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PESTLE ANALYSIS ON

PRESENTED BY:
Sagar Naresh
Debasish Prasad
Soniya Ganglani
Kavya Chaudhary
Narendra Reddy
Y. Harish Chandra
ABOUT
Nike is without a doubt one of the worlds top sports and fitness
companies, and has a legacy which dates back to 1962 when they first
arrived on the scene under the name of Blue Ribbon Sports. Today Nike
is known for their top of the line sports apparel and athletic shoes.
The company was founded on January 25, 1964, as Blue Ribbon
Sports, by Bill Bowerman and Phil Knight, and officially became Nike,
Inc. on May 30, 1971.
The company is headquartered near Beaverton, Oregon, in the Portland
metropolitan area. It is one of the world's largest suppliers of athletic
shoes and apparel.
Nike markets its products under its own brand, as well as Nike Golf, Nike
Pro, Nike+, Air Jordan, Nike Blazers, Air Force 1, Nike Dunk, Air Max.
WHY PESTLE ANALYSIS?
Nike Inc.s growth partly depends on external conditions. These
conditions are outlined in this PESTEL/PESTLE Analysis of the
company.
In the case of Nike Inc., the PESTEL/PESTLE Analysis enumerates such
external factors that influence the companys strategic decision-
making processes.
As one of the major firms in the global sports shoes, apparel and
equipment market, Nike Inc. must address these external factors
Its important to ensure business dominance in the industry, especially
when considering the presence of aggressive competitors like Adidas.
A PESTEL/PESTLE Analysis of Nike Inc. identifies key issues that the
company must include in its strategic formulation.
POLITICAL
Stable political climate in most major
markets (opportunity)
Expanding free trade policies (opportunity)
Improving government support for
infrastructure (opportunity)
The United States, Nikes home country so
to speak, has fantastic policies for growth
which are especially valuable to this
corporation.
As a company that produces and sells
physical goods, Nike is, however, always
subject to changes in tax and manufacturing
laws.
ECONOMIC
Economic stability of developed markets (opportunity)
Rapid growth of developing markets (opportunity & threat)
Slowdown of the Chinese economy (threat)
Nike Inc. must emphasize global expansion strategies while devising
new ways to capture growth in developing countries.
Like for many other organizations as well companies, the biggest threat
economically would be the economic recession.
Besides US, Asias economies downfall too has its effects on the Nike,
as many of its products are being manufactures in the Asia as well.
SOCIAL
Increasing individual wealth in developing countries (opportunity)
Increasing emphasis on product safety (opportunity)
Improving positive attitudes about leisure (opportunity)
Nike has always been the first choice of people when it comes to buy
something sport and fitness related.
Nike can take benefits of this influencing social dynamic by
introducing its fine quality athletic and other sports products (apparel
and equipment both).
On the other hand Nike has failed to address the problems like that of
the condition of labor and factory at different locations of the
production in Asia.
TECHNOLOGICAL
Technology gives companies the ability to innovate in so many
different ways. From interacting with customers to designing products,
technology provides value to organizations just like Nike.

Social media allows things to blow up or whittle away faster than ever.
Nike is doing well with using social media to build their brand, but it
can be a double-edged sword if used incorrectly.

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.
LEGAL
Improving employment law in developing countries (threat &
opportunity)
Expanding consumer law in developing countries (opportunity)
Expanding health and safety regulations (opportunity)
It shouldnt surprise you to hear that, like most massive corporations,
Nike also dodges substantial amounts of tax. In recent years, there
hasnt been too much of a crackdown on this, but its still valuable to
consider.
Also, Nike occasionally meets legal repercussions for its shady
marketing practices, which include false discounts
ENVIRONMENTAL
Expanding environmental law (opportunity)
Climate change (opportunity)
Increasing sustainability strategies among firms (threat & opportunity)
Nikes mass production factories are, without a doubt, harming the
environment. Not only do they release plenty of aerial pollution like most
factories, but Nikes production centers occasionally go as far as directly
polluting rivers.
However, Nike also shows promise of a change in their current practices, with a
strong resolve to become more eco.
CONCLUSION
Nike Inc. must address a variety of opportunities shown in this
PESTEL/PESTLE Analysis. It is recommended that Nike must pursue a
more aggressive approach to international expansion based on free
trade policies, with focus on high-growth developing countries. This
action can help address the potential decline of Nikes performance in
the Chinese market. Another recommendation is for the company to
invest more in research and development (R&D) to tap potential
demand for sports shoes, apparel and equipment integrated with
advanced computing technologies. The external factors in this
PESTEL/PESTLE Analysis also highlight the importance of improving
Nikes sustainability and employment practices. These actions address
regulatory and sociocultural concerns and, consequently, improve
Nikes brand image and corporate image.

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