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Case Study | Inside Nike’s Radical Direct-to-Consumer Strategy

• Chantal Fernandez

In October 2020, in the middle of a global pandemic that had infected 188 countries, causing record sales damage across the retail sector, Nike’s share price hit an all-time high.

Like other retailers, Nike had been forced to close most of its network of more than 900 stores across the world, as had its key wholesale partners like Nordstrom and Foot Locker.

But the American sportswear giant’s performance during the pandemic, when its online sales spiked, signalled to many that Nike had the competency to prosper long term, in a future that will be increasingly defined by e-commerce and digital brand connections.

It was a validation of a strategy that Nike prioritised three years ago, dubbing it “Consumer Direct Offense,” but the seeds of the approach go back almost a decade.

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Above all, Nike is a marketing company. It doesn’t just sell sneakers; it sells the brand aspiration that imbues those sneakers with meaning. But to achieve the reach required to scale its business, Nike’s distribution strategy had long-relied on third-party retailers to sell its products, even if the consumer experience offered by those partners diluted its brand.

But in a future increasingly defined by e-commerce, fast-moving trends and, above all, the rising power of branding to drive consumer preference when competitors are just a click away, Nike realised that in order to thrive, it needed to take control of its distribution to better manage its brand and deepen its connection with consumers.

It was definitely architecting a new retail, and a bold, retail vision for Nike.

Such an evolution is easier said than done, especially for a business as large as Nike in a category as competitive as sportswear. But by radically cutting back on its wholesale distribution and raising the bar for brand experience with the third-party partners that remained; expanding its focus on content, community and customisation to keep customers close; investing in its data analytics and logistics capabilities; and rethinking the role of the store as a brand stage, Nike drove a veritable direct-to-consumer revolution.

When the pandemic hit, these shifts went into overdrive.

“It was definitely architecting a new retail, and a bold, retail vision for Nike,” said Heidi O’Neill, Nike’s president of consumer and marketplace, and one of the most prominent executives leading the brand’s new strategy in recent years. “But it started with our consumer, and we knew that consumers wanted a more direct relationship with us today.”

In this case study, BoF breaks down Nike’s pioneering direct-to consumer strategy and how it has worked to the brand’s advantage, propelling its share price to new heights during the global crisis of 2020.

Click below to read the case study now.

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The Nike Customer Experience And The Role of Its Journey Map

Within the fashion and apparel industry is an extremely competitive division where major brands vie for supremacy. Among them, one brand stands out not only for its incredible products or eye-catching campaigns but also for its ability to delight customers in various ways through every touchpoint that consumers experience – we’re referring to the Nike customer experience.

In this article, we will delve into the world of Nike’s Customer Experience, taking a closer look at some of their most successful initiatives, their customer journey , and some recommendations for implementing similar actions in your projects or businesses.

The Heart of Nike’s Customer Experience

At the core of Nike’s customer experience strategy lies a commitment to providing stylish products that perform exceptionally well. This commitment is reflected in their range of athletic gear, meticulously designed to cater to the needs of athletes and sports enthusiasts alike.

However, to become one of the leading brands in your industry, that alone is not sufficient. This is where customer experience strategies come into play. These are initiatives that focus on the customer journey, from the moment someone sees an advertisement or enters a Nike store to the post-purchase interactions. All of this is done with the aim of delighting their customers.

These strategies serve as the backbone of brand loyalty, reputation management, data-driven decision-making, customer retention, and global relevance. Nike’s unwavering commitment to delivering exceptional customer experiences ensures that it doesn’t just sell products; it sells a lifestyle, a mindset, and an enduring connection with its customers.

Nike has become a master of these types of initiatives and actions. In the following sections, we will explore some of the most successful ones and reflect on what we can learn from these strategies.

Examples of Nike’s Customer Experience Strategies

House of innovation.

The House of Innovation project by Nike significantly impacts the customer experience. These flagship stores, known as ‘temples to shopping in the digital age,’ blend physical and digital worlds seamlessly, immersing customers in the Nike brand’s ‘Just Do It’ ethos. The digital integration enhances convenience and engagement with features like QR codes for virtual dressing rooms and interactive wall displays.

An important element to highlight within this initiative is personalization. Exclusive services like Nike by You offer NikePlus members one-on-one customization sessions with designers, creating unique, branded products. This elevates the shopping experience and strengthens the emotional connection between customers and the Nike brand, fostering loyalty and advocacy.

The Nike App was a game-changer for both Nike and its customers. Their App enhances the shopper experience by giving access to the NikePlus rewards program. This loyalty program offers members exclusive products, member exclusives, access to Nike experts, personalized workouts, priority access to events, and, most importantly, gives Nike insights into customers’ shopping habits and product preferences. This personalization enhances customer satisfaction and strengthens the emotional connection between consumers and the Nike brand solidifying their loyalty and enriching their shopping journey.

Nike Live Stores

The introduction of Nike Live stores in various locations has brought a revolutionary shift to the customer experience. These dynamic spaces, beginning with the inaugural store in Los Angeles, offer customers a shopping environment that feels alive and ever-changing. Nike Live stores transcend the traditional retail model with rotating product arrays, local artwork, and interactive features like the sneaker bar and consultation services. Customers can now immerse themselves in a personalized shopping experience, trying out shoes on treadmills and enjoying the vibrant atmosphere.

Technology in Physical Stores

Nike has succeeded in providing unique experiences to people visiting their physical stores by incorporating advanced software and hardware that surprises anyone who interacts with such technology. These implementations are not merely experiential; they make the purchasing process simpler and more efficient for people. Some notable examples include:

Replica Kiosk: A digital retail kiosk with a 65″ touch display where Nike Football fans can find, customize, and order their favorite Nike team products. It provides real-time product availability for both in-store and online purchases, streamlining the shopping process and improving stock efficiency.

Nike Bootroom: An interactive surface with a 65″ multi-touch display that facilitates employee and customer interactions. It offers real-time availability information for Nike products based on size and color, thanks to RFID technology and 3D cameras.

Mobile Connect: This feature offers free WiFi in-store, promoting extensive use of digital terminals. It enables more than 1,000 interactions on busy days, often involving groups. Integrating seamlessly with the retailer’s mobile app supports customers’ journeys throughout the store and allows convenient content sharing via smartphones.

Media Wall: The multi-touch, multi-user wall serves as a dynamic information hub, displaying campaigns, products, and real-time social media updates. It aggregates content from platforms like Facebook, Instagram, and YouTube, including soccer team rankings and scores. Additionally, customers are encouraged to engage by taking selfies, which are instantly discoverable through custom hashtags.

The Role of the Customer Journey Map in a Company’s Strategy

The customer journey map is a graphic and visual representation of all the points of interaction between users and a brand. This includes any type of contact, ranging from seeing an advertisement to something as involved as making a purchase.

These touchpoints are usually organized into stages and include additional information to better understand the steps or actions a potential consumer takes.

Each of these customer touchpoints is an area of opportunity if leveraged effectively. Likewise, they can become pain points where the user experience and perception can be negatively affected. Therefore, constant monitoring of each of these points and a strategy for continuous improvement are of great importance in the growth of any business.

Example of Nike’s Customer Journey Map

Below is an example of a fictitious customer journey map for Nike, created with reference to some of the most common touchpoints in the industry and information gathered from media and specialized portals.

Nike’s customer journey map would look like this:

Stage 01: AWARENESS

Stage 02: consideration, stage 03: purchase, stage 04: usage, stage 05: loyalty, stage 06: advocacy, start delighting your customers by nurturing every stage of your customer journey.

In a market flooded with choices, consumers are not just looking for products; they seek an emotional connection with the brands they choose. This is where the customer experience comes into play and becomes a differentiator that positions brands like Nike above others, even if they offer equally good products.

These types of strategies are not exclusively reserved for large corporations; in fact, they are something that all companies should implement regardless of their size or revenue. The rewards of doing so are numerous and impossible to ignore, especially if you aim to build a base of loyal and happy customers.

QuestionPro has developed an entire suite of tools and solutions to help you implement a successful customer experience strategy.

Among the most notable are:

QuestionPro CX, our Customer Experience Management Software,

A platform with everything you need to delve into the minds of your customers and understand their satisfaction levels. Thanks to features like our ticketing system and survey platform, you can identify opportunities within your customer journey to delight your users at every stage.

QuestionPro SuiteCX

A platform with everything you need to create customer experience journey maps and perform journey analytics in a simple and effective way. You can integrate various data points, user persona profiles and easily edit them to create action plans and detailed contact strategies.

If you’re interested in learning more about our solutions and how QuestionPro can help you empower your business, please contact us. We’d love to chat with you and find the best way to execute your projects with our technology.

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How Nike Is Enhancing Future Customer Experience Through Brand Image

Featuring first-hand insights from nike, adidas, and under armour executives.

The pandemic has reminded customer experience analysts of a few trends that have been forgotten in the past decade of digital marketing, brand image, product development, customer service, and the complete customer experience that encompasses each of these departments. 

A few key takeaways before we dive in: 

Speed of innovation trumps accuracy.

Marketing messages need to appeal to the social interests of customers. 

Most importantly, personalization is the new foundation of customer experience and needs to encompass every initiative a brand launches, whether it’s targeting a single customer, or a wide array of customers, personalized brand image needs to be apparent, appealing to a specified consumer persona.

Personalization can reap a 300% or higher return on investment

The latter is a prime finding in not only nearly every CCW Digital report relating to customer experience and customer service, but Kibo's fourth annual survey regarding personalization within the retail experience, specifically.

The survey reveals that half of retailers adopting a personalization strategy can reap a 300% or higher return on investment and are often in the best position to pivot in making changes to meet customer needs , whether it’s during a socioeconomic pandemic, or after one.

