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Q: History of Nike Corporation ( Answered 4 out of 5 stars,   0 Comments )
Subject: History of Nike Corporation
Category: Business and Money > Advertising and Marketing
Asked by: santabarbara-ga
List Price: $15.00
Posted: 23 Sep 2005 16:19 PDT
Expires: 23 Oct 2005 16:19 PDT
Question ID: 571825
How did Nike get started? Did they use grass roots marketing amoung
college athletic coaches. What is the early history of Nike company?
Subject: Re: History of Nike Corporation
Answered By: tlspiegel-ga on 23 Sep 2005 17:29 PDT
Rated:4 out of 5 stars
Hi santabarbara,

Thank you for a very interesting question.


The Force Behind the Nike Empire by Jackie Krentzman

"In a very short period of time, Phil Knight created one of the
greatest American commerce stories of the 20th century," says sports
agent David Falk, who has frequently butted heads with Knight over the
marketing and representation of athletes."


"But make no mistake: As athletically awesome and charismatic as
Michael Jordan is, he alone did not make Nike as recognizable
worldwide as Coke and McDonalds. Nor did he make "Just Do It" the
slogan that best encapsulates the 1990s. Nike is a cultural icon
because Knight understood and captured the zeitgeist of American pop
culture and married it to sports. He found a way to harness society's
worship of heroes, obsession with status symbols and predilection for
singular, often rebellious figures. Nike's seductive marketing focuses
squarely on a charismatic athlete or image, rarely even mentioning or
showing the shoes. The Nike swoosh is so ubiquitous that the name Nike
is often omitted altogether.

"Phil understands the symbolic power and attractiveness of sports,"
says A. Michael Spence, dean of the Stanford Graduate School of
Business and a Nike board member. "And he helped build that connection
in our culture."


"No company has put as much creative energy and resources into
marketing celebrities as Nike. If, as Marshall McLuhan famously said,
advertising is the greatest art form of the 20th century, then Nike is
its Picasso, imaginatively expanding the parameters of the medium's
use of the athlete-endorser. "We didn't invent it," Knight
acknowledges in an interview, "but we ratcheted it up several

Nike engineered shoes for the top echelon of athletes to compete and
train in. At the same time, the company's mass marketing made the
shoes so attractive and desirable that they became a de rigueur
accessory to the American wardrobe and dream--even if increasingly
sedentary teens only wore them to watch TV."


"An indifferent student, Knight graduated from Oregon with a degree in
journalism in 1959. He enlisted in the army for a year (and served in
the reserves for seven), then enrolled at the Graduate School of
Business at Stanford.

Stanford changed Knight's life. Finally, school wasn't drudgery. For
the first time, he was excited to read about something other than
sports. And it was in Frank Shallenberger's small-business class that
Knight conceived Nike.

Shallenberger gave his class the following assignment: Invent a new
business, describe its purpose and create a marketing plan. In his
paper, "Can Japanese Sports Shoes Do to German Sports Shoes What
Japanese Cameras Did to German Cameras?" Knight developed a blueprint
for superior athletic shoes, produced inexpensively in Japan, where
labor was cheaper. "That class was an 'aha!' moment," Knight says.
"First, Shallenberger defined the type of person who was an
entrepreneur--and I realized he was talking to me. I remember after
writing that paper, saying to myself: 'This is really what I would
like to do.' "


"Knight streamlined the company (laying off 600 of the company's 2,000
employees) and reorganized Nike along more conventional, corporate
lines. Where Knight was once famous for governing by instinct, today
Nike studies reams of statistics and convenes a focus group before
designing a new shoelace. The marketing budget grew, and so did the
emphasis on design, Nike's euphemism for fashion."


Powerbasketball - a coaches resource center

From the book:  Sole Influence: Basketball, Corporate Greed, and the
Corruption of America's Youth by Dan Wetzel, Don Yaeger

Unlike Mike

"The irony is how easy it was for Nike to sign the original.

