Consumer behavior

Analyzing the use of consumer behavior techniques in Advertising

Nike's use of consumer behavior techniques won over the hearts of their consumers.

Nike released the "You Can't Stop Us" campaign to motivate people through tough times.

BY ALAN SARIEDDINE

May 27, 2021

The sports apparel industry is one of the largest in the world today. According to Statisa.com, “The global sports apparel market generated around 181 billion U.S. dollars in revenue in 2019, an increase of more than seven billion U.S. dollars on the previous year. Rising revenues are forecasted to continue and estimated to reach around 208 billion U.S. dollars in 2025” (Statista 2021). One of the most recognized brands is Nike. I have always been a big fan of both Nike’s products and its advertisements since I was a young child. As a sports fan, Nike is one of the brands that I have been interested in and I continue to be inspired by to this day.

History of Nike

Bill Bowerman and his former student Phil Knight formed Blue Ribbon Sports, which would later become Nike. Knight founded the company in 1964, and by 1966, it opened its first retail location. Initially, the company operated as the United States distributor for Onitsuka Tiger's running shoes (aka Asics). Knight and Bowerman decided to create and produce their own shoes after a few successful years; the first pair was released in 1971. Nike became the official name of the company in 1978, which originated from the Greek Goddess of Victory, and went public in 1980. Nike became one of the most valuable brands in the world in just a few years. Nike has retail stores and distributors in over 170 countries now. Its logo, the now widely recognized curved checkmark or "swoosh", is one of the most famous in the world (McFadden 2019). The brand is currently headquartered in Beaverton, OR, where the founder Phil Knight is originally from. In his book “Shoe Dog”, Knight says “I was proud to call Oregon my home, proud to call little Portland my place of birth” (Knight 1). Nike is in the Apparel, Accessories, and Sports equipment industry among other major companies such as Adidas and Puma. Nike's mission is to strengthen and develop the brand. These corporate statements are used as guidelines for the company's evolution, resulting in the development of business strengths such as a strong brand image. Their mission statement says “Our mission is what drives us to do everything possible to expand human potential. We do that by creating groundbreaking sport innovations, by making our products more sustainable, by building a creative and diverse global team and by making a positive impact in communities where we live and work” (Nike.com).

Nike grew to become a global athletic footwear, apparel, equipment, and accessory company that designs, develops, markets, and sells athletic footwear, clothes, equipment, and accessories. Running, Nike basketball, the Jordan brand, football, training, and clothing are among the company's six product categories. Nike implements its pricing strategy based on the product’s understanding and determining which price point is best for their products. Nike, unlike its competitors who dropped their prices and offered heavy promotional discounts, was able to raise its price range which increased their profits. In 2014, Nike implemented its new pricing strategy after determining from a market analysis that its customers appreciated the value that the brand provided. Nike uses a value-based pricing strategy in order to set its prices according to the consumer perceptions about the value of the company’s products. Nike focuses on delivering the highest quality products at the right price to ensure the best customer experience whereas the other companies use the idea to sell products at the cheapest rate to generate more sales. This was Nike’s way to see how much their consumers can pay for certain products. This pricing strategy worked for Nike as it came to know about its product’s value amongst the customers and the company started to get profits and prices of its merchandise started to rise (Haque 2019). This has turned Nike into one of the most popular luxury sports brands in the world. Nike provides many different products ranging from lifestyle clothing to athletic clothing. These products can be worn in any setting making Nike a brand suitable for a large market of consumers. Although the apparel and sports market can be very broad, Nike primarily targets consumers who are between the ages of 15-40. The company caters to both male and female athletes, and has increased its focus on children and teenagers in order to foster long-term brand loyalty. Nike accomplishes this through promoting marketing campaigns that depict young adults aspiring to be like their sports heroes. While most companies see advertising as product-centered, the popular athletic brand does not settle and goes beyond promoting its products by enkindling emotion among its target market. Nike’s trademark is telling stories of inspiration from different points of view. “From Olympic players and NBA superstars to brave little girls and proud people of color, Nike always seeks to provide a narrative that humanizes our perceptions of greatness not just in sports, but also in life” (Nafarrete 2020). In every advertisement, despite the varied stories and perspectives, Nike uses subliminal advertising to remind us of its key message: Just Do It.

