ADIDAS Marketing Strategy

Submitted to: Deepti Srivastava

Submitted By: Vijayta Yadav

Satyendra Yadav

Tinku Yadav

Himanshu Kanaujia

Abhinav

Anurag

Rahul

INTRODUCTION

Adidas was created by Adolf Dassler who took his nickname, Adi, and combined it with

the first syllable of his last name to create the Adidas brand. Adidas first started using

athletes to promote their line of products. In the 1936 Olympic Games, Jessie Owens

sponsored Adidas by wearing Adidas shoes for his races. A lot of star athletes were

sponsored and today star soccer players such as Kaka, Zinedine Zidane, David Beckham

are sponsored by Adidas.

At the end of the 1970s Adidas dominated the world market in sportswear. But in 1978,

a small Oregon company named Nike founded in 1972 offered more distinctive colors

and styles while also patenting the technical innovations underneath and inside them.

As a result Adidas was overtaken by Nike in the 1980s, with large financial misfortunes.

They were able to come back in the market by creating the credo that “Teens will

usually shun whatever their parents wear” and their parents wore Nike. In 1997 Adidas

sales had climbed over 50% from the previous year, jumping back as the driving force in

the sportswear market.

ADIDAS IN INDIA

1989 - entered India, license agreement with Bata

1996 - joint venture with Magnum International Trading Co. Ltd.

1998 - Sachin Tendulkar is Brand Ambassador for India

1999 - introduced the cheapest range of shoes they had ever sold

2001 - first televised advertisement for India: Paes & Sachin

2004 - Advantage adidas campaign kicks in. 30% growth milestone

2005 - Andreas Gellner is new MD, India

CUSTOMER SURVEY ANALYSIS

We have conducted the survey of adidas customers to analyze the willingness of the

customers in India. So according to our survey we have drafted a graph.

There are various prices on the x-axis and on y-axis we have the

percentage population.

Percentage of customer who are willing to pay the prices according to

their affordability.

As it is clear from the graph when we asked to customer if we are

providing you the pair of adidas shoes at just ` 1000-1499 price. We have

only 7% people who are ready to buy the shoes at these prices. Most of

them are putting question on the quality of the product so inspite of

buying adidas at this price they are ready to pay these to some cheaper

product of matching quality. Hence we have the less percentage.

Then we increased our price to `1500-1999, and then we have 25% of the

population. Most of them are ready to buy at these prices just coz they

believe that adidas may not compromise with the quality. And these

prices they can afford.

After increasing the amount to` 2000-2499 the percentage of population

who are willing to pay the price are maximum ie, 31%. They are willing to

pay for that and compromise with the prices factor.

Increasing price more to `2500-2999 some of them choose for different

brand of some high quality, as if they can pay `2999 so they also go for

other options.

Increasing more to `3000-3499 the percentage again decreasing i.e., 8%.

the interest of percentage decreasing as for most of them it is not an

affordable prices.

Now as we asked at `4000+ the percentage of population increases these

population basically high class customers. Most of them are willingly to

pay prices with durability and comfort.

SWOT ANALYSIS OF ADIDAS Strengths Took advantage of the trend in mobile media advertising early, before many competitors.

The Respect M.E. ad campaign reached out to America's youth.

Ahead of the curve on innovative advertising, due to limited budget.

Partnership with MTV further enhanced its image of cool.

Attained consumer confidence and comfortability with the adidas logo on their cell phones.

The adidas arcade-style soccer game applet creates a complete brand experience for users.

Breaking into the large, urban basketball market (U.S.)

Weaknesses Consumers on average receive no more than 8 minutes of adidas advertising per year through all forms of broadcast media.

Many of its ad campaigns in Europe focused on older consumers, and not the key 12-24 demographic.

Rigid pricing structure.

Many adidas shoes are low quality and over-priced.

Limited product line.

A line of shoes targeted towards athletes (many adidas are) should not be so heavy.

Opportunities Video games can provide a brand experience specifically aimed at the 12-24 year old demographic.

Digital media offers richer, more personal, transactional experiences than television or print.

Advertising through mobile media can be delivered directly to a targeted audience.

While having the portability of print, mobile media devices are more time-sensitive, providing continuous on-time delivery content.

3G-equipped cell phones allow users to browse the web, watch movie clips and sporting events, download music and play games; this opens new doors for adidas. Lag in technology adoption in the U.S. cell phone market enables adidas to test new products in Europe before launching them in the U.S..

Target the achievers psychographic.

Trends in North America tend to have enormous impact on consumer preferences around the world

Threats Consumers may be annoyed by advertisements intruding into their personal lives (mobile media).

Pop-up blockers and digital video recorders provide customers with ways to avoid unwarranted messages.

Scarcity of time available to directly address consumers.

The dot-com-induced stock market decline of 2000 lost the confidence of many would-be advocates of digital media.

Hard to measure the effectiveness of mobile marketing in a rapidly changing technological environment.

Advertising must be tailored to regional tastes in different countries.

Out of adidas, Reebok, and Nike, adidas is the least preferred brand among consumers.

Failure to expand in North America could hamper adidas prospects in Asia and

threaten its leadership in Europe, where Nike is growing.

MARKETING MIX

Marketers use the tools to meet the needs of the target customers these tools are

called marketing mix.