It was the summer of 1984 and Vaccaro was waiting at a Tony Roma's
restaurant in Santa Monica, California, for his then best friend
George Raveling, the head coach of the University of Iowa and an
assistant on the U.S. Olympic men's basketball team, to bring Michael
Jordan to lunch. Vaccaro was a marketing guy for Nike, charged with
the concept of getting the company involved in the world of


"But Nike had decided that what would truly work is developing a
signature shoe for an athlete. By creating for a player his very own
shoe, named and marketed just for him, Nike was hoping that said
player's popularity would spur sales. Vaccaro liked the concept of the
signature, just as he had liked the concept of signing college
basketball coaches to exclusive endorsement contracts and assuring
that the nation's top collegians?all amateur athletes prohibited from
signing individual endorsement deals?would have his brand-name shoe on
their feet"


"But the game plan was set in motion from Nike's standpoint in
November of 1983 when we were identifying the college players and then
solidifying them in January or February of '84. We knew Michael
(Jordan) could come out and..."


"Vaccaro, Jordan, and Raveling had lunch and talked hoops. Through
college Jordan had worn Converse at North Carolina because of the
company's endorsement deal with Tar Heel coach Dean Smith. Off the
court, Vaccaro says, Jordan wore adidas.

"Michael had never seen nor ever played in a Nike shoe until then," Vaccaro said.

Vaccaro touched lightly on Nike's ideas and they agreed to another
meeting just before the Olympics with Jordan, his agent, David Falk,
Vaccaro, and Nike executive Rob Strausser. That time they met at the
exclusive L'Ermitage Hotel in Beverly Hills. Strausser was one of the
creative geniuses behind Nike until he left the company in 1988; he
later ran adidas America until his death in 1997. He and Vaccaro laid
out the plan for the signature shoe?the Air Jordan, a phrase Falk and
Strausser coined. Jordan and Falk were intrigued and although Converse
was signing most of the game's top talents Jordan seemed uninterested
in endorsing the company.

"We presented a plan to him," Vaccaro said. "It was a detailed plan.
The whole plan was how we were going to market Air Jordan, how we were
going to make it different."

Jordan was interested enough about Nike to come to Portland, Oregon,
in the fall with his parents to learn more about the Air Jordan. There
the Jordans were given a tour of the city, wined and dined, and showed
repeatedly that Nike considered the Air Jordan to be the highest of

"It was very formal," Vaccaro said of the meetings. "It was a
recruiting trip because I think signing him had a lot to do with what
we said we were going to do and the relationship I established with
him early. He felt comfortable once he came to Oregon." Although,
Vaccaro admits, there really wasn't much to show the Jordans. Phil
Knight's company was nowhere near the corporate giant it is now, so he
couldn't offer much of a tour.

"There was no plant," Vaccaro said. "There was no NikeTown. There was
no Nike campus. We were in cubbyholes, a bunch of cubbyholes in leased
office space. We didn't have a building. Michael built the Nike
buildings." Although Michael sat in on every presentation, it was his
parents who did most of the talking, Vaccaro said. "I think they were
more in tune with what we were trying to do than even Michael,"
Vaccaro said. "I think Falk had a lot to do with convincing them this
was a landmark thing. I think David did a good job preparing him and
getting him ready for this thing." At one meeting the Jordans were
shown the Air Jordan logo?then a pair of wings similar to the kind
airline pilots wear. They were also shown a prototype of the Air
Jordan shoe. "He was excited about havinghis shoe, but it wasn't like
we had this prototype thing that was the most innovative shoe in the
world," Vaccaro said. "In fact, the first Air Jordan was pathetic."


Analysis of Marketing Plan of Nike and Michael Jordan
"During 1971, BRS caught a break when a trading company called Nissho
Iwai introduced BRS to important letters of credit. This credit
allowed BRS to subcontract its own shoe line and by 1972 it was
selling Nike Brand shoes. Over the next decade Nike expanded almost
double its size each year from the previous year. Nike is officially
called Nike in 1978 and has signed on tennis great John McEnroe, New
York City marathon champion Alberto Salazar, women?s marathon gold
medallist Joan Beniot, and Olympic track star and gold medallist Carl
Lewis. Also during this time Nike is opening manufacturing plants all
over the U.S. Nike was a household name for most athletes by early

Nike?s focus was still on track and field and for the most part track
athletes were their target market. One of the first individuals to
endorse a Nike product was a man who exemplified their style and way
of conducting business, Steve Prefontaine. Prefontaine was a household
name in the late seventies and has gone down in history as one of the
best American track and field athletes ever. Prefontaine was a friend
of Knight and had been coached by Bowerman at the University of
Oregon. Prefontaine embodied what Nike wanted as its differential
advantage of other companies due to his brash attitude, high talent
level, and cavalier mentality. Nike marketed itself as a new and
innovative shoe company that constantly had the athlete?s performance
in mind unlike existing companies who focused on their products
appearance and durability. Nike infested their market with bright
colors, new styles, and technology information pertaining to their
products. This is why Steve Prefontaine and Nike were a tremendous
tandem in the early years of Nike?s existence."


