Background Research and Analysis: Adidas is one of the strongest sports brand around the world, known for its wide collection of shoes and the brand also manufactures clothing and different accessories.
Industry Overview: The one of the most iconic brand has been in the market around 92 years and without no doubt its been evolving around time. The industry has created Olympic medal winning shoes that has maintained the classic athletic outlook that positioned itself to create brand for sports and style. This brand was created by two brothers and a washroom. They used their mother's laundry room in one of the small town of Germany to produce their products. The company's financial status begun in 2008, with it's reaching demand of $195 billion in 2015 and $211.5 billion by 2018.
Company Overview: Adidas is widely used in different parts of the world that includes Western Europe, North America, USA Reebok, Russia/CIS, Latin America, Asia/Pacific, and Emerging Markets. It operates under the adidas and Reebok brands. Adolf Dassler was the founder of Adidas in 1920 and is headquarters is located in Herzogenaurach, Germany.
Insights of Adidas: Adidas uses digital information to retain best outcomes from consumer insights. These insight comes from the data being used by the company itself. If the company see thats the something is missing to connect consumers with the company, it can react accordingly and stick to their plans to fuel it's marketing plans. The data insight was not only used to connect consumer but also to discover new and efficient ways to working to build a better perspective for the company that are faster and more convenient. New process is created by adidas by using consumer's first thinking consumer insights as the main point to create their goods and models. Adidas company always believed that, nothing can be relevant without the use of insights into what the consumers experience. It had the slogan that Taking risk, testing of the new ideas and innovation needs data as early as often.
Below are the some of the Adidas strengths, weaknesses, opportunities and threats:
• Legacy and Heritage: To build a youthful brand, Adidas has been travelling for decades of heritage and legacy. It started in 1949 and came very far since then.
• Diversified portfolio: The Adidas company has different types of components with varied range of footwear and accessories under brand name Adidas which is known as premium segment and Reebok which is known as mid range.
• Strong Financial Position: The company has very strong financial position which accounts for 2400 stores all over the world and contribute up-to $4.3billions.
• Network Distribution: The company owns online as well as supermarket stories for its buyers. The adidas the different types of system distributions that are available through the different channels.
• Touch Points with community: Adidas awareness has been increased in the global market due to its close and touch relationships with FIFA, UEFA, NBA and Olympics. As a result it has achieved its targets customer base.
• Collaborations and memberships: Different organisations such as International Labour and international Finance has provided Adidas a strong membership to give company an edge over its new arrivals in the market to have a defendable business.
• High Price Range: Adidas is affordable for limited customers only due to its high price range and innovation technology being used.
• Outsourced Manufacturing: To cut off the labour cost and easy reach to resource, Adidas has transferred its 93 percent of the procession to the 3rd party that has been running the risk of dependency over the Asian markets. Therefore, The goods are received by the consumers have the quality issues as far as the brand is considered.
• Limited product line: Due to its limited acquired brand under its name such as Reebok, there is major scope of product line expansion despite its deep associations with other community ambassadors.
• Lifestyle Changes: There is a huge rise in the premium goods and products due to changing economies, taste, education and lifestyle in developing countries.
• Development of Market: Due to high competition in the market, it is very good opportunity for Adidas to enter into the new markets and have a very successful place incoming future.
• Product Line Expansion: To differentiate itself from its new arrivals in the market, it is very important for Adidas to expand their product line that will create new set of goals for the industry.
• Increasing demand of premium goods: There has been increase in the markets in regard to demand for premium goods that leads to further expanding size of developing countries.
• Backward integration: To work in the open system, backward integration will help Adidas to secure their rights and integrate with new markets.
• Competition: Adidas is facing competition from other brand such as Nike (Which is considered number 1) and placing Adidas on the second place in the premium segment. regardless of this, there are several other local arrivals that are giving hard time to Adidas.
• Dominancy Supplier: Production is being outsourced by the Adidas due to which suppliers have more bargain powers than the company itself.
• Government regulations: China manufactures 35% and Asia produces 93% due to which import regulations pays a important role in price and success of Adidas.
Marketing communication Objectives: Adidas uses SMART goals to achieve the following:
To increase its personal satisfaction over 80 percent
To achieve market share in the US and to re-energise its brand
To increase its sale across the world.
To test-market with the new concept of “Adidas Street ball Challenge”
To establish a raw competitive advantage over rivals.
Strategic: To obtain the personal satisfaction and to increase the sales production, it is very important to offer bonuses and to provide training to the right people. To obtain edge over the US market, Adidas have to unlock its brand value and commercial opportunities through sports products in American Context. To reenergise its brand, Adidas to have listed as the most motivational sports priciest and footwear brand.
