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. (Pestle Analysis Of Nike Macro Environmental Factors Business Essay, 2013). 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. 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. This is changing, though, which might mean higher Nike prices across the globe come with the development in Less Economically Developed Countries. According to the experts responsible for offering Nike case study PESTLE analysis, the firm currently has 3000+ retail stores across 160+ countries with Europe and Britain being the biggest markets. Political AnalysisIt is the responsibility of government to create such economic policies, which will have a great effect on the growth of business. 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. Gratitude in the workplace: How gratitude can improve your well-being and relationships Rapid technological obsolescence also threatens Nike by putting pressure on the company to increase its product development efforts. 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]. They may have a strong brand and healthy finances, but they need to pay careful attention to the morality of their practices and watch out for other growing, cheaper outlets. Most of today’s political changes only affect how a company can produce their goods or how much profit they make, for example. 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). Based on the external factors in this component of the PESTEL/PESTLE Analysis, Nike Inc. has considerable opportunities for product development and business growth. PESTLE standing for Political, Economic, Social, Technological, Legal and Environmental. T – Technological 5. (2007). Like most big companies, Nike has a number of strengths. Social media allows things to blow up or whittle away faster than ever. The Retail Services Industry in the United States, Stable political climate in most major markets (opportunity), Expanding free trade policies (opportunity), Improving government support for infrastructure (opportunity), Economic stability of developed markets (opportunity), Rapid growth of developing markets (opportunity & threat), Increasing individual wealth in developing countries (opportunity), Increasing emphasis on product safety (opportunity), Improving positive attitudes about leisure (opportunity), Increasing R&D investment among firms (threat), Rapid technological obsolescence (opportunity & threat), Widespread use of mobile technology (opportunity), Expanding environmental law (opportunity), Increasing sustainability strategies among firms (threat & opportunity), Improving employment law in developing countries (threat & opportunity), Expanding consumer law in developing countries (opportunity), Expanding health and safety regulations (opportunity). 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. 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. The company is headquartered near Beaverton, Oregon, which is part of the Portland metropolitan area. We use cookies for website functionality and to combat advertising fraud. Nike Inc.’s growth partly depends on external conditions. 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. The economic external factors in this component of the PESTEL/PESTLE Analysis show that Nike Inc. must emphasize global expansion strategies while devising new ways to capture growth in developing countries. Also, the company has opportunities to develop safer products and use marketing campaigns that highlight the safety of its sports shoes, equipment and apparel. Needless to say, the most important strengths are Nike’s powerful brand and low product cost. UCF Research Guides. With its ‘deep pocket’ of finances, Nike has the resources to chase after small emerging markets in which they could sell products. 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. 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. 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. In fact, the issue of Nike sweatshops is so prominent that it has warranted an entire Wikipedia article on the topic [2]. 2. The external factors in this PESTEL/PESTLE Analysis also highlight the importance of improving Nike’s sustainability and employment practices. Its swoosh symbol is easily recognized by everyone. A market collapse could mean bad news for Nike, along with many other big brands. PESTEL Analysis of Nike: The international brands face several kinds of pressures while operating in a highly competitive market. 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 identifies the technological conditions that lead to significant change in the remote or macro-environment of companies. These days, he spends his time flipping domain names, writing articles and pursuing other interesting business ventures. Nike’s business performance depends on the state of economies where it sells its athletic footwear, equipment and apparel. 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. Legal terms influence businesses like Nike. T he PESTLE analysis evaluates the Political, Economic, Social, Technological, Legal and Environmental aspects influencing Nike externally. Please consider supporting us by disabling your ad blocker. In this section, we will share with you first of the five pestle analysis … 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. 