Strategic management

Strategic Management Strategic Management Q1: Business-level strategies that Nike is pursuing Differentiation: Nike is robustly engaged in differentiating its products from those of competitors. This is evident when it paid millions of dollars to popular and successful sports icons such as Michael Jordan, Tiger Woods and Serena Williams to promote the sales of its products. The company focused on producing high quality shoes and other sports wear whose sales were promoted through “guerilla” marketing. This proactive approach resulted into increased 1998 revenues of $9.6 billion. Nike cements its business-level strategy with corporate strategy (diversification) to serve its customers better and increase its market share, thus higher revenue.
Focused differentiation: Nike also pursues focused differentiation strategy where it focuses on serving the sports segment by providing the best sports products than other players in the segment. Nike serves two major market segments: footwear and apparel market segments.
Q2: How Nike’s business level strategies changed the nature of industry competition
Nike utilized its competencies in design and marketing to penetrate new market segments. The company’s business-level strategies changed competition in the industry in that the company significantly reduced the threat of competition through acquisitions. The company resorted to purchasing other footwear companies that offered substitute products, for example, the company acquired Converse, Hurley International as well as Official Starter among others. Nike has made its products unique from those of competitors and relied on innovation for new product development. This has enabled the company to venture new markets. The company has used its competitive advantage over other competitors to stay on top of the market.