NIKE CASE STUDY

1. Sustainable Marketing : Problem – Strategies – Outcomes

Problems

- The company’s focus on reducing costs along with an aggressive strategy

caused labor relation problems for Nike. Throughout the 90’s, Nike was
scrutinized for its labor practices.
- Problems such as Nike’s contracted factories, illegal pay practices,
employee abuse, and dangerous working conditions etc. were exposed by
the Labor Activists working against the company.
- By 1998, CEO Phil Knight was forced to acknowledged that “the Nike product
has become synonymous with slave wages, forced overtime, and arbitrary
abuse.
- For much of the 90’s, Nike achieved Double-Digit Growth which was 42% in
1997 but tapered off to a lowly 14% in 2008. This happened by combining
extensive and effective product marketing with a rapid expansion plan across
emerging markets.
- Nike was needed to respond strongly to the complaints and issues raised
otherwise there was a threat to the goodwill earned over the years and the
image of the company getting tarnished.

Strategies

- Nike had to rethink its entire operating model across the supply chain. It started
by working on its Code of Conduct, making sure that the behaviors that resulted
in these labor problems are not incentivized.
- Nike also started to think about their design and marketing process, how it
affected different aspects of their supply chain.
 - VP of Corporate Responsibility Hannah Jones emphasized the importance of
“designing for the future… as opposed to retrofitting for the past.”
- Initiatives such as Considered Design Philosophy, Lean Manufacturing
Models etc. which reduced wastages & slowdowns were launched and
brought forward.
- In the early 2000s, Jones introduced the Sustainable Innovation initiative and
advocated for it throughout the company.
- The company has also set up ambitious environmental goals as it aims to
further reduce its environmental impact. Some notable goals are its aim to
reduce its factory count by 24% even with double digit growth targets and to
obtain 100% of its energy requirements from renewable sources by 2025.

Outcomes

- By turning its labor relations woes to successes in the field of sustainability,

pundits declared Nike have gone “from Villain to Hero”.
- In recent years, Nike successfully established itself as a brand dedicated to
sustainability.
- By the late 2000s, Nike had developed the Flyknit shoe design that lowered
wastage (the shoe used about 95% of materials procured).
- Nike also used sustainability as an important core competence and marketing
tool against other shoe manufacturers.
- The company needs to use its newfound status as a sustainability champion,
not only to further market its products, but also as leverage to pressure
governments and corporations to act on climate change.
- The company also needs to work on more partnerships with academic
institutions and NGOs to further harp on its idea of Sustainable Innovation.
- The company must secure its foothold as the leading company in sustainable
apparel with the intention of not only securing its future market share, but also
educating the end-consumer of the importance of sustainable products.
2. What can be the areas of skepticism/ Greenwashing?

Ans. Greenwashing is the practice of marketing a company or organization so they

appear more environmentally friendly or more ecological (more natural,
healthier, free of chemicals, recyclable, less wasteful of natural resources...) when
in practice its activities pollute the environment. Greenwashing is therefore
considered abusive or misleading because the company improperly positions
itself as more green than it actually is.

- Nike’s promise of making the Flyknit Shoe Design that has lowered the
wastage and claims to use 95% of the materials as recycled can be taken as
a case of skepticism by the end consumer. He/she has not verified the claims
being made by the company and hence it becomes a scenario of Greenwashing .
- Nike’s announcement of opening up a waterless dye factory after airing its
concerns regarding water shortages for apparel manufacturers can also
appear as a greenwash to many critics since there are no certifications or any
legal approvals to back it. It can be thought to be a gimmick just to catch the
public’s attention.
- Nike’s ambitious goals of reducing its factory growth by 24% even while
achieving double-digit growth appears to be a scam just to attract the attention of
the potential buyers. It can not go hand-in-hand as being projected by the
company.
- The company wants to obtain 100% of its energy requirements from
renewable sources of energy by 2025 which is yet another fallacious claim
since we don’t have any method of verifying if Nike has the appropriate
technology in place to make such tall claims.
- Initiatives such as Considered Design Philosophy and Sustainable
Innovation Initiative appear nice on paper but what are the actual benefits
being derived out of such initiatives remains unknown to the end consumer.
This again leads to a scope of doubt within the mind of the consumer and as
such becomes a case of Greenwashing.
 Sustainable Products and Materials (Category Based
Strategies) - Amazon Case Study

