Business Models: A of Puma and Nike - Case Study Example

Business Models A study of Puma and Nike Submitted by: XXXXX XXXXXX Number: XXXXXXXX of XXXXXXXXX XXXXXXX XXXXXX Subject: XXXXXX Subject Code: XXXXXX Date of Submission: XX – XX - 2009 Table of Contents Table of Contents 1 1.Introduction: 2 2.Business Model: 2 3.Target Markets: 3 4.Key Competitors: 3 5.Evaluation of Websites: 4 6.Conclusion and Recommendations: 7 Bibliography 8 1. Introduction: The websites that have been chosen for this study are Puma (UK) and Nike (UK). Both these company are extremely famous worldwide and have a strong market position across the world. The main reason to choose these sites is for the difference that the sites have to offer when compared to any other consumer goods website. Each of them have their own style and image that they have created. This report aims at comparing the two websites and highlighting the positives and negatives of each of these sites. Also a brief discussion of the business model that the companies use will be discussed here. A brief overview of the target audience and the key competitors will also be made in this report. Also an evaluation of these sites will be done based on the criteria for web designing. 2. Business Model: The business model used in Nike is: “We grow by investing our money in design, development, marketing and sales and then contract with other companies to manufacture our products” (Nike Biz, 2009) Puma on the other end is more into being innovative and is more focused on the long term running of the company and strategies that can be useful for the long run rather than for the short term and quarterly interest only (Portfolio, 2008). 3. Target Markets: The main target market for both these websites is more of sports oriented people and also enthusiasts who prefer to customise and personalise all of their products (Johnson, G., Scholes, K. and Whittington, R., 2006). Also internet enthusiasts who would prefer to buy all their products using the ecommerce websites are also a major target here. The main age group of these people is normally between the ages of 18 to 30. 4. Key Competitors: The major competition for Nike has been recognised to be three main companies: Adidas, Reebok, K – Swiss and many others. Both Nike as well as Puma forms major competition for one another as well. However the competition that each of these faces is mainly from Adidas, Reebok, K –Swiss and many others. The figure below provides a clear break up of the market and the market share of the major companies in the markets. Figure: Global Statistics of the Market Share (Wikinvest, 2009) 5. Evaluation of Websites: Each of these websites will be evaluated based on the criteria that have been set down for successful web designing. Before moving into the evaluation of the websites, it is important to get a brief perspective on the various criteria that have been set down and pose to be the most essential for the development of excellent and successful websites. Listed below is the list of criteria for successful websites 5.1 Criteria: The basic criteria that is required to have better performing websites include, Functionality, Accessibility, Speed, Bandwidth Sensitive, Quality of Source Code, Layout, Navigation, User – Friendliness, Content, Customer interactivity, Security, Use of technology, Legal, and Adherence (Fisk, R. P., Grove, S. J. and John, J., 2000). 5.2 Nike: This site has all the elements that would make it a successful website. There is an instant appeal in the website, alongside with an excellent and easy navigation system. The company has used simple yet excellent, with very good use of Flash, which provides a chance to increase the interactivity of the website. The website allows good interactivity and provides the customers with an excellent interactive shopping experience. The website is very user friendly and provides the customers with a lot of options for customization in terms of colours, sizes, and styles for the shoes as well. The company has made good use of the website and technology and allows a number of features and possibilities for customization including almost every product that is listed in the product line. The level of personalisation and customization that is allowed on the website is one of the best features of the website. There is a strong positive aspect of the website, that customers have a chance to review the designs and view them from various angels before submitting the shoe created. Also the customers have a chance to finish up the personalisation and have a choice of almost eight to nine characters to be placed on the back of the shoe. Nike on an overall analysis has been able to keep in touch with all the above mentioned criteria and is an extremely well designed. The site allows for easy navigation and also the site map is very deep but with easy accessibility to all users. The website provides a chance for a customers and users to choose more than one shoe and customize it to their needs and requirements. Also the website provided details of the products and