Impossible is nothing

Executive summary • ADIDAS  is a German Multinational corporation that designs

and manufactures sports shoes, clothing and accessories• The Adidas group, headquartered in Herzogenaurach

(Germany) was built on 18th August 1920 by Adolf Dassler. • The Current CEO of ADIDAS is Herbert Hainer.• Furthermore, the company has worldwide 169 subsidiaries

and had total revenue of 11.990 Mio. Euros in 2010.• The company uses the image of its brand and the available

amount of capital to sponsor many sports events such as Olympic Games or Paralympics and many more.

• In 2012 Adidas will be the official sportswear-partner of the Olympic Games and the Paralympics in London.

Environmental analysis : SWOT

• Strength : An essential strength of Adidas is its strong brand as it is recognised and respected. Adidas has an efficient working network and highly qualified personnel

• Weaknesses : High dependency on raw material prices. Manufacturing of Adidas is another weakness as it is situated in “low wage countries”.

• Opportunities : Investments focused on highest potential markets and channels.

• Threats : Increase in raw material costs – Over pricing. Lots of competitors (same products, same price range)

Situational AnalysisCUSTOMER : • Bargaining power of Buyers of Adidas

products tends to be high. • One of the reasons for this is that the

buyers’ concentration is high, that means they buy large volumes.

• The suppliers for the Adidas products are available in plenty and so the bargaining powers of suppliers are low.

COMPETITORS :•  The rivalry among existing

competitors is pretty high in the sports and footwear industry as compared to other similar industries.

• There is a degree of threat from substitutes . The substitutes of Adidas products are NIKE, PUMA

NIKE•Teamed up with Apple Inc.•Marketing strategy is an important component of the company’s success.•Sells its product to more than 20,000 retailers in the U.S., including its own outlets and “Niketown” stores and in approximately 140 countries in the world•“Just do it” and “Joga Bonito” slogan

PUMA

•Third largest sportswear manufacturer in the world•Business strategy is to solidify the brand’s status as a global icon.•Leading supplier in the motor sport footwear market.

COMPANY OVERVIEW• Adidas is the biggest sportswear manufacturer

in Europe and one of the biggest in the world. • Owns a global market share of 35%. • The company that started in 1924 is one of the

favourites for many athletes.• Adidas has also won the trust of many

customers as a strong and reliable brand. • Their core products are Footwear, Clothing, and

Accessories

Marketing Opportunities and Issues

MARKET OPPORTUNITIES : • 60 new foot-friendly designs each year.• Venture to making more stylish designs.• Tie-up with emerging sports teams/clubs/players.• Brand building by setting up sports academy.ISSUES :• Slow growth due to rising cost of resources.• Big boom – due to increase in popularity of sports.• Criticized, allegations of sweatshop labor usage.• Criticized for production done using animal skin.

Objectives• To be leader in sporting goods

industry.• Maximize operational and financial

performance.• Diversifying brand.• Leading through innovation.• Becoming a sustainable company.• Understanding needs/wants of the

customer.

Marketing Strategy • During the mid to late 1990s, Adidas divided the

brand into three main groups with each a separate focus: Adidas Performance was designed to maintain their devotion to the athlete; Adidas Originals was designed to focus on fashion and life-style; and Style Essentials.

• "Adidas is all in" is the current global marketing strategy for Adidas. "Impossible is Nothing" was the previous mainstream marketing slogan for Adidas.

Target MarketGEOGRAPHIC SEGMENTATION: This segment

divided the market into different units of location like neighbourhood, states, regions, cities and countries.

DEMOGRAPHIC SEGMENTATION: The demographic segmentation of Adidas is as follows:– Age 15-36– Income level: $15,000– Social Class: Upper middle, upper class and lower

upper.– Gender: Both male and female– Customer is working and loves sports, fashionable and

stylish

BEHAVIORAL SEGMENTATION: This segment divided the consumers according to their attitude, knowledge, response and use of the product. Below are the behavioural segmentation for Adidas :

• Benefits• Gym regular users• Sports lovers• Athletes• Image seekers• Brand freaks

PSYCHOGRAPHIC SEGMENTATION: In this segmentation, consumers are divided according to the personality, values and lifestyle. Consumers within the similar demographic segment can present very diverse psychographic profiles.

• Achievers• Well-experienced• Hard workers• Goal achievers

Positioning• Shoes are comfortable as compared

to any other competitive brands.• Apparels are stylish and designed to

suit the customers need• Eye gears and perfumes serve the

‘niche market’.

Marketing Mix :The 4 P’s

• Products :- The Adidas group has 4 main subsidiary’s. • The first is its own brand name – Adidas, which is

present in clothes as well as footwear. • The second is Reebok which has overtaken Adidas and

is one of the leading subsidiary’s in the Adidas group.• The 3rd is Rockport which specializes in outdoor

footwear, apparel’s and accessories • 4th is Taylor made which is focused on golfing clothes,

equipment etc. Out of all the above subsidiary’s, Reebok is the strongest followed by Adidas.

Pricing • For run of the mill products, Adidas

uses competitive pricing.• Newly introduced products are

uniquely designed, Adidas uses skimming price.

• Adidas never uses penetrative pricing because that will affect the brand equity of Adidas.

PlaceThe major areas in which Adidas is sold is through retail outlets.• Manufacturing > Adidas outlets > End

customer• Manufacturing > Distributor > Multi

brand showrooms• Manufacturing > Online fashion

websites / Adidas website > End customer

Promotion– Promotion objective

• Become the NO.1 sporting brand in the world.– Promotion Mix

• Advertising commonly through the mass media.• Through the use of the internet• Point of Sale• ‘Impossible is Nothing’ campaign

Review and Control

Contingency plan • In order to not deviate from the 49% goal margin,

Adidas has it’s contingency plan.• When sales start reducing, we are prepared to

reduce product line and have just in time products in our inventories that will decrease cost of production.

• Adidas has it’s manufacturing factories in more economically and politically stable. They have products in their inventories in case of crisis (Asia).

• They also implement cash collection system that require customers to pay with only debit cards, cash, Adidas token’s or gift cards. This improves liquidity position and reduces debts.

Thank you!