MANAGEMENT INFORMATION SYSTEM

Ing. Joseph Ballon Alvarez

CASE
Nike Becomes a Technology Company
Named for the Greek goddess of victory, Nike is the biggest sports footwear and apparel
company in the world. Nike designs, develops, and sells a variety of products and services to
help in playing basketball and soccer as well as in running, men’s and women’s training, and
other action sports. Nike also markets sports-inspired products for children and various
competitive and recreational activities such as baseball, golf, tennis, volleyball, and walking. Nike
is known for its leading-edge technologies to make its products more appealing and enhance
user performance, including the advanced technology used to support the sports superstars
associated with Nike as well as the technology used in the running shoes you can buy online.

For example, Nike Air technology uses super gases encased in urethane plastic to provide
superior cushioning for running shoes that minimizes stress on runners’ joints each time their
feet hit the ground. The make-up of the gas, the strength of the plastic, and their placement
within the shoe give great cushioning without losing performance. Nike Air was the first major
piece of shoe technology to come out of Nike, and it has influenced every other running shoe
since. Of course, Nike has been using information technology in the design and manufacture of
these leading-edge products, and now it is embracing information technology in new, more far-
reaching ways. Some of Nike’s most recent offerings are actually information technology
products, such as the Nike+ Fuel Band. The Fuel Band is an activity tracker that is worn on the
wrist and used with an Apple iPhone or iPad.
The Fuel Band enables its wearers to track their physical activity, steps taken daily, and number
of calories burned. The information from the wristband is integrated in the Nike+ online
community and phone application, allowing wearers to set their own fitness goals, monitor their
progress on the LED display, and compare themselves to others who are part of the community.
In addition, with Bluetooth 4.0 wireless technology, the Fuel Band stays constantly connected,
synchronizing the data it collects with the user’s Nike+ account and giving feedback and
motivation when needed. The Nike Fuel Band has competitors, including trackers from Fitbit and
Jawbone.
Nike has made some improvements to its Fuel Band SE to keep up with these competing
devices, such as the ability to remind users to get up and walk around periodically, to measure
specific workouts, and to measure activities such as yoga or bicycling. As Fitbit trackers have
been able to do, the new Fuel Band also measures sleep. However, the key differentiator of the
Fuel Band is not hardware or a feature; it’s the point system created in conjunction with the
gadget called Nike Fuel. Nike’s proprietary software turns all tracked movement into Nike Fuel
points, which can show achievements, be shared with friends, or engage others in competition.
According to Nike, Nike Fuel is its universal way of measuring movement for all kinds of activities.
Nike Fuel provides users with a metric that enables comparisons—no matter what height, weight,
gender, or activity—to past performance, another person, or a daily average, which Nike defines
as 2,000 Fuel points. Nike won’t divulge exactly how the metric is calculated.
Nike increasingly wants other fitness technology products to integrate with Nike+ and provided
funding and assistance to small companies that are building applications for this purpose. The
more people measure their activity with Nike Fuel, the more they are locked in to the Nike+
ecosystem of movement-tracking devices— and the harder it will be to switch to other wearable
MANAGEMENT INFORMATION SYSTEM
Ing. Joseph Ballon Alvarez
computing devices. You can’t get credit for the Fuel points you’ve accumulated if you decide to
switch to a Fitbit wristband. Nike’s integration of information and information technology into its
products keeps people coming back to Nike’s own website and apps. Other Nike+ devices
include the Nike+ Sport Watch GPS and the Nike+ Running App, available for both Apple and
Android mobile devices. The Nike+ Sport Watch GPS keeps track of your location, pace,
distance, laps, calories burned, and (with the Polar Wear link+) heart rate. After recording a run
on the Nike+ Sport Watch GPS, you can upload workout information to [Link] by plugging
the Sport Watch into your computer’s USB port.

Once your data have been uploaded, [Link] enables you to track your progress, set
goals, see where you ran, and find great routes. The Nike+ Running app maps your runs by
using GPS so you can track your progress and get the motivation you need to keep going. The
Nike+ Running app tracks distance, pace, time, and calories burned, giving you audio feedback
as you run. Users can automatically upload to [Link] to see their runs, including the route,
elevation, and Nike Fuel points. They can even post the start of their run to Facebook and hear
real-time cheers for each Like or comment they receive. The latest version of this software
includes training programs, coaching tips, and daily workouts. A new Next Moves feature on the
home screen allows runners to flip easily through suggested challenges, for example, to run their
fastest 5 kilometers or go their farthest distance. Users of multiple Nike+ devices can visit the
[Link] site to access all their data, including lifetime Nike Fuel points accumulated from
all their Nike+ devices. The Nike+ ecosystem is part of a larger phenomenon called the Internet
of Things, in which individual devices such as sensors, meters, and electrical appliances are
connected to the Internet so that the performance of people, and machines, can be monitored
and analyzed. Other consumer product companies besides Nike are embracing this technology
with gadgets such as Internet-connected water bottles to gather water consumption data or
Procter & Gamble’s web-enabled toothbrush, which links to a smartphone and records brushing
habits. Nike has no interest in making money by selling the detailed information it gathers about
users’ workout routines to help companies and advertisers target their ads. That information may
be valuable to other companies, but what Nike really wants to do is build cool-looking devices
that closely connect to its own software. It’s all about serving one particular kind of customer: the
athlete.