When you’re the top dog in sports apparel, as well as the largest global footwear brand, it might be easy to keep doing what got you there. 

In 2017, Nike recognized its dominant market share across these two industries and interestingly decided that this would be the perfect time to start drastically changing some of its marketing and customer experience practices. The apparel juggernaut introduced the  Triple Double Strategy  - promising to double its “cadence and impact of innovation,” double its “speed to market” and double its “ direct connections with consumers .” The three components of Nike’s Triple Double Strategy sound nice on the surface, but one has been recently proving more profitable than the others. 

Read More: How Nike Combines Customer Centricity With Brand Reputation To Stay On Top

What really sets brands apart?

Of course, much of Nike’s retail model is underpinned by consumer research, which stems partly from the company’s voice of customer program (started two years ago), Rodgers explained. 

“If you have a digital ecosystem and you have physical stores, how do those two things go together? But the  real  question is: how do consumers want to use those two channels in different ways?” Their “direct connections with consumers” of their Triple Double Strategy has proven imperative before and during the pandemic. More importantly, they’re using the campaign to lay the groundwork for after the pandemic, something we can all learn from. It’s not solely speed of service and omnichannel customer experience outlets that set Nike apart from Adidas or Under Armour. 

As former Under Armour VP of Retail, Carl Smit recently told me, “Most retailers are trying to get customers in store, we were trying to get them out more efficiently,” which is undoubtedly one of the most important factors in customer experience - efficiency of channels, that is. But it’s not the only one. 

However, “We didn’t have any consistency with how Under Armour was showing up across [these] different channels,” due to misaligned brand marketing.  

On the other hand, as Jeff Lienhart, President of Adidas Golf told me at our last online event , “We’re in the process of launching a brand new footwear style… We’re on the ground with experiential activations, included with assets like our tour-players. We’re getting that content and then the content [based on demographics and geo-targeting] will be used throughout the spring to bring life to the product and sentiment around that product,” on a personalized basis. 

For a customer to engage in your channels, stores and media, there needs to be established brand reputation and credibility in order for customers to want to experience them. To some degree, Adidas, as well as Nike’s “direct connections with consumers” approach encompasses not only their physical and digital channels, but the communication they’re relaying, and the message consumers are ultimately, well, consuming. 

Delivering a Nike message

Staying fit indoors is challenging enough. Staying motivated can be far more difficult for the market Nike, Adidas, or Under Armour are all in. 

Read More: Nike's Top 3 Priorities For The Digital Customer Experience

Space is limited for many, of course. And public indoor workout options or even gyms are largely off the table – not to mention the emotional weight of economic uncertainty along with fears around the coronavirus’ toll on our communities. With Nike facing many of the same challenges that competitors like Adidas or Under Amour are facing, the question remains, why does Nike continue to win the race? Why are customers engaging in their channels and outlets as opposed to competitors? The takeaway here extends to a global level right now, from local mom and pops shops to fortune 500 juggernauts. 

While the overall retail market is shrinking during the socioeconomic pandemic (like most markets), and Adidas and Under Armour continuing to struggle with brand imagery, Nike continues to win their personal connection with consumers in the long hall. They’re investing in their future.

For example, according to Adweek :

Nike had recently raised a motivational flag for fans to rally around with  its “Play for the World” campaign,  which used simple text to convey a relatable and personal message of solidarity, a massive marketing campaign displayed to a large audience, but a tactically crafted and personalized message nonetheless. They’re not hammering their latest products. They’re talking directly to their customers. 

Now the brand is back with a 60-second spot, “You Can’t Stop Us,” for which  Wieden + Kennedy Portland  compiled video footage shot at homes all over the globe.

While there are a few star athletes to be found in the ad, including LeBron James, and Nike-backed talents like Somali boxer Ramla Ali and beach volleyball star Sara Hughes, it’s clear that the message is one of unity across all levels of athletics, unifying athletes (and customers) in a personal and emotionally appealing marketing message, cultivating a brand that we’re inadvertently gravitating towards. 

The ad is part of a much larger quarantine-era commitment by Nike to help people stay active, including  livestreamed workouts from Nike “master trainers”  and a fun interactive competition called  the Living Room Cup.

Marketing for the future of CX

They’re adopting a “display the right message now, reap benefits later” approach to their “direct connections with consumers” campaign. 

Read More: A Pyschological Approach To Management And Leadership After A Socioeconomic Crisis

As the world’s leading customer experience and customer service influencer, NYT, WSJ bestselling author, and  CCW Digital advisory board member ,  Shep Hyken  recently told me:

  If there is something to consider, it is a shift from reacting to what we’re going to do coming out of this crisis…. With ‘light at the end of the tunnel,’ what are companies doing to prepare to get back to normal? How are they going to manage their teams to come back? What are they doing to get their customers ready to return? I think we need to start focusing on the ‘coming back’ strategy.

And it starts with the personal message you’re relaying to your customers. 

With over 150,000 global members, join the largest research hub for customer contact and customer experience professionals by subscribing here . Through our complementary offerings, you’ll have access to the latest research, news, blogs, podcasts, webinars, whitepapers, training, and technology insights in customer experience. 

For media coverage, lead gen, and digital marketing inquiries, contact me at  [email protected] .

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Nike’s Customer Experience Puts Their Best Foot Forward

Creating a cohesive cross-channel experience for customers has become a high priority for brands during the pandemic. With shoppers relying more on ecommerce , brands had to undergo a digital transformation to ensure that they instill confidence in their customers via online channels. 

Over three weeks, we examined Nike’s email and mobile marketing experience. By completing various actions—sign up for emails, abandon a product browse, abandon a cart, etc.—with Nike, we were able to uncover customer experience successes as well as opportunities. 

Nike has an excellent experience when it comes to marketing their products. They sent multiple triggered abandoned cart and abandoned browse emails to encourage us to buy products we had looked at. However, there is the potential to further personalize some of these messages. With the data Nike collects, message individualization could reach a whole new level. 

The results of our research are at the end of this post in our Customer Experience Analysis, but first we’ve highlighted some stats below for context about our time with Nike.

The First-Hand Customer Experience

In the attached analysis we illustrate the research process in a timeline to demonstrate when and how Nike shares their marketing messages.

Over the three weeks we received:

• 32 messages total
• 17 emails (12 promotions, 2 welcome emails, 3 abandoned browse/cart)
• 15 mobile messages (8 mobile inbox, 7 push notifications)

Our goal with this research was to better understand how retail brands are using their marketing messages during a time where ecommerce has become more prevalent than ever before. Do they use multiple channels? How personalized are their messages? Are their cross-channel strategies cohesive and centralized? While our takeaways only capture a small sample of Nike’s full customer experience, the insights gained are applicable to other apparel brands and retail brands in general. 

As a new user, Nike did well to gather our information and welcome us as a Nike Member. They sent not one, but two welcome emails describing the benefits of becoming a member with links to download their app and talk to Nike experts. 

One takeaway, in particular, however, is Nike’s collection of zero-party data . Gathering data directly from the customer, rather than through third parties, ensures the data is highly accurate and aligned with the customer’s preferences. Nike collects information like customer name and birthday to be able to provide individualized messages to each user. But, there is room to improve their personalization efforts. 

See how Nike can go a step further with personalization and other takeaways in the analysis below and be sure to check out our other Customer Experience Analyses on HBO Max , ASOS , and e.l.f. Cosmetics . 

Iterable is the AI-powered cross-channel communication platform that helps organizations like Redfin, DoorDash, Calm, and Box to activate customers with joyful interactions at scale. With Iterable, organizations drive high growth with individualized, harmonized and dynamic communications that engage customers throughout the entire lifecycle at the right time.

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Nike Marketing Strategy: How Nike became a market leader and you can "just do it" too!

Learn about nike's iconic marketing strategy and advertising campaigns. read how nike aces the 4ps of marketing mix - product, price, promotion & placement..

• overview#goto" data-overview-topic-param="history">Revolutionary history
• overview#goto" data-overview-topic-param="first">Nike's First Shoes
• overview#goto" data-overview-topic-param="mix">Nike's Marketing Mix
• overview#goto" data-overview-topic-param="strategy">Nike's Marketing Strategy
• overview#goto" data-overview-topic-param="noteworthy">Noteworthy Marketing Campaigns
• overview#goto" data-overview-topic-param="key">Key Takeaways

When you hear the word Nike, it’s impossible that you don’t see the Swoosh logo right in front of your eyes along with the words “Just Do It”. This is the result of Nike’s exemplary marketing and brand positioning since its inception in 1964. Today, Nike has established itself as the undisputed leader in the sportswear industry.

Being a consumer brand, Nike has managed to develop a competitive advantage of customer loyalty and strong brand recognition. What marketing strategy did Nike use to be the top-valued brand worth USD 176 billion in the sportswear industry? Let's find out!

Revolutionary history and innovation of the first Nike shoes

Inspiration and innovation are Nike’s deeply rooted core values. To understand this better, we need to know Nike’s history to understand why it is the way it is.

Foundation of Nike as a company

Nike Inc, previously known as Blue Ribbon Sports, was founded in the year 1964 by Bill Bowerman and Phil Knight. Nike is an American sportswear company headquartered in Oregon.

Fun Fact - Bill Bowerman was a track and field coach at the University of Oregon, and Phil Knight was his former student.

Source - Business insider

The jogging revolution

Jogging wasn’t mainstream in the early 1960s. It was believed to be only for athletes. 

On a trip to New Zealand in 1962, Bill discovered jogging and its benefits. He published a pamphlet on jogging in 1966, which was then turned into a book the next year. Bill is credited for bringing the jogging craze which swept America in the late 1960s. Jogging was then seen as a means to maintain a healthy lifestyle.

