Brand Loyalty and the Influence of Celebrities in the Nike Sportswear Industry (Dissertation Sample)

University of Westminster
___________________________
Ma International Business and Management
INVESTIGATION OF BRAND LOYALTY AND THE INFLUENCE OF
CELEBRITIES IN THE NIKE SPORTSWEAR INDUSTRY
Angelos Dionysiou
Submission Date: 2022
Module: Business Research Methods
Word Count (All Included): 10,134
Abstract
The purpose of this dissertation is to investigate brand loyalty and the influence of celebrities in the Nike sportswear industry. A mixed-methods approach will be used, employing quantitative and qualitative data collection methods. An online survey will be administered via Zoom, targeting Nike sportswear consumers. Research has shown that consumer satisfaction is one of the most critical variables determining whether a consumer will remain loyal to a particular brand. According to several studies, consumers who are pleased with a product or service are more likely to purchase it again and suggest it to their friends and family. These research findings were used to get a deeper comprehension of the elements contributing to customer brand loyalty and to discover any prospective aspects that may play a role in consumers' decision-making process within the Nike sportswear business. The research findings provide insightful knowledge about the factors influencing customer brand loyalty within the Nike sportswear business. Businesses can, therefore, effectively focus their marketing efforts and provide a more immersive experience for their consumers when they have a deeper grasp of the elements that contribute to the loyalty of their customers. Additionally, by identifying potential influencers within the Nike sportswear market, companies can capitalise on opportunities to increase brand awareness and build stronger relationships with their consumers. Ultimately, this research project will significantly advance our understanding of consumer brand loyalty within the Nike sportswear industry.
Keywords: Sportswear, brand loyalty, celebrities, Nike Company
Table of Contents TOC \o "1-3" \h \z \u Abstract PAGEREF _Toc111697517 \h 21INTRODUCTION PAGEREF _Toc111697518 \h 51.1Background PAGEREF _Toc111697519 \h 51.2Problem Statement PAGEREF _Toc111697520 \h 81.3Aim and Research Question PAGEREF _Toc111697521 \h 91.4Objectives PAGEREF _Toc111697522 \h 91.5Structure of the Research PAGEREF _Toc111697523 \h 102LITERATURE REVIEW PAGEREF _Toc111697524 \h 122.1Conceptual Framework: Brand Loyalty PAGEREF _Toc111697525 \h 132.2Impact of Celebrity Endorsements PAGEREF _Toc111697526 \h 162.2.1Triangle Theory of Love PAGEREF _Toc111697527 \h 172.3Gaps in Literature PAGEREF _Toc111697528 \h 233METHODOLOGY PAGEREF _Toc111697529 \h 253.1Participants PAGEREF _Toc111697530 \h 253.2Instruments PAGEREF _Toc111697531 \h 253.3Data Analyses PAGEREF _Toc111697532 \h 263.4Research Design PAGEREF _Toc111697533 \h 263.5Data Collection PAGEREF _Toc111697534 \h 273.6Ethical Considerations PAGEREF _Toc111697535 \h 283.7Limitations of Method PAGEREF _Toc111697536 \h 294FINDINGS PAGEREF _Toc111697537 \h 314.1Summary PAGEREF _Toc111697538 \h 314.1.2Reliability Test PAGEREF _Toc111697539 \h 324.1.3Correlation PAGEREF _Toc111697540 \h 334.2Nike Multi Regression PAGEREF _Toc111697541 \h 345DISCUSSION PAGEREF _Toc111697542 \h 366CONCLUSIONS AND RECOMMENDATIONS PAGEREF _Toc111697543 \h 406.1Conclusion PAGEREF _Toc111697544 \h 406.2Recommendations PAGEREF _Toc111697545 \h 41REFERENCES PAGEREF _Toc111697546 \h 427APPENDICES PAGEREF _Toc111697547 \h 547.1Questionnaire Administered During the Online Survey PAGEREF _Toc111697548 \h 547.2Appendix B: Ethics Form (ETH2122-2219) PAGEREF _Toc111697549 \h 567.2.1Ethics application PAGEREF _Toc111697550 \h 567.3Appendix C: External factors PAGEREF _Toc111697551 \h 587.3.1Participants PAGEREF _Toc111697552 \h 597.4Appendix C: Location PAGEREF _Toc111697553 \h 63
INTRODUCTION
Background
According to Kim (2020), Nike is a major American sportswear and footwear company, with its headquarters in Beaverton, Oregon. The company is the world's largest supplier of athletic shoes and apparel and a major manufacturer of sports equipment, with revenue above $24.1 billion in its fiscal year 2012 (ending May 31, 2012) (Nike's ethics, n.d.). As of 2014, it employed more than 56,500 people worldwide (Statista, 2021). Nike and its trademark "Swoosh" design are registered trademarks of Nike, Inc. In 1968, what is now known as the Nike Sportswear Industry started as Blue Ribbon Sports and after some time, in 1978, the corporation was rebranded as Nike, Inc. Nike has been a major player in the sports industry for over 40 years (Davis, 2016). In that time, it has become one of the world's most recognisable and successful brands. According to Mahdi et al. (2015), Nike's success can be attributed to its unique brand loyalty program, which focuses on creating a connection between consumers and Nike products. The company's brand loyalty program was known as NikeFuel.
