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Essay: Decathlon overview, strategy and marketing

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The decathlon chain was founded in 1976 by Michel Leclercq. For tennis fans this name is well-known, he was a top-level tennis player in the biggest national and international tournaments between 1961 and 1975 and first cousin of Gérard Mulliez, founder of the Auchan hypermarkets. On July 27, 1976, he opened his first self-service sports goods store in the car park of the Auchan shopping centre in Englos near Lille.

The name Decathlon comes from the top ten sports presented in this first store. The concept consists in equipping all athletes, from beginners to advanced athletes, in the same store at the best price. It also offers a repair and maintenance service for all the equipment it sells.

He soon realized that his employees could not be mere salesmen, but real advisors to their customers, so he opened his first training centre in 1985, which he called “The International School of Decathlon Crafts”.

Consumers quickly adopted Decathlon stores that met all their needs and requirements, with a wide choice of materials at attractive prices.

In 1986, creation of the subsidiary, Décathlon production, whose mission is the design and manufacture of sports articles by Décathlon, the same year the group began its international expansion with the opening of a store in Dortmund, Germany. In 1988, Olivier Leclercq, son of Michel Leclercq, internationalized production with the opening of the first production office in Asia.

In 1989, Decathlon Production became Decathlon Production International. Offices are located in Hong Kong, Thailand, Taiwan, Korea, Spain and Italy. The objective was to gradually balance the decathlon with the trade balance of each country where it is produced.

In 1994, the international headquarters of the decathlon was established in Villeneuve d’Ascq near Lille in France. In 1996, the company created its first two “passion brands”, the Tribord brand dedicated to water sports and the Quechua brand to mountain sports.

In 1999, the brand took over the MVP stores in the United States and opened its first stores near Boston, Great Britain. The same year, the sports brand Quechua, dedicated to mountain sports, moved to Domancy in Haute Savoie, in the Mont-Blanc region, which is also the symbol of this brand.

In 2000, they continued their international expansion and opened stores in Amsterdam and Lisbon. In 2003, the first store in China opened in Shanghai. In 2004, a new turning point for the Decathlon brands, while all the other groups are regrouping their structures to reduce costs, Decathlon did the opposite, realizing that to meet the expectations of athletes, it is necessary to be close to them on a daily basis and they are relocating their brands such as Tribord to the shores of the Atlantic Ocean in the Pyrenees, the development of the Decathlon brands Aptonia and Géonaute, dedicated to the well-being of passionate athletes, Kalenji for running, Fouganza for horseback riding, Artengo is born for racket sports….. Today it is 20 brands”passions”, each specialized in a practice of sports that represents more than 50% of the items offered in stores, thanks to an attractive purchase price for the customer the success of Passions brands comes quickly.
In 2006, as the results of the overseas market deteriorated sharply, the group withdrew from the American market, but opened their first store in Russia.

The name Le décathlon became too simplistic in relation to the diversity of different sports articles offered in the stores, so the name of the group changed to Oxylane in 2008.

In 2009, after spending fifteen years setting up the brand in Asia, Olivier Leclercq succeeded his father as President of the Network. In 3 years, he propelled the group into the BRICS with a 66% valuation, the Euro-denomination of the Mulliez group.
In the same year, he moved the Oxylane international centre to Dourges in northern France. This centre is both the international headquarters of the logistics teams, but also a 51,000m2 warehouse designed with innovations in reception and shipping procedures that play a key role in the group’s success.

In 2010, opening of B’Twin Village in Lille, a site entirely dedicated to cycling with the assembly factory and a store entirely dedicated to cycling enthusiasts. In that year, internationalisation continued with openings in the Czech Republic and Turkey.

In June 2012, Matthieu Leclercq replaced his brother as President of Oxylane Network. In 2014, Oxylane became Décathlon again and in 2015, Michel Aballea took over the management of the group. That same year, 140 stores were opened abroad, including 51 in China.

The Decathlon group has set up a dynamic and “responsible” management system.

