Nike: How a Top Sports Brand is Built (Part I)
Part 1: Nike’s Roots
Adidas existed before Nike but Nike still became a powerful brand.
There’s a few lessons in there. The Beaverton based American multinational corporation seems to be dominating the sports and cultural conversation. It is known as one of the largest brands in the world today and it is unlikely to lose its place anytime soon. The shoe company has come a long way since its start in the 70s, it has diversified and it has grown throughout the years to becoming a major player to contend with.
Nike now controls more than 45% of the athletic apparel market in the United States and commands one of the most powerful sports apparel brands on a worldwide basis.
There’s a definitely few lessons to learn from the rise of Nike.
Let’s get to it.
Phil Knight Early History
It came from an idea Phil Knight had in college. See, Knight went to Oregon State for college. While there, he participated in the sport of running. He was “a middle distance runner, lettering three years. He had a best time of 4:10 minute in the mile”.
The head coach of the Oregon track team? Bill Bowerman stayed in this position from 1948 to 1972 and racked up quite a few accomplishments in NCAA and All Americans over the course of his run at Oregon. Bill Bowerman became a respected and prestigious figure in track and field and was already a prominent figure by the time that Phil Knight was moving on from college to the next phase of his life.
He would still go for runs on his own after college and did so even throughout
Phil Knight would serve with the US army for a year. He would then go to Stanford Business School where he would form a blueprint for what would later become the powerhouse that is Nike. It was in one of his courses at Stanford Business School where he would write a master’s thesis called, “Can Japanese Sports Shoes Do to German Sports Shoes What Japanese Cameras Did to German Cameras?”.
Phil Knight was quite confident that the Japanese shoe manufacturers had it within them to displace the predominant German Sports shoes manufacturers. Phil Knight would conduct the thesis, go on to graduate from Stanford Business School, obtain his MBA and make moves from there. Well, kind of.
Phil doesn’t really have a clear sense of where he wants to go but he knows he can’t simply sit around and do nothing. He knows he can possibly make a dent in the world of sports shoes as he felt from his own experiences and from his research that there was room for improvement in the sector.
He borrows money from his dad and goes on a journey to Japan, he visits a few other states and countries on the way to his final destination. Now, obtaining money from his father was not easy. His father wasn’t necessarily made of money and he expected the young Phil Knight to become a traditional, respectable, young individual. One who wouldn’t make rash moves such aimlessly traveling, and chasing a potential market opportunity.
In the end, the elder Knight gives young Phil the money. Phil starts his journey on his first stop, in Hawaii. The many lures of Hawaii traps him and his friend Carter, there for a while and his plans become derailed temporarily. He picks up a job as a door to door bookseller. This doesn’t turn out to be so great. He moves on the finding a job selling securities. After a while, he gets the hang of it and he’s earning while living it up in Hawaii.
After two months of frolicking in Hawaii, he realizes he has to get back to the core, he’s got to get back on his world tour. He has to leave his friend behind and a short while later, he find himself in Tokyo.
Business Matters in Tokyo
Phil soaks up the culture of Tokyo and connects with a few of his fathers business friends, they provide him with a few words of advice on how to interact with the Japanese. He does some further research and decides that Onitsuka and a few of their specific product lines seems to be appealing, they seem right in line with his thesis.
He decides to meet a few of the executives of Onitsuka, he schedules an appointment and begins his journey to their headquarters in Kobe, Japan. He makes it to the meeting on time and it starts, it goes well and then one of the Onitsuka executives asks as to what company he’s with, Knight has to think fast, he’s not officially with any specific company, he’s there on his own.
So, what does he do?
He comes up with the name of a company, he calls the company, Blue Ribbon because of the one’s he’s won over the course of running career. After slipping by this initial hurdle, he’s able to get down to business and dive into his thesis presentation.
He’s confident that the Japanese shoe manufacturers will be able to surpass the Germans in the shoe manufacturing sector as well, he continues the presentation by painting a compelling market opportunity for the Onitsuka executives.
Knight apparently does a great job with his presentation and strikes a chord, the executives are impressed, they might have the opportunity to steal market share from Adidas.
Onitsuka, for its part had been looking into the United States market and think that there’s real potential there. Knight has done his research and he’s on to something that resonates with his target audience.
They Onitsuka executives start to conduct a presentation of their own.
The Japanese shoe executives start to show him their new lines of Tiger shoes they’re interested in delivering to the public. The executives close the presentation by asking if Blue Ribbon would be inclined to be a representative of the Onitsuka corporation in the United States of America.
Knight’s ecstatic, he gives them the address to send the samples to. He finishes the meeting and continues with his world tour. Knight visits a few countries in Asia, in Europe, and in the Middle East before he finally goes back home to Oregon.
To be continued…