1. Household goods, food & grocery, Amazon Devices, Fashion &

Apparels, Chemicals: What are the evidences of being green/eco
friendly? Appeal to which age group, gender and income levels?
● Household Goods
- implemented a Chemicals Policy and Restricted Substance List
(RSL)
- broader retail sector’s collaborative effort to use safer formulations
and produce more sustainable products
- Amazon joined the Retail Leadership Council of the Green
Chemistry and Commerce Council (GC3).
● Food and Grocery
- uphold the Five Freedoms framework for animal welfare, including
freedom from hunger and thirst; freedom from discomfort; freedom
from pain, injury, or disease; freedom to express normal behavior;
and freedom from fear and distress.
- all applicable laws and to take a zero-tolerance approach to animal
cruelty, abuse, and neglect.
- Research ingredients and audit sourcing practices for Whole Foods
Private Brand products
- products are free of added hormones or antibiotics, and no cages
or tethers are permitted during the animal’s daily life.
- responsibly managed fish farms and fisheries.

● Amazon Devices
- understanding the environmental impact of these devices,
completing detailed life-cycle assessments (LCA) for many of them.
 - methodology for assessing the environmental, human health, and
natural resource impacts of products and services.
- These assessments help improve device energy efficiency,
research and prototype new materials, and explore additional
opportunities to improve the circularity of Amazon devices through
programs like Amazon Second Chance which allows customers to
learn about reuse, refurbishing, and recycling.
● Fashion and Apparel
- High-quality, sustainable apparel products.
- lower environmental impact of our Amazon-owned Private Brand
apparel products
- Direct partnership with suppliers for sustainably-produced fabrics
and recycled materials.
● Chemicals
- commitment to quality is avoiding chemicals of concern in our
products that can affect human health and/or the environment.
- strategically prioritize which chemicals of concern to focus on
based on product type, customer concerns, and the availability of
safer alternatives.

Product Type Age Group Gender Income Level

Household Goods 18+ Both

Food & Grocery 18+ Both

Amazon Devices 15+ Both

Fashion & Apparels 15+ Both

Chemicals 25+ Both

 2. How is green-washing possible in each category?
● Household Goods - fraudulent claims, use of toxic chemicals that are
harmful for the environment. In this case the end user has no means to
validate the claims of the seller.
● Food & Grocery - the condition of employees at a food packaging unit is
said to be very tough, not managing employee health and claiming to do
so. Meat of hunted animals might be sold. Food may contain unnecessary
chemicals and artificial color and flavors.
● Amazon Devices - sometimes a device repair is refused to encourage the
customer to purchase a new product. Inflated results of Life Cycle
Analysis may be shown.
● Fashion & Apparels - to pull down the product cost, synthetic fibers are
used or the natural fibers are mixed with other materials which makes it
difficult to recycle the product.
● Chemicals - the chemicals may be harmful for humans as well as the
environment which is not visible in the short run.

Sony Ericsson: pushing through the "greenwash" -Case Study

Comment on the need for Sony Ericsson to go GreenHeart?

From Sony Ericsson’s point of view, Greenheart represents a strong differentiator among
customers wanting to promote their own greenness. Many enterprise buyers have their own
sustainability and social responsibility targets: Sony Ericsson claims its 2009 Naite model has
had good success with enterprise customers and its 2010 Aspen model (a Windows Phone 6.5
smartphone) will also play into the enterprise market. Network operators hoping to shore up their
own green credentials are also more eager to include Greenheart models in their range than they
might otherwise be.

This green dollar is a significant marketing advantage: Sony Ericsson quoted market research
that shows that 10–30% of people are willing to pay extra for greener products, while 85–90%
will pick the greener alternative if two products are otherwise equal (in price, performance, and
quality).
 How does it affect their marketing?

marketing consumer electronics as “green” is troublesome: arguably the best thing most
handset

vendors could do for the environment would be to stop selling so many phones – not the most
popular or profitable strategy. So manufacturers’ claims of environmental responsibility should
be taken along with the understanding that they are underpinned by self-interest as well as good
intentions.

In marketing sony can highlight following green impact of greenheart -

Greenheart handset has a lifecycle carbon footprint that is roughly 15% lower than a comparable
standard model.

