Nike Segmentation, Targeting and Positioning (STP)

Segmentation, Targeting and Positioning (STP) in Nike’s Marketing Strategy

Nike is the world’s largest sports shoes brand with a strong presence across several leading markets and enjoying strong brand awareness in most corners of the world. The company is known for making premium quality shoes, apparel and equipment. However, NIke is also appreciated worldwide for its marketing strategy that efficiently targets the health conscious youth and athletes.

Nike is currently the dominant player in the sports shoes and apparel industry. The company invests heavily in innovation which is cited as one of the main reasons behind the popularity of its products, strong demand and its market leadership. Nike is operating in a highly competitive market environment. However, its excellent marketing strategy has turned the brand into a global leader and helped it differentiate its brand from the rivals. Its marketing strategy is cited as among the best in the world. The swoosh logo and Just Do It Slogan have set the brand apart from the crowd of brands in the international market.

Nike’s market leadership is also a result of effective targeting and excellent positioning. It has created an identity of a customer oriented and innovative brand that makes premium and innovative products for athletes and sports lovers around the globe.

In this post, we will analyse the segmentation, targeting and positioning strategy of Nike and how they have helped the company market itself successfully to a global audience.

Segmentation in Nike’s marketing strategy:

Segmentation is one of the most crucial concepts in marketing. It is an essential step in marketing that also decides how well a marketer or brand understands its target audience and their needs. In the simplest term it means dividing the market into various identifiable segments on the basis of specific characteristics. One of the most common segmentation techniques used in marketing is that of geographical segmentation.

This is commonly used across various industry sectors since people living across a geographical region who are part of the same culture and society may have similar tastes and preferences. Dividing consumers geographically helps marketers several concerns related to marketing communication, sales and services. In fact most brands divide their global market into distinct market segments geographically. Nike’s largest geographical market is the United States that accounts for the largest part of its total net revenue. 

However, in a vast number of cases only geographical segmentation is not sufficient since efficient targeting of potential customers depends on many more factors like their age, gender, lifestyle, education, and earnings among other factors. Nike has also segmented customers based on age, gender and income level. It is also an essential step for a business since one business cannot serve all customer segments efficiently and not all customer segments depend on the same brand to fulfill their needs. It is why segmenting customers on other bases apart from geography becomes important for marketers since that allows them to communicate with and serve the target audiences efficiently.

In such a case, active and healthy lifestyle, high wages, and gender serve as important bases for segmentation. Nike makes products in three main categories that are men, women and kids.  However, there are various subcategories too focused on different sports activities. Nike has also segmented its customers based on their personalities, interests in sports and physical activity level.

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Targeting in the marketing strategy of Nike:

Targeting means selecting those customer segments whom the company believes it can serve efficiently. The main such consumer categories that Nike targets include men, women and kids. It makes and sells a vast selection of products targeted at men and women. The company also makes and sells products targeted at kids. However, for more efficient targeting, Nike has divided its target audiences based on sports or health activity. It makes running shoes or shoes for people that are interested in running. These products do not target only the athletes but also the people living a healthy and active lifestyle. Similarly, it makes products targeted at other sports like Basketball, soccer and outdoor activities. 

Targeting on the basis of sports and health activities allows Nike to target its customers across geographies more effectively. Basketball players and fans can buy products in the basketball category and so can the soccer players and fans. However, the company mainly targets people in the 14-40 age group.

Nike targets its various segments of customers through specialized innovations. The company innovates to make products that serve the needs of particular customer segments more effectively than the rivals. The company has also achieved a remarkable level of differentiation through innovation. Sponsorships and association with famous personalities from the world of sports are two important marketing techniques utilized by Nike that allow it to target fans of various sports all over the world with highest efficiency. Moreover, it targets the sports fans that have their heart in sports and utilizes emotional marketing and promotion techniques a lot to connect with them. In simpler terms, the company targets the people who are passionate about sports and adventure. 

However, it is also critical to note that Nike makes products in the premium segment which are priced higher than the rivals. So, Nike is not targeting the price sensitive consumers but the ones that are willing to pay a price for innovative products and want to stand out from the crowd. Now, it is also targeting the environmentally aware consumer through its sustainable innovation and recyclable products.

Positioning in the marketing strategy of Nike:

Nike has positioned itself as the global leader in sports shoes, apparel and equipment whose focus is creating highest customer satisfaction and helping athletes excel in their specific fields through market leading innovations. It has created the identity of an innovative and passionate sports brand. The popular perception of Nike is that of a brand that innovates for victory and that is passionate about serving its consumers. 

How a brand positions itself affects several things including its overall marketing strategy, marketing ROI, brand image, sales and popularity. However, Nike does not simply innovate for performance but also for the sake of fashion. It has positioned itself as a leading fashion label that targets the fashion needs of the modern generation successfully. Around the world, the demand for athleisure products has grown and Nike is at the forefront in this change serving people with a wide selection of athleisure products that are fit for fashion and sports both.

In this way, while Nike reflects people’s passion for sports, it also reflects their choices in terms of fashion. Nike connects with its audiences at a deeper and very personal level. It is a popular brand that helps people engage in their favorite sports or physical activity with more passion. This is constantly reflected in its advertising campaigns where the general feeling is that of overcoming obstacles in life through hard work and a passion for winning.

Nike’s positioning strategy greatly influences its sales and marketing. Where there is Nike there is sports, and Nike encourages you to do the impossible and win. Its excellent positioning strategy has helped it win the hearts of millions of fans worldwide.