Company Overviews of Nike and Reebok Essay - 3983 Words

Company Overviews of Nike and Reebok In 1964 in Oregon, Phil Knight and Bill Bowerman join together to make a new enterprise; each contributed about $500 to the partnership. The company started bringing low priced and high tech athletic shoes from Japan to replace the German domination of athletic shoes in the industry. In 1971, a graphic design student created the Swoosh trademark for a $35 fee. In the same year Jeff Johnson, Blue Ribbon Sports’ first employee, made his most durable contribution to the company in coming up with a new name, Nike, after the Greek goddess of victory. NIKE is the worlds #1 shoemaker and controls over 20% of the US athletic shoe market. Reebok Reebok’s ancestor-based company came from the United Kingdom†¦show more content†¦Many of the product lines lack differentiation, most of the shoes look different, but they are basically the same. The products are highly perishable, and the product life cycles are extremely short. Lastly, the rivals are diverse in strategies, origins and personalities. Each one of the major rivals is identified with a certain marketing approach, and also symbolized by the paid support of famous sport stars. Suppliers The bargaining power of suppliers is medium to high since it is dominated by relatively few companies. The product is unique, and the switching costs are high. With the materials being used to manufacture shoes are typically considered raw materials. Because the materials are not very expensive and they are not hard to come by, so the cost of making shoes is not very high. It is also possible for the suppliers, especially in foreign manufacturing to integrate forwards into the industrys business especially in overseas markets and become a rival to the industry. Substitutes The threat of substitute products is low. The industry is upgrading the products frequently to cope with flashy fads and the hottest fashion. There are not too many close substitute products to athletic shoes. What else would you wear when you run? Of course, multipurpose shoes such as cross trainers may impose a possible substitute threat to the current highly diversified range of athletic shoes on the market. In the end, however, consumers have very bigShow MoreRelatedAdidas: Will Restructuring Its Business Lineup Allow It to Catch Nike?1072 Words   |  5 PagesAdidas: Will Restructuring Its Business Lineup Allow It to Catch Nike? I. CASE OVERVIEW For almost two decades throughout the 1960s and 1970s, Adidas became the best-selling brand of sporting goods in the world. 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