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Nike Sustainability: Marketing for the Greater Good 4 Concord McNair Scholars Research Journal Volume 15 (2012) 28 Table of Contents Andrea Bertrand Mentor: Betsy Tretola, Ph.D. Nike Sustainability: Marketing for the Greater Good 4 Tiffany Blair Mentor: Ellen Darden, Ph. D. Utilization of Hands-On Activities to Promote Participation in STEM Fields 17 Michael Bowling Mentor: Tesfaye Belay, Ph.D. Immune Cell Localization in the Genital Tract Regions of Cold-Stressed Mice during Chlamydia trachomatis Infection 4b Jessica R.B. Ferrill Mentor: Karen Griffee, Ph.D. Factors Influencing Language Development in Sibling and Non-Sibling Children 18b Sarah Haltom Mentor: Jack Sheffler, M.F.A. Exploring Female Identity Through Visual Art 40 Jeremiah Nelson Mentor: John Fazio A.B.D. Alliance Management: A Progression Towards Sustainable High Performance Partnerships 63 Wendy Pace Mentor: Roy Ramthun, Ph. D. Analysis of Visitor Prefrences of the Hatfield-McCoy Trails 88 2 Adam Pauley Mentor: Dr. Cynthia Khanlarian The Bonner Scholars Program and its Impact on Issue Areas: An Athens/Concord Study 109 Laken N. Pruitt Mentor: P. Danette Light, Ph.D. Individual Beneficiaries: User-Type Husbands in the Swinger Lifestyle 120 Dustin Spivey Mentor: Tom Ford, Ph.D. Effects of Acid and Alkaline-Mine Drainage on Functional Diversity of Microbial Communities in Streams of southern West Virginia 134 3 McNair Nike Sustainability Marketing for the Greater Good Andrea Bertrand 4 Nike Literature Review Nike is an athletic company that was established in 1972 and dominating the industry ever since. Bill Bowerman was the head track and field coach for the University of Oregon when Phil Knight joined the team as a middle-distance runner in 1955. Not soon after Knight graduated from Stanford University with an MBA in finance, the two decided to became partners. When Knight and Bowerman started Nike, their vision was to provide an exceptional running shoe to athletes all over the country. But before it became the Nike known worldwide today, it started as Blue Ribbon Sports. The business consisted of selling the shoes out of the trunk of Knight’s green Plymouth Valiant, while Bowerman tackled the shoe engineering aspect to make the shoes more functional and lighter. Needing more assistance, Jeff Johnson was the first hired full-time employee for Blue Ribbon Sports. The majority of the marketing elements were created by him and the name of the company, Nike, was discovered by him in 1971. Later the company transitioned from selling another company’s footwear to designing manufacturing them their selves. The company made its debut in 1972 at the US Track and Field Trials, adding innovation to the running shoe with a lighter, more function design and the iconic “swoosh.” Nike has been running with it ever since (Nike Inc.) Now it is a thriving worldwide business that not only provides athletic shoes but apparel and other components for various sports. They continue to find new ways of marketing themselves and broaden the options they offer the consumers. The next frontier they have embarked on is the concern for the environment, creating the Nike segment “Nike Better World.” Nike keeps the same stylish and highly functional elements but reduces their carbon footprint on this planet (Nike Better World). The commitment to making Nike more sustainable has expanded exponentially in the past five years from simply counteracting criticism to innovating the way they conduct business 5 and manufacture their products. In an article from the Wall Street Journal published in 2009, the author is skeptical of Apple and Nike’s decision for their resignation from the U.S Chamber of Commerce board. Both companies claim that the board needs to alter its views and approach to climate change. The Boxer-Kerry bill, which will charge per carbon emission, will arguably not affect Nike because their manufacturing is mainly outsourced to approximately 700 factories in other countries across the globe. Satire is detected when the author of this article addresses the issue by stating “green virtue is easier when someone else is paying for it.” In an attempt to counteract the assumed loop hole Nike has an additional step which will be taken to set in motion a bill that will issue a carbon tariff on products produced in China and Vietnam that are sold in the U.S. In hopes of avoiding a significant amount of taxation, Nike is also continuing to reduce their carbon footprint based solely on the principle of becoming an eco-friendly brand in the athletic apparel industry. Some of the top brands in any industry to go green are Whole Foods Market, Apple, Dove, Walt Disney, Burt’s Bees, and SC Johnson (Swallow 2). With this small list compiled, one has to notice the absence of athletic apparel. Nike has the chance and is in an