“Follow the rules. But be fierce.”
starting the business
Like Fred Smith and the origins of FedEx, Philip Knight’s early ideas for what would become Nike Inc. came to him while he was at
school. While working on his master’s degree at Stanford, Knight, an accomplished runner during his undergraduate days at the University
from Oregon, wrote an essay outlining a plan to break Adidas’ monopoly on the running shoe market. thought the way
to realize this was to employ cheap Japanese labor to make a cheaper and better shoe.
The plan was put into motion shortly after graduating in 1962. Knight traveled to Japan to meet with Onitsuka Tiger executives.
Co., a maker of knockoff Adidas shoes, claiming to be the head of a company called Blue Ribbon Sports (not
exist, except in your mind). Knight convinced Tiger to export his shoes to the United States through Blue Ribbon and asked them to send samples.
so that his associates could inspect them.
Knight paid for the samples with his father’s money. He sent some pairs to Bill Bowerman, Knight’s track coach in his days at
the University of Oregon, who became interested in the company. Knight and Bowerman became partners and each put $500 into the
purchase of 200 pairs of tigers. Blue Ribbon Sports was formed, and Knight began attending track events in high school.
selling shoes from the trunk of his car.
Sales were at $3 million when Knight decided to dissolve the partnership with Tiger in the early 1970s. Blue Ribbon began
producing his own line and began selling his Nike line (named after the Greek goddess of victory) in 1972. These early Nike shoes
they were emblazoned with the now internationally recognizable Swoosh logo that Knight had ordered for $35, and had the
Traction-enhancing “waffle soles”, conceived by Bowerman while watching his wife use a waffle iron.
building an empire
The success of Blue Ribbon (renamed Nike in 1978) throughout the 1970s and into the 1980s can be largely attributed to Knight’s marketing.
strategy. He thought it was better not to promote his Nike shoes through advertising, but to let expert athletes endorse his product.
Fortune smiled on Knight when his partner Bill Bowerman became the coach of the US Olympic team and many of the best
in the team he decided to put on his feet with Nikes. Of course, when the runners performed well, the shoes they wore were
highlighted. Steve Prefontaine, a daring and unconventional American record holder, became the first spokesperson for Nike shoes.
After tennis player John McEnroe injured his ankle, he started wearing a Nike three-quarter shoe, and sales of that particular shoe
brand jumped from 10,000 pairs to over 1 million. As Knight hoped, celebrity athlete endorsements brought success to the
business. Knight also tapped into the running craze and through clever marketing persuaded the consumer that it should only be
wearing the best the best in the world.
The Air Jordan helped the company continue to thrive in the 1980s. In its first year, the shoe earned more than $100 million.
Knight achieved its initial goal of replacing Adidas as the world’s number one shoe manufacturer in 1986. By then, total sales
had exceeded one billion dollars. However, by neglecting the growing interest in aerobic shoes, Nike would have to face some
difficulties.
Through troubles and controversies
Sales fell 18% between 1986 and 1987 due to high demand for Reebok’s stylish and modern aerobics shoes. gentleman had to
recognize that the technical achievements of Nike shoes would not satisfy those who put appearance before performance. Tea
Nike Air was Knight’s answer to Reebok. He revived sales and put Nike back to number one in 1990.
The corporate monster it had become, Nike was the subject of public outrage in 1990 when stories of teenagers being murdered for their
Nikes began to float around. It was believed that Nike was promoting her shoes too strongly.
That same year, Jesse Jackson attacked Nike for not having African-Americans on its board or among its vice presidents, despite the fact that
the fact that his customer base was largely black. Jackson’s boycott of Nike lasted until he appointed a black member of the board.
There has also been controversy over whether Knight’s use of Asian factory workers as cheap labor is exploitative.
Despite all the bad press Nike has received through these events, Nike shoes have continued to sell well. And in
1993, The Sporting News voted Knight “the most powerful man in sports”, even though he was neither a player nor a coach. gentleman
Marketing proficiency is to be lauded and considered a major factor in their impressive successes.
