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I. Brand InventoryCompanyLocationAdidas is established in Germany and its headquarter is in Herzogenaurach, Germany. Adidas also has several headquarters throughout the world such as in North America, South Africa and Asia. It has its stores and storages all over the world and customers can find them on a website of Adidas.

Organization, Major activities and subsidiariesAdidas group owned several brands such as Adidas, Reebok, Rockport, and Taylor Made. This huge group hire almost 46,000 employees all over the world.BrandMajor Activity

AdidasPerformance footwear, apparel, and innovation

ReebookPerformance footwear focusing on fitness

RockportFootwear

Taylor MadeGolf equipment such as apparel and footwear

Brand History.Adidas Group started by Adi Dalsslerin a small town in Bavaria, Germany. His mission is to provide athletes the best possible equipment. The first milestone and reward of Adidas was in 1928, Karoline, a German runner, won the first Olympic champion in the 800m for women, wearing Adidas. Also in 1936, Jesse Ownes winning four gold medals in 1936 Summer Olympics in Berlin,Germany, wore Adidas. In 1949, Adolf Dassler registered the Adi Dassler adidas Sportschuhfabrik with 47 employees in Herzogenaurach, Germany. Later on the day, he registered a shoe with now famous 3-Stirpes. In 1967, Adidas first showed its apparel through Franz Beckenbauer's tracksuit. Adi Dasslers secret effort for success was not only the innovative products, but also, his attention towards athletes. He personally met athletes and collected information and resources such as what athletes wants ,what athletes like and dislike. He kept try to change to meet the need of athletes and did not fear to apply innovation on equipments.In 1970, Adidas presented TELSTAR, the official ball for the 1970 FIFA World Cup. By providing TELSTAR, Adidas finally became a partner with FIFA and still providing the official match ball to every FIFA World Cup untill these days.After death of Adi Dassler in 1978, Horst Dassler who is son of Adi took over the company and continued Adis invention. However, in 1987, Horst Dasslers sudden death put the family business to end, and Robert Louis-Dreyfus became the new CEO in 1993. With his partner Christian Tourres, he brought Adidas which almost got bankrupt back on the growth path. After their hardworking to got Adidas back on the track, most of Adidas' famous innovations, including Torsion, the Equipment concept, the Streetball campaign and the Predator football boot, were achieved and refocused Adidas on what it has been known for years: making athletes better. Since then, Adidas has not only focused on innovation but also expanded its group. In 2006, Adidas bought Reebok, Rockport.. In 2011, Adidas Group finally brought Taylor Made into their group.Annual Report and Financial DataResult of 2013Group sale 14.492 billion

Wholesale segmentstable

Retail segment8%

Taylor Made3%

Rockport6%

Reebok11%

Gross Margin49.3%

Operating Margin 8.7%

Average operating working capital20.9%

Capital expenditure 479 million

Gross borrowing 1.334 billion

Netborrowing/EBITDA Ration-0.2

Earning per Share6% ( 4.01)

Adidas share price 38%

Dividend per share 1.50

Net Sale by Region ( in millions)Region20132012Change

Western Europe3,8004,076-7%

European Emerging market1,8941,947-3%

North America3,3623,410-1%

Greater China1,6551,5626%

Other Asian Market2,2062,407-8%

Latin America1,5751,4816%

Net Sale by product category ( in millions)Category20132012Change

Footwear6,8736,922-1%

Apparel5,8136,290-8%

Hardware1,8061,6718%

Key personnelExecutive BoardHerbert Hainer - Chief Executive officerRonald Auschel - Global SalesGlenn Bennett - Global OperationEric Liedtke - Global BrandRobin J.Stalker- Chief Financial Officer

Supervisory BoardIgor Landau : ChairmanSabine Bauer : Deputy ChairwomanWilli Schwerdtle : Deputy ChairmanDieter Hauenstein : Member of Works CouncilDR. Wolfgang Jaeger : Managing DirectorDR. Stefan Jentzsch : Corporate Finance ConsultantHerbert Kauffmann : Independent Management ConsultantKatja Kraus : Managing PartnerKathrin Menges : Executive Vice President Human Resources and Infrastructure serviceRoland Nosko : Trade Union OfficerHans Puprecht : Sales Director Customer ServiceHeidi Thaler-Veh : Member of the Central Works Council

Recent NewsOne of the recent news of Adidas Groups is an appointment of new president of the North America Adidas group. New president of the North America Adidas group is Mark King. Mark King has a long and successful record with the Adidas Group. He was a CEO of Taylor Made since 2003 and led it toward the most profitable golf company in the world. He doubled the profit of Taylor Made from 2003 to 2013. Mark started his career as sales representatives in early 1980s.