First shoes by Nike – Waffle Trainer

Nike’s first retail outlet was opened in 1966. Once, while having breakfast, Bill looked at the waffle and said the top part would be perfect for the track field. He got the materials for making the shoe soles and poured them into the waffle iron. This is how Nike created its first shoe, Waffle Trainers. Nike launched them in 1973.

Where did Nike derive its name and logo from?

Blue Ribbon Sports was renamed Nike Inc in 1979 and went public in December 1980. Nike derived its name from the name of the Greek Winged Goddess of Victory. The logo represents the wings, symbolising motion and speed.

Nike’s first content marketing strategy

In Nike’s case, content marketing came before the product. The customer base was built before the idea of the product was even thought of. Which marketing strategy did Nike use in its initial days?

Customer awareness

In the 1960s, people were unaware of the benefits of jogging. Selling shoes in a market that didn’t know it needed them would have been a fool’s act. Nike sold shoes only when customer awareness was shifted from Unaware to Solution aware.

Existing pain point 

Nike solved an existing problem which is ‘how to get fit’. It didn’t try to solve a non-existing pain point. 

You must develop products keeping your customers in mind.

Benefit-centric marketing

Nike shoes were sold as a means to support a healthy and sporty lifestyle. It didn’t boast about its product features. It used a benefit-centric marketing plan instead of a product-centric one.

Sell products you believe in

Bill Bowerman invented shoes that were lighter and faster. This shows how passionate he was about them. Nike’s belief in providing the highest customer value originates from its founders themselves. Nike truly believes in its products. This reflects in Nike’s customer perception as well.

Nike Marketing Mix - The four P’s of marketing

Nike uses its marketing mix to determine the strategies to be applied to execute its marketing plan. Nike’s marketing mix focuses on high-quality sportswear sold through online or offline mediums at a premium price while using customer-centric promotion strategies.

Nike Product Strategy

Although Nike shoes are the MVP, it’s a sportswear brand. Nike's products range from sports shoes, clothes, backpacks, sports equipment, and accessories. 

Nike has positioned itself as a leader in the sportswear industry. It focuses on high-quality products that are durable, visually appealing, and trendy. 

Nike produces distinct shoes for different sports like running shoes, basketball shoes, tennis shoes and ice hockey skates. Air Jordan is the most valued Nike shoe brand. Modern technology and innovation are the core elements of the creation process of Nike products.

Nike’s Pricing Strategy

Nike charges a premium price for its product quality, the value it provides, and the intensive technology investment.

Nike's strategy consists of the below two pricing plans:

Value-based pricing strategy

In this pricing strategy , Nike analyses the consumer perception that is the maximum price the consumers are ready to pay for its products and charges value-based prices.

Premium pricing strategy

Nike charges premium prices to establish itself as a premium brand amongst its competitors. Premium branding is done by partnering with high-profile sports celebrities and sponsoring them as brand ambassadors as well as being a sponsor of sports events like being an Olympic sponsor. This establishes Nike as a brand with premium products.

Nike’s Distribution channels

Nike sells its products through online and offline mediums for higher market reach.

Retail stores

Nike uses retail stores to sell its products to a wider target market without spending extra costs on infrastructure. These are strategically located to be easily accessible to consumers. This includes local stores as well as shopping malls. 

Online store

Nike’s online store website offers a wider range of choices along with the convenience of place and time. It offers an effortless and fun user experience through vibrant pictures, detailed filters, and smart product recommendations. Online store product prices are lower because other than delivery and manufacturing cost, there isn’t any added cost.

Nike-owned retail stores

Nike-owned retail outlets are called NikeTown. In these stores, only Nike athletic footwear, apparel, and accessories are sold. This allows them to control the sales process and provide customers with a brand-focused user experience. As of May 2022, Nike owns 1,046 retail stores all over the world. 

Source - Nike Website

Nike Promotion Marketing Strategy

Nike uses a highly influential promotion marketing strategy to maintain a strong brand image and bring in maximum sales.

It uses every possible marketing trick in the book to amp up its reach like Banner Advertising, placing a sales team for personal selling through retail outlets and direct marketing via website, emails, and social media networks. Nike also spends a ton of money on sales promotions by offering discount codes. It's also heavy with its Public Relations activities and ads via digital marketing strategy to improve its brand value.

As of 2022, Nike's global ad spending amount to USD 3.22 billion alone, minting them USD 46 billion in revenues!

Nike's Marketing Strategy

Nike has adapted well to the ever-changing trends and dynamic technology without losing its core identity, brand message, and voice. Their approach is still consumer-centric and benefit-driven. Even in a fiercely competitive market, Nike manages to be the talk of the town with below methods:

Brand positioning

The Nike marketing strategy operates in a focused target market which is the sporting goods industry. Nike’s target audience is professional athletes, sportspersons, and people who want a healthy and sporty lifestyle.

Focused marketing helps the Nike company be at the top of the mind of its consumers. When people think of sportswear, they automatically think of Nike. 

It uses a customer-centric approach. Instead of boasting about the product and its features, Nike focuses on their consumer’s pains and problems and how a Nike product can solve them. Few companies are doing it like Nike.

As a brand, you must  define your ideal customers and serve only them. If your marketing message doesn’t target a specific group of people, or you are serving multiple vertical markets, you are writing your doom. 

Your consumers don’t care about the brand-new features of your product. They care about how it can make their life easier. Don’t sell products, sell benefits.

Emotional storytelling 

Nike is the ace of brand storytelling. Through Nike’s ‘Just Do It’ campaign, it tells stories to encourage and inspire people to achieve their fitness and sports goals.

Authentic stories build trust and a strong connection with the brand. Nike helps people to dream big and customers feel like they belong. This builds a strong community and unshakable consumer loyalty, which is rare to find in other brands.

Nike’s very first commercial shows a shirtless 80-year-old man running across the Golden Gate Bridge. He runs 17 miles every morning. The core message is, if an 80-year-old can do it, you can too!

Nike - Just Do It (1988) - Very first commercial

Nike’s Find Your Greatness campaign conveyed the message that greatness isn’t for a select few. It’s in every single one of us. This ad shows people from various parts of the world and ages overcoming their fears and achieving greatness.

Nike: Find Your Greatness

By taking inspiration from the Nike marketing strategy, you must use storytelling in your content marketing strategy. Take your potential customers on a Hero’s journey where they are the protagonist fighting their way through obstacles and achieving victory.

The Nike social media strategy

Nike’s consumers are the younger generation between the ages of 15 and 45.

The company depends on this data to find out on which social media platforms Nike users hang out and develops a marketing plan to provide value to them on those platforms.

Social media marketing channels help Nike improve its brand recognition and be at the top of its target customers’ minds.

Nike differentiates itself based on the value it provides instead of price or any other factor.

Nike’s social media content types include:

Sports celebrity endorsements

Nike collaborates with high-profile faces in the sports industry and uses emotional marketing and storytelling to celebrate their achievements and talk about their failures.

Endorsements by famous athletes like Michael Jordan, Kobe Bryant, Ronaldo, Serena Williams, LeBron James, and many more establishes Nike as a premium brand.

In this Instagram post, Olympian and gold medallist Simone talks about how becoming the first Black swimmer to win gold impacted the future of the next generation of Black swimmers.

https://www.instagram.com/p/ClboXHrrVMj/

Joining customer’s social conversations

Nike joins existing customers' conversations on social media where it is mentioned. This ensures direct communication with Nike customers. Nike’s audience feels heard and valued, further solidifying its relationship with its customers.

Source - Twitter

Affiliate marketing by influencers

Nike developed an affiliate marketing program through which influencers can earn commission by promoting the line of products Nike sells. This enables the brand to earn mentions across various social media channels in the form of product unboxing, reviews, or use case videos. Nike reaps the benefits of influencer marketing without spending extra costs on advertisements.

Nike’s Email marketing strategies

Email marketing is at the core of the Nike marketing strategy. Nike sends 3 - 4 emails every week to its customers to keep them engaged and eager for more.

The emails are automated responses to various touchpoints like signing up, leaving reviews, successful purchases, product delivery, and newsletters. Their email marketing strategy enables them to be in direct contact with their target consumers and stay consistently connected.

4. Ensuring a simple, fun, and hassle-free online shopping experience

Nike ensures a smooth user experience for online shopping through its strategic eCommerce marketing strategy

Nike website theme - bold, vibrant, and youthful

Nike uses youthful, fearless, bold, and athletic pictures on its website to align with its brand image. Nike positions itself as a sports brand that is unique, youthful, and vibrant.

Source - Nike website

The detailed product filtering process

Customers can filter products on the basis of type, gender, price, colour, brand, sport, athletes, weather, and collaborator. This detailed filtering helps customers to find exactly what they want, fast!

Product recommendations

Nike's website recommends relevant products to the product the user is viewing. This makes the buying process easy, quick, and effortless for the buyer.

Nike membership

Nike membership provides members exclusive products, Nike by you customization, and special offers to its members.

5. High-quality, unique and innovative products

Nike puts its customers first. It collects data on its target customer behavior to optimize its products and services to meet its needs.

Nike uses advanced and innovative technology for constant improvement in its products.

One of the most innovative Nike products is HyperAdapt 1.0. A Shoe with adaptive lacing technology that laces itself when you put your heel in.

Source - Amazon Website

Noteworthy Nike Marketing Campaigns

Nike’s creative advertisements are at the centre of the Nike marketing strategy. They deliver impactful messages that stay with the viewer long after seeing them. Nike is well known for its campaign ‘Just Do It’ which encourages people to go after their dreams and just do it! 

