Final Communication Plan

Team #2

Alejandra Gonzalez-Rivera

Carly Lundahl

Dylan McCabe

Brendon Thomas

Taylor Van Roekel

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Table of Contents

Executive Summary.3

Introduction..4

Our Impact Throughout the Years...4

Looking Back...4
Nike Today...4
Moving Forward..4

Competitors are Catching Up...4

Our Stakeholder Disconnect........4
Challenges we are Facing...........5
Customers are a Top Priority..5

Customers are Connecting with Competitors More....5

Customer Connection..5
Comparing Ourselves with Competitors.....5
Decrease in Sales Growth...6

Implementing a New Marketing Plan.6

The Current Marketing Plan..6
The New Marketing Plan........6
Demand Creation Expenses Budget...7
Timeline for Implementation..7
Communicating Our Plan to Stakeholders.....8

Rising to the Top Again..9

Celebrity Endorsement Success..9
Success in Utilizing Social Media...9
Return on Demand Creation Expenses...9

Conclusion.10

References.11

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Executive Summary
Introduction
Our intern team has identified a threat of competitors and their success with connecting their
specific products to their customers. After research and analysis, we identified a recommendation
to allow us to more comfortably maintain our position as the leader in the athletic footwear and
apparel industry.

Our Impact Throughout the Years

Nike established itself as the dominant sports apparel brand and continues to lead the industry.
However, to be standout leaders and gain significant profits against our successful competitors,
we must adjust how we communicate our products to our customers.

Competitors are Catching Up

We identified our main competitors as Adidas and Lululemon. We are experiencing slowed
growth due to our competitors taking away major market share from us. They succeeding
because they are meeting customers product needs.

Customers are Connecting with Competitors More

We analyzed our customer connections compared to our competitors customer connections and
indicated how that affects our sales. From this analysis, we were able to indicate areas of
opportunity in which Nike can capitalize on.

Implementing a New Marketing Plan

We are recommending that Nike create a new marketing campaign that includes product-specific
advertisements, in addition to our existing celebrity endorsements and emotionally appealing
advertisements.

Rising to the Top Again

Utilizing Nikes current marketing strategies, we can add product-specific advertising that will
address our threat of connecting with our customers to our products and provide us with a high
return on our marketing expenses.

Conclusion
By implementing our recommendations, Nike will gain more product publicity and further
increase its influence in the industry.

pg. 3
Introduction
While Nike continues to be a leader in the athletic footwear and apparel industry, we have been
facing a threat of competitors in the past year, particularly from Adidas and Lululemon. Nikes
competitors are finding success in how they communicate their specific products to their
stakeholders, whereas, Nike predominantly focuses on its entire brand image. Our competitors
current success poses a short-term threat to Nike. Following our extensive research of Nikes
current situation and background narrative, we analyzed the issue and decided to recommend for
Nike to implement a new marketing strategy that will enhance product awareness and loyalty, in
addition to the brand loyalty we already possess.

Our Impact Throughout the Years

Looking Back
Since its debut in the 1972 U.S Track & Field Trials in Eugene, Oregon, we have remained the
worlds most dominant company in the sportswear industry. Nike was the face of athletics and
the most sought out brand before its competitors entered the industry. According to the New
York Times, with little threat from these opponents, Nike saw major sales revenue and growth
through the years with an 84% increase in profits and a market share of 30% (1990). Consumers,
investors, and communities created a strong brand loyalty that provided us with attention and
publicity.

Nike Today
Today, we still prove ourselves as a top leader of sportswear. We continue to remain the top
market share of the industry but are realizing the undesirable effects of competition as Adidas
and Lululemon steal our customers and revenues. According to The Associated Press, with little
threat from these opponents, Nike saw major revenues and growth through the years with an
84% increase in profits and market share of 30% (Roberts, 2016). As our competitors show rapid
growth and improve their products, the need to take action is crucial. If we desire to maintain our
position as the industry leader and recover our vanished revenues, immediate changes must be
implemented.