"The more Jordan played in front of national audience the more Nike was marketed." 


Investor's Business Daily - Business Leaders & Succcess

"The company name was changed to Nike Inc. in 1980, when it went
public. It passed the billion-dollar revenue mark in 1986. Nike, based
in Beaverton, Ore., markets its products in more than 100 countries
and is the world?s No. 1 sports and fitness company in market share
and sales, about $9 billion in 2000. At that time, Nike accounted for
more than 40% of all athletic-shoe sales in the United States.

Bowerman?s inspiration and high standards had a lot to do with Nike?s
rise to stardom.

"Bowerman had a laser focus to solve a problem with an athlete and
then move on," said Geoff Hollister, Nike?s grass-roots marketing
manager, who trained under Bowerman while at the University of Oregon.

Knight, a marketing wiz, was expert at taking Bowerman?s solution and
making it available to the masses..."


An interesting article on Nike Advertising can be found at:

History and Timeline

Nike's Heritage

The Swoosh

"The SWOOSH logo is a graphic design created by Caroline Davidson in
1971. It represents the wing of the Greek Goddess NIKE. Caroline
Davidson was a student at Portland State University in advertising.
She met Phil Knight while he was teaching accounting classes and she
started doing some freelance work for his company. Phil Knight asked
Caroline to design a logo that could be placed on the side of a shoe.
She handed him the SWOOSH, he handed her $35.00. In spring of 1972,
the first shoe with the NIKE SWOOSH was introduced.....the rest is
history! (from Nike Consumer Affairs packet, 1996)

A brief history of Nike

The Nike athletic machine began as a small distributing outfit located
in the trunk of Phil Knight's car. From these rather inauspicious
beginnings, Knight's brainchild grew to become the shoe and athletic
company that would come to define many aspects of popular culture and
myriad varieties of 'cool.'

Nike emanated from two sources: Bill Bowerman's quest for lighter,
more durable racing shoes for his Oregon runners, and Knight's search
for a way to make a living without having to give up his love of
athletics. Bowerman coached track at the University of Oregon where
Phil Knight ran in 1959. Bowerman's desire for better quality running
shoes clearly influenced Knight in his search for a marketing
strategy. Between them, the seed of the most influential sporting
company grew."


Nike's Timeline:  1957 - 1996


Nike, Inc - Timeline:  1962 - 2005,_inc.htm


NIKE HISTORY by Scott Roth


11/21/2002: Press Release from Nike, Inc. 

Oklahoma Native American High School Track To Be Dedicated Friday 

"Geoff Hollister, who will speak on Friday, ran under Bill Bowerman at
the University of Oregon and coached the early jogging program in
Eugene. As an early Nike pioneer, he founded the Nike OTC Marathon,
initiated the Athletic West Club, and operated Nike's Olympic Track &
Field for over 12 years. Still committed to Nike, and serves on four
non-profit organizations as board members, including WINGS of


keyword search:

nike shoe
nike marketed to college coaches
nike's grass root marketing 
nike marketing + plan
Nike, Inc marketing athletes
nike swoosh logo design history + orgins
phil knight nike
history + timeline Nike, Inc


Best regards,

Request for Answer Clarification by santabarbara-ga on 23 Sep 2005 21:59 PDT
I really wanted to know about the first few years of Nike. How did
Phil Knight start from the trunk of his car up to the point he signed
Michael Jordan. What "grass roots marketing" did he use to get

Clarification of Answer by tlspiegel-ga on 23 Sep 2005 22:11 PDT
Hi santabarbara,

Thank you for your clarification request.  I'm working on that now and
will post ASAP.

Best regards,

Clarification of Answer by tlspiegel-ga on 23 Sep 2005 22:53 PDT
Hi santabarbara, - High School Special report: The game of his life Foot soldiers

Stanford MBA student Phil Knight writes a research paper asserting
that low-priced, high-performance exports from Japan could challenge
Germany's dominance in the U.S. athletic shoe industry. Two years
later, Knight teams with his former track coach at the University of
Oregon, Bob Bowerman, and with $500 each they form the Blue Ribbon
Sports (BRS) shoe company that later becomes Nike.

