By giving full play to its potential, Nike has produced more kinds of products than Adidas, creating a precedent for various styles of shoes. Too wide a production range may bring a lot of trouble, or it may damage production efficiency because of too wide a production range, thus greatly increasing the cost. Many people kindly suggest that the company reduce the scope of production, cut off those products that are not too hard, and concentrate manpower and material resources to win in the competition. Here we can see that Nike didn't take this countermeasure, but it became one of the most successful companies in the 1970s. Obviously, its business strategy is different from that of Adidas. What is a strategic product mix?
Although Nike may have violated some product portfolio concepts, let's see how it violated and at what cost. Nike attracts all kinds of runners by offering products with different styles, different prices and multiple uses, making them feel that Nike is the most comprehensive running shoe manufacturer. Millions of runners of all types and abilities have this idea, which is a very attractive image in a rapidly developing industry. Moreover, in the rapidly expanding market, Nike found that it can open up the widest top with its wide product range. It can sell shoes to flexible retailers, such as department stores and shoe stores, or continue to do business with specialized shoe stores. Even because the company can supply various models and styles of shoes-different types of retail stores can get the same type of shoes, which makes them happy. It is the only company that can properly take care of some cheap shops selling Nike shoes.
Multiple models and the minimum output of each product will generally increase the production cost. But for Nike, this may not be a big problem. Most of the tasks of producing shoes are outsourced-about 85% are contracted to foreign factories, mostly in the Far East. Because many foreign factories produce some products according to contracts, the small output of various products is a negligible economic obstacle for Nike.
A long time ago, Nike began to pay attention to research and development and technological innovation. The company is committed to finding lighter and softer running shoes, which can not only keep the wearer, but also provide athletes-world-class athletes or amateurs-with the most advanced products that running shoes technology can produce. Nike attaches great importance to the research and development of new products, which shows that it employs nearly 65,438+000 researchers specializing in research, many of whom have degrees in biomechanics, experimental physiology, engineering technology, industrial design, chemistry and various related fields. The company also hired a research committee and a customer committee, including coaches, athletes, equipment operators, podiatrists and plastic surgeons, who met with the company regularly to review various design schemes, materials and ideas for improving sports shoes. Its specific activities include high-speed photographic analysis of the human body in motion, analysis of the situation of athletes' trampling, planning to let more than 300 athletes carry out Nike experiments, testing and developing new running shoes and improving the original running shoes and materials. The expenditure on product development and testing in 1980 is about 2.5 million dollars, and the budget in 198 1 is nearly 4 million dollars. For a very common item like shoes, it is unprecedented to carry out such a major research and development work.
Nike doesn't have much originality in business strategy. In many ways, it still follows the successful marketing strategy recognized by the footwear industry established by Adidas decades ago. These strategies are mainly: concentrate on testing and developing better running shoes; Expand the production line to attract consumers in all aspects of the shoe market; The obvious signs of invention are printed on all products and can be recognized immediately; Use famous athletes and major sports competitions to show the use of products. Even if most of the production tasks are contracted to low-cost foreign processing plants, Nike is not the only one to do so. However, Nike can easily use these proven business skills, which is better and more aggressive than any of its competitors, even Adidas.
Nike's success is not mainly due to its innovative research on sales, or because it found sales opportunities that no one saw, or invested more money in promotion and advertising than those unlucky competitors. The key factor of Nike's success is effective imitation.
Of course, imitation must be cautious. Imitating market strategy should be the most effective strategy that has made great achievements in history. As far as the running shoes market is concerned, Adidas' long-term marketing strategy is to produce all kinds of shoes, let athletes wear products with the company logo in major sports competitions, and constantly update products-this is almost an unchangeable marketing strategy, and all running shoes manufacturers follow the same strategy-only Nike does better.
What a company should do in imitation is to develop its own personality. Reputation doesn't mean making exactly the same products as others. Only those successful decisions, standards and behaviors should be imitated. In addition, we must fully develop our distinctive personality characteristics and signs, and establish an organization and management department that is good at seizing new opportunities.
Finally, we can see how fragile the so-called market advantage and market first are. No company, whether it is in a leading position in the market or not, can rely on its own reputation and ignore the changes in the external environment and the offensive of powerful competitors. Adidas is in a leading position in the footwear industry, just as international business companies are in the computer industry. However, Adidas relaxed its vigilance and weakened its offensive at the critical moment.
As we can see here, it is easy for people who run in front of the race to be complacent. When the market demand increased sharply, the company put the knives and guns into the warehouse, let it go south and let its guard down. During this period, the sales of shoe-making faucets rose rapidly, which made complacency arise. However, this rapid increase in sales may hide the downward trend of marketing, and competitors are embezzling the interests of this dominant company and gaining huge benefits. In the end, the advantage will fall into the hands of one or more powerful competitors. Companies that previously dominated may never make a comeback and regain their leading position. The success of one company may be caused by the mistake of another company-not so much being replaced by others as dereliction of duty-and not taking or at least not taking the necessary action until very late.