Moving Forward
In the end, we strive to guarantee our dominance within the market and rise above toward our
past growth and revenues. It is essential that customers choose us not only for our brand as a
whole, but for our innovative and advanced products as well. By following through with the
proposed recommendations, we will have the opportunity to heighten our connection with
consumers and grow not only as a company, but as a brand. Our long-term value, revenue, and
market share will all correlate together and increase in the future.

Competitors are Catching Up

Our Stakeholder Disconnect
The key issue we are currently facing is the connection our stakeholders are finding in our
competitor's products, rather than with our brand as a whole. Marketline mentions how this
major issue enhances the disconnect because we are not following our mission statement to
connect and meet the consumers needs with the latest trends (NIKE Inc SWOT Analysis, 2017).

pg. 4
Our competition has placed a short-term threat on our company because their quick advancement
has made us look worse within the industry.

Challenges we are Facing

We are facing the challenge of slowed growth as a direct result of our competitors taking away a
major share of our market. In fact, we have lost 1.2% of our market share (Roberts, 2016).While
we are tied to our brand as a whole, Adidas is tied to its Superstar shoe and Lululemon is tied to
its WunderUnder leggings. While our brand name and loyalty is what made us such a huge
influence in the industry, it poses a challenge for us because it is also essential for us to keep up
with the market. We need to recognize product trends, consumer trends, and marketing
incentives that are going to provide us an advantage over our competitors. Seeing our
competitors success by connecting their products with their customers, we have already fallen
behind and need to catch up through implementing similar marketing strategies.

Customers are a Top Priority

It is a part of Nikes corporate social responsibility strategy to give top priority to our customers
as a stakeholder group. Customers are what drive our business and affect our revenues and
reputation within our industry. Panmore Institute mentions how unfortunately, we haven't been
connecting with our customers the way that we intend to, and our customers feel like our
competitors are establishing a better customer connection with them right now (Kissinger, 2017).
We have been providing a wide variety of products, but we haven't been effectively
communicating and showing them how we are following trends.

Customers are Connecting with Competitors More

Customer Connection
The decrease in revenues can be associated with the decrease in the connection that we have with
our customers on a product standpoint. Customers connect with our entire brand image, but
lately they havent had a real interest in our top of the line products. Our competitors have gained
customer interest with following the shoe trends, tailoring each specific product line to the
customers needs, and adjusting their prices accordingly. Adidas has followed the shoe trends
with the Adidas Superstar shoe (Business Insider, 2017). Furthermore, Lululemon has improved
their womens legging line by increasing comfort and adding pockets to some of their leggings
per their customers desires. Establishing a customer connection is crucial in this era of
consumer and company relationships.

Comparing Ourselves with Competitors

In our research, we found that the Adidas superstar shoe was the top selling active shoe in 2015
and 2016 partly because of the Adidas advertising effort (Adidas, 2016). This is with Adidas
using celebrities and trendy ads in their product advertisements, which Nike does with its
advertisements towards their brand but these marketing strategies are not product specific.
Correspondingly, Lululemon had a very strong holiday season in the fall and winter of 2016.
Their fourth quarter sales totaled about $785 million, which is a large sum of money earned in a
span of three months (Borchardt, 2017). This can be a result of lululemons advertisements and
the relationship they have built with consumers.

pg. 5
Decrease in Sales Growth
Unfortunately, we are struggling with improvement in our sales because we are not giving the
customers what they currently want. Our customers want their results sooner rather than later,
and they choose the products that stand out or are trending. Although this is not a long-term
issue, it is significant because Adidas is expected to grow their sales by 9.3 percent in 2018 while
Nike sales are only expected to grow a more modest 6.5 percent (Garcia, 2017). This is leading
to a decrease in Nikes sales growth, and is something that needs to be changed to bring the
company back to its constant dominance in the market.

Implement a New Marketing Plan

We recommend for Nike to add to their already successful marketing strategies by creating
product specific advertisements, in addition to their emotionally appealing, brand specific
advertisements.

The Current Marketing Plan

Nikes strategic marketing efforts are what provide the company with massive success and
recognition. Our extensive celebrity sponsorships and emotionally appealing advertisements are
what originally contributed to our powerful brand name and what established us as the leader in
the athletic footwear and apparel industry. What differentiates us from our competitors is that
when one thinks of Nike, the whole brand comes to mind, not just specific products.