II. Decathlon strategy

A. The main goal of this strategy

Decathlon strategy present competitive advantages. In fact, concerning innovation and R&D, Decathlon works on the design, and favours a good quality/price ratio approach.

The company use a vertical integration system, this allows the company to control everything from the production to the distribution. The final aim is to reduce the costs of production and innovation to reduce final price. “An advantage of vertical integration is that it gives to the company a competitive advantage over non-integrated companies. Consumers are more likely to choose their goods or services. Either the costs are lower, the quality is better, or the product is tailored directly to them.” (Kimberly Amadeo; Vertical Integration, Its Pros and Cons with Examples; 2018)

The strategy adopted by Decathlon include an intensive growth with the development of the different services. They want to create customers loyalty, increase the visitor’s numbers and also increase customer awareness in sustainable development with Eco’cathlon. This new concept consists in the recovery of textiles and shoes of the « Marques Passion » to recycle them.

B. The segmentation

Decathlon’s main customers are people who are aware of sustainable development with the Troc-Cathlon which allows Decathlon customers to sell their used items and the Eco’Cathlon which recycles these used items and so answer to an economical and moral need of environment; protection. They are also casual and high-level athletes and also families.

C. The positioning on the market

Decathlon is at the third rank on international market of retailing sport items.

Its primary customers are from fifteen to thirty-five years old. This is mainly due to accessibility of products, low prices and the development of their own-brands to achieve innovation in some sports. Decathlon want to adapt their products to the level of practice of the consumers.

Every offers Decathlon is making are turned to practice sport before extension of use of the products like the jogging which are used in everyday life by some users.

D. Brand equity Prism:

The Brand Identity Prism is a concept created by J.Kapferer in 1986. According to him, any brand can be identified by its characteristics. This prism is represented by this following hexagonal prism. The importance of the conception and its understanding quickly disseminated in the entire world. The literature on brand management, which has been widely examined, uses the terms “equity” (Aaker, 1996).

  • Physique: White and blue logo, place to buy good quality products and cheap items
  • Personality: Cheap, good quality, passion
  • Relationship: Good quality, Affordable prices, Distinct identity
  • Culture: European style of life
  • Reflection: Useful for everyone
  • Self-Image: Innovative, young

E. Customer Based Brand Identity CBBE:

The customer-based brand equity (CBBE) approach is a two-edged sword, it is said that an image is worth a thousand words, but it is important to make no mistake about the image or graphics that should represent the brand. This choice is crucial for the company or brand, it must reach the customer to become a positive capital for the brand to attract the customer. The word “positive capital” is not insignificant, because it is this positive or negative feeling of the consumer about the image created for the company that will make it successful or unfortunate. This “Positive Capital” must not only make it possible to understand the desires and needs of clients, but it must also anticipate them before they even express them.

The most common model on the CBBE is the one created by marketing professor Kevin KELLER in his book ”Strategic Brand Management”, he presents a four-level pyramid with two central layers divided equally into two factors.

  • Salience – High recognition on sport goods retail market: well-known brand -> strong competitors on the market
  • Performance – Focused on selling their own brands products -> less costs of distribution
  • Imagery – Well-organised, easy to find articles
  • Judgments – Easily recognisable, good quality product
  • Feelings – High quality, for passionate, leisure
  • Resonance – One of the leaders on the market -> strong brand resonance

F. Perceptual map:

Perceptual maps commonly have two dimensions even though they are capable of having several. For example, in this perceptual map you can see consumer perceptions of various sport goods retailer on the two dimensions of low/high quality and low/high price. This sample of consumers felt that Decathlon were the cheapest and have the best quality of the ones in the study. They felt that Intersport items were the most expensive and have a really good quality. A company considering the introduction of a new product will look for an area on the map free from competitors.

G. Core associations

Mickael Korchia, Professor of Marketing Research, notes that in order to improve brand equity, it is clear that brands cannot simply communicate their benefits in any way. They must stand out from the competition by showing how unique and incomparable they are.

Decathlon is a well known brand all over the world, and customers can easily recognize TV and online ads thanks to decathlon Jingle which is very easy to remember.