COVID-19 Nike Campaign

Nike’s “You Can’t Stop Us” is a video that featured a dynamic split-screen with 36 pairs of athletes. It depicts a cast that is diverse in terms of gender, race, and culture as they transition from one active sport to another. “The actions of the athlete on the right side of the screen mirrored those on the left, making it seem as if they experienced the same event despite the distance,” according to the 90-second short film. Apart from that, "You Can't Stop Us" also demonstrated how Covid-19 has affected people in the sports community as it showed closed gyms and empty stadiums, as well as workers in hazmat suits performing the new health and safety protocols in these areas. The message of the advertisement is simply: “You can’t stop sport. Because you can’t stop us” (Nafarrete 2020). Regardless of how different we are from one another, and despite the fact that things may not always go our way, the sheer thought of people banding together in the face of huge problems inspires optimism for the future. In these three ads, Nike uses two types of market segmentation in this ad campaign to reach their audience: Demographic and Psychographic. Demographic segmentation is the most widely used technique from Nike because it helps them “in understanding its consumers and satisfying their wants and needs” (Martin 16). This advertising campaign targets people based on their gender, age, and life cycle stage, as determined by demographic segmentation. Nike also uses gender as a crucial aspect in attracting their target audience, which is shown with the inclusion of female athletes in the advertisement as well as popular female sports figures. Nike has recently begun to invest heavily on advertising to females, even though their male purchasing audience is larger. Specifically, “Nike has developed a strategic approach to targeting Women by launching a variety of female sports lines where revenues are expected to grow significantly in the future” (Gupta 2019). Nike utilizes psychographic segmentation “to answer why consumers need its products,” what products interest them, and their “purchasing habits”. Nike aimed this ad targeting active people who enjoy sports, go to the gym on a daily basis, are athletes, and are passionate about sports, which are a big part of their lives. One of Nike's most common strategies is to associate people's lifestyles with their activities, hobbies, and behavior, resulting in a distinctive "feeling" through their ads and as a result people buy their products. Nike uses a sports-centric strategy to motivate, inspire, and emotionally connect all athletes to its products. “Nike’s statement ‘To bring inspiration and innovation to every athlete in the world’ not to mention ‘Run with me’ encourages all kinds of athletes to follow the firm with the sense that they belong to the same family” (Vasiliki 2017).

"Consumer Behavior" By Micael Solomon - Techniques

These three ads all come from the same campaign made by Nike, and for that reason they all communicate the same key benefits. We as people crave big, bold, and beautiful work which is why Nike’s “You can’t stop us” campaign continues to inspire consumers and motivates them to associate with the brand. The ad makes use of a variety of narrative techniques. The advertisements include some of the most popular athletes as well as real-life people who have achieved greatness. While other advertisers are using similar advertisements, “Nike and Apple are shining the brightest with videos that give us chills and goosebumps” (Robertson 2020). Nike had to go through over 4,000 distinct video possibilities to find the perfect fit for “You Can't Stop Us.” Above all, the commercial highlights Nike's mission, which is to bring the world together through “sport in order to build a healthier planet, more active communities, and a level playing field for all.” Nike doesn't want us to be held back by closed gyms or empty stadiums, so it's displaying the different ways athletes are pushing forward. This shows Nike as more than just a clothing brand, as the message and benefits they spread are like no other. This technique is very effective because people begin to feel a close connection to the brand and give them more of a reason to purchase from Nike over other competing brands (Robertson 2020). These creative strategies incorporate a few of the consumer behavior techniques that we have covered in class this semester such as persuasion and perception. The use of persuasion is very common with all Nike ads and is very clear in this example. Nike is known to have a star-studded class of athletes, which incorporates celebrity endorsement to increase their credibility and makes their brand stand out against competing companies. “The company’s core competency is epitomized by sponsored celebrities that are creating heroes, selecting athletes who succeed beyond all limits” (Walker 2019). By using famous athletes in this campaign, Nike’s product's use by the celebrity builds trust and credibility with their fans. It also reassures consumers that Nike’s products are of high quality. Using celebrities also helps Nike stand out from the crowd. It improves their ad recall; it allows consumers to remember the ad campaign and can open the brand up to new markets. There is also a use of perception in the advertisements through the use of subliminal advertising. While watching the advertisements, people are not bombarded with information about the product being sold but rather are taken through a short emotional film that triggers stimuli. One of the key things used is subliminal advertising. Nike’s checkmark is now very well-known and for that reason they do not have to even mention the brand's name. In this ad campaign, Nike uses “a combination of text, imagery, and more to convince their audience that they need Nike products” (“Campaign Monitor”, 2020).