The New Marketing Plan

While we should continue to leverage our current marketing strategy, we want to add to it by
also including product specific advertisements. Adidas gained popularity through its Superstar
shoes and Lululemon is notorious for its Wunder Under Leggings. We want to implement new
marketing that will utilize our celebrity endorsements to advertise specific products. Our
celebrity endorsements will increase publicity of our products and add to the credibility of our
products on top of our brand reputation.

We will begin by hiring a market research analyst. The market research analyst will research
market conditions and customer preferences, needs, and buying habits to identify potential
markets, identify factors affecting product demand, and create a marketing campaign (O*Net).
The individual will also conduct extensive research on our competitors and our current
marketing methods in comparison with Adidas and Lululemon.

We will then hire a search marketing strategist. We plan to continue utilizing the internet and
social media to market our products. The search marketing strategist will utilize search
marketing techniques that will increase engagement with our products online. They will search
query behaviors on search engines and analyze the data to understand consumers online
behavior. Specifically, the search marketing strategist will analyze web metrics, identify Key
Performance Indicators and report key metrics from digital campaigns, and conduct online
marketing initiatives such as paid ad placement, email promotions, and viral marketing
campaigns on social media (O*Net).

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Lastly, we will hire a public relations specialist. The public relations specialist will assist in
promoting our intended public image. The individual will direct the development and
communication of our programs and campaigns to maintain a favorable image of our company.
They will continue to analyze our company to develop strategies that will influence public
opinion and promote our products (O*Net).

The new product specific advertising will only be an addition and will not replace our current
marketing strategies. Nikes impact as a brand cannot be undone therefore, adding a new
marketing plan will allow us to connect with our customers even more successfully. With the
creation of new advertising, customers will feel deeply connected to our products, as well
continue to feel connected with the brand in its entirety.

Demand Creation Expenses Budget

In fiscal year 2017, Nike spent $3.3 billion in demand creation expenses. These are expenses
in advertising, celebrity endorsements, and anything that contributes to the marketing of our
products (Nike). In comparison, Adidas spent $2.9 billion (Adidas, 2016) and Lululemon spent
just $18.5 million (Lululemon, 2016). Since Nike already places so much value on marketing,
our recommendations are ones that corporate will want to implement. Our marketing budget plan
is graphically depicted below:

Search
Market
Marketing
Research
Specialist,
Analyst,
$55,000
$65,000
Creation &
Public
Implementation,
Relations
$5,000,000
Specialist,
$60,000

Celebrity
Endorsements,
$20,000,000

Timeline for Implementation

We plan on hiring our market research analyst, our marketing strategist, and our celebrity by
October 26. We realize that is a tight turn-around time but we are optimistic that after reaching
out, the best individuals will want to work with such an influential company, such as ourselves.

pg. 7
After hiring, we plan to begin our market research immediately so that we can have our research
completed by November 2. We are confident that this will be enough time to analyze market
trends and data with the assistance of our marketing team. We also plan to have our public
relations specialist hired by November 2 and want to begin the creation of our product-specific
campaigns immediately.

We plan to finish, finalize, and release our advertisements on November 20. Again, we realize
this is a tight turn-around time however, with the research we provided, the planning phase has
been significantly reduced, allowing us to jump straight into advertisement creation.

The reason why we are choosing to release our advertisements and campaigns at this time is
because the holiday season is approaching. While we are not recommending Black Friday sales,
many individuals do their holiday shopping on Black Friday so we want to have our product
advertisements ready for the upcoming season. In addition, since we want to incentivize our
customers through product-advertising coupons, our customers will feel more motivated to shop
at Nike, since it is necessary to shop during the holiday season and they will have a coupon to
use.

