One Of Nike's Core Strategies Is In Danger

oscar pistorius

Photo: Michael Steele/Getty Images

Nike has “done it” again and again. Its marketing strategy has catapulted the company to its lofty perch atop the sports gear, apparel and footwear marketplace. In fact, according to D&B site Hoovers, Nike is the world’s #1 shoe and apparel company.What is the basis of Nike’s winning strategy?

The three biggest weapons Nike uses in its marketing arsenal are theā€¦

  1. Nike Swoosh logo, which appears on the uniforms and athletic gear of athletes. This logo is strategically placed so that it visually prominent as athletes perform and as their performances are carried on TV broadcasts, instant replays, videos, magazines and newspapers
  2. Focus on hero athletes, such as basketball legend Michael Jordan.
  3. Creation of ads that become news stories so that the news media ends up promoting the ad messages for free and creating large viral pyramids that leverage the Nike brand and message content.

This basic strategy has paid off for Nike. It has brought it great riches and market leadership.

All is not rosy in Nikeland

In the past few years, however, the “hero athlete” component has come under fire as a result of the bad behaviour of some of its “heroes” most notably Michael Vick, Tiger Woods, Kobe Bryant, Marion Jones, Alex Rodriquez, and most recently, Lance Armstrong, and Oscar Pistorius. In an effort to contain the damage, Nike has distanced itself from Lance Armstrong, and just suspended its contract with Pistorius pending further investigation of the murder charges against him. Since Tiger and Kobe never cheated in their sports or killed anyone, Nike has stood by them with little negative repercussions for the Company. Time and good performance has also helped to dampen the negative feelings toward Kobe and Tiger with a large assist from Nike’s advertising. Right after the Tiger Woods scandal broke, Nike created a famous commercial that featured his father talking to him from the grave. Nike also stood by Marion Jones and Alex Rodriquez after deciding that their offenses do not rise to the same level as Armstrong and Pistorius. Nike initially dropped Michael Vick after the dogfighting scandal, but it has teamed up with Vick again since his rehabilitation and return to football and his winning ways.

Problems with the hero athlete strategy

All these cases point to the inherent problems of closely associating a brand with “hero athletes” and famous spokespeople. Contrary to the belief of their loyal fans, “heroes” are humans too. Unlike most of us mortals, they have been coddled and treated as special since they were small children. This gives them a sense of invincibility and entitlement where many believe they can do anything. Even worse, some believe they are entitled to do whatever they want. Mix that with athletic success and the ego that usually goes with it, and you have a disaster waiting to happen. As these athletes become more successful and famous, their public persona grows, and traditional and social media magnify and accelerate their transgressions to exponential proportions. If Nike continues to hitch its sails to star athletes, some percentage of the ones they sponsor are going to get into trouble, damage their image, and drag Nike along with them. This is why many brands prefer to use mascots instead of spokespeople, celebrities, and heroes. Mascots typically don’t age, do bad things, or get the associated brand in trouble.

Should Nike stick with the hero athlete component of its strategy?

Since it has very successful so far, Nike may decide to play the percentages and stay on course with the hero athlete component of its marketing strategy. They sponsor so many athletes that they may believe that the risk is spread over a large enough number that they are not worried when a few get into trouble. On the other hand, with social media and virtually instant communications, it may be increasingly difficult for Nike to manage its image when some “heroes” drag them into the muck. Time will tell if they stick with this strategy. For now, their successful branding and clever use of the news media for promotional leverage is how Nike just does it, how they are likely to continue to “just do it” again and again.

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