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. The online technology has enabled customers to make contact-less payments via mobile phones. This Nintendo PESTLE analysis examines six factors that will impact the company the most and how the video game firm is responding to challenges. That is why you need a PESTLE analysis of Nike brand. A PESTEL/PESTLE Analysis of Nike Inc. identifies key issues that the company must include in its strategic formulation. Here’s the swot analysis of Nike as follows; Strengths of Nike Sub Brands. P – Political 2. Political factors are especially important to the backend of a company — the part we don’t normally see. PESTEL Analysis includes factors like Political, Economic, Socio-cultural, Technological, Environmental, and Legal.Nike PESTLE Analysis is described below: 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 foundation stone of Nike was laid at the University of Oregon when both the founders met. It shouldn’t surprise you to hear that, like most massive corporations, Nike also dodges substantial amounts of tax [3]. Everyday our market is changing the way it is. 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. PESTEL or PESTLE analysis, also known as PEST analysis, is a tool for business analysis of political, economic, social, and technological factors. PESTEL or PESTLE analysis, also known as PEST analysis, is a tool for business analysis of political, economic, social, and technological factors. Having been founded in 1964, Nike serves to “bring inspiration and innovation to every athlete in the world.” [1]. The United States, Nike’s ‘home country’ so to speak, has fantastic policies for growth which are especially valuable to this corporation. Coupled with its iconic “Swoosh” logo and its equally catchy tagline, Nike’s strength is that it has emerged as a “Can Do” company. Organizational Structure Characteristics (Analysis), U.S. Department of Commerce. Based on this component of the PESTEL/PESTLE Analysis, Nike Inc. has major opportunities to improve its brand image and corporate reputation. PESTLE analysis refers to all the macro-environmental factors that are necessary for strategic management. V arious exa mples, for the impressive work of Nike on R&D. Copyright by Panmore Institute - All rights reserved. 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. 1. These people will undoubtedly buy plenty of sports apparel, something which would make Nike very happy. 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. Phil Knight was the track athlete & Bill Bowerman was his coach. 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. E – Environmental 6. The global clothing apparel market is oligopolistic with for players Nike, adidas, H&M and Zara having a combined market share of 7.0%. Nonetheless, this external factor provides the opportunity for Nike to further improve its sustainability standing. Ecological issues influence Nike’s remote or macro-environment. For example an Industry may be highly profitable with a strong growth trajectory but it won't be any good for NIKE, Inc. if … It is generally assumed that if political temperatures are down; businesses tend to flourish and the vice versa is also correct. Nike is an American company that is engaged in the design, manufacture and marketing of apparel, footwear, equipment, services and accessories. 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). PESTEL analysis of the macro-environment. Nike is the main brand of the company and it has the proven experience of adding billions of dollars to the brand’s account. 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. For GDPR compliance, we do not use personally identifiable information to serve ads in the EU and the EEA. Nike can also adopt new product development strategies to address needs for products for leisure activities. Nike’s sports shoe business is subject to the effects of the political landscape. PESTEL analysis provides great detail about operating challenges NIKE, Inc. will face in prevalent macro environment other than competitive forces. 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. This has to do with politics of the day prevailing in country. Having been founded in 1964, Nike serves to “bring inspiration and innovation to every athlete in the world.” [1]. 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. This component of the PESTEL/PESTLE Analysis model deals with the effects of social conditions on the firm’s remote or macro-environment. BIM Implementation: PESTEL Drivers & Barriers (Cross-national Analysis). 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… If you want to learn about the external factors of Nike; check out the pestle analysis of Nike. Politically, Nike has some interesting issues to contend with. Nike being number one sportswear in the USA, its profits, turnovers, marketing sponsor ships and advertising surmount all other sports wea… PESTEL or PESTLE analysis, also known as PEST analysis, is a tool for business analysis of political, economic, social, and technological factors. Industry Analysis. Nike PESTEL/PESTLE analysis Big brands that sell internationally can be subject to some unique forces which impact their sales and profits. The level … Its athletic footwear, equipment and apparel to integrate advanced technologies in its strategic formulation the stone! 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