Ten of Nike’s most noteworthy advertising campaigns:

I am not a role model - Charles Barkley, 1993

Nike’s controversial ad sparked an uproar about whether   athletes   should be looked at as role models.

Nike "I Am Not a Role Model" commercial w/Charles Barkley - 1993

Hello World - Tiger Woods, 1996

This advertisement introduced Woods to the world when he was just starting his career in golf. Nike claimed Woods will be influential in the future, and its predictions came true.

Failure - Michael Jordan, 1997

In this Nike ad, Michael Jordan talks about his failures. This is a retrospective ad on his Basketball career.

Love me or hate me - Kobe Bryant, 2006

This ad was crucial because it was Nike’s first ad with Kobe Bryant after he was faced with sexual misconduct allegations. While others didn’t want anything to do with him, Nike stood their ground and supported him.

I feel pretty - Maria Sharapova, 2006

This ad was aimed at eliminating the “Pretty Girl” label Maria was given despite taking the tennis world by storm.

No excuses - Matt Scott, 2007

Matt Scott, an American wheelchair basketball player, points out excuses people use to not do something in this powerful ad.

Bottled Courage - Olympics, 2008

This Nike ad’s message is that the courage you are seeking on the outside is already within you.

Equality - 2017

Nike aimed at fighting the prejudice and discrimination against Black people with this ad.

What are girls made of? - 2017

This stunning Nike ad starts with the girl stating the general stereotypes about girls and then goes on to share that girls are made of iron, resilience, dreams, and dedication.

One day we won’t need this day - 2020 

On International Women's Day in 2020, Nike honoured women’s achievements by featuring women athletes in its ad, hoping that someday we won’t need a day to celebrate women.

Key takeaways from the Nike Marketing strategy for entrepreneurs 

Nike’s marketing strategy is a gold mine to learn from and grow your brand. These are the key takeaways you must apply to your brand to see exponential growth.

Identify what your target customers want from you

Nike identified its target customer’s need to become fit. It smartly positions itself as a brand that helps its customers reach their fitness and sports goals.

Identify your target customer’s problems, pains, concerns, fears, and doubts and help them overcome them. You can build brand authority by answering your target customer’s most prominent concerns. Provide them value instead of boasting about your product and being salesy.

Instead of putting all your focus on product features and competitor strategy, identify what your customers want from you and give them that. 

Research the best medium to reach your customer

Determine your target customer, know where they hang out and how best you can reach them. 

Don’t be on a platform just because everyone else is. If your target audience is below 25, they will be hanging out on Instagram way more than on Facebook. If you are on Facebook instead of Instagram, then you are doing it wrong. Create content with your audience in mind and share them on the right platform at the right time.

Bonus tip: Provide consistent value to stay on the top of your target audience’s mind.

Create customer-centric content

Whatever form of content you create - blog, social media posts, videos, white papers, they should all be customer-centric. That is, they must provide the best content to solve your customer’s problems.

If you provide high-quality content, then you’ll be seen as a market leader. Your content will be widely shared and spread.

The biggest key takeaway from the Nike marketing strategy is that your customer must be your hero and included in your brand image . Everything you create and share must be done keeping them in mind. If you're building a retail product, we would also recommend you read our marketing case study on Jockey which also uses similar product-focused marketing tricks.

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Please note you do not have access to teaching notes, co‐creating value through customers' experiences: the nike case.

Strategy & Leadership

ISSN : 1087-8572

Article publication date: 5 September 2008

This case aims to demonstrate how leading firms are learning how to sustain competitive advantage by co‐creating experiences of value with customers.

Design/methodology/approach

The shoe company Nike provides a glimpse of the next “best practices” of value co‐creation with customers. By engaging with informed, connected, and networked customers around the globe, Nike has found their shared experiences to be a new source of value.

The paper finds that customers are now informed, connected, networked, and empowered on a scale as never before, thanks to search engines, engagement platforms, the growth of internet‐based interest groups, and widespread high‐bandwidth communication and social interaction technologies. Customers have learned how to use these new tools to make their opinions and ideas heard.

Practical implications

A few leading companies like Nike are involving customers in the value creation process by offering Internet sites where they can share their interactions and experiences. These range from customers' ideas about how to improve or customize products to their feelings when they use products.). For Nike, the learning from these interactions creates new strategic capital. The company can now learn directly from customers' direct input on their preferences. Nike can build relationships and trust with the Nike+ community and experiment with new offerings, all the while enhancing its brand.

Originality/value

The strategic opportunity for Nike is to build and promote the use of Internet engagement platforms through which the firm can build customer relationships on a scale and scope as never before. Effectively managing these new initiatives initially posed a new challenge for Nike, a traditionally product‐centric organization. Now their viewpoint is reversed. “In the past the product was the end point of the consumer experience. Now it is the starting point.”

• Value added
• Customer information
• Social interaction
• Consumer marketing
• Customization

Ramaswamy, V. (2008), "Co‐creating value through customers' experiences: the Nike case", Strategy & Leadership , Vol. 36 No. 5, pp. 9-14. https://doi.org/10.1108/10878570810902068

Emerald Group Publishing Limited

Copyright © 2008, Emerald Group Publishing Limited

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Nike is setting the standard for omnichannel loyalty in every industry.

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Most marketers understand that earning loyalty is bigger than rewards programs and incentives. That it’s important to treat different customers differently. And they agree that a loyalty program should deliver the best content, offers, and experience that a brand has to offer.

But, making the shift from loyalty as a standalone marketing practice to something that is tightly integrated with the customer experience is hard. And companies struggle with many of the fundamentals that make it possible — such as understanding customer interactions across channels, delivering a consistent experience, and collaborating with internal groups like eCommerce and customer service.

Enter Nike.

Membership in NikePlus, which it bills as “the very best of Nike”, is at the center of Nike’s direct to customer growth strategy. The 170M members of the program get benefits for both shopping and using its family of apps. There are three things that set Nike’s approach apart:

• Loyalty has a higher calling than a promotional firehose.  Nike prioritizes loyalty and membership as part of the company’s corporate strategy for growth. In his FY2019 letter to shareholders, Mark Parker referenced members and membership six times and attributed 35% growth in digital revenue to the expansion of the program.
• Exclusivity, access, and innovation are front and center.  NikePlus members get access to shopping perks like free shipping but the emphasis and focus is on access and exclusives rather than percent off. It consistently tests new kinds of partnerships and benefits to keep the program fresh and exciting. For example, in November it introduced “Member Days,” where program members could get unlock a new benefit – such as free gift with purchase, rewards for doing a working in Nike’s training apps, or first access to the new Kyrie 6 shoe — each day for six days.
• Member insights impact omnichannel experiences . The member experience and exclusive offers aren’t just limited to mobile, web, and email. Nike brings membership to life in its stores as well with express checkout, special store hours for members, and a members-only floor at its flagship store in NYC. It’s also using member data to enhance the value it delivers for members through hyper-localized store formats: at the end of October, Nike  expanded its Nike Live concept  with two new stores in Long Beach, CA and Tokyo, Japan.

Nike may be setting a new standard for loyalty, but the uptick in retail loyalty program revamps I’ve seen in the past 18 months tells me that other retailers are paying attention and investing in program evolution too. Stay tuned, you’ll be hearing more from us about retail loyalty in 2020.

This post was written by Principal Analyst Emily Collins, and originally appeared here .

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Nike Marketing Strategy 2024 - 7 Effective Findings from Case Studies

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Table of Contents

Nike marketing strategy: top effective findings from case studies, history of nike, goals and objectives - nike marketing strategy, nike’s target audience, nike marketing strategy: challenges, solutions, and its approaches, how nike’s marketing strategy evolved, how to apply the nike’s marketing strategy to your brand, growth and market reach, what to take.

Nike has taken an image of an athleisure company and an American multinational corporation, but, the brand has taken way the world with inspiration, emotion, diversity, and unity with its simple marketing campaigns.

The core purpose of Nike marketing strategy is to keep moving the world forward. Over the years, it has launched and introduced various stylish and sustainable services from remembering the Swoosh, and the tagline ” Just Do It” which does not only come into our mind.

Enlisting the action of Nike's marketing strategies is remarkable. What makes it so special to get the products?

There are multiple reasons why people buy Nike products in this case study explained, but, one absolutely convincing means is that it is more than a brand that builds communities, planet protection, and makes sports accessible beyond diverse horizons. We have also discussed the top Nike Marketing Strategies that you can learn in 2024.

Purpose of the Article

The main aim of this article by Sprintzeal caters to information as social proof from various case studies about a process, product, or service that can resolve marketing issues.

Known as one of the largest athletic apparel companies,  Nike (Nike, Inc.)  is an American multinational association that deals with the design, development, manufacture, and global marketing and sales of footwear, accessories, apparel, equipment, and services. Began with a mission to, “bring inspiration and innovation to every athlete” in the world It is based in Beaverton, Oregon, NIKE, Inc. includes the Nike, Converse, and Jordan brands, and many more. 

It was founded by Bill Bowerman and his former student Phil Knight in 1964.

Nike plans to build a 3.2 million square foot expansion to its World Headquarters in Beaverton.

The Nike brand strategy focuses on bringing the culture of the invention to today’s athletes while solving issues for the upcoming generation.

Nike has acquired and sold several footwear and apparel companies over the years. It has also acquired Starter, Zodiac, Celect, and Datalogue and purchased RTFKT Studios.

It was founded in 1964 by Bill Bowerman, a track-and-field coach at the University of Oregon, and his former student Phil Knight as Blue Ribbon Sports. The brand was rebranded in the 60s, their company was relaunched as Nike in 1971.

In 1972, Blue Ribbon sports which later became Nike unveils "Moon Shoes

In 1974, the Waffle Trainer was patented, featuring Bill's famous Waffle outsole.

