Nike’s corporate level strategy includes a moderate level of diversification. The operational relatedness between businesses is very high. They share most information and technology needed to succeed. Nike falls into the category of related constrained, since less than seventy percent of revenue comes from a dominant business and all businesses share product, technological and distribution linkages. Nike’s diversification is related because the firm builds upon or extends its core competency and resources/capabilities to create value. Also, economies of scope are incorporated. For example, Cole Haan line of luxury footwear and Bauer hockey utilize cost savings from capabilities and competencies that were developed in one of its businesses, Nike, and used in the others. Nike expects activity sharing among units to result in increased strategic competitiveness and improved financial returns, which it has seen. Moreover, intangible resources are difficult for competitors to imitate and/or understand. This allows the other businesses to gain an advantage immediately over competitors.

Nike has also bought and changed firms through acquisitions as part of its global-level strategy. Nike used the acquisition method of entering into the global market when it purchased Montreal-based Bauer Inc. in 1995. Bauer Inc employed over 500 union workers in the hockey apparel industry. Bauer was a very popular name in the world of hockey and seemed to be the best way for Nike to gain market share among Canadians and hockey fans abroad. Bauer was a natural way for Nike to enter into the hockey business with low barriers of entry because Bauer had already been an established leader in the hockey apparel industry. When the deal was completed in 1995, Bauer and Nike executives told their workers that there were no changes anticipated by the deal. The hockey business then started to have troubles in the spring of 1997. Nike executives then told workers that they would have to “reposition” the business. This meant that they would move the manufacturing of hockey apparel to Eastern Europe or Asia to reduce labor costs. All of the 450 employees at the Bauer ice-skating and hockey-clothing plant in Cambridge Ontario were laid off by 1998. This is an example of how global market strategies shape and reshape the entire world. More advanced countries such as Canada lose jobs and employment within their country while third world countries gain them.

Like many companies Nike wants to have a global presence in the marketplace for selling its apparel goods. Nike has to choice a corporate-level strategy first and then determine which business level strategy for the market is best. Nike can choose a business level strategy based on if it has a different product then others, is a cost leader, has differentiation; is a focused cost leader, has focused differentiation or integrated cost leadership/differentiation.

Nike is using the Internet to get their global presence into the marketplace as well as prepare the youth to purchase Nike’s products. One of Nikes new strategies to enter the global market has been to use a new popular “Advergame”. This advergame is a free downloadable video game offered through Nikes web site that advertises Nike’s products.

International Corporate-Level Strategy

Nike’s advergame is a 3D interactive soccer game called “Scorpion Knock Out” and it takes place in the belly of an ancient sea freighter” (Going Global www.smallbusinessnewz.com). After downloading the game users can select three players from international teams. You are then given the choice to play against the computer or against opponents from around the world. The video game works in 12 different languages and offers free gifts to the highest-ranking teams. Scorpion Knock Out has several Nike advertisements that run throughout the game and attempts to program Nike’s swoosh, into its users minds. The use of the advergame by Nike is an international business-level strategy that offers differentiation to the user. There are currently no other sporting apparel manufactures like Nike, which use the advergame. Nike gains a global presence to younger age brackets with this free video game package.

Some topics in this essay:
Market Entry, Finally Nike, Knock Nike, Michael Jordan, Nike Inc, Nike Corporation, Resources Nike, Strategy Nikes, Unrelated Nike’s, Nike PSAPlay, global presence, strategy nike, global market, level strategy, markets nike, international business-level strategy, video game, international business-level, strategic alliances, strategy international, transnational strategy, global presence marketplace, business-level strategy international, business level strategy, nike executives told,