Category and CompetitionCategory DefinitionAccording to what Adi said, Adidas' goal is to provide the best sporting equipments to athletes. Sporting goods are not only mean shoes but also include cleats, backs, apparels, protectors, and hardware.

Size of CategoryThe market for sporting goods in the United States has a value of more than 80 billion U.S. dollars in 2012. (http://www.statista.com/topics/961/sporting-goods/)

History of CategoryThe National Sporting Goods Association (NSGA) has worked on behalf of retailers and dealers since the associations founders fought an unjust tax on sporting goods in 1927. South Carolinas General Assembly had approved a 10 percent tax on retail sales of sporting goods in 27, and this so enraged the states sporting goods dealers that they formed the Sporting Goods Dealers Association of South Carolina to urge repeal of the tax. One year later, they accomplished their goal.Soon after, other regional sporting goods associations began to form. Ultimately, at a meeting in January 1929, in New York City, East Coast sporting goods distributors banded together to form the Athletic Goods Wholesalers Association. Two months later in St. Louis, Mo., Midwestern and Southern sporting goods dealers formed the Sporting Goods Distributors Association.It wasnt long before the two regional organizations met in Cleveland, Ohio; the result of this meeting was the merging of the two associations. On May 26, 1929, the Sporting Goods Distributors Association was born. In 1930, the name was changed to the National Sporting Goods Distributors Association. Finally, in 1936, the organization adopted the name National Sporting Goods Association.

Method of Distribution Major routes of distribution is through wholesale, retail sale, and ecommerce. One of the most famous and the biggest retailers of sporting goods is Wal-Mart. They made almost $8 billion sales a year. Also, there are several major sporting goods stores such as Dick's and Sport Authority.

Major PlayerIn sporting goods industry, there are so many companies. Some companies made several goods for several sports and some are made only one goods for only one sport. The number one player of the sporting goods industry is NIKE which hold almost 31% of the market segment. Second major player is the Adidas Group which holds almost 22% of market segments.

Seasonal Factors Sales of goods are changed as season changes because weather and season make some sports to be playable and some sports to be unplayable. For example, in winter, the sales of hood, jackets, gloves are growing. However, the sales of shorts and cooling shirts are reduced. For summer which is the best season for sales of sporting goods, it is a good time to sell shorts, cooling shirts, running shoes, and especially soccer shoes. Especially, Adidas enjoys to sell their FIFA official soccer ball every four year when the Olympic is launched.

Regional FactorsWestern and the North America are the two biggest market for the Adidas Group. These two markets are where people enjoy their leisure life and do outdoor activities actively. Region20132012Change

Western Europe3,8004,076-7%

European Emerging market1,8941,947-3%

North America3,3623,410-1%

Greater China1,6551,5626%

Other Asian Market2,2062,407-8%

Latin America1,5751,4816%

Legal ConsiderationOne of the legal consideration for the Adidas Group is Health and Safety for the employees. Therefore, the Adidas Group in Germany put in a health and safety management system. Also, their employees are always trained to know how to do first aid for emergency.

Product within CategoryShare of Category by productNike, Adidas, Puma, and Asics are the key players in the global athletic footwear market. Those groups holds more than 30% of world market shares together. However, they cannot stop because there are several players such as New Balance and Vans who are seeking for the opportunity to catch them up.

Footwear Sales (in millions)Company2012CAGR(2010-2012)

Nike$13,42614.2%

Adidas(include Reebok)$9,01813.3%

Puma$2,0785.8%

Asics$1,9405%

Nike and Adidas Group formed the certain leading group by showing their sales powers toward other brands. They comptet aggressively not only in sales and market segment but also for sponsorship of major sporting events and players.