In 1982, introduced the Air Force 1 basketball shoe.

In 1994, Nike signs LeBron James

In 2000, launched Nike Shox in the market.

In 2008, introduced the Flyware shoe and signs Derek Jeter

In 2018, introduced React Element 87. Nike launched a new "Just do it" ad campaign featuring Colin Kaepernick.

In 2020, Nike Air-max 97G "Peace and love" was introduced. It also reveals uniforms for the 2020 Tokyo Olympics.

The main priorities and objectives of Nike marketing strategy,

• It includes promoting diversity, equity, and inclusion.
• Innovations that create sustainable materials and approaches to tackle environmental impact.
• Towards advancing a transparent and responsible supply chain.
• To build community by investing in organizations that pay efforts on economic empowerment, education, and equality.
• Uplifts unity with the current generation through sport and encourages an active lifestyle to reach their potential future.

To truly understand the effectiveness of Nike's marketing strategy, it's crucial to dissect the various segments within their vast target audience. Nike's ability to connect with different consumer groups is a central theme in this Nike marketing strategy case study. Let's delve deeper into these segments:

Athletes, Professionals, and Enthusiasts: Nike casts a wide net, catering to athletes at all levels, from elite professionals to passionate enthusiasts. Their product range is meticulously designed to enhance athletic performance, making Nike the preferred choice for athletes worldwide.

Running Enthusiasts: Nike's dominance in the running domain is unparalleled. They offer an extensive selection of running shoes, apparel, and accessories tailored to the specific needs of runners, whether they're seasoned marathoners or occasional joggers.

Sports Enthusiasts: Beyond athletes, Nike appeals to anyone with a fervent passion for sports. Their marketing efforts invite individuals to adopt the mindset of an athlete, whether they actively engage in sports or simply lead an active lifestyle.

Women in Sports: Recognizing the growing influence of women in sports, Nike has dedicated a significant portion of their marketing efforts to empower female athletes and sports enthusiasts.

Young Athletes: Nike understands the importance of cultivating brand loyalty from a young age. Their marketing strategies are crafted to inspire and engage young athletes, nurturing a lifelong connection to the brand.

Sustainability Advocates: In recent years, Nike has expanded its reach to consumers who prioritize sustainability and ethical practices. Their marketing seamlessly integrates these values, resonating with the environmentally conscious audience.

This diverse and inclusive approach to their target audience has been a pivotal factor in the success of Nike's marketing strategy. It showcases their ability to resonate with a wide range of consumers, from professional athletes to environmentally conscious individuals.

Striving to create more eco-friendly materials as possible, bioplastic for their sneakers is used as a replacement for plastic, leather, and other materials.

Well known for the fact that Nike promotes its products through sponsorship agreements with influencing athletes, professional teams, and athletic teams.

- High level competition of Nike with Adidas and Reebok and other companies with the closely similar product line and common target markets. 

- Limited exports of Nike products due to legal restrictions can be one reason for fewer sales or revenues.

- The economic and political situation of those countries manufacturing Nike products is also one main challenge.

- Being a global brand, controversies are sensitive to the company image.

Hence, these is some of the reasons why strategies are relevant for Nike.

The questions still arise, why do people go after Nike products even if several brands apply the same approach? Does Nike market segmentation do it differently?

With being able to pull effective  Nike marketing plan  guidelines over past years; the other part also had faced consequences and drove up on solutions-making with,

1) Advertising

One of the key parts of the  Nike advertising strategy  is advertising through television ads and other social media forms with affiliate marketing.

In 1982, Nike aired its first three national television ads during the broadcast of the New York Marathon.

2) New Media Marketing

Having to understand the importance of having different mediums along with display advertising, content marketing, and social media promotions, boosts Nike global marketing strategy in the right direction.

Nike is risk-taker, with the way to early application of internet marketing, email management technologies, narrowcast communication technologies, and broadcast to build multimedia marketing campaigns.

3) Emotional Branding

How undeniable that Nike always puts powerful emotions through the brand! The advertisement seldomly briefs on its products and services.

A few of the best ads and commercials from Nike quotes for motivation, inspiration, and greatness can be:

“We gave up giving up”,

“All you have to do is pick up your feet.”

“My better is better than your better.”

“Don’t believe you have to be like anybody to be somebody.”

The building of the right emotions by Nike effortlessly comes through curated content and narrative that again narrates a story; a tale of inspiration applicable to anyone to combat their challenges and meet their victory.

Instead, Nike emotional branding has been impactive followed as an effective strategy in the world of marketing at present. It inturns invokes emotions related to success, morale, victory, and self-improvement which makes it a powerful product.

4) Nike Target Market Segmentation

One thing marketers should learn from  nike segmentation targeting and positioning 

is understanding their customer.

And, Nike focuses very well on their main target markets for their product and services i.e., athletes, runners, and sports enthusiasts.

In the running years, it enlarges strategies to lead precise market segments for runners, women, and young athletes. 

An observation is taken into action to create that meets the custom interests as per customer requirements.

5) Convey a Story

To have been accompanied by a global audience, another marketing strategy applies by conveying the story in simple and effective points rather than using descriptive or jargon with their brand voice.

In this way, they connect and try to encourage the masses to chase their dreams and “Just do it”.

An instance as shown in the above image; another excellent technique is their tagline which builds an emotional marketing story that relates to anyone to catch their dream and build customer loyalty,

6) Newsworthiness

This brand strategy uses newsworthiness to impact and appeal to a story. In most cases, it uses recent events or happenings about what people need or want to know.

It is also tricky to decide what stories to cover, but Nike evaluates and continues with newsworthy stories before the release to avoid controversies or false information.

This pattern could be applied based on events that impact your readers all over the world

7) Invest in Customer Loyalty

In Nike, it associates with diverse masses apart from the target audience. Does it have good customer loyalty? Yes. 

With less loyal customers, the challenge to come up with anticipatory decisions and effectively plan your finances can be scary.

One of the reasons the brand is irresistible globally till current which is less surprising is sole because of customer loyalty. The precise, well-executed product and service not only attract new customers but retain customers with good profit margins.

- Nike is releasing “No Finish Line,” a new book that celebrates and figures Nike’s 50 years of game-changing design and innovation in the favor of athletes and sports. It lay down a design vision for the next 50 years.

- It applies measures to create a better future by investing in active and inclusive communities. Nike Community Impact Fund (NCIF), an employee-led and neighborhood-focused approach 

in aid of local community organizations globally for a positive, effective, and making a play for all the kids.

- Nike made about 35% digital and aims to achieve 50% by 2025.

One of the best ephemeral approaches is that a part of Nike’s success goes to influencing and inspirational athletes such as Michael Jordan, Mia Hamm, Roger Federer, Tiger Woods, Kobe Bryant, Lebron James, and many others.

To truly appreciate the efficacy of Nike's marketing strategy, it's essential to trace the evolutionary path it has taken over the years. This retrospective analysis of Nike's marketing strategy is integral to our Nike marketing strategy case study. Here is a comprehensive exploration of the evolution of Nike's marketing approach:

The Early Years: Nike's origins can be traced back to its predecessor, Blue Ribbon Sports, which primarily served as a distributor of Japanese running shoes. During this nascent phase, Nike's strategy was firmly rooted in performance and innovation.

The Birth of Nike: In 1971, Nike emerged as a distinct entity, drawing inspiration from the Greek goddess of victory. This marked the inception of Nike's emphasis on empowerment and achievement, an approach that would become central to their branding.

Celebrities Take Center Stage: The 1980s heralded a new era for Nike, marked by the strategic use of celebrity endorsements, most notably with basketball icon Michael Jordan. These high-profile endorsements solidified a deep emotional connection between Nike and consumers.

The "Just Do It" Era: In 1988, Nike introduced its iconic "Just Do It" slogan, encapsulating the ethos of personal determination and resilience. Swiftly, it became synonymous with the brand's identity and mission.

Digital Transformation: Nike was an early adopter of digital marketing, recognizing the potential of the internet and social media. They harnessed these platforms to engage consumers through multimedia campaigns and create a digital presence that mirrored their innovative spirit.

Emotional Branding: Nike's pivot towards emotional branding represented a pivotal moment in their marketing evolution. Rather than simply showcasing products, they focused on evoking powerful emotions, such as success, motivation, and self-improvement. This shift solidified Nike as a potent and influential brand.

Sustainability and Inclusivity: In recent years, Nike has demonstrated a commitment to sustainability and inclusivity, both in their products and marketing. They aim to create eco-friendly products and promote social responsibility, aligning with the evolving values of today's consumers.

This journey of evolution highlights Nike's remarkable adaptability and capacity to align their strategy with changing consumer landscapes. From their roots in performance and innovation to their current focus on emotional branding, sustainability, and inclusivity, Nike's marketing strategy has continued to resonate with a diverse and ever-changing audience.

To harness the power of Nike's potent marketing strategy for your own brand, it's essential to follow a well-defined blueprint. This section of our Nike marketing strategy case study provides a step-by-step guide on how to apply Nike's principles to your brand effectively:

Know Your Audience Inside Out: Much like Nike, start by conducting thorough market research to understand your target audience's specific needs, preferences, and aspirations. Tailor your products and marketing strategies accordingly.

Forge an Emotional Connection: Take a page from Nike's playbook and aim to create profound emotional connections with your audience. Share compelling stories that resonate with your brand's mission and values, inspiring and motivating your customers.

Embrace the Digital Realm: Leverage the expansive digital landscape, including social media, content marketing, and multimedia campaigns, to amplify your brand's reach. Follow Nike's lead in utilizing these platforms effectively to engage and captivate your audience.

