Nike Pestel Analysis

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Introduction

The assignment describes a company and the nature of  management of its business. The chosen company is Nike and this company’s origin is United States. The purpose of the assignment is to shoe the relationship between Nike and its origin through PESTEL analysis and Porter’s five forces. The structure of the assignment contain the company background , country background, PESTEL ananlysis, Porter’s five forces, strategic recommendation and in the end, there will be a conclusion to summarize everything.

Company background

Nike is an international chain selling product of athletic footwear , sport equipment and other products related to sports. Nike was originally named as Blue Ribbon Sports in 1964. It became Nike.Inc in 1971. The founder of Nike were Bill Bowerman and Phil Knight who is now the chairman of the company. The products are sold to more than 160 different countries, the price of the product is at the middle range.Nike’s first employee, Jeff Johnson create the name Nike, it means the Greek goodness of victory. It became the world’s largest marketer of athletic footwear. It holds a global market of almost 37 percent in the whole world. Nike also sells product under other footwear company such as Converse, All Star and etc.

Country background

Nike’s origin is United States. The government of the USA is the federal government of the republic of fifty states that govern United States. United States is world’s third largest country with a population of 318,892,103. The capital of the country is Washington,D.C., it is where Nike’s Headquarter is located. The government is further divided into three parts, they are the legislative, executive, and judicial.The current president is Barack Obama, who is an  African American. The economy in United States was known as the world leader for the past few hundred years. Since 1947, the USA GDP growth rate is about  3.24 percent. The main industry in USA are textile, auto, chemical, mechanical and electronics as they are the most demanding products by the people.

PESTEL Analysis

PESTEL analysis is also known as the PEST analysis. It is a concept of marketing principles used as a framework or tools by company. It helps the company to track the environment for their new product to be introduced. It analyze the external marketing environment, the result of the analysis was used to recognized the threats and weakness of the market.PESTEL stands for six factors.P is political, E is economic, S is social, T is technological, E is environmental and L is legal. PESTEL shows a business situation of a company in different views. Below is a table of USA PESTEL analysis.

PESTEL of USA

Political:Stability of the government

The stability of the government will affect the function and development of the company. Unstable government will influent business marketing and has a direct impact towards the enterprise management of the company. This will further result in an decrease in the growth of the company, it may also decrease the rate of income of the company as the changes cannot be control by the company. USA is a stable country and it is also know as the world leader in its economy. This enable Nike to have an increase in the social purchasing power and marketing consumption requirement. Thus, stable government can bring good management environment to the business industry.

Economic:GDP

 A country’s overall GDP and its GDP growth rate can be used to analyze the economic environment of a company. In USA, the GDP market price is $17.42 trillion. GDP is used to measure the economic growth or decline of a  nation over a long period of time,also it can  determine  wether an economy is in recession. USA GDP is one of the highest in the whole world. This means the country also has high income rate per capita which is $3317. With higher income , people are able to purchase more goods and services to meet their demand. Thus, more people are able to afford to buy Nike products. This will allow Nike to have a stable increase of income, enable it to remain as the largest marketer of athletic footwear.

Social:Population

The overall population of USA 318,892,103, it is one of the highest population rate among all countries in the world. As we all know, USA is also well-known by the sports, especially basketball. Nike is one of the biggest sponsor to their own basketball team. This is a way to advertise their own product. Thus, most of the people in USA likes Nike footwear , especially the Air Jorden modern. Even artist like Whiz Khalifa also wears that. With a large population number and a large group of people who loves sports. Nike company will have a stable income through this population. This also includes people all over the world whom loves sports and Nike’s footwear product.