Since the “You Can’t Stop Us” campaign was released in July 2020, I was able to see the result it had on the brand. “According to Top Design Firms' study of 501 people in the U.S, Nike's marketing campaign, "You Can't Stop Us," incorporates inclusive marketing that appeals to its target audience, it was found that 46% of consumers were likely to make a purchase after viewing the ad” (Yu 2020). Nike saw an increase in online memberships and subscriptions following the launch of the campaign, which lasted the duration of the quarantine. Nike saw a more than 100 percent rise in active users of its Nike Training Club App in the United States alone. Between June and August of this year, Nike's online sales increased by 82 percent. In terms of online contact and engagement, Nike had over 170,000 participants in their live workout sessions on Instagram during the first week of the brand's store closures. Due to its message, inclusion, and technical mastery, the "You Can't Stop Us" campaign gained worldwide praise. “It was praised and featured on multiple advertising and business sites like the United States’ CNN Business, the United Kingdom’s It’s Nice That, Canada’s Beloved Brands, Asia’s Marketing Interactive, and Australia’s Luma Research, just to name a few” (Yu 2020). Off these statistics it is clear that the media plan has reached the target audience and is still doing so to this day. The media plan uses both reach and frequency. For this campaign, Nike had “had a reach in the millions along with a three-times-per-week frequency” (Wacksman 2014). Not only do Nike advertisements have a large reach, but they are also viewed multiple times touching each viewer at a high frequency. A lot of the success in this campaign is due to two consumer behavior theories that we covered in class, brand prominence and the Red Sneakers Effect. Nike is one of the most prominent sports brands in the world, which means that consumers are knowledgeable on what products they offer. For this reason, Nike takes a different approach in their media plans, by attracting the emotional appeal that is related to the brand with loud signals such as the Nike Swoosh and their slogan “Just do it”. This is also done with the use of celebrities. Nike uses celebrities to represent their products to potential customers. Famous people, such as professional athletes, are often utilized to promote Nike's products. “Target customers are watching their favorite celebrities use the company's products. As a result, customers are motivated to imitate the behavior of these celebrities” (Ahmed 2016). The Red Sneaker Effect is used by Nike because their main message in their advertisements is going above and beyond expectations. This theory shows that people who show nonconforming behaviors lead to positive impressions. One big example in this campaign, is the inclusion of Lebron James who even when the odds were against was able to stand up to adversity and become one of the most inspirational athletes in the world.

If you ask me!

As a Nike fan and frequent shopper, I feel obliged to provide some recommendations on how the brand can improve their shopping experience and brand image moving forward. Nike provides very good customer service; however, they must take a closer look into their consumers' demands. Nike has been around since 1964, but they allowed a brand such as Lululemon that was founded over 30 years later to find a piece of the market that Nike was not satisfying. For this reason, Nike must do a better job at knowing the consumers’ wants and needs by studying predictive analytics and to find out what their customers are most interested in. When it comes to Nike’s brand image, they do a good job at maintaining a good image to the public, however they must try to avoid the temptation to feed into controversial topics that put their long-standing positive brand image. They were under hot water when they supported the protests of Colin Kaepernick as many people felt that Nike should be an unbiased brand. “The polarized public response to Nike’s ad campaign raised several questions about social justice, freedom of speech, and the role companies do and/or should take in engaging in political issues” (Kim 2020). In this scenario, Nike was just standing up against the discrimination that people of color receive as they take pride in diversity and everyone working together to be successful. Still, Nike has one of the best marketing strategies among its competitors, and that has put them in the place of success that they are in today.