Champion Sustainability and Social Responsibility: If your brand aligns with sustainability and social causes, make them integral to your strategy. Showcase your commitment to positive change through sustainable practices and support for relevant social issues.

Consistency is Key: Maintain a consistent brand image and message across all marketing channels. This consistency not only reinforces your brand identity but also leaves a lasting impression on your audience.

Prioritize Innovation: Continuous innovation should be at the heart of your strategy, much like Nike's dedication to pushing the boundaries. Innovate your products and marketing strategies to stay relevant and capture the full attention of your audience.

Leverage Influencers and Celebrities: Collaborate with influencers or celebrities whose values align seamlessly with your brand's mission. This partnership can help expand your reach and enhance your brand's credibility, similar to Nike's successful partnerships with iconic athletes.

By following these steps, you can effectively incorporate the power of Nike's marketing strategy into your own brand. Building a successful brand, as exemplified in this Nike marketing strategy case study, requires a strategic approach, unwavering dedication, and a profound understanding of your audience's aspirations and needs.

Don't Wait, Just Do It

In the ever-changing field of marketing, the key to success is action. Much like Nike urges you to take action; we encourage you to propel your digital marketing career forward by enrolling in Sprintzeal's Digital Marketing Course. Don’t let your hesitation cost you your opportunities.

Equip yourself with the skills, knowledge, and confidence excel in the digital marketing domain. We curate and design our courseware to ensure you're well-prepared for the dynamic world of digital marketing. So, why delay? Enroll now , and allow us to help you make your career in digital marketing.

As per  Wikipedia , During the Q1 of 2020, the company's online sales have grown by 36%. While the net income in mil. is $6,046 and revenue is $46,710 in 2022. 

As per the Forbes report, Nike's Financial Summary for 2022, the revenue is $46.9 billion with assets of $38.6 billion and profits of $6.1 billion.

The following image gives a glance at the percentage growth with the approaches.

Image Source:  Nike

Final Results

During the article study, we also found that problems may occur subsequently with changes made to the distribution, marketing, and management strategies of Nike.

Companies can refer to Nike's marketing strategy to influence the four Ps i.e, price, product, promotion, and place. New features may expand the changes to higher growth of the product and might develop a new market.

Source 1:  Nike-A Case Study Just Do It

Source 2:  Nike Marketing Case Study

Source 3:  An Investment Analysis Case Study: Nike - NYU Stern

Research Details

This article emphasizes curated study from three case studies apart from Nike’s official website.

Therefore, all the effective strategies are presented for information and education means for readers in response to the current marketing issues along with the given references in this article.

Winning the market is one technique that Nike has been doing so well since its implementation till date. What’s even interesting is having to market its products under its various brands and subsidiaries.

The subsidiaries like Nike+, Nike Golf, Nike Blazers, Nike Pro, Air Jordan, Air Max, and other brands like  Hurley Int., Jordan, and Converse.

In the field of such marketing, digital marketing plays a dominant role. To pursue a career in digital marketing training, choosing from a globally recognized ATO (An accredited training organization) from  Sprintzeal  accelerates your career of interest.

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Nchumbeni Yanthan

Nchumbeni is a content writer who creates easy-to-read educational blogs, articles, varying client request, and social media content helping millions of learners meet their career goals.

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Customer Service Case Studies: Real-Life Examples Of Service Scenarios.

Are you looking for real-life examples of customer service scenarios that can help you improve your own customer service skills? Look no further!

In this article, we will explore a series of case studies that highlight different aspects of effective customer service. These case studies will provide you with valuable insights into how to handle challenging situations, resolve issues, and create positive experiences for your customers.

Customer service plays a crucial role in the success of any business. It is not just about answering phone calls or responding to emails; it is about building relationships and exceeding customer expectations. By studying real-life examples, you can gain a deeper understanding of the importance of effective customer service and learn strategies to enhance your own skills.

In each case study, we will delve into different scenarios and examine how businesses successfully handled them. From resolving product quality issues to dealing with difficult customers, these case studies will showcase various approaches and solutions that you can apply in your own work.

Get ready to dive into these insightful stories that demonstrate the power of exceptional customer service!

Table of Contents

Key Takeaways

• Effective customer service is crucial for the success of a business.
• Empathy and proactive customer service are essential aspects of providing excellent customer service.
• Prompt resolution of product quality issues, with notification and compensation for affected customers, helps maintain customer satisfaction and loyalty.
• Handling difficult customers with a calm and empathetic approach, offering alternatives, and empowering them to make choices can build trust and loyalty.

The Importance of Effective Customer Service

You can’t underestimate the impact of great customer service – it’s like a warm cup of coffee on a chilly morning, instantly making you feel valued and appreciated.

In today’s competitive business landscape, providing effective customer service is more important than ever. Customers have numerous options at their fingertips, and one bad experience can send them running to your competitors. That’s why empathy plays a crucial role in customer service.

When customers feel understood and cared for, they’re more likely to become loyal advocates for your brand. Empathy is the ability to understand and share the feelings of others. In customer service, this means putting yourself in the shoes of your customers and genuinely listening to their concerns.

By showing empathy, you demonstrate that you value their emotions and are committed to finding a solution that meets their needs. This not only helps resolve issues effectively but also builds trust and strengthens the relationship with your customers.

Proactive customer service is another essential aspect of providing exceptional support. Instead of waiting for customers to come to you with problems or complaints, proactive customer service involves anticipating their needs and addressing any potential issues before they arise.

This approach shows that you’re dedicated to delivering an outstanding experience from start to finish. By taking the initiative, you can prevent problems from escalating and create positive interactions that leave a lasting impression on your customers.

The importance of effective customer service cannot be overstated. Empathy allows you to connect with your customers on a deeper level by understanding their emotions and concerns. Proactive customer service demonstrates your commitment to going above and beyond expectations by anticipating needs before they become problems.

By prioritizing these aspects in your approach to customer service, you can foster loyalty, build strong relationships with customers, and ultimately drive success for your business.

Case Study 1: Resolving a Product Quality Issue

Resolving a product quality issue can be challenging, but did you know that 86% of customers are more likely to repurchase from a company that resolves their complaint? When faced with a product quality issue, it’s important for companies to take immediate action and address the problem effectively.

One notable case study involves a product recall due to safety concerns. The company promptly notified customers about the recall through multiple channels such as email, social media, and website announcements. This proactive approach not only ensured customer safety but also demonstrated the company’s commitment to resolving the issue.

To further enhance customer satisfaction during this challenging time, the company offered compensation to affected customers. The compensation included a full refund for the recalled product as well as additional discounts on future purchases. By going above and beyond in compensating their customers, the company not only mitigated any potential negative feelings but also showed genuine concern for their customers’ wellbeing.

In addition to addressing individual complaints, the company took steps towards preventing similar issues in the future. They implemented stricter quality control measures throughout their production process and conducted thorough inspections before releasing any products into the market. This proactive approach reassured customers that their concerns were taken seriously and instilled confidence in the brand’s commitment to delivering high-quality products.

By resolving a product quality issue promptly and ensuring customer satisfaction through compensation and preventive measures, companies can not only retain existing customers but also build trust with new ones. It’s crucial for businesses to recognize that effective customer service goes beyond simply resolving complaints; it requires taking responsibility for failures, implementing meaningful solutions, and continuously improving processes to prevent similar issues from arising again in the future.

Case Study 2: Handling a Difficult Customer

Navigating through challenging interactions with clients can be a test of your company’s ability to handle difficult situations. Dealing with angry customers requires a delicate balance of empathy, patience, and problem-solving skills.

One real-life example of a company successfully managing a difficult situation involved an irate customer who had received a damaged product.

In this case, the customer contacted the company’s customer service department immediately after receiving the damaged product. The representative on the phone remained calm and empathetic throughout the conversation, acknowledging the customer’s frustration. They apologized sincerely for any inconvenience caused and assured the customer that they would resolve the issue promptly.

The representative then offered several options to address the problem, including sending a replacement or providing a refund. By presenting these alternatives, they empowered the customer to choose what solution best suited their needs. This approach helped defuse tension and created an atmosphere of collaboration rather than confrontation.

Ultimately, by effectively managing this difficult situation and prioritizing customer satisfaction, the company not only resolved the issue but also built trust and loyalty with their client base.

Case Study 3: Going Above and Beyond for a Customer

Exceeding expectations and leaving a lasting impression, one company went the extra mile to ensure a memorable experience for a dissatisfied client. The customer, let’s call her Sarah, had purchased a high-end laptop from this company but encountered numerous technical issues soon after receiving it. Frustrated with the product’s performance and the lack of support she received initially, Sarah reached out to the company’s customer service department for assistance.

To address Sarah’s concerns promptly, the customer service representative assigned to her case took immediate action. Recognizing that resolving her technical issues alone would not suffice in restoring Sarah’s trust and satisfaction, they decided to go above and beyond what was expected. The representative personally followed up with Sarah daily to provide updates on their progress in fixing her laptop. They also offered additional compensation for the inconvenience caused by sending her a complimentary accessory package.

In addition to their exceptional level of communication, this company created a personalized experience for Sarah through small gestures that left an indelible mark on her overall perception of their brand. One example was when they surprised her by upgrading her laptop’s warranty without any additional cost. This unexpected act not only demonstrated their commitment to providing quality products but also highlighted their dedication towards ensuring customer satisfaction.

By going above and beyond in addressing Sarah’s concerns and surpassing her expectations at every turn, this company exemplified outstanding customer service. Their proactive approach not only resolved technical issues efficiently but also left a lasting impression on Sarah concerning how much they valued her as a loyal customer. Through personalized attention, generous compensation, and unexpected upgrades, they not only ensured Sarah’s satisfaction but also fostered a long-term relationship based on trust and loyalty. This case study serves as a powerful reminder that going the extra mile can make all the difference in customer satisfaction and retention.