We will monitor our marketing strategy from November 20 through January 1, since most
shopping is done the couple weeks after the holidays. According to a survey Forbes conducted,
66% of respondents said they were expecting to shop on December 26 whereas 45% of
respondents were expecting to shop on Black Friday (Leinback-Reyle, 2015). Then, on January
1, we will evaluate the effectiveness and success of our marketing plan, with the help of our
marketing strategist. We will decide if it is a marketing plan that we want to continue to utilize.
We are confident that we will see positive results and will want to continue implementing this
plan.

Communicating Our Plan to Stakeholders

Given how influential technology is today, we want to continue to utilize the internet and our
social media platforms to communicate with our customers. We have a strong social media
presence that allows us to communicate initiatives with specific target markets. For example, we
have over 7 different accounts targeted towards specific markets, such as basketball, soccer,
football, and more.

With the help of our search marketing strategist, we will be able to identify specific trends and
behaviors in our social media platforms that will help us to provide our target markets the best
advertisements in the most efficient manner. With our celebrity endorsement, we will create
product-specific advertisements tailored towards all the fitness and sports-specific enthusiasts,
such as football enthusiasts, running enthusiast, and more. Leveraging our successful social
media platforms, we will reach our audiences efficiently and provide our customers with the
content they want to see.

In addition to our social media advertising, we want to create coupons that will discount a
specific product. We will distribute these coupons in stores, when customers buy a product and
the cashier hands them their receipt. We will also send these coupons through email. The coupon
will have the product-specific celebrity advertisement, in addition to a discount offer on the

pg. 8
product being advertised. We are doing this because we plan to market products during the
holidays when more shopping occurs, naturally. The coupon will publicize the product we want
advertised and will drive customers to actually buy the product because they will have a
discount.

Rising to the Top Again

Implementing these marketing and advertising recommendations can positively impact the
companys revenue and customer-product connection. Due to our pre-established strong brand
equity, combined with a new focus on product advertising, we will increase our customer
lifetime value. This shift will direct us towards long-term growth, rather than a focus on returns
on advertising spending, which focuses towards short-term gains.

Celebrity Endorsement Success

Endorsing our products through popular celebrities in both the sports and entertainment industry
has the power to influence our market share. For example, our endorsement deal with Tiger
Woods in 2000 increased our market share from 0.9% to 4% in just six months. Utilizing the
market research and advertisement analysis, Nike will be able to capitalize on trending
celebrities and social media platforms to increase market share upwards of 40%.

From an external standpoint, our competitor Adidas had Pharrell Williams promote the
Superstar style shoes. This resulted in 15 million pairs being sold, making up 10% of the
companys revenue in 2015. This shows the power in product-specific endorsements. Hence,
incorporating our partnership with Bella Hadid towards advertising our products has the potential
to increase our revenues just as Adidas did with Pharrell (Low, 2016).

Success in Utilizing Social Media

Another aspect in which we would benefit from this new marketing strategy would be through
the audience we are targeting. Working with social media and celebrity endorsements to carry
out our product specific advertisements will connect with the youngest generation, Generation Z.
This generation doesnt range beyond the age of 21, meaning they have been engrained in the
technology and social media world. Holding $44 billion dollars in buying power, Generation Z
can impact our market value through the lifetime value of a customer.

Return on Demand Creation Expenses

Utilizing Adidass statistics including their increase in market share of 5% in 2016, what would
be a third of Nikes current market share, we would expect an increase of 1.6% in market share.
This implementation clearly shows an area of opportunity for growth within Nike.

Connecting with this generation through our products and brand grants us the opportunity to
obtain the longest customer lifetime span in comparison to other generations. Therefore, an
increase in our lifetime customer value will cause our market value to increase (Sokolovska,
2016).

pg. 9
Conclusion
Nikes influence in the sports apparel industry has been decreasing as our competitors success
and influence continues to rise due to their ability to effectively communicate their products with
their customers. After analysis of this threat, we provided a recommendation for a new strategy
that will allow us to stay competitive, increase product awareness, and increase our influence in
the industry. Our intern team believes that creating new product-specific campaigns will aid in
addressing the threat of competitor influence and provide long term growth and benefits. Thank
you for providing us with the opportunity to analyze and work closely with Nike. We hope you
find our recommendation useful. Please contact us if you have any questions.

pg. 10
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