Other benefits flowing from reduced plastic and paper consumption, and use of less toxic
materials.

Some benefits are minimal in terms of carbon footprint, but have strong local benefits in and
around factories (such as switching to water-based paints).

What are the challenges? -

Compliance requirements by suppliers, Profitability, Greenwashing Claims.

A major stumbling block in making consumer electronics products greener is bringing suppliers
on board. Handset manufacturers face a complex supplier network, typically operating in
developing countries with less stringent regulations and low margins on individual components.

Making a real impact involves convincing not just suppliers but suppliers’ suppliers to adhere to
compliance requirements, and this process takes time and cross-industry cooperation to be
successful.

The imperatives of maintaining profitability do not interfere too significantly with sustainability
goals.
Seven Steps for a Sustainable Marketing Model for Electric Vehicle?

1. Sustainable Marketing : Problem – Strategies – Outcomes

Problem: The conversion of People from Regular Automobiles to Electric

Vehicles, with few challenges like: -

1. Regulatory Environment - With the Increasing CO2 Emissions most

Automobile Players have Ambitious growth plans of OEMs have announced
the launch of more than 600 new EV models by 2025. Which will attract
more competition and OEMs may find it more difficult to make profits if
governments reduce subsidies as EV technology advances.
2. Customers - According to a 2019 EV Consumer Survey shows persistent
hesitation among consumers in the largest automotive markets—China,
Germany, and the United States but on a contrary note many people consider
purchasing EVs (36 to 80 percent of car buyers, depending on the market). A
Survey by Mckinsey in 2019 on EV Mystery Shopping revealed the core
challenges facing OEMs that sell EVs right from their in-store presentation,
the accessibility of test drives, and the EV knowledge and processes of sales
associates must follow.
3. EV Infrastructure - Infrastructure is very important for any industry to work
particularly in EV fast-charging ones, is sparse. Battery quality, the time
needed to charge, and limited access to chargers are the biggest concerns for
potential EV buyers, accounting for 38 percent of all concerns raised.2 The
 rollout of charging infrastructure is accelerating, but no integrated, seamless,
and compelling solution is available, because the market is very fragmented.
4. EV business case and profitability - High investment required, initially low
sales volumes, the high cost share of the battery, and lower after sales
revenues, Falling government subsidies, increasing competition, and
persistent customer concerns are major areas to think about when
Jumping into this Industry.

Strategies: EV Marketing a step to g]make the globe a Sustainable place

but to push the product at the initial stages the Markets of EV need to
implement GO To The Market (GTM) strategies where in the organization,
plans to utilizing their outside resources (e.g. sales force and distributors),
to deliver their unique value proposition to customers and achieve
competitive advantage. Here the Marketers can

1. Target the Tech Savvy Segment with their Technologically

Advanced Products.
2. Target the Customers while showing the advantages like Clean Air
which they get by using an EV and as the customers are also used to
clean air since the arrival of Covid and Lockdown.
3. Target by saying Ability to Charge at Home than going to a Public
Place which some or most of the people/ customers are avoiding
from CoVid.
4. Target customers by convincing there are changes in regulation
which will affect their purchase if they don’t buy an EV now.

Outcomes: Primarily by making changes on the production and technology

sides (for instance, improvements to battery sourcing, platform strategies,
and alliances and ecosystems). OEMs must also develop innovative GTM
models to sell the required number of EVs and to find a sustainable
business model.seven radical innovations in four areas—offerings, sales,
after-sales services, and business models—will shape the OEMs’ EV future

1. Reinvent brand positioning - Focusing on differentiating themes. The

value proposition should align with the overall brand but also be specific to
EVs. Integrated EV-mobility bundles that include products and services.
include charging, on-demand features and services, revenues from data,
financing options (such as battery leasing), mobility services, and after-
sales packages (for instance, Care by Volvo).digital campaigns, to reach
and educate prospective EV customers.

2. Shape the charging ecosystem - create end-to-end charging systems

with single access points as quickly as possible—and at a reasonable cost
to the consumer integrate the different charging options (home, public, and
dealer) into the existing system and app landscape, working closely with
leading ecosystem partners. Home charging by bundling a co-branded wall
box with the EV, including a dealer margin to boost sales. OEMs could also
establish international partnerships to create a public charging solution with
a sufficient network of both standard and fast chargers.