Case Study 4: Turning a Negative Review into a Positive Experience

If your business has ever received negative feedback, it’s important to know how to turn that experience into a positive one.

In this case study, we will explore how a business addressed a customer’s concerns and transformed their perception from negative to positive.

By taking the necessary steps and going above and beyond, the business not only resolved the issue but also improved their reputation in the process.

The negative feedback received by the business

Despite your best efforts, your business was bombarded with a barrage of scathing feedback that left you reeling. Customers expressed their dissatisfaction with the quality of your products and the poor customer service they received.

These negative reviews not only affected customer retention but also posed a threat to your brand reputation. The negative feedback highlighted areas where improvements were needed. It pointed out flaws in your product design, manufacturing processes, and communication channels.

While it may be disheartening to receive such criticism, it presents an opportunity for you to address these issues and enhance the overall customer experience. By acknowledging the shortcomings and taking immediate action to rectify them, you can regain customers’ trust and loyalty while rebuilding your brand’s reputation.

The steps taken to address the customer’s concerns

After receiving the negative feedback, we quickly took action to address the customer’s concerns and improve our products and services. We understand that addressing customer complaints is essential for maintaining a positive reputation and ensuring customer satisfaction.

Our first step was to reach out to the customer directly, expressing our apologies for any inconvenience caused and assuring them that their concerns were being taken seriously.

To resolve the customer’s issues, we implemented a thorough investigation into the matter. This involved examining the specific details of their complaint, evaluating our internal processes, and identifying any areas where improvements could be made. By conducting this analysis, we were able to pinpoint the root cause of the problem and develop an effective solution.

Once we identified areas for improvement, we promptly made necessary changes to prevent similar issues from occurring in the future. This included updating our training programs for staff members involved in customer service interactions and enhancing quality control measures throughout our production process. We also communicated these updates transparently with all relevant stakeholders to ensure everyone understood our commitment to resolving customer issues.

Addressing customer complaints is not just about solving individual problems; it is about continuously improving our overall products and services. By taking immediate action upon receiving negative feedback, we demonstrate our dedication to providing exceptional experiences for every customer.

We remain committed to resolving any issues promptly while striving to exceed expectations in delivering high-quality products and top-notch service.

The transformation of the customer’s perception and improved reputation

Now that the steps have been taken to address the customer’s concerns, let’s discuss the transformation of their perception and the improved reputation of your business.

By promptly addressing the customer’s issues and providing a satisfactory resolution, you’ve demonstrated your commitment to customer satisfaction. This level of responsiveness not only resolves the immediate problem but also leaves a lasting impression on the customer.

As a result, their perception of your brand is likely to improve significantly. They’ll appreciate your willingness to listen, understand, and take action to rectify any issues they may have faced. This positive experience can lead to increased brand loyalty as customers recognize that you value their feedback and are committed to delivering exceptional service.

To further enhance customer satisfaction and foster brand loyalty, consider implementing these strategies:

• Personalized follow-up: Reach out to customers after resolving their concerns with personalized messages or phone calls. This gesture shows that you genuinely care about their experience and want to ensure their ongoing satisfaction.
• Proactive communication: Keep customers informed about any changes or improvements related to the issue they encountered. Sharing updates showcases transparency and builds trust in your ability to continuously improve.
• Loyalty rewards program: Offer incentives or exclusive benefits for loyal customers who continue choosing your brand despite any initial challenges they may have faced. Rewarding their loyalty encourages repeat business and strengthens long-term relationships.

By investing in improving customer satisfaction and building brand loyalty, you can create a positive reputation for your business while fostering long-term success in an increasingly competitive market.

Frequently Asked Questions

What are the key elements of effective customer service.

Effective customer service requires several key elements.

One interesting statistic is that 86% of customers are willing to pay more for a better customer experience. This highlights the importance of providing exceptional service.

Effective communication plays a crucial role in customer service as it allows you to understand the needs and concerns of your customers, while also conveying information clearly and concisely.

Empathy and understanding are equally important, as they enable you to connect with customers on an emotional level, showing them that their satisfaction is your top priority.

By incorporating these elements into your customer service approach, you can create positive experiences that leave a lasting impression on your customers.

How can companies measure the success of their customer service efforts?

To measure the success of your customer service efforts, you can utilize various customer satisfaction metrics and conduct thorough customer feedback analysis.

Customer satisfaction metrics, such as Net Promoter Score (NPS) or Customer Effort Score (CES), provide valuable insights into how satisfied your customers are with the service they received. These metrics allow you to quantify customer sentiment and identify areas for improvement.

Additionally, analyzing customer feedback through surveys or social media monitoring enables you to understand specific pain points and address them proactively.

By consistently measuring these indicators and taking action based on the results, you can continuously enhance your customer service performance and ensure a positive experience for your customers.

What are some common challenges faced by customer service representatives?

Handling difficult customers and managing high call volumes can be incredibly challenging for customer service representatives. Dealing with irate customers can feel like trying to calm a hurricane with a feather, as their frustrations can reach astronomical levels. It requires an extraordinary level of patience and empathy to navigate through their anger and find a resolution that satisfies both parties.

Additionally, managing high call volumes can feel like juggling flaming swords while walking on a tightrope. The constant influx of calls puts immense pressure on representatives to provide quick and efficient assistance without compromising the quality of service.

However, despite these Herculean tasks, customer service representatives rise above the challenges by employing exceptional communication skills, problem-solving abilities, and an unwavering commitment to customer satisfaction.

How can companies improve their customer service skills and knowledge?

To improve their customer service skills and knowledge, companies should invest in comprehensive training programs that provide employees with the necessary tools and techniques to handle different scenarios. These programs can include modules on effective communication, problem-solving, and empathy to ensure that representatives are equipped to handle any customer interactions.

Additionally, implementing feedback systems that allow customers to provide their input and suggestions can also be beneficial. This feedback can help identify areas for improvement and enable companies to make necessary adjustments in their processes or training programs.

By prioritizing ongoing training initiatives and actively seeking customer feedback, companies can continually enhance their customer service skills and knowledge, leading to improved overall customer satisfaction levels.

What are some best practices for handling customer complaints and resolving issues?

When it comes to handling customer complaints and resolving issues, think of yourself as a skilled navigator guiding a ship through stormy waters. Customer feedback is like the wind, sometimes gentle and other times fierce, but always pushing you towards improvement.

Conflict resolution is your compass, helping you find the right path to address concerns and turn unhappy customers into satisfied ones. Actively listen to their grievances, empathize with their frustrations, and offer swift solutions that demonstrate your commitment to their satisfaction.

By taking ownership of the problem and going above and beyond to resolve it, you can transform a dissatisfied customer into a loyal advocate for your brand.

In conclusion, effective customer service is crucial for businesses to thrive in today’s competitive market. As demonstrated by the case studies discussed, handling product quality issues, difficult customers, and negative reviews with empathy and proactive solutions can turn potentially negative experiences into positive ones.

One interesting statistic that highlights the impact of great customer service is that 86% of consumers are willing to pay more for a better customer experience (Source: PwC). This statistic evokes an emotional response as it emphasizes the value customers place on exceptional service. By investing in providing top-notch customer service, businesses not only create loyal customers but also have the potential to increase their revenue.

To ensure success in customer service scenarios, it is essential for businesses to empower their employees with proper training and resources. By equipping them with problem-solving skills, effective communication techniques, and a genuine desire to help customers, companies can build strong relationships and foster trust. Additionally, embracing technology solutions such as AI-powered chatbots or self-service options can streamline processes and provide faster resolutions.

In summary, delivering exceptional customer service requires a proactive approach that focuses on resolving issues promptly while exceeding expectations. By prioritizing the needs of customers and going above and beyond to provide personalized solutions, businesses can create memorable experiences that result in increased customer satisfaction and loyalty. Remember, investing in superior customer service is not just about satisfying your current customers; it’s about attracting new ones who’re willing to pay more for an outstanding experience.

The eSoft Editorial Team, a blend of experienced professionals, leaders, and academics, specializes in soft skills, leadership, management, and personal and professional development. Committed to delivering thoroughly researched, high-quality, and reliable content, they abide by strict editorial guidelines ensuring accuracy and currency. Each article crafted is not merely informative but serves as a catalyst for growth, empowering individuals and organizations. As enablers, their trusted insights shape the leaders and organizations of tomorrow.

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Where is customer care in 2024?

Customer care leaders are facing their greatest challenge in decades. They must prepare their organizations for an AI-enabled future while simultaneously meeting tough commercial targets and rising customer expectations. Our latest global survey suggests that many companies are struggling on all these fronts.

About the authors

This article is a collaborative effort by Eric Buesing , Maximilian Haug, Paul Hurst, Vivian Lai, Subhrajyoti Mukhopadhyay, and Julian Raabe , representing views from McKinsey’s Operations Practice.

Major disruptions are always painful, and the transition from a care paradigm dominated by human agents to one steered by AI technologies may be the biggest disruption in the history of customer service. Can organizations find a route to hyperefficient, digitized customer care while retaining the personal contact and responsiveness that customers require?

Right now, many customer care leaders feel trapped in no-man’s-land. Technology has enabled them to evolve their operations significantly, and the traditional call center environment is rapidly becoming a thing of the past. Yet when these digitally enabled models underperform—and they often do—companies need to master entirely new approaches to performance improvement alongside their traditional tool kits.

Customer care in the spotlight

The key findings in this article are based on McKinsey’s fourth global survey of customer care executives. This survey was our largest yet, gathering the views of more than 340 leaders at the director, senior director, vice president, and C-suite levels. Respondents came from companies with annual revenues of $100 million to $10 billion-plus, representing every major industry segment.

