that, like most massive corporations, Nike also dodges substantial amounts of tax [3]. To us, this may seem insignificant, but Political factors decide the survivability of an organization. However, this external factor also provides an opportunity for the company to apply higher standards for labor and employment. Nike Inc. Five Forces Analysis (Porter’s Model), Nike Inc.’s Marketing Mix (4Ps/Product, Place, Promotion, Price) – An Analysis, Nike Inc. SWOT Analysis & Recommendations, Home Depot PESTEL/PESTLE Analysis & Recommendations, Wendy’s PESTEL/PESTLE Analysis & Recommendations, Toyota PESTEL/PESTLE Analysis & Recommendations, Harley-Davidson PESTEL/PESTLE Analysis & Recommendations, Starbucks Coffee PESTEL/PESTLE Analysis & Recommendations, Ford Motor Company PESTEL/PESTLE Analysis, Nike Inc. Generic Strategy & Intensive Growth Strategies, Nike Inc. In this particular case, it can be said that it is neutral and thus not expected to cause much rubble in the new companies operations. Nike is the main brand of the company and it has the proven experience of adding billions of dollars to the brand’s account. However, future political challenges cannot be ruled out. The foundation stone of Nike was laid at the University of Oregon when both the founders met. Similarly, the company has opportunities to improve its health and safety measures to address expanding health and safety regulations. The PESTEL analysis is a tool devised by Harvard professor Francis Aguilar to conduct a thorough external analysis of the business environment of any industry for which data is available. The online technology has enabled customers to make contact-less payments via mobile phones. A market collapse could mean bad news for Nike, along with many other big brands. 1. Also, expanding free trade policies facilitate better market penetration overseas. Copyright by Panmore Institute - All rights reserved. Nike is doing well with using social media to build their brand, but it can be a double-edged sword if used incorrectly. Our website is made possible by displaying online advertisements to our visitors. Nov. 21, 2020. Nike uses advanced IT to market its products and targets the needs of its customers. However, the rapid growth of developing markets also threatens Nike by increasing labor costs in the company’s supply chain and production facilities. Also, the company has opportunities to develop safer products and use marketing campaigns that highlight the safety of its sports shoes, equipment and apparel. See our Privacy Policy page to find out more about cookies or to switch them off. Roper, K. (2012, November). PESTLE Analysis is one of the very important tools that is used for analyzing macro-environmental factors that has an impact on the Company. Do you know of any other factors which might be relevant to Nike? As one of the major firms in the global sports shoes, apparel and equipment market, Nike Inc. must address these external factors to ensure business dominance in the industry, especially when considering the presence of aggressive competitors like Adidas. Nonetheless, this external factor provides the opportunity for Nike to further improve its sustainability standing. Having freelanced for years, Thomas has appeared on various online publications numerous times, but recently set up his own website 'TalkSupplement' about the world of sports nutrition. BIM Implementation: PESTEL Drivers & Barriers (Cross-national Analysis). Despite being one of the largest sport apparel and accessory companies in existence, Nike has to keep a high guard in its extremely competitive market. Nike, fully known as “Nike, Inc.”, is a US-based transnational corporation which provides trendy, functional sportswear across the globe. PESTLEanalysis.com is an educational website collecting all the information and resources related not only to PESTLE but also SWOT, STEEPLE and other analysis that will come useful to business owners, entrepreneur, and students alike. Nonetheless, this external factor provides opportunities for Nike to integrate advanced technologies in its products. Pestle Analysis Examples: Uber. For example an Industry may be highly profitable with a strong growth trajectory but it won't be any good for NIKE, Inc. if … (Pestle Analysis Of Nike Macro Environmental Factors Business Essay, 2013). The company also has the opportunity to use these programs to address climate change, which affects supply chains and the appropriateness of Nike sports shoes and apparel in certain regions. T he PESTLE analysis evaluates the Political, Economic, Social, Technological, Legal and Environmental aspects influencing Nike externally. Analysing various aspects of the brand with SWOT analysis gives the case study on Nike brand major insights about Nike organisational structure. Phil Knight was the track athlete & Bill Bowerman was his coach. PESTLE Analysis. This is changing, though, which might mean higher Nike prices across the globe come with the development in Less Economically Developed Countries. Nike’s Strengths – Internal Strategic Factors. From interacting with customers to designing products, technology provides value to organizations just like Nike. To maintain its position in the athletic shoes market, Nike Inc., must address the opportunities and threats based on the external factors that shape the conditions of its remote or macro-environment. The global clothing apparel market is oligopolistic with for players Nike, adidas, H&M and Zara having a combined market share of 7.0%. A PESTEL/PESTLE Analysis of Nike Inc. identifies key issues that the company must