The Swoosh is born. Knight pays graphic design student Carolyn
Davidson $35 to come up with an identifying symbol for his shoes.

BRS uses the name "Nike" on gear made for track athletes at the U.S.
Olympic Trials in Eugene, Ore. Jeff Johnson (the company's first
employee back in 1965) suggested the name after dreaming about the
Greek goddess of victory in 1971.

Vaccaro, who had joined Nike the previous year, starts giving college
coaches free Nike shoes and $5,000 contracts to have their teams wear
them exclusively.
Vaccaro bets Knight his job that Michael Jordan is worth an
endorsement contract for $500,000 a year. Knight signs Jordan, and the
next year the Air Jordan shoe line grosses $100 million.

At the Summer Olympics, because of Reebok's multimillion-dollar
contract with the U.S. Olympic Committee, members of the "Dream Team"
are obligated to wear Reebok warm-up suits on the medal stand. Jordan,
who has his own multimillion-dollar contract with Nike, wears the suit
but rolls back the collar to hide the Reebok name and drapes an
American flag over the logo. Said Jordan afterward: "I stood for what
I believe in. That's what the flag means to me."



In the second paragraph you'll notice:

"In the beginning, Knight?s company was a grassroots organization.
Knight would sell shoes at local track meets out of his car. His
grassroots strategy was born of low capital and necessity, but became
one of the strengths of the company. Blue Ribbon shoes developed a
reputation of authenticity and high quality somewhat due to this
grassroots strategy.

In the sixth paragraph poste you'll notice:

In the beginning, Knight?s company was a grassroots organization.
Knight would sell shoes at local track meets out of his car. His
grassroots strategy was born of low capital and necessity, but became
one of the strengths of the company. Blue Ribbon shoes developed a
reputation of authenticity and high quality somewhat due to this
grassroots strategy."

"Nike got its start in 1962 as Blue Ribbon Sports, when Phil Knight
started selling shoes out of the trunk of his car. Knight was an avid
runner, and thought there was a market for athletic shoes designed by
athletes for athletes. He was right.

In the beginning, Knight?s company was a grassroots organization.
Knight would sell shoes at local track meets out of his car. His
grassroots strategy was born of low capital and necessity, but became
one of the strengths of the company. Blue Ribbon shoes developed a
reputation of authenticity and high quality somewhat due to this
grassroots strategy.

Still, the company was not an instant success. It would have been easy
for Knight to give up early. In 1964, Bill Bowerman, Knight?s track
coach, joined the company, and in 1965, Jeff Johnson was hired as the
first employee. Still, the company only made $20,000.00 in sales and a
meager $3,240.00 in profit. Blue Ribbon opened its first retail outlet
in 1966. In 1969, Blue Ribbon posted sales of $300,000.00, and Knight
finally quit his job as Assistant Professor of Business Administration
at Portland State University, to concentrate full time on the growing
enterprise. His seven years of devotion to Blue Ribbon Sports, while
simultaneously maintaining a full time job to pay the bills, was
finally starting to show signs of success.

In 1973, the new Nike, Incorporated (renamed after a Greek goddess and
chosen for simplicity) had a first of a different kind when they
signed Steve Prefontaine to endorse the Nike brand running shoes.
Prefontaine was Nike?s first endorsed athlete, and proved to be a
vision of things to come. He was not just a great athlete. He
epitomized the company?s anti-establishment, irreverent attitude.
Nike?s ability to find great athletes who represented something that
transcended sports and who were able to reach people on many levels
would play itself out over and over again in Nike?s future and prove
to be one of Nike?s biggest competitive advantages."


"In 1980, Nike?s marketing, which we have all come to know quite well,
was in its infancy. The grassroots marketing techniques were still the
norm, and helped establish authenticity with athletes. Endorsements
were big as well. Nike chose athletes who, like Steve Prefontaine,
were not just good at sports, but had distinct personalities too.
These athletes embodied the ideals of determination, individually,
self-sacrifice, and winning. Phil Knight believed that people were
heavily influenced by what top athletes were wearing and would
purchase shoes accordingly. He called this the ?Pyramid of Influence?.