The majority of respondents said that the companies they worked for were headquartered in North America (just over 50 percent) or Western Europe (almost 25 percent), with 10 percent headquartered in India and 4 percent in China. Most respondents said their organizations operated in multiple regions: 75 percent reported operating in North America, 58 percent in Europe, 57 percent in Asia–Pacifc, 39 percent in the Middle East and Africa, and 37 percent in Latin America. We plan to expand future research to include more organizations headquartered outside North America and Western Europe.

To make matters worse, executives say that most of the challenges highlighted in our last survey  are still present today (see sidebar, “Customer care in the spotlight”). Those challenges include rising call volumes, high levels of employee attrition, and persistent talent shortages. Meanwhile, some of the largest consumer-facing technology organizations in the world have become exceptional at digitally enabled customer care, which is lifting customer expectations everywhere, piling further pressure onto customer care staff and leadership at other companies.

Our survey reveals three major themes that are top of mind for customer care leaders. First, their priorities are shifting, from an overwhelming focus on customer experience to a multidimensional approach that also emphasizes revenue goals and technology transformation. Second, they are working hard to build future-ready AI-enabled ecosystems for their operations. Finally, they are boosting their capabilities by investing in employee upskilling programs and building stronger outsourcing relationships.

Would you like to learn more about our Operations Practice ?

Reprioritizing core operations.

When we began monitoring the sentiment of customer care leaders in 2016, their priorities were clear. Customer experience came first, followed at a distance by operational improvement, technology transformation, and revenue generation—in that order.

Over the past seven years, those priorities have converged (Exhibit 1). Revenue generation, which was mentioned by about one in 20 customer care leaders in our first survey, has been rising steadily in importance ever since. It is now a priority for a third of customer care leaders. But over the past two years, technology enhancements and operational improvements have seen the fastest increases. The expectation that customer care functions can do it all and do it well has never been higher.

Leaders also understand that they need to engage with their customers to delight them. Currently, only 11 percent of respondents say reducing contact volume is important to them, a 20-percentage-point drop over 12 months. Indeed, 57 percent of leaders expect call volumes to increase by as much as one-fifth over the next one or two years.

Separate research suggests that these leaders are right to stay focused on direct personal interaction, even when many of their customers are young digital natives. In a recent McKinsey survey of 3,500 consumers, respondents of all ages said that live phone conversations were among their most preferred methods of contacting companies for help and support. That finding held true even among 18- to 28-year-old Gen Z consumers, a cohort that favors text and social messaging for interpersonal communications.

There’s also evidence that younger consumers are getting tired of the digital self-service paradigm. One financial-services company reports that its Gen Z customers are 30 to 40 percent more likely to call than millennials, and they use the phone as often as baby boomers. Premium-segment customers of all ages also prefer the phone, with many saying that live phone support is part of the premium service they are paying for.

These findings don’t point to a future of phone-only customers, however. While customers of all generations prioritize support from a real person, they also want the flexibility to use different channels according to their needs. Digital-chat services have achieved a high level of acceptance across generations, and email remains important, especially for older consumers (Exhibit 2).

The need to excel in service across multiple channels creates extra challenges for customer care leaders, especially when budgets are tight. And 37 percent of respondents in our survey say that cost is still a key priority. This tension is driving companies to look for ways to control the customer care costs that go beyond call volume reduction, with automation and outsourcing the most frequently cited levers.

Creating a future-ready AI ecosystem

The tensions in modern customer care are clearly seen in companies’ approaches to advanced digital technologies. Our survey demonstrates that digital has already become a decisive differentiator. Among respondents who report that their operations are delivering better-than-expected performance, more than half have high levels of digital integration. Banking, telecommunications, and travel and logistics are among the leading industries in this regard.

Those high performers are in the minority, however. Only 8 percent of respondents from North America report greater-than-expected satisfaction with their customer performance. In Africa, Europe, and the Middle East, the figure is 5 percent. Among organizations reporting that performance was in line with or lower than expected, more than 80 percent also say their levels of digital integration are partial or low.

Leaders agree that they need to get digital right. More than half of the respondents to our survey expect the share of inbound contacts that take place through digital channels to exceed 40 percent in the next three years.

Artificial intelligence will play a decisive role in future customer care ecosystems. Respondents to our survey are already deploying AI tools in a variety of applications, including chatbots and automated email response systems, training and support for call center agents, back-office analytics, and decision making.

Over the past 12 months, the availability of powerful generative AI (gen AI) tools, especially large language models (LLMs) that can parse and respond to unstructured text or speech, has opened new possibilities for technology in customer care. More than 80 percent of respondents are already investing in gen AI, or expect to do so in the coming months, with leaders highlighting a wide range of potential applications.

One European subsidiary of a global bank replaced its well-established rules-based customer chatbot with a new system based on gen AI technology. Seven weeks after launch, the AI chatbot was 20 percent more effective at successfully answering customer queries than the old tool. The bank has already identified a road map of improvements that could double its performance in the coming months.

Early adopters are extremely ambitious about the potential of gen AI. The executive in charge of customer care at one major global organization told us that they expect 100 percent of customer interactions to be AI-enabled in the coming years, using a combination of technologies including new virtual assistants, agent-assist tools, and AI-powered voice analytics.

For most companies, however, the gen AI customer care revolution is still in its early stages. Leaders highlight multiple issues that are making it hard for them to integrate these technologies into their existing processes and workflows. The issues include technical challenges regarding deployment and scaling; concerns about safety, security, and governance; and difficulties in defining the desired outcomes from, or business case for, gen AI investments (Exhibit 3).

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Rethinking skills.

Today, customer care organizations lack many of the critical skills they need to deliver excellent service and navigate the transition to a digitally mediated, AI-enabled world. In part, that’s because customer care leaders have been running to stand still. Record levels of staff attrition following the COVID-19 pandemic meant that supervisors spent much of their time interviewing and bringing new staff up to speed. They spent less time mentoring their established teams, a problem exacerbated by the introduction of hybrid and remote working arrangements. Some agents and team leaders have spent years working with little interaction or coaching from their managers.

Staff turnover has now slowed, and two in three leaders in our latest survey say upskilling and reskilling are critical priorities. Companies highlight a range of benefits that accrue from effective upskilling and reskilling programs, including improvements to employee morale, increased productivity, and faster adoption of new technologies and working methods. Meanwhile, technology is changing upskilling programs. Twenty-one percent of leaders tell us that they are already using AI-based tools to train and support their customer care staff.

AI-based agent support systems are already becoming a key tool for companies seeking to offer extremely effective personal service to demanding customers. These systems can help agents resolve complex queries the first time, simultaneously reducing care costs and boosting customer experience.

One global construction equipment company, for example, uses a gen AI system to help its call center staff navigate thousands of pages of technical-support documentation. The system selects the appropriate steps to resolve a customer’s problem in seconds, based on free text questions entered by the agent and background information such as the serial numbers of vehicles and parts. The tool has cut average call resolution times from around 125 minutes to a few seconds, and it is currently saving customers €150,000 to €300,000 per day in reduced asset downtime.

Elsewhere, companies are using AI to transform the way they manage and support their customer care agents. New AI-based tools can optimize call volume forecasting, for example. This approach helped one company improve forecast accuracy by seven percentage points, while halving the work required to manage team capacities and schedules. The change improved customer service levels by more than 10 percent, while cutting staffing and overtime costs by more than 5 percent.

Companies are also looking outside their organizations for innovative ways to fill capability gaps. Outsourcing, once viewed primarily as a way to reduce costs, is increasingly seen as an effective source of additional skilled capacity and innovation capabilities. Fifty-five percent of the companies in our survey currently outsource part of their customer care operations, and 47 percent of those organizations expect to increase their outsourcing over the next two years.

Outsourcing relationships are becoming deeper too, with respondents telling us that they are now using their business process outsourcing for a range of activities that extends far beyond traditional call and email handling. They include content management and digital-marketing services, payments handling, and the development of AI-based customer care tools. Following the blueprint established by major players in the industrial products, medical device, software, and e-commerce sectors, some companies are now working with outsourcing partners to set up global innovation hubs that will drive the development of next-generation customer care technologies.

Our survey suggests that customer care organizations are running at two different speeds. In the fast lane, top performers have seized the opportunities presented by advances in digital technologies. With ruthless prioritization, they are investing capital to drive efficiency and service excellence across the customer journey. The best have already reshaped their organizations around highly integrated digital platforms. One high-performing company with more than 5,000 service agents is on track to deliver 75 digital-experience improvements this year, for example.

Other companies are still in the slow lane, struggling to fit a patchwork of digital point solutions into legacy care ecosystems. Unsure where to put their dollars, they are trapped in a cycle of continual system adaptation with no clear destination or road map.

In 2024, both types of organizations may need to shift their positions on the road. Gen AI is raising the bar for performance, productivity, and personalization in customer care, and tomorrow’s fully AI-enabled care organizations will operate very differently from those of today. It’s time for companies to look at their care ecosystems with fresh eyes. They should formulate an independent perspective on the changing expectations of their customers and the role of advanced AI in their organization. The future of customer care is calling. Leaders should answer with a bold vision and an aggressive time line for change.

Eric Buesing is a partner in McKinsey’s Charlotte office, where Paul Hurst is an associate partner; Maximilian Haug is an associate partner in the Boston office; Vivian Lai is a consultant in the New York office; Subhrajyoti Mukhopadhyay is an expert in the Chicago office; and Julian Raabe  is a partner in the Munich office.

The authors wish to thank Jorge Amar, Brian Blackader, Marcela Guaqueta, Suryansha Gupta, and Josh Wolff for their contributions to this article.

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