Threat of Counterfeits
The company has experienced marketing issues due to the presence of counterfeit products. The company has its production in a foreign country; hence, it does not manage all the manufacturing processes. In addition, its effects are shipped to the United States for sale through retailers, which creates complex distribution channels. These elements expose consumers to the purchase of counterfeit products unknowingly. There is increased imitation of products in the apparel and footwear industry, which exposes brands to counterfeit products to consumers. Due to the high price of products, customers also purchase the branded product at lower prices from retailers, exposing other unsuspecting consumers to such trends. Nike’s foreign production also poses challenges to the possibility of imitations. The oversee companies are involved in imitating products to benefit from such sales due to low employee wages.
Other companies in the industry also face the challenge of imitations, such as Adidas. Nike has introduced high innovation to develop its products through new launches and improved features. The company has an in-house design team to create products that are hard to imitate. It has also invested in research and development programs to produce better and unique products that match consumer needs to outdo the competition and become a fast-mover. However, it will need to increase its product features to distinguish it from counterfeit. If the company does not solve this issue, it could lead to saturation of counterfeit products in the market, which will affect customer trust, loyalty, and brand preference.