Works Cited:

● Ahmed, R. R. (2016, April 11). Strategic Marketing Plan of Nike. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2760631.

● Gupta, H. (2019, April). Nike Imc (Project on Nike Integrated Marketing Communication). https://www.scribd.com/document/405857788/nike-imc-project-on-nike-integrated-marketing-communication.

● Haque, F. (2020, June 24). Pricing Strategies of Nike. The Strategy Watch. https://www.thestrategywatch.com/pricing-strategies-of-nike/.

● Kim, J. K., Overton, H., Bhalla, N., & Li, J.-Y. (2019, November 18). Nike, Colin Kaepernick, and the politicization of sports: Examining perceived organizational motives and public responses. Public Relations Review. https://www.sciencedirect.com/science/article/pii/S0363811119302590.

● Knight, P. H., Gilbert, L., & Gilbert, T. (2019). Shoe Dog. FBV.

● Martin, G. (2011, June). View of The Importance Of Marketing Segmentation. https://clutejournals.com/index.php/AJBE/article/view/4359/4446.

● McFadden, C. (2019, October 14). The Extraordinary History of Nike. Interesting Engineering. https://interestingengineering.com/the-extraordinary-history-of-nike.

● Monitor, C. (2020, October). 4 Powerful Examples of Subliminal Advertising in Email. Campaign 4 Examples of Subliminal Advertising in Email Marketing. https://www.campaignmonitor.com/blog/email-marketing/4-examples-of-subliminal-advertising-in-email-marketing/.

● Nafarrete, J. (2020, October 12). "You Can't Stop Us": Nike's Inclusive Ad Debunked. Juiceletter. https://upadcorejuiceletter.wordpress.com/2020/10/12/you-cant-stop-us-nikes-inclusive-ad-debunked/.

● Read Nike's Mission Statement and find information about NIKE, Inc. innovation, sustainability, community impact and more. Nike News. (n.d.). https://about.nike.com/.

● Robertson, G. (2021, February 26). Nike's "You can't stop us" is a masterclass in advertising. beloved brands. https://beloved-brands.com/2020/07/30/nike-you-cant-stop-us/.

● Shahbandeh, M. (2021, January 20). Total revenue of the global sports apparel market 2012-2025. Statista. https://www.statista.com/statistics/254489/total-revenue-of-the-global-sports-apparel-market/#:~:text=The%20global%20sports%20apparel%20market%20generated%20around%20181%20billion%20U.S.,billion%20U.S.%20dollars%20in%202025.

● Vasiliki, P. (2017, December 10). Segmentation, Targeting and Positioning Strategy of Nike & Buying Decision Analysis. Researchgate. Https://www.researchgate.net/publication/338370597_segmentation_targeting_and_positioning_strategy_of_nike_buying_decision_analysis.

● Walker, C. (2019, January). Nike Inc. Corporation SWOT Analysis. https://domynursingessay.com/nike-inc-corporation-swot-analysis/.

● Wacksman, B., & Stutzman, C. (2014). Connected by Design: Seven Principles for Business Transformation Through Functional Integration (1st ed.). Jossey-Bass.

● Yu, K. (2020, October 9). You can't stop us! This iconic brand made a mark with its impactful campaign during the trying times. [Fridays: Gorillas of Guerrilla Marketing]. Valens Research. https://www.valens-research.com/dynamic-marketing-communique/you-cant-stop-us-this-iconic-brand-made-a-mark-with-its-impactful-campaign-during-the-trying-times-gorillas-of-guerrilla-marketing/.