H. Brand values

All over the world, Decathlon share a string and unique company culture with two values: Vitality and Responsibility.

Vitality

Vitality is Life with intense activity and energy. Employees are full of vitality as they have a positive mindset and are bursting with energy. They are enthusiastic, they love creating and innovating, and try to improve and make things around them change.

Responsibility

Being responsible is about making decisions and making sure they are acted upon. Decathlon’ employees are fully responsible for their decisions, both in terms of their team and their customers. Responsibility is also about anticipating the challenges facing society and orienting decathlon’ actions towards sustainable development. And it is also their responsibility to guarantee the safety of our customers and employees all over the world.

III. Promotional strategy and target customers

Marion DESLANDE (2018) published an article on the FASHION NETWORK website on the change in communication of the Decathlon group. After having communicated for several years on the price and innovations of its brands such as Quechua or Tribord, the French brand has the ambition to bring all French people back to sport.

Overall sales in 2017 increased by 11% for all stores worldwide, while in France this growth was only 3% according to OC&C’s 2018 ranking.

After several years of targeting regular sportsmen and women, or even top-level sportsmen and women with low prices and technological innovations, Decathlon has decided to expand its customer base by targeting occasional or even non-sporting sportsmen and women, focusing on fun, friendly sports and eliminating competitiveness as much as possible. Their new slogan is “enter the dance”, the brand pushes simplicity and proximity with the consumer by staging its own employees. Ordinary, young and dynamic men and women who enjoy playing sports.

Yann AMIRI (2018), who holds the position of social media manager at Decathlon on media strategy, gave an interview to Fabian ROPARS on the moderator’s blog. He explained the group’s new communication orientations. Social networks are obviously at the heart of their strategy, Facebook, comes first because it reaches a large audience, even with the new network algorithm policy, they have not recorded a decrease in traffic because they have anticipated this change through the sponsorship of videos with a format, short dynamic that meets the expectations of their communities. Then Instagram progresses rapidly, and Twitter is a daily network and conversations.

This overexposure on the networks at its worst, the critics can be quite virulent and as Yann AMIRI explains, their strength is to take into account each critic by approaching the dissatisfied customer to understand his dissatisfaction, in order to constantly improve the products.

One of the communication tools that is most important to him is the creation of videos on Youtube. The concept is simple, a member of the company meets an expert who introduces a new sport, the content is relevant, while combining relaxation and humour. In one year, they have already published 347 videos, a sustained but essential pace because the group wants to attract a new clientele with non-athletes and beginners without losing the market of experienced athletes. It therefore requires a variety of speeches to reach as many people as possible in a language they understand.

There is still an important focus, local communication. Decathlon quickly understood that certain areas, such as winter sports resorts or seaside resorts, have peaks in attendance during certain seasons and some of these stores achieve up to 30% of their figures in two months. Yannick Remaux, head of decathlon France communication, told Cospirit that depending on the region where the store is located, the POS and store layout are different. “When you are close to the mountains, the sea, in the city or in the countryside, the needs of customers are not the same”. Each store adapts to its region. Their strength is also the exploitation of their employees’ sporting talents, allowing them to work in the department that corresponds to their sporting skills, thus creating real trust between the customer and the salesperson. This personalized approach is intended to encourage the customer to go into the store to seek advice from the seller rather than to order the product online.
In its local communication, Decathlon takes the concept of proximity even further by offering its customers free of charge to run on Saturday mornings with a running specialist, thus creating bonds of trust and complicity that are priceless”. This is essential when you know that Decathlon has set itself the challenge of bringing 80% of French people to the sport by 2030.

IV. Intersport, a different marketing approach

A. Intersport introduction

Intersport is a company specialised in the retail of sporting equipment. The company is the leader on the international market. The group was established in 1964 during the sport items purchases regroupment (Norway, Sweden, Denmark, Germany, Austria, Switzerland, France, Netherland, Italy, Belgium). In France it was the purchase regroupment of La Hutte.