Ironically, given the current advertising that Nike does, in 1980,
Phil Knight did not believe in advertising. He thought it hurt the
intimate relationship between the runner and his or her shoes. For the
purist athlete, advertising and commercialism were heresy. Nike did a
little bit of advertising, but only in peer-group running journals. It
wasn?t until 1987, that Nike ran its first TV advertising campaign."


Phil Our Hero

"Thirty years ago when Knight was selling shoes out of the trunk of
his car on evenings and weekends (in addition to his day job), he was
fortunate to average $2.50 a day from the shoe operation. It was his
tenacity and his extraordinary skills as a capitalist (a pejorative
designation for the sign wavers) that created the most increditable
success story in the history of Oregon business enterprise. His
concept of marketing with endorsers was key to the success of Nike and
continues to be an important element in their successful operation.
The economic wealth he has created for our society in wages and taxes
are almost beyond calculation and our state would be a far poorer
place without him."


Sports Business

"In 1962, Knight founded Blue Ribbon Sports Inc. with his former
University of Oregon track coach Bill Bowerman. Before Nike and the
air bubble technology, Bowerman was inspired by a waffle iron to put
the criss-cross design on the bottom of track shoes to add traction.
Sales in the first year totaled $8,000.

In 1971, Knight paid designer Carolyn Davidson $35 to make the famous
swoosh. The following year, the company changed its moniker to Nike,
named for the Greek goddess of victory."


"In 1984, Nike was the only brand willing to give a rookie named
Michael Jordan his signature shoe."


The link I provided for Nike History by Scott Roth states

"Nike would have never become the company it is now without the sound
business decisions of their CEO Phil Knight. Knight was one of the
first businessmen to allow retailers to pre-order inventory. This was
a revolutionary business decision that soon became standard among
other businesses.After 8 years Nike decided that it was time to go

Then in 1985 Nike signed the one player that every other company
envies Nike for. During this year there was a young NBA rookie by the
name of Michael Jordan entering the league. Nike soon signed the young
superstar and launched the new Air Jordan shoes. This line is now one
of the longest lasting lines in all of shoe history. The Air Jordan
gave Nike the edge in basketball shoes.They now are the leaders in not
only running shoes but also in basketball. Nike would soon branch out
into many other sports making it a diverse and hugely profitable


Hoops Vibe - Retro basketball The Birth of the Famous Nike Air Jordan
I Black and Red

"Early winter 1984, nike (a struggling shoe company then) had to find
another selling segment as the running-shoe craze began to wind down.
nike thought Michael Jordan was the man to save the company, hoping
that the other products he was already endorsing would rub-off on the

But Michael Jordan, a rookie, just out of college didn?t like nike. He
liked Converse, the shoes endorsed by North Carolina and coach Dean
Smith. But Converse already had great players like Larry Bird and
Magic Johnson on their payroll. They weren?t prepared to offer a
better deal than nike. The other company MJ was interested in, was
Adidas. However Adidas did not show much enthusiasm for this rookie,
and in fact gave him a worse deal than Converse!!


"David Falk (Michael Jordan?s agent) wanted Jordan to sign up with
nike because nike was prepared to give him his own line of shoes,
called the "air jordan". Michael Jordan didn?t see the significance of
a shoe deal. A shoe is a shoe after all, you sign-up and get paid for
wearing them. nike knew Jordan was something special, he was a
champion with a big heart, and they put the company on the line for


"Then as he and Falk walked out of the meeting, Michael Jordan said to
Falk, "Let?s make the deal." There you go, the Genesis of air jordans.
Peter Moore gave us the first air jordan Logo which was a basketball
with wings lifting it.

After Michael Jordan won the 1986-87 Slam Dunk comp at Seattle
Colliseum, the logo metamorphosised into the Jumpman Logo we all

nike signed Jordan to a US$2.5 million deal for 5 years, plus
royalties and other fringe benefits."


Phil Knight sheds his running shoes - He gave Nike its trademark swoosh

He gave Nike its trademark swoosh

"A former University of Oregon track star, Knight founded Blue Ribbon
Sports, with Bill Bowerman in 1968. Knight's first shoes, which he
sold out of the trunk of his car, had soles made on Bowerman's waffle


"The company was renamed Nike in 1972." 


"Under Knight, Nike pioneered celebrity-athlete endorsements of its
products. The company signed basketball great Michael Jordan in 1984,
turning him into a brand name with Air Jordan shoes."


Best regards,
santabarbara-ga rated this answer:4 out of 5 stars
Good answer!

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