These are 4p’s of marketing: product, price, place and promotion. Collectively they are

called marketing mix. In the context of 4p’s product is to meet the needs of consumers

in terms of services and goods.

Place, promotion, accessibility are the other factors which gives importance there

should be a good place for stocks which will be easier to the consumer to get through it.

Promotion of product also plays and important role in the marketing. Promotion of the

product increases the interest of customer and also creates a value and trust towards it.

It also gives the importance and relevance of the products. Promotion can also be

through the communication.

Price also matters it should be in accordance with your target customers. Also in such a

manner that it will give more revenues in short run.

Each mix has its own importance, remember if your marketing mix doesn’t meet the

needs of the customers then you will never meet your objectives. For example if you

have improve your product, then the cost in the production must increases as a result it

increases the cost of the product. There must be a good communication to tell the

customers that you have improved the quality for them to make more desirable and

stable thus increases the price.

PRODUCT PRICE PLACE PROMOTION

The product is the physical product or service offered to the consumer. In the case of physical products, it also refers to any services or conveniences that are part of the offering. Product decisions include aspects such as function, appearance, packaging, service, warranty, etc.

Pricing decisions should take into account profit margins and the probable pricing response of Competitors. Pricing includes not only the list price, but also discounts, financing, and other options such as leasing.

Promotion decisions are those related to communicating and selling to potential consumers. Since these costs can be large in proportion to the product price, a break-even analysis should be performed when making promotion decisions. It is useful to know the value of a customer in order to determine whether additional customers are worth the cost of acquiring them. Promotion decisions involve advertising, public relations, media types, etc.

Place (or placement) decisions are those associated with channels of distribution that serve as the means for getting the product to the target customers. The distribution system performs transactional, logistical, and facilitating functions. Distribution decisions include market coverage, channel member selection, logistics and levels of services.

PRODUCT

we know that marketing is the fundamental to provide the actual benefit to the

customers. Marketing is not only to provide the product but it is to the change or to

communicate to the customers and convince about it. Adidas as a product people need

comfort, durability and style.

FEATURED SPORTS MORE

Chelsea FC

Brotherhood

adidas by Stella McCartney

F50i

Basketball

Golf

Football

Running

Training

Tennis

Women outdoor

bodycare

eyeware

micoach

watches better place

PRICING

is the only mix which generates the revenues to the company. so the company should

follow the strategy of price making by considering various factors:-

BRAND VALUE – the price should be decided in such a manner so that it matches

with pshycology of the customers. If you made a higher price than it will

decrease the demand for the product and hence fewer buyers. Fewer buyers

ultimately lesser will be the sales and hence profit.

The price should not be too low because If the price is too low than then it will

decrease the value of the product for the customers. They might be question on

the quality of the product.

SUITABLE FOR THE TARGET CUSTOMERS - As higher as well as the lower price

will affect the value hence the price should be right. It should be matched with

customers which you are targeting. If you are targeting to high class then your

price should be high and if you are targeting the middle as well as the lower

class then the price should be matched accordingly.

GENERATING THE REVENUES QUICKLY – pice also affect the revenues and the

profits of the company. If we talking in terms of profit maximization then

marginal revenue should be equal to marginal cost, MR = MC

Also the difference between the total revenue and the total cost should be maximum,

π = TR – TC.

- competition T he company should aware about the competetors, what the similar

product company offering prices to customers.

PLACE-DISTRIBUTION A crucial decision in any marketing mix is to correctly identify the distribution channels. The question “how to reach the customer" must always be in your mind. The place is where you can expect to find your customer and consequently, where the sale is realized. Knowing this place, you have to look for a distribution channel in order to reach your customer.

Distribution areas: Locations

Logistics

Channels

channel motivation

market coverage

service levels

internet usage

mobile technology usage Instead of "place" it would be better to use the word "distribution" but the MBA lingo uses "place" to memorize the 4 Ps of the marketing mix!

The distribution strategies applied by ADIDAS: 1. CONCENTRATING RESOURCES ON MOST PROFITABLE CUSTOMER SEGMENTS.

Concentrating on distribution channels reaching most profitable segments.

Offering total customer service at higher price.

2. EXPLORING AND EXPANDING NEW GEOGRAPHICAL MARKETS.

National market expansion.

Regional market expansion.

Export market expansion.

PROMOTION Promotion includes all of the tools available to the marketer for 'marketing communication'. Promotion uses methods of communication with two objectives: (1) Informing the existing and potential consumers about a product. (2) To persuade consumers to buy the product.

TOOLS OF PROMOTION Advertising

Public relations

Messages

Direct marketing

Sales

Media

Budget

The promotion strategies applied by ADIDAS: REDUCING NUMBER OF LOST CUSTOMERS.

Improving communication with present customers.

Promotion aiming at existing customers.

Understand reasons for losing customers. ATTRACTING OTHER MARKET SEGMENTS.

Seeking other distribution channels.

Advertising in other media.

CONCLUSION Adidas have used the theoretical systems to create their brand building programs. Adidas

launched sub brand of the equipment product line for the elite of sports men. Adidas

continues to prove itself as a brand built to last through a game plan of reinvention. And it is

constantly improving the sales and the brand image.

Marketing mix plays an important role in increasing the sales and making a brand name in the

market. The right product on a correct price at a right place and with proper and constant

promotion plays a vital role in marketing. Adidas used the tool of Marketing mix rightly to enhance

the image and to conquer the market.