Nowadays, the group represent around 5 500 shops in more than 66 countries (Europe and Canada) and represents up to 15 brands. More than 650 stores in France and the world leader in the distribution of sport goods. Intersport’s turnover is around 1.8 billion € and more than 9,000 employees. According to Intersport’s website, the group has a hundred stores movement planned in the next 3 years with commercial growth of over 100,000m2. These investments should allow the creation of more than 2,000 jobs in France.
Intersport have its own brands like Energetics for the fitness, Etirel for Multisport clothes), Dynatour for the golf… and each brand have is own autonomy like is main competitor Decathlon.

Today, Intersport is the market leader in the International market and second only to Decathlon on the French market.

B. Decathlon competitor’s analysis

Decathlon has some aggressive competitors. The main competitors are not all specialised in retailing and distributing sporting goods. Only Intersport, Go Sport and Super Sport are specialised, and the others use different distribution techniques as for example the supermarket chain Carrefour or Walmart.

These two SWOT analysis were made thanks to an interview with M.Minot, CEO of Decathlon Saint-Nazaire, and with comments find on websites. These SWOT are also a good way to understand why Decathlon chose to develop itself by its own way.

First, we will compare their strengths. Decathlon have a huger range of product than Intersport because of its own brands which allow customers to have the choice between quality and price. As we compared these two stores in the previous part, we can see that Decathlon has a better logistics and organisational system. Intersport is the leading retailer in the international market, but Decathlon is the market leader in France. Decathlon sells its own brands in addition to all the other brands unlike Intersport which is selling every famous brand in its stores like Levi’s Jeans which are everyday life products. This point gives to Decathlon an important advantage over its main competitor. To consider with the strengths, compared to Intersport, Decathlon’s employees are qualified, because every employee is practicing a sport, and more precisely, the sport shelve in which one they are working. Another advantage for Decathlon is that the stores are bigger than Intersport stores and allow to take more space for shelves and to make shopping easier for customers. The last advantage for the two brands is that their websites are comprehensive and easy to use and that is important for customers to be able to find what they are looking for on the website.

Secondly, we can also compare these two stores with their weaknesses. A major problem for Intersport is its after sales service which is criticised a lot on the internet by customers, compared to Decathlon’s one which has no adverse comments on this sector. The principal problem for Decathlon is that it has high costs because of the innovation it has developed in its own brands. Another weakness for Intersport is the lack of space in the stores compared to decathlon which have a lot of space to allow customers to be more comfortable in the store to do shopping. Decathlon was not established in the US, but this year, they created stores in San Francisco with only French speakers’ employees. A main weakness for Decathlon is that it uses only short-term employment contracts because it employed lots of students compared to Intersport that employed people in long-term contract, but they are not specialised in a special sport.

Thirdly comparison of opportunities. One of the most important idea for Decathlon is to be aware of consumer’s health and the protection of nature, and this can be an opportunity for Decathlon because lots of people are passionate about this subject. Intersport have opportunities thanks to its partnership with Olympique de Marseille football team because as a partner, it has welcomed large numbers of their fans. Another opportunity for Intersport will be to improve it after sales service to prove to customers that there are improvements in the stores. The last opportunity for Decathlon is that in 2017, they opened stores in San Francisco, Africa, India, Israel and in Hong-Kong; and in these two lasts one, they were empty after the opening day because of their success.

Finally, we can compare them with their threats. The main point concerning these two groups is that they are direct competitors on the market. Since the 2008 crisis, customers purchasing power reduced and this is an important threat for these two competitors. Decathlon can also have threats regarding its own brands, because competitors can make a big competition on these own brands. The last threat for decathlon is that its own brands items can be obsolete in few years, because they created these items to respond to nowadays problems.

These two stores organisation show that Decathlon and Intersport have different strategies to catch their customers attention. In fact, in Decathlon store, we can see that every store shelf is well organised. This organisation is used to help customers to find what they want easier, and moreover, this organisation can allow the customer to find other items he was not looking for. In Decathlon stores, every cheapest items of each shelves are put at the beginning of the shelve with price in bold, to attract customer attention on this cheapest item which is often an item of their own brands.

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