Description
Write a 5-6 page report for an executive-level management team about whether Adidas should develop a similar DTC competitive strategy to Nike's.
In this assessment, you will write a report with your analysis of a DTC distribution strategy for an executive-level management
Instructions
Respond to the following scenario as you complete your report:
You have been hired as a consultant by Adidas to analyze Nike's direct-to-consumer (DTC) distribution strategy to determine if Adidas should develop a similar competitive strategy.
Nike, the U.S. sportswear giant, has been working to bring its manufacturing process closer to the point of sale, and concurrently adopting a direct-to-consumer strategy with a focus on owning the experience. Selling direct to consumers, commonly referred to as DTC or D2C, means you're selling your products directly to your end customers.
Write a management report analyzing Nike's supply chain strategy for Adidas' executives. Include the following:
- Analyze why the company (Nike) has adopted a DTC supply chain strategy by explaining the advantages and disadvantages and the impact of this strategy on its profitability.
- Analyze the importance of the Internet and social media (to Nike) and compare today's marketplace to a future marketplace advantage.
- Analyze how the company's (Nike's) DTC strategy satisfies customers and discuss the advantages of this type of competitive distribution strategy.
- Recommend steps for the company (Nike) to continue to grow its DTC strategy and support with cited sources in areas of organizational structure, technological investments, digital strategy, and customer relationship management.
- Recommend steps for the company (Adidas) to effectively grow its DTC strategy and support with cited sources in areas of organizational structure, technological investments, digital strategy, and customer relationship management.
team.
Submission Requirements
Your assessment should also meet the following requirements:
- Format: Submit a professional and well-organized Word document.
- Length: 5–6 double-spaced pages.
- Font and font-size: Times New Roman, 12-point.
- APA format: Use current APA style and formatting for in-text citations and references.
- References: 3–4 sources are required.
- Note: Attributing sources in your professional and academic work throughout this course and your program supports your analysis and conclusions and demonstrates ethical behavior and academic honesty. Following APA rules for attributing sources provides consistency and ensures that readers can locate original sources if desired.
- Note: Use of additional resources will assist in achieving distinguished level ratings.
Explanation & Answer
Please view explanation and answer below.
NIKE’S DTC DISTRIBUTION STRATEGY REPORT
Nike’s DTC Distribution Strategy Report
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NIKE’S DTC DISTRIBUTION STRATEGY REPORT
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Nike’s DTC Distribution Strategy Report
The last few decades have seen a dramatic prevalence in the number of direct-to-consumer
marketing business models integrated into the overall marketing strategy to enhance operations
and competitive advantage. In particular, the disruption has transformed the brand-consumer
relationship. Most traditional and upcoming organizations are no longer depending on
intermediaries and physical stores to showcase their products and services to the customers.
Customers can now purchase products and obtain services directly from the brands or companies
themselves, effectively eliminating complex distribution networks of retailers. The majority of the
current DTC brands have been primarily made possible by the internet, with firms targeting
younger generations. Nike is one of the firms that recognized the potential benefits of using the
DTC distribution strategy. The sportswear giant has grown direct-to-consumer sales significantly
through its use, thereby enhancing competitive advantage and improving sustainability. This paper
explores the integration of the DTC strategy by Nike to ascertain its benefits and provides
recommendations of the business model to its competitor Adidas.
Analysis of why Nike has Adopted DTC Supply Chain Strategy
Research reveals that Nike has improved its direct-to-consumer sales from 16% of its
revenues to 35%, thereby improving its market share in the industry (Salpini, 2021). According to
studies, about 80% of consumers plan to buy products and services from D2C brands by 2023
(Salpini, 2021). This is in line with many organizations, including Nike, where it no longer
provides customer experience physical but focuses on 100% digital transition, thereby offering a
more customer-centered design, quality, and service. Nike has leveraged the advantages of a
direct-to-consumer distribution strategy to enhance its competitiveness. In particular, some of its
benefits comprise increased digital platforms to reach clients directly, advocate for their target
NIKE’S DTC DISTRIBUTION STRATEGY REPORT
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consumers, and offer and prove the company's mission and values. A more evident advantage is
profitability generated by DTC, as reflected in the number of new companies cropped up as DTCs.
Nike is reputable with a strong brand allowing it to command a substantial business by solely using
its channels. Another advantage offered by the marketing technique is Nike has more control over
how its brand is positioned through DTC channels (Mahdi, et al., 2015).
Nike has co...
