Nike vs Adidas vs Under Armour

Ever wonder why some brands feel like they “get you”?

They do not just sell products. They tap into emotions and needs you didn’t even know you had. It’s almost as if they understand your mindset and speak directly to your values.

The secret lies in their ability to connect with people on a deeper level 😃 and build a relationship that goes beyond a simple transaction.

One such brand is Nike and people love it amid its high prices.

What does Nike do that other competing brands do not?

Let's see!

STP Analysis

Segmentation

Nike segments its customers into clear groups to serve them better.

• Demographics: Nike focuses on men, women, and kids. Whether they are professional athletes or casual fitness enthusiasts, Nike addresses all who value high-quality and stylish sportswear.

• Psychographics: Nike targets people who value self-improvement, performance, and looking good while staying fit. These are those whom goals and challenges inspire.

How competitors do it:

Adidas leans towards younger, trendy consumers who love streetwear and fashion, while Under Armour targets athletes who focus on high-performance gear rather than style.

By understanding these differences, Nike ensures its products and marketing align with its audience's needs and values.

Targeting

Nike focuses on young, active people aged 15 - 40. These individuals are tech-savvy, live in cities, and follow fitness and sports trends. Nike makes everyone feel like they can achieve greatness, whether a pro or just starting.

How competitors do it:

Adidas attracts fashion-forward youth with celebrity collaborations like Yeezy by Kanye West, while Under Armour targets dedicated athletes who want gear that helps them perform their best.

Nike’s unique focus on inclusivity and empowerment helps it connect emotionally.

Positioning

Nike positions itself as more than a sportswear brand. It sells motivation and inspiration. Nike connects with people emotionally and encourages them to chase their dreams with its slogan, Just Do It.

Nike strengthens this position through

• Endorsements from top athletes like Serena Williams and LeBron James.

• Powerful advertising campaigns like Dream Crazy inspire people to think big and act boldly.

How competitors do it:

Adidas focuses on blending sports with fashion, making it a lifestyle brand, and Under Armour is for serious athletes who prioritize performance and durability over style.

Nike’s emotional storytelling makes it stand out. It is is selling a mindset, not just products.

Why Nike’s STP Strategy Works?

Nike’s strategy is powerful because it combines emotional connection with practicality.

1. Broad yet personal: Nike’s message speaks to everyone while making each customer feel special.

2. Emotional connection: Nike inspires loyalty by tying its products to values like determination and empowerment.

3. Staying relevant: Nike adapts to trends like sustainability and personalized shopping experiences to meet customer needs.

SWOT Analysis

Strengths

Nike has several strengths that make it a leader in the sportswear industry:

• Strong brand loyalty: Nike has built a loyal customer base. According to Statista, 79% of Nike customers are repeat buyers.

• Powerful athlete endorsements: Nike spends more on athlete endorsements, working with icons like LeBron James, Serena Williams, and Cristiano Ronaldo.

• Innovation and technology: Nike invests in product innovation. For example, its Flyknit technology changed the game by making shoes lighter and more sustainable.

These have helped Nike stay ahead of competitors like Adidas and Under Armour.

Weaknesses

Even as a market leader, Nike has areas where it can improve:

• High prices: Nike’s pricing can be a barrier for budget-conscious customers. For example, the average cost of a Nike shoe is $110, compared to Adidas’ $85.

• Overdependence on endorsements: While endorsements are a strength, they are also a risk. If an athlete faces a controversy, it can affect the brand.

Nike is aware of these challenges and actively works to address them. For instance, it has expanded its Nike Factory Stores to offer lower-priced products.

Opportunities

Nike has several growth opportunities to explore:

• Sustainability: Consumers today care about the environment, and Nike is meeting this demand with its Move to Zero initiative.

• Emerging markets: Nike sees potential in growing markets like India and Southeast Asia, where the demand for incomes and fitness trends are rising.

• Digital growth: Nike’s e-commerce sales are booming, mainly through its platforms like the Nike App and SNKRS.

Threats

Despite its success, Nike faces several threats:

• Intense competition: Adidas, Under Armour, and Puma innovate often to grab market share. Smaller niche brands compete with unique, eco-friendly, or customized products.

• Economic challenges: Recession-like conditions or inflation could affect customers’ ability to buy premium products.

• Counterfeit products: Nike loses revenue to fake products, which is common in emerging markets.

Nike’s strong brand and focus on innovation help it tackle these threats, but staying vigilant is still needed.

Marketing Mix

Product

Nike often create products that blend style, performance, and sustainability. Its product range includes footwear, apparel, and sports equipment for several sports and activities.

• Nike’s Flyknit technology, which uses a single thread to create lightweight shoes, has reduced waste. Nike says it has diverted over 2 million pounds of waste from landfills since its launch.

Here’s the technology behind Nike’s Flyknit technology:

• Nike’s Move to Zero initiative aims to achieve zero carbon emissions and zero waste. Products like Space Hippie sneakers are made with up to 90% recycled materials.

Here’s Move to Zero initiative video:

Competitor Comparison:

Adidas blends heritage with innovation, such as its BOOST cushioning technology, while Under Armour prioritizes performance, with products designed for intense athletic use, but lacks Nike’s range of casual and sustainable options.

Price

Nike uses premium pricing for most products, reflecting its quality and brand reputation. However, it also addresses budget-conscious buyers through outlet stores and discounts on older collections.

• Price comparison: The average price of a Nike shoe is $110, compared to $85 for Adidas and $70 for Under Armour. (Source)

• Perceived value: Customers are willing to pay more for Nike because of its strong brand, innovative designs, and high-performance gear.

Place

Nike excels in omnichannel distribution, using a mix of retail stores, e-commerce platforms, and direct-to-consumer (DTC) sales channels.

• Nike has over 7,000 stores worldwide and ships to over 190 countries through its online platforms.

• In 2023, Nike’s DTC sales, including online and app sales, reached $21.3 billion. It shows Nike's success in cutting out middlemen and connecting directly with customers. (Source)

Competitor Comparison:

Adidas also focuses on e-commerce but depends more on collaborations with retailers like Foot Locker, while Under Armour depends more on wholesale distribution, giving Nike an edge in customer engagement through direct sales.

Promotion

Nike’s promotions focus on emotional branding, telling stories that connect with people’s values and aspirations.

• Ads like Dream Crazy featuring Colin Kaepernick inspire and spark cultural conversations. This ad increased Nike’s sales by 31% in the weeks following its release.

Here’s the Dream Crazy ad featuring Colin Kaepernick:

• Nike’s YouTube videos, social media campaigns, and Nike App promotions engage younger, tech-savvy audiences. For instance, the You Can’t Stop Us campaign has over 50 million views on YouTube as of July 2023.

Here’s You Can’t Stop Us campaign video:

And the brand empower people like this on Instagram:

Competitor Comparison:

Adidas invests in celebrity collaborations like Yeezy, focusing on fashion and exclusivity, while Under Armour promotes functionality over emotion, often targeting hardcore athletes in its campaigns.

Final Thoughts

Nike’s marketing strategy is the best example of how innovation, emotional connections, and smart business decisions can drive success. By understanding its audience and creating meaningful experiences across every touchpoint, Nike has built a brand that stands out in a competitive market. Its ability to adapt and stay relevant shows that great marketing is about more than products.