include in its strategic formulation. Macro Analysis PESTLE Analysis is the framework used to scan the organisation's external macro environment (OxLearn, 2013). The biggest strength of Nike is that it is an extremely competitive organization with its approach of “Just Do It” slogan for its brand epitomizing its attitude towards business. Am i do my homework, dissertation help online who am i Reading, why i am the person i am today essay, hr … Also, Nike occasionally meets legal repercussions for its shady marketing practices, which include false discounts [4]. These include low-interest rates and well arranged international tax agreements. The following political external factors determine some of Nike’s strategies: Stable political conditions in most major markets present opportunities for Nike to grow its business in these areas. This Nintendo PESTLE analysis examines six factors that will impact the company the most and how the video game firm is responding to challenges. This action can help address the potential decline of Nike’s performance in the Chinese market. P – Political 2. Nike is a US-based company that sells sports apparel for men, women, and children and is a major competitor in the industry, In this paper, we’ll be discussing Nike’s standings by using a PESTLE analysis, which looks at the political, economic, social, technological, legal, and environmental factors that affect an organization (A Pestle analysis, 2017). Nike is an American company that is engaged in the design, manufacture and marketing of apparel, footwear, equipment, services and accessories. What is visual communication and why it matters; Nov. 20, 2020. This article may not be reproduced, distributed, or mirrored without written permission from Panmore Institute and its author/s. These actions address regulatory and sociocultural concerns and, consequently, improve Nike’s brand image and corporate image. In this article, we’ll be discussing Nike’s standings and potential future through the lens of a PESTLE analysis, which looks at the Political, Economic, Social, Technological, Legal, and Environmental factors that affect an organization. This company takes its name from the Greek goddess of victory named Nike (About.nike.com, 2016). This advancement has reduced the cost of workforce which would be otherwis… Not only do they release plenty of aerial pollution like most factories, but Nike’s production centers occasionally go as far as directly polluting rivers [5]. Pest Analysis On Nike - December 2nd, 2010 Nike, Inc. (pronounced / na ki /) (NYSE: NKE) is a major publicly traded sportswear and equipment supplier based in the United States. The PESTLE Analysis highlights the different extrinsic scenarios which impact the business of the brand. In addition, the slowdown of the Chinese economy threatens Nike’s performance, which is now significantly dependent on the Chinese market for sports shoes, apparel and equipment. These conditions are outlined in this PESTEL/PESTLE Analysis of the company. Many …, There are many companies the world over, that conduct PESTLE …. This component of the PESTEL/PESTLE Analysis model deals with the effects of social conditions on the firm’s remote or macro-environment. PESTLEanalysis.com is an educational website collecting all the information and resources related not only to PESTLE but also SWOT, STEEPLE and other analysis that will come useful to business owners, entrepreneur, and students alike. Social issues impact the attractiveness of Nike’ athletic shoes, apparel and equipment. We use cookies for website functionality and to combat advertising fraud. Rapid technological obsolescence also threatens Nike by putting pressure on the company to increase its product development efforts. PESTLE Analysis of Nike The focus should be on the macro environmental factors of Nike, as it is an international organization, so consists of political, economics, society, and technology. Worldwide increases in ‘health consciousness’ means that more and more individuals are moving towards better lifestyles. You need to focus on the external elements that influence the brand's activities. Nike PESTEL Analysis. Blog. However, Nike also shows promise of a change in their current practices, with a strong resolve to become more ‘eco’. PESTLEanalysis.com is an educational website collecting all the information and resources related not only to PESTLE but also SWOT, STEEPLE and other analysis that will come useful to business owners, entrepreneur, and students alike. A good social status means a lot for modern corporations, so it’s definitely worth considering these factors: Technology gives companies the ability to innovate in so many different ways. In Nike’s case, the following legal external factors are important in the sports shoes, apparel and equipment business: Improving employment law in developing countries is a threat because it leads to an increase in labor costs in areas where many of Nike’s production facilities are located. This component of the PESTEL/PESTLE Analysis model deals with the impact of ecological concerns on business performance. (2007). In fact, the issue of Nike sweatshops is so prominent that it has warranted an entire Wikipedia article on the topic [2]. A PESTEL/PESTLE Analysis of Nike Inc. identifies key issues that the company must include in its strategic formulation. The company is headquartered near Beaverton, Oregon, which is part of the Portland metropolitan area. Plenty of sports apparel, something which would make Nike very happy in Far Eastern.. 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