Brand Value Chain In Sports
The sporting goods market is a $59 billion business at wholesale and adds that to the fashion wholesale market of 125 billion, and the industry seems like it continues to build its value chain on traditional processes. Today we are going to discuss two main topics regarding the value chain of a brand:
1. Brand Value Chain in Sports
2. Nike’s Value Chain
“If people believe they share values with a company they will stay loyal to the brand.” - Howard Schultz
Brand Value
Porter states that the first step is to lay out the industry value chain. The brand value chain provides companies with a snapshot of the brand’s marketing program investments and initiatives, and offers a structure means to understand where and how value is created (Parr, 2022). Sports organizations have to understand their pricing and distribution strategy of their tickets and merchandising. Dale Parr in his article, Brand Value Chain, states “Marketers and business owners alike need to understand that consumers will only pay a premium price if the product exceeds their perceived value.”
The way the product is sold or distributed can influence the equity and profitability of the brand (Keller, 2013). Looking at the figure above it gives you a clear indication of what steps are needed to have a proper brand value chain. The customer mindset remains one of the most important pieces to this chain. We must consider the ability of the brand’s marketing program initiatives to positively influence consumers’ mindsets – which consist of all their thoughts, feelings, perceptions, images, and beliefs (Keller 2013, 325).
Within the market multipliers, there are two main key factors which include:
1. Competitor superiority – Are you being left behind by the activities of a rival?
2. Customer size & Profile – Is the target market sustainable in the long run?
Nike Value Chain
Nike’s value chain analysis shows that the company is a global brand that maximizes its profit through an efficient supply chain, states an article on Wondershare EdrawMax. Nike’s customer mindset is rather simple to evaluate, as their awareness of the brand and the attachment they have with it is unique. Their stock price hasn’t been hit as much as people would have thought during the pandemic and their pricing still seems affordable to a majority of their permanent buyers and new buyers.
Wondershare EdrawMax in the article states, “Nike has a supply chain that encompasses suppliers, transport, internal delivery, quality check to deliver up-to-the-market goods and services.” Nike’s product and communication remains top notch, even though their main competitors, Adidas, have great products, Nike has a cultural influence within sports and beyond that gives them the edge over Adidas as a brand.
Looking Ahead
Being able to create and perceive a properly curated brand value chain for any organization is instrumental in every aspect for your company.
Catch us each week for more on brands and take a look at our Sports & Brand Image Building article from last week!
Looking Ahead
Being able to create and perceive a properly curated brand value chain for any organization is instrumental in every aspect of your company.
Catch us each week for more on brands, sports, and marketing!
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