According to Chang (2014), until 2018, NikeFuel was a loyalty program created by Nike in 1986 to create a connection between customers and its products. The program was designed to reward Nike customers for their loyalty and to encourage them to shop at Nike stores. The program offered a variety of rewards, including discounts on products and services, free products, and the opportunity to win exclusive prizes. NikeFuel has been highly successful in creating brand loyalty among its customers. Nike's brand loyalty program was unique because it explicitly connected consumers to Nike products. Other companies have similar programs, such as Best Buy's Runners Club and Target's REDcard, but Nike's program is more focused on rewarding customers for their loyalty, whereas the companies' programs are designed to promote product sales and encourage customers to shop at the company's stores.
In recent years, there has been an explosion in the Nike Sportswear sector, leading to a multibillion-dollar market (Mathur and Dabas, 2014). The company's efforts to advertise its brand have met with great success. It is one of the brands recognised the most globally and has a powerful brand identity (Eyada, 2020). Because of this, it has been able to attain a significant portion of the market and a healthy level of profitability. Over the last several years, it has also improved its market share by inventing new items and efficiently promoting those products (Mahdi et al., 2015). Because of this, it is now considered one of the most successful brands in the sector.
According to Veldekens (2016), the sportswear industry saw a year-over-year increase of 10% over the past decade. As a result, it became critical for sportswear firms to win the loyalty of their respective clients. Because of the rise in popularity of sportswear and the profitable nature of the industry, several companies have been developing and expanding their product lines to include not just footwear and clothing that can be worn daily but also improved athletic performance apparel (Mahdi et al., 2015). These expansive lines of products, which are much similar to everyday items, produce more income for the brand while simultaneously boosting the level of familiarity of the brand from one person to the next (Kalinic, Sarasvathy and Forza, 2014). These items can bring in a much larger number of clients for the brand, create additional characteristics that are distinctive to the company itself, and also present the product to the consumer.
According to Mathaba, Dhurup, and Mpinganjira (2017), many retailers of sportswear place a significant amount of importance on maintaining their consumers' devotion to the brands they sell. Some of these efforts include the creation of catchy slogans for the company, developing product extensions, producing one-of-a-kind television commercials and programs, and sponsoring the customer's preferred sports team (Rantalainen, 2020). The shoe brand produced by Nike Sportswear “Air Jordan” is one of the most successful brands in the industry and has produced remarkable brand devotion by those who buy athletic apparel. Many devoted Air Jordan fans stand in line numerous times each year to get the latest iteration of Air Jordan merchandise (Anthony, 2022). As a result, the product sometimes sells out of available inventory within just a few hours after its first introduction.
According to Lim and Aprianingsih (2015), the most well-known companies in the sportswear sector, like Nike, are working hard to cultivate a powerful brand image and deepen their consumers' brand loyalty to remain competitive in the ongoing effort to become the top sportswear firm. Innumerable initiatives, such as the 10k run from Nike and the Nike+ training software solutions, have been made to enhance the clients' results and provide more robust marketing to the general populace (Janitzek and Christensen, 2012). These programs generate more media attention, aspirations more individuals, and bring so much appreciation to the brand, and the consumers are all the more faithful to the products.
This study will use the line of research from the previous studies on customer loyalty to clothing that have been carried out in the United Kingdom and all over the world. According to previous research conducted by Buil, De Chernatony, and Martínez (2013), Foroudi et al. (2018), and Hooi (2012), it has been established that the factors that determine brand loyalty can be broken down into a total of seven different marketing mix categories. These categories are as follows: quality of the product; merchandise style; brand; storage location; customer satisfaction; advertising and promotion factor; and valuation factor. According to Kim and Chao (2019), Nike has a significant presence in the worldwide ma...