Product-form descriptionFor the product of Adidas Group, Adidas itself contains mainly 6major categories which are original, basketball, running, football, soccer and training. The category of original is what very ambiguous. For example of original category, shoes in original can be considered as casual and not only for sports. Reebok which is one of the brand under the Adidas Group is also contain 7 main categories which running, studio, yoga, training, dance, walking, and crossfit. As Reebok introduce themselves, they are focused on the fitness. Therefore, their category is more detailed about the sports that they focus such as yoga, dance, and studio.Rockport is not a brand for sport functioning equipments. They mainly sell casual shoes for both gender. Their shoes fit very well with dress and suit. Rockport is one of the strength of the Adidas Group because owning Rockport can show customers that Adidas is now not only innovate and work for athletics but also focus on customers who are not really interested in playing sports.TaylorMade is one of the most famous golf brand in the world. They produce and provide fancy golf equipments and accessories to customers.

New Product IntroductionOne of the reasons why Adidas and Nike compete aggressively on sponsorship for major sporting events and star players is new product introduction. Products that star players wear are what customer impressively watch on the television and eager to get even if they do not feel no difference with common athletic shoes that they own already. Therefore, Adidas now faces the biggest opportunity that can introduce their new products because Olympic will begin in 2months.

Benefit and Appeals of new productOne of the recent product of Adidas Group is Brazuca which is the official soccer ball for 2014 FIFA World Cup and the uniforms that Adidas support such as Spain, Germany, and Argentina. Those products appeals to customers who are fans of and loves soccer and make them eager to own the products. Also, the new products helps brand to get more and more market shares. Therefore, the brand can make more profits and helps to become a leader of the market.

New packagePackaging is one way to introduce and spread the image of brand. Also, packaging is used for the marketing. One of the famous package of Adidas is a black box with 3 white stripes which used the famous logo of Adidas. New package in one factor that can attract customers to visit the Adidas store and helps them to realize which are the products of Adidas. Therefore, Adidas continuously used their 3 stripe design on their packaging that everybody can notice which are the Adidas products and who buys the Adidas on the day.

InnovationOne of the most important innovation that Adidas always focus is official soccer ball for the World Cup. Since 1970, Adidas offered Telstar and FIFA became the partner with Adidas. After 1970 when the Telstar used, the complaints from players reduced until 21st century. In 2002 when Korea and Japan held the World Cup, players complained that the ball is to light. Also in 2010, when players complained the most, Adidas faced the challenged because of the inaccuracy of the ball. Therefore, Adidas now spend more than two years to test the ball and finally introduced Brazuca which is 2014 World Cup official ball.

Recent NewsOne of the most famous recent new is about the official ball that Adidas introduces. The name of the ball is Brazuca. For the advertisement, Adidas launched a world trip and film scenes. The films is about the trip with the ball and people who are exciting about the 2014 World Cup. The film will be released through next 8 weeks, one film per week.

Brand AnalysisTop brands by euroBrandRevenue

Nike 17,559 billions

Adidas 14,883 billions

Asics 1.752 billions

New Balance 1.416 billions

Puma 2,530 millions

K-Swiss 16.201 millions

Sketchers 1.134 millions

According to the report, Nike and Adidas are the major players of the sporting goods brand in the world. Since the gap in revenue between top 2 brands and other smaller brand is huge, sporting goods market are definitely controlled by Nike and Adidas.

Growth trend of top brandsNikeThe number one brand of sporting goods is Nike. Nike's revenue is increased from $23,331 million in 2012 to $25,313 million in 2013. Also, their five-year CAGR which is from 2009 to 2013 is 7%. Also, their earning per share in 2013 is $2.69 which is 25cents higher than 2012 which was $2.42. Their growth is based on their growth from the North America and Western Europe. According to those resources, Nike is still growing and have enough potential to keep their honor as the leader of sporting good company.

AdidasAdidas is not only the second largest sporting good company but also the only one company that can compete with Nike. The net sale of Adidas was 14,883 million in 2012 and is 14,492 million in 2013. The most reason factor that prove why the net sale decreases is because of their decreased net sales in their biggest market which is Western Europe. However, Adidas is now facing the best opportunity which is 2014 World Cup that can make them to jump up on their net sales.

