8. Nike, over the past years, neglected the crucial money making zone, the $60-to-$90-a-pair sneaker segment that analysts say makes up most domestic sales--and 50% to 60% of Nike's U.S. shoe sales. They have put too much emphasis on new technologies like Shox and lost market share in the mid-priced arena. The result: an average drop of 15% in U.S. footwear sales for Nike, while No. 2 shoemaker Reebok International Ltd. saw a 3.4% climb. Privately held New Balance had growth of 25% in 2001, while analysts are forecasting that Nike's domestic footwear business will drop 6% in the coming years. Many observers blame those situations on the Berm (Knight not thinking outside the box) mentality. They attribute Nike's lousy record with acquisitions to the same mind-set. For example by passing on the chance to acquire bankrupt rival Converse Inc., analysts say the company lost a shot at penetrating low-end department stores with a well-known, less-expensive brand. When it has completed deals, Nike has had trouble integrating the new companies. After buying hockey-equipment maker Bauer Sports Inc., Nike insisted on putting out its own Nike brand of skates--thus cannibalizing the brand it had just bought. What Nike is going to have to do to grow the US market is to as they say, “go outside the label”. Nike is going to have to look at opening itself up to changes that are not homegrown and / or Philip Knight’s idea. With Nikes competitors swallowing up the market, they are losing Knight and Nike need to start thinking outside the Berm.

9. Well, if you base the success that Nikes competition has had in the markets that Nike is currently pursuing. It can be said that they have chosen appropriate targets for new marketing efforts. With most of the markets that Nike is going after they are in the usually rut they have been in for years, they are not the first to get into it. The only thing that saves them repeatedly is the superior quality of their shoes once they do get into the market. As for the women and extreme sports, segments it is pursuing Nike can be successful in these markets if they completely lose their current mentality. You see Nike had a chance to buy North Face, Inc., which makes and markets extreme sports apparel. This would have double their capabilities in the market and put them in as the immediate leader. Well, in his lack of infinite wisdom Knight shot this deal down and said it would be better to do a homegrown company and not battle the problems of another acquisition. Well, that was two years ago and Nike is still not in the extreme sports market. Nike needs to look at these two markets in a fresh light as a chance to re-identify itself and get off the stagnant $9 billion in revenues it has seen in the past three years.

• Closed minded upper management staff

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