3. Generate income from the life cycle - offer on-demand services and
features to consumers, as Tesla does through its AutoPilot. gain about
€100 a year in profit (around 1 cent per kilometer driven) over a car’s life
cycle after selling a new vehicle. opportunity to generate revenues from the
data of customers and vehicles. revenues from data could generate
approximately €50 a year per vehicle.
4. Massively reskill and refocus the sales force - Lack of knowledge among
salespeople about some of the potential benefits of EV, the human
tendency to avoid criticism, and lower EV dealer margins and after-sales
revenues. Converting the dealers into true EV advocates. OEMs should
ensure that all showrooms prominently display the entire EV portfolio
(including wallbox and charging solutions) and that customers can explore
them with digital tools.

5. Perfect the omnichannel approach - Investing significantly in their digital

presence to provide easy access to information about important customer
concerns.

6. Upgrade after-sales customer-centricity and readiness - EVs require less

after-sales service and understand battery and high-voltage technology.
Hence Companies need to conduct EV-specific training programs—in
battery diagnostics, for example—to train the technicians in their dealer
networks

7. Transform the business model to achieve profitability at scale - Higher

production costs, lower after-sales revenues, continuing uncertainty about
battery reuse and remarketing, and the significant investment required for
the charging infrastructure.optimizing their existing dealer networks by
easing standards, such as stock requirements. Adopt leaner, more
customer-centric retail formats, such as urban flagship stores and
experience centers, depending on the needs of specific geographies. They
can ensure quality of service by offering new after-sales concepts, partially
shift to direct-to-consumer sales models (such as subscriptions) for
selected geographies or offerings.
 CASE 1 (AMAZON)

Renewable Energy

Amazon has a company-wide goal to power our operations with 100%

renewable energy by 2025. In 2019, we reached 42% renewable energy
across our business. As of June 2020, Amazon has 91 solar and wind
projects across the globe that have the capacity to generate over 2,900
megawatts and deliver more than 7.6 million megawatt hours of energy
annually—enough to power more than 680,000 U.S. homes.

Shipment Zero

Shipment Zero is Amazon’s vision to make all Amazon shipments net zero
carbon, with a goal of delivering 50% of shipments with net zero carbon by
2030. Shipment Zero means that the fulfillment operations we undertake to
deliver a customer’s shipment are net zero carbon—from the fulfillment
center where an item is picked off the shelf, to the materials used to package
the item, and the mode of transportation that gets the package to the
customer’s door.

Electric Vehicles

In 2019, Amazon ordered 100,000 new electric delivery vehicles from

Rivian, a U.S. electric vehicle manufacturer. This order, the largest order
ever of electric delivery vehicles, sends a signal to the marketplace to start
inventing and de- veloping new technologies that large, global companies
need to transition to a low-carbon economy. Amazon plans to have 10,000
of the new electric vehicles on the road as early as 2022 and all 100,000
vehicles on the road by 2030.

Sustainable Packaging
Amazon created our Frustration-Free Packaging program to encourage
manufacturers to package their products in easy-to-open, 100%
recyclable packaging that is ready to ship to customers without the need
for an additional shipping box. Since 2015, we have reduced the weight of
outbound packaging by 33% and eliminated more than 880,000 tons of
packaging material, the equivalent of 1.5 billion shipping boxes.

Right Now Climate Fund

Amazon established the Right Now Climate Fund, a $100 million USD fund to
restore and conserve forests, wet- lands, and grasslands around the world.
Through the Right Now Climate Fund, Amazon is taking immediate action to
remove or avoid carbon emissions by supporting nature-based climate
solutions. Amazon is working with The Nature Conservancy to identify
projects around the world that can create real and lasting carbon reductions,
while also em- powering communities, enhancing natural environments, and
protecting wildlife.

Climate Pledge Fund

In June 2020, Amazon announced The Climate Pledge Fund to support

the development of sustainable and decarbonizing technologies and
services that will enable Amazon and other companies to meet the
goals set by The Climate Pledge. This dedicated investment
program—with an initial $2 billion in funding—will invest in visionary
companies whose products and solutions will facilitate the transition to
a low carbon economy.