Category Share by Region Nike and Adidas are both consider the North America and Western Europe as the major markets for their profit and market shares. However, the competition will be focused on the Brazil where the World Cup is held and boosts the sales of sporting goods especially soccer related products. Also, the future market that has the greatest potential is China where 1/5 of world population is living and still growing.

Pricing TrendPricing is the most important factor that influence customer to decide what to buy when they shop. The price of Adidas is keep increasing little by little as other sporting brands and general brands do. The most common reason of increased price is because of the increased price of raw material and labor force.

Recent News The Adidas' first NEO polish store opens in Warsaw. The NEO means new by definition, new in concept, and new in spirit. This first NEO store is just opened after from the successful launching of ten NEO stores in Germany. This campaign will engage with German and Polish teen shoppers to be familiar with Adidas.

Consumer ProfileDemographic-Gender : Male and Female-Age : From New born to Senior-Nationality : Anywhere people can visit or contact with Adidas store or have an internet access-Occupation : No limitation is exist. Anyone who want to feel the freshness of Adidas.-Income : Anyone who can afford product which the average price is $40

Place of PurchaseThe number one place of purchasing of Adidas product is wholesale which is 64%.The second place of purchasing of Adidas product is retail store which is 23%The third place of purchasing of Adidas product is online which is 13%Frequency of purchase/UsageN/A

Heavy-user profileAdidas' target customer and heavy-user is people who involved in many sporting activities or people who play several sports with short term of rest. For example, one of the most famous star player who wear the Adidas footwear is Lionel Messi who plays soccer.

Awareness and attitudeSince the Adidas is one of the famous sporting good brands in the world and many of star players wear their products, it is pretty well-know brand throughout the world. Nowadays, it extends its power influence toward golf and casual shoes. Therefore, awareness of Adidas group will keep increase.

Decision Makers vs. Purchaser N/A

Normal Purchase CycleAccording to the annual report, half report, and quarter report. Adidas show that their first quarter is when they have the lower net sales throughout the year. Also, they made the best net sales in the third quarter.

Brand Loyalty/switchingMany star players have brand loyalty because they can feel the little difference when they play sports and also the sponsorship of the brand makes them to keep wear the same brand. However, brand switching among general customers can be easily happened. Therefore, Under Armor and New Balance now start to build their brand loyalty, attract customers from the two leading sporting good brands and get more and more market shares.

Advertising/Marketing Communications Creative strategies of top brandNike brand strategy is to build a powerful brand than build customer loyalty all over the world. The unique technique that Nike uses for their strategy is the story of Hero. This Hero strategy inspires customer loyalty all the time. The most common Hero always has one greatest external evil who tries to ruin everything. However, Nike hero is always fight against his internal foe such as laziness. Nike knows that how often customers battle with their own laziness. Advertisement show a man who is running and start to think he cannot run any more. However, he finally get to the goal line and won the battle against himself. This is how Nike uses the emotional marketing that attract customers.

PromisesThe promise of Adidas is to provide the best equipment to athletes. To prove this promise, Adidas spend two and half years to make, test, and introduce the new official World Cup soccer Ball Brazuca.

AppealsBrazuca is now tested by many customers and they leave their comments about the ball on the website. Most of users' opinion is good to use and stand tall during use.

ClaimsAccording to the information about the comparison of Brazuca and Incyte which made by Nike. Performance and design of both balls get great compliments from the customers and users. However, one thing that customers like Incyte more is about the pricing. Incyte is $149.99 and Brazuca is $199.99. Price gap between two balls is $50 dollars

Special EffectsSpecial Effects that Adidas will get is the effect of being a sponsor of World Cup. By being a sponsor of the World Cup, customers will see Adidas' products on the field where players wear soccer shoes, official country uniform and kick the official ball.

Media Category and brand spending ( in millions)Category20132012

Sales working budget340304

Marketing working budget1,4571,502

Marketing overhead425445

Sales force1,8901,885

Logistics766750

Research & Development128128

Central administration1,1271,136

According to the annual report, the major spending categories of Adidas is sales force and marketing working budget. Marketing working budget is including the promotions and communications that brand launches during the year and sales force is cost what brand hire people for the stores.

