Our brand values "pride" and "trust" must be reflected in everything we do.
Essence of a brand is often expressed as keywords. Examples of keywords used to express brand values include ‘quality’, ‘creativity’, ‘luxury’, and ‘integrity’: functional values; expressive values; and central values. Brand values are the core values represented by a brand. Today, leading companies focus their management efforts on intangible assets. For example, the Ford Motor Company has reduced its physical asset base in favor of investing in intangible assets. Today, many companies including LVMH, L’Oréal, Gucci, Prada and PPR have recognized acquired brands on their balance sheet. Given the direct link between brand value and both sales and share price, the potential costs of behaving unethically far outweigh any benefits, and outweigh the monitoring costs associated with an ethical business. The understanding, interpretation and measurement of brand equity indicators are crucial for assessing the financial value of brand. Brands influence customer choice, but the influence varies depending on the market in which the brand operates. Brand valuation is a powerful process that captures the present and future value of a brand. Investments in and returns from tangible assets are reported at sophisticated and detailed levels, but this is not true for intangible assets. The global competition getting tougher and much competitive advantage the value to the shareholder will increase. Brand valuation can be on business investments, by making the brand asset comparable to the other intangible assets of the company. Measuring the return on investments for the brand can help you arrive at calculations that can help you come at final conclusions. Your brand values are expected to be the foundation of you wholesome brand in the market. The experience that customer gets form the brand is the brand promise. And the attributes that accrue to a brand includes loyalty, trust, confidence etc. Google’s brand promise: To allow people to find information as soon as possible and get on their way. Nike’s brand promise: Authentic athletic performance. McDonald’s brand promise: An inexpensive, familiar and consistent meal delivered quickly in a clean environment. Even if your company has a horizontal management structure, and decision making is very much a democratic process, it is impossible for the identity a company to come from anywhere else apart from the original founders. Building value in your brand, is about focusing on the things you would expect; customers, market and marketing. However, it is also based on how your run your business. Your brand is likely to be deemed more valuable if you have a proof of previous profits and established streams of revenue. A brand takes forms like name, sign, symbol, color combination or slogan. A concept brand is a brand that is associated with an abstract concept, like breast cancer awareness or environmentalism, rather than a specific product, service, or business. A commodity brand is a brand associated with a commodity. The most valued brands in the market are as follows
IBM
APPLE
MICROSOFT
COCA COLA
McDonald’s
Malboro
GE
Vodafone
NIKE – Case Study[/b][/b]
Strengths.
Nike is a very competitive organization. Phil Knight (Founder and CEO) is often quoted as saying that 'Business is war without bullets.' Nike has a healthy dislike of is competitors. At the Atlanta Olympics, Reebok went to the expense of sponsoring the games. Nike did not. However Nike sponsored the top athletes and gained valuable coverage.
Nike has no factories. It does not tie up cash in buildings and manufacturing workers. This makes a very lean organization. Nike is strong at research and development, as is evidenced by its evolving and innovative product range. They then manufacture wherever they can produce high quality product at the lowest possible price. If prices rise, and products can be made more cheaply elsewhere (to the same or better specification), Nike will move production.
Nike is a global brand. It is the number one sports brand in the World. Its famous 'Swoosh' is instantly recognisable, and Phil Knight even has it tattooed on his ankle.
Weaknesses.
The organization does have a diversified range of sports products. However, the income of the business is still heavily dependent upon its share of the footwear market. This may leave it vulnerable if for any reason its market share erodes.
The retail sector is very price sensitive. Nike does have its own retailer in Nike Town. However, most of its income is derived from selling into retailers. Retailers tend to offer a very similar experience to the consumer. Can you tell one sports retailer from another? So margins tend to get squeezed as retailers try to pass some of the low price competition pressure onto Nike.
Opportunities.
Product development offers Nike many opportunities. The brand is fiercely defended by its owners whom truly believe that Nike is not a fashion brand. However, like it or not, consumers that wear Nike product do not always buy it to participate in sport. Some would argue that in youth culture especially, Nike is a fashion brand. This creates its own opportunities, since product could become unfashionable before it wears out i.e. consumers need to replace shoes.
There is also the opportunity to develop products such as sport wear, sunglasses and jewellery. Such high value items do tend to have associated with them, high profits.
The business could also be developed internationally, building upon its strong global brand recognition. There are many markets that have the disposable income to spend on high value sports goods. For example, emerging markets such as China and India have a new richer generation of consumers. There are also global marketing events that can be utilised to support the brand such as the World Cup (soccer) and The Olympics.
Threats.
Nike is exposed to the international nature of trade. It buys and sells in different currencies and so costs and margins are not stable over long periods of time. Such an exposure could mean that Nike may be manufacturing and/or selling at a loss. This is an issue that faces all global brands.
The market for sports shoes and garments is very competitive. The model developed by Phil Knight in his Stamford Business School days (high value branded product manufactured at a low cost) is now commonly used and to an extent is no longer a basis for sustainable competitive advantage. Competitors are developing alternative brands to take away Nike's market share.
As discussed above in weaknesses, the retail sector is becoming price competitive. This ultimately means that consumers are shopping around for a better deal. So if one store charges a price for a pair of sports shoes, the consumer could go to the store along the street to compare prices for the exactly the same item, and buy the cheaper of the two. Such consumer price sensitivity is a potential external threat to Nike.