Tactical: For a positive feedback, the company have to increase its repeat purchases. The “Adidas Streetball Challenge” will provide positive feedback to consumers by giving an on-strategy experience, memberships and high visibility in order for the concept to be well maintained by the public.
Competitor Analysis: Adidas has a rigid competition in the Indian market. Now Nike is considered as the leading player in the industry. Multi - Brand Approach provides adidas major competition and significant additional commercial opportunities related to single brand. Boarder Distribution is being used by Nike but if the adidas also uses the close cooperation with all its retailers it can significantly improve the in-store experience for the product. Cost Leadership: Nike and Reebok and used the significant opportunities to reduce and optimise costs. Adidas has strong grip only in basketball and casual wear. There is no product of Adidas that is associated with athletics, Cricket and hockey that can significantly help Adidas to compete with Nike. As a result Nike is the main sponsor of cricket products for Indian team.
Adidas Competitor advantages and weakness:
Advantages: The strengths and advantages includes the following:
• Nike has a strong brand image and is evolved in its product quality that creates edge designed for its athletic companies
• It has strong innovation processes as compared with adidas
• Nike has large production in the world and netwok distribution as compared with Adidas
• Labour arguments that includes production facilities in developing economies .
• Production Mix limitations: Although Nike has huge product line but it is still suffering in obtaining bigger share of the sports products.
• Developing markets have limited presence of Nike suppliers in regards to pricing, imitation and patent protection.
2. Callaway Golf Company
• The advanced technology has bought consistency to the quality of Callaway Golf Company
• Keeping successful track of all the goods and services, it has trapped all the integrated number of technology companies to make a reliable supply chain.
• WorkForce is highly skilled in Callaway Golf Company
• Investment is below the fastest growing industries in regards to Research and Development
• There is no segments that can solve the challenges that are faced by the new entrants due to which they have lose small markets
• Not considered very best in the demand of the product
3. Puma SE
• Puma is considered as the one of the high growth rate that gained 12.8% increase in sales in 2016.
• Puma is spending very high rate in promoting its brand all across the world by including many legends in promoting videos
• Puma has very rich Research and Development team
Puma has low financial revenue as compared to other brand ambassadors
Puma has facd disputed in regards to wages due to which its workers has to go on strike
Targeted Audiences: The main targeted audience for the Adidas is its 20-30 years old consumers that are involved in its sports production. Adidas produces high quality for all its products for all its sports. As a result, it will affect its audience in an affordable price. Along with audience that buy sports products from products, there is smaller number of audience that does have any interest in the sports but they buy Adidas for its big logo and for look in terms of fashion.
Primary Target Market Audiences:
Demographics - Age between 15-35 years includes both male and females, athletes
Lifestyle - Athletics, Upper, Middle and Lower class levels
Behaviour - Person with Sports Mind
Secondary Target Market Audiences:
Businesses that provide houses for the extended stay visitors, long distance commuters
Objectives of Adidas:
• To become the leader globally in the sports industry
• Operational and financial performances to be maximised.
• To earn profitable market growth and become leading sales growth department
• To be one of the topes retailer in the world
• To build up an internet sale also known as eCommerce
• To obtain a qualitative and quantitative growth
• To lower the costs of producing goods
• Modernise the infrastructure
Consumer Persona #1
Education College Graduate
Carer Enterpreneur, Active Blogger
Comments Jamie has very keen interest in running and sports. She participated in local 5k and 8k events. She has been running for couple of years, she has developed passion for sports and sport products like adidas. Before coming to buy adidas she has broken interior souls of many pair of shoes. So she switched to adidas with grate attributes that gratis maximum performance and go to higher performance.
Consumer Persona #2
Carer Receptionist; $38k
Origin Loss Angeles, CA
Comments: Brandi is very emotional in buying branded shoes and his narrow feet always is the problem. But her love for adidas is unconditional as she gets her number from adidas companies. She has done shopping both online and in-store stores of adidas and she is pretty happy with them.
Consumer Persona #3
Age Late 20's
Education College Student
Carer College Soccer Athlete
Comments: Adam has a great love for adidas. He has grown bearing adidas brand from his early years in soccer. Today Adam is busy working and collaborating all kind of things but Adam still rocks adidas.
• Adidas has lost the touch of german headquarters companies with the American Tastes.
• People are becoming more fond of Nike as Adidas has lost its major deals as compared to Nike
• The Adidas company has slow turnaround point which store its products for unto 18 months period but adidas is ensuing its consumers they are changing it to 6 months.
• People are turning to different brands because adidas production is very slow and it has paid Reebok too much when it was staging to cope with market values.
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