SeasonalityBecause outdoor activities are easily influenced by weather and season, the product of Adidas and sales of Adidas are changed throughout the seasons. For spring and autumn, people tends to buy more running or walking shoes with longer but thinner apparel. For summer, it is the time to sell the swim related products and many outdoor products. For winter, the major sports products for Adidas group is hockey equipments

Regionality Since Adidas has stores and headquarters all over the world, it is important to use effective media to advertise themselves. For example, the most effective media is television in the U.S. Therefore, the price of one advertisement during the major sport events are dramatically high but has the great influence toward customers.

Media employed by Top Brand- Number one media is television advertisement- Number two media is through major events such as World Cups and Olympic- Number three media is radio and printing advertisement-Number four media is promotions

Spending PatternAccording to the chart on Category and brand spending, the amount of money that Adidas spend is decreased. The reason of decreased of spending of Adidas is their decreasing in net sales and recession of their brand.

Spending compared with Market share (2013)BrandNikeAdidas

Market share33%28%

Amount5,654.47million6,133 million

The amount of money that Adidas spent on 2013 is little bit more that the amount of money that Nike spent 2013. The reason why Adidas spent more money is because Adidas is which need to catch up the leader.

PromotionPromotion used in category- Coupons- Events- Promotion code

Major brand promotion types and example- Adidas official webpage : calendar for events and notification- Adidas Coupon on Facebook : Promotion code and Coupon

Success rate of PromotionN/A

Internet and New Media WebsiteBrand

Adidaswww.adidas.comhttps://www.facebook.com/adidasoriginals?fref=ts

Reebokwww.reebok.comhttps://www.facebook.com/ReebokUS?fref=ts

TaylorMadewww.Taylormadegolf.comhttps://www.facebook.com/TaylorMadeGolf?fref=ts

Rockporthttp://www.rockport.com/https://www.facebook.com/Rockport?fref=ts

Purpose of SiteThe purpose of those official site are to notify and to help customer easily contact with each brands and get more information about the brand and their products that they proudly offer. Also, by operating and having social media websites, brand easily know what consumers likes and dislikes and can communicate friendly.

Ecommerce ActivityFor the ecommerce activity, each brands helps customers look up the products, design, and provide more opportunity to shop without visiting the stores that can be far from where customers live. Also, one of the helpful ecommerce activity is collecting the feedback from the customers by inter survey.

Social Media ActivityThe major social media activity of Adidas is using Facebook page actively. On the facebook, Adidas continuously updates the information about the new released item, new event that is going on or will be go on, and the promotion codes.

DiscussionIn general and according to the annual reports of Adidas Group, the brand value of the Adidas Group will decrease in 2015. The net sales, revenues and market shares are keep decreasing from 2008 recession even though the economy is slowly recovering. However, there are one huge factor which is 2014 World Cup that can make Adidas Group to jump up and increases its brand value. 2014 FIFA World Cup is what Adidas Group give customers an impression about themselves through by their product and brand power.

II. Brand Exploratory

The total number of people who participate the survey is 11 which include 8 male and 3 female participants. This survey asks participants about their awareness about the sporting goods brand. Most number of participants are Juniors and least number of participants are Seniors.

The first category that participants were asked to answer is about the awareness of sporting good brands.

According to the respond, as Nike and Adidas are two major leading sporting good brands, all of the students know and hear about the Nike and Adidas. However, New Balance, Under Armor and other brands have lower awareness than two major brands.

According to the respond, the most important factor that customers consider when they are in decision making process is how much the shoes are comfortable for their feet while they are in sporting activity.

According to the chart, Nike and Adidas are clearly showing that they sell the most number of shoes and Apparels. However, in accessories and other parts, Under Armor shows it power influence toward customers. According to the respond, the most power factor that has influence over customer is brand name. In conclusion, Nike and Adidas, as they are the major leading brands, show their power on the sporting goods markets. Most of participants aware of the names of two brand and more than half of participants own one or more of their products. Especially, they are clearly prove that their shoes and apparels what make them to be the leading brands.

RecommendationAdidas is one of the oldest sporting good brands in the world and it worked longer than Nike did. However, they are not the number one sporting brand in the world. My personal reason why Adidas is not the number one brand is because it is less attractive than