advantageous position to take the lead over other companies such as Adidas, Puma, and Under Armour. A plethora of approaches have been made to address the issue of sustainability and it has strayed away from becoming a target to more of an approach that endlessly needs to be reevaluated (Fromartz). For Nike, redesigning the athletic shoe itself and making it more sustainable instead of simply cutting back on particular manufacturing activities became the concentration for being eco-friendly. The article then proceeds to note that Nike’s challenge is to deviate from “compliance” and be avant-garde in the athletic apparel industry. Discovering that the production process took three shoes worth of material to complete only two jolted the 6 corporate offices. Waste of that material resulted in an annual loss of $700 million and extensive contribution to their carbon footprint. From that point on Nike established goals for the long run, setting a focal point of 2020. Setting these goals will prove beneficial only if substantial improvement is seen across the board. As of 2009, 15% of their products are considered “cutting edge” and they are striving to convert all shoes to this design by 2011, all clothing by 2015, and accessories by 2020. Change is constant and one thing that Nike does well in their journey to sustainability is provide figures for the general public to exam. Some figures provided by their annual report are the products have reduced waste by 67%; energy use was cut by 37% and solvent use declined by 80%. The figures are in comparison to other Nike products that have not implemented the new production methods. With other companies Nike could be more active in their pursuit to spread the technology they have, and not only being able to spread it is enough but actually making sure it gets done. In their effort Nike also teamed up with the World Wildlife Fund to make strides toward cutting carbon emissions. Spokesman for Nike, Joanie Komlos stated in an interview with In Business “we are taking the necessary measures to ensure our footprint has a minimal impact.” One of the more elaborate ways that the company has make an impact is their partnership with Delta Air Lines in a program that they both donated portions of the ticket price to offset emissions. An important element that Nike brought into their changes was re-evaluating their standards from relevant information. “We need to deliver innovations that rapidly evolve the way things are done at Nike, in our industry and throughout business,” Mark Parker quoted in an interview given to Business Wire. It is an acknowledgment of the forever changing market and with that comes the implementation of a new factory rating system. In the article it provides the main criteria for which the factories will be rated such as total performance, measures of quality, 7 cost, and environmental performance. Goals that were reached in recent years are carbon emissions were reduced by 6% from 08-11 and 97% of Nike footwear has reached baseline level or better for “Considered” Index. Some goals that they have set for the coming years are that by the end of 2015 there will be a 20% reduction of carbon emissions per unit in footwear manufacturing and that they will achieve zero discharge of hazardous chemicals for their entire product line by 2020. These are critical and bold standards to meet. Technology has only propelled Nike forward. It has given them the ability to not only reduce waste but also use the waste in manufacturing processes (Edelson). Products can be continually reused, which in turn reduces waste and cost for new materials (Entertainment Weekly). With these innovations Nike has reduced waste by 17% and has thus far recycled 18 million pairs of shoes. This practice is under personal scrutiny because there is no formal way for the public to send their shoes to Nike if they wished for them to be recycled instead of thrown away. In products outsourced to Japan, plastic bottles were melted down from landfills to create their new Soccer jerseys for 2010 (ENTWK). This process in turn saved 13 million plastic bottles from being dumped into landfills across Asia. These products still offer the innovative and functional design of Nike products but with a more positive impact on the planet. Where a problem arises is in Nike’s ability to market their sustainability concept to the younger market. An article from the Park Howell blog it shows the concerns of younger consumers and how they are less responsive to the idea of sustainability. The issue is that their understanding of the concept is lacking and they would rather strive for a “better world.” Nike needs to find a way to not only market to the up and coming segment but to also motivate them to want to be a part of a company in its attempt to change the world.
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