Business Studies
Write a paper (750-1,000 words) that analyzes the changes to IMC strategy a company faces in light of the digital upheaval led by Google, Yahoo, Microsoft, and others.
The paper should consider the five forces of competition, including competitors, buyers, suppliers, potential entrants, and substitutes.
The paper must be supported by appropriately cited research.
Prepare this assignment according to the APA guidelines found in the APA Style Guide, located in the Student Success Center. An abstract is not required.
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ANSWER
NIKE IMC Strategy Changes
Integrated Marketing Communications entails the collaborative, strategic, and promotional marketing function where the targeted audience gets persuasive and steady brand messaging via diverse marketing channels in an integrated mode that moves the purchaser’s through the decision-making process. Integrated Marketing communications has ensured that marketers utilize different channels to boost their brand messaging and marketing campaigns to reach their target audience (Kerr and Patti, 2015). Companies such as Microsoft, Google, Yahoo, and many others have caused a digital upheaval that has caused companies to make changes and adapt their IMC strategy. Nike has been one of the companies that have made significant changes in its IMC strategy due to digital upheaval. This paper will analyze the IMC strategy changes that Nike has made and the five forces of competition that influence the market.
In the 21st century, marketing has changed due to the rise of email marketing, social media, personalization, machine learning, and a multitude of innovative features that have changed the digital landscape. Through companies such as Google, Yahoo, and Microsoft, the internet has offered opportunities such as customization and interaction. The enormous communication and information opportunities offered by the internet have changed most companies’ integrated marketing communication strategies (Kerr and Patti, 2015). For instance, social networking sites developed by companies such as Facebook have enabled other entrepreneurs to connect with their clients, thus boosting interactivity, information and communication. Information is disseminated in real-time with accessibility from anywhere in the world, thus surpassing the barriers of space and time.
Nike has been one of the recognized brands in sports products. Nike has also been known for its innovation and regular methods of communication to ensure that they have stayed connected with its stakeholders. Before the digital disruption, Nike used traditional marketing communication elements such as broadcast channels, print, and public advertising. With the development in information and technology and changes in the IMC strategy, companies like Nike have to consider the changes. Nike relies on the integrated marketing technique to build its brand image through various channels to reach its global consumers and promote all its products in the six categories, which include Jordan Brand, Football, Baseball, Running, and Training (Ahmed et al., 2016). Nike has changed its marketing communication strategies due to digital disruption that’s has been led by websites, blog posts, product pages, social media platforms, email marketing, and other digital marketing platforms.
Digital disruption has led to changes in the marketing communications strategy, which has now included social media, point of sale, print and TV advertising, media relations, mobile and internet marketing tools. Nike is now using constant messaging systems that are independent of digital platforms of marketing. Nike has a website and social media platforms that have made it easier to interact with its clients. Nike has developed a strong brand identity on social media platforms such as Twitter, Instagram, and Facebook through their pages that have played a great role in creating the Nike brand (Stanković, Brkljač, and Nikolić, 2014). Nike relies on social media campaigns to boosts its products. Nike has reached its consumers through powerful social media campaigns that have engaged existing and new consumers. Nike has successfully maintained a powerful brand image in the social media channels by creating enjoyable experiences that the consumers have through visiting the retail stores on the interactive online media. Nike has also relied heavily on sponsorships and celebrity endorsement to drive awareness, boost products, and gain popularity.
Contemporary IMC elements at Nike include a wide variety of new options such as social media, online marketing, mobile marketing, product placement, and brand entertainment. The new marketing communication elements and online media have shifted the interface between the company and clients where there has been a change in power between consumer and media with consumer-generated media, which has turned clients into content creators. Nike has been using various digital marketing techniques and tools to tap into the consumers. A large percentage of the consumers have used search before making purchases. The changes in Nike’s integrated marketing communication strategy have enabled the brand to communicate to its consumers efficiently.
Five Forces of Competition
The state of competition within every industry varies depending on the basic forces of competition. The basic forces of competition include the threat of new entrants, the bargaining power of suppliers, and bargaining power of buyers, industry rivalry, and the threat of substitutes. These forces have a collective strength that evaluates the profit prospective of an industry, thus increasing its desirability. When the forces are intense, most companies in the industry tend to earn unattractive returns on investment.
The threat of new entrants entails new companies and capacities that desire to gain market share. The threat of new entrants tends to influence the existing competitors within the industry. Cost and time of entry, specialist knowledge, and economics of scale, technology protection, and cost advantages are some of the barriers to entry (Bruijl, 2018). Nike has a weak threat of new entrants due to the high cost of development, cost of doing business, and high economies of scale, which make it difficult for new firms to compete with large companies such as Nike.
The bargaining power of supplies involves how much control and power the company’s suppliers have over the potential to lower profitability and increase prices. The availability of substitute suppliers and the concentration of suppliers are essential factors in determining the power of the suppliers. Nike has a weak bargaining power of supplies due to the high supply and large suppliers that lower the effects of individual actions of suppliers (Flehantova and Nyamekye, 2021). Relatively, the large number of suppliers has reduced the impact of individual demands by the suppliers on a large company such as Nike.
The bargaining power of the buyers entails the extent to which the consumers can put the organization under force, which influences the consumer’s sensitivity to changes in price and quality. Consumers have more power when they are not many of them and can switch from one company to another (Flehantova and Nyamekye, 2021). The buying power is less when the consumers are many, buy in small amounts, and the products in the market are different from the competitors. Nike consumers directly impact the performance of a business. Low switching costs, availability of substitutes, and small individual buyers have influenced the bargaining power of consumers.
The threat of substitute products includes the buyer’s ability to substitute the products due to product differentiation. The common product boundaries tend to increase the ability of consumers to switch to alternative products. Substitutes have threatened the performance of Nike as one of the leading players in the shoe market. The low switching costs and high availability of substitutes from big competitors have influenced the company’s performance.
The industry rivalry includes the extent or intensity of the current competition in the market. This is determined by the existing competitors and each competitor’s capability, influence, and position in the market. Rivalry increases when more competitors are equal in power and size or when the industry is growing at a low pace. Competitors have greatly determined how Nike maintains its customer share in the footwear market (Flehantova and Nyamekye, 2021). High aggressiveness of competitor and low market growth has influenced the industry environment and performance of Nike.
In summation, the changes in the Integrated Marketing Communications strategy and the Five Forces of competition have influenced Nike’s operation in the footwear business. The case of Nike has demonstrated that strategic and proper IMC strategy can help a business achieve growth. The five forces are an essential analysis tool that helps understand what forces shape competition and performance within the industry.
References
Ahmed, R. R., Brohi, B., Bhutto, A. H., Prithiani, J., Khubchandani, R., Kumar, S., & Abbas, Z. (2016). “Strategic Marketing Plan of Nike. ” ResearchGate, Indus Institute of Higher Education.
Bruijl, G. H. T. (2018). The relevance of Porter’s five forces in today’s innovative and changing business environment. Available at SSRN 3192207.
Flehantova, A., & Nyamekye, R. (2021). Five Forces Analysis of Top Three Brands in Sportswear.
Kerr, G., & Patti, C. (2015). Strategic IMC: From abstract concept to the marketing management tool. Journal of Marketing Communications, 21(5), 317-339.
Stanković, J., Brkljač, M., & Nikolić, S. T. (2014). Strategic integrated marketing communications: Domination or equality of elements?. Anali Ekonomskog fakulteta u Subotici, (32), 205-218.