information and suggestions for all the products. This ensures that the customers are receiving whatever they are looking for and also are aware of the details of the products. The website is very customer centric and this is noted due to the fact that it offers the customers with a choice of templates that they could use to gain a better idea of the colours and the designs. The overall usability and comfort of this website is very focused on customers. These highlight the fact that the company is clear about the needs of the customers and understand its market well (Fisk, R. P., Grove, S. J. and John, J., 2000). Also, the website is much focused and works based on the business model that the company has had for a very long time now, i.e. the investment of money into design, development, marketing and sales along with the contracts with other companies to manufacture the products. 5.3 Puma: Puma on the other hand is a very different Ecommerce website with a very different shopping experience. The website has a lot of flash and the site has a strong design with excellent navigations. The entrance of the site leads the customers to a variety of pages like the shoes and the products that the company has available for the customers. The website however is not as effective and efficient as that of Nike. There is a lot of waiting time that is present for the images. The website also has an area which is referred to as the ‘Mongolian Shoe BBQ’. This is an idea that has been derived from the Ghengis Khan’s time. The website leads the customers into a restaurant kind of area which is where the customers can customise the new shoe. The website is fun and interactive, with a great design, however it does lack speed and the timing for the changes to be saved is very high. The shoes are allowed to be made to a number of colour and exactly to the customer’s needs and choice (Beynon-Davies, P., 2004). There is definitely a wide range that the customers can choose from and experiment on the shoes. The concept is excellent and this website provides its user with a wider range to choose from than what Nike provides. The theme is well incorporated and the flash used in the website is very good. The website plays not only with the visuals senses of the customers but also the sound. The overall experience of the Puma Website is very interesting and it is very user friendly. This website however has a very big draw back that it takes up a lot of the space and speed of the internet and can lead to the users website being slowed down due to the high level of flash and other videos that are integrated into the site. Also the website can get a little annoying after a certain point in time and this can leave the website with a number of drop offs and early exits (Jobber, D., 2004). The website although has a wide range of details that can be made, the choice of products that can be customised is very limited unlike Nike. The overall experience is good however it does have a number of glitches and technical issues, which in some terms overrides the excellent theme and design. 6. Conclusion and Recommendations: Based on the above discussion it has been noted that the companies in discussion here have been able to follow the criteria of the website designing. Nike and Puma have developed websites which are a new era in the virtual world and a totally new concept of personalisation and customisation. The websites have used all the features that are considered to be the criteria for website designing and have brought about a revolution in the online shopping experience (Evans and Moutinho, 1999). The only draw back is that Puma has been able to contribute to a great extent to the online shopping experience however it does have a lot it could change and improve in its website. The theme and concept used is very good however the company needs to concentrate on the improving the speed of the process and using low band width applications. However apart from this the companies have a strong influence on the markets and both these companies will always be remembered for the contribution to the online shopping experience (Dahan. E., and Hauser, J.R., 2001). Bibliography Beynon-Davies, P., 2004, e-Business, Palgrave Macmillan, NewYork Dahan. E., and Hauser, J.R., 2001, ‘The Virtual Customer’, Massachusetts Institute of Technology, Cambridge Fisk, R. P., Grove, S. J. and John, J., 2000, Interactive Services Marketing, Houghton Mifflin, Boston Jobber, D., 2004, Principles and Practice of Marketing, 4th Edition, McGraw – Hill, Berkshire Johnson, G., Scholes, K. and Whittington, R., 2006, ‘Exploring Corporate Strategy’, 7th edn, Prentice Hall, Essex Martin Evans and Luiz Moutinho, Contemporary Issues in Marketing, 1st edition, 1999 Nike Biz, 2009, ‘Company Overview’, Accessed on 22nd July 2009, Retrieved from http://www.nikebiz.com/company_overview/ Portfolio, 2008, ‘Q&A With Puma C.E.O. Jochen Zeitz’, 20th February 2008, Accessed on 23rd July 2009, retrieved from http://www.portfolio.com/views/blogs/fashion-inc/2008/02/20/qa-with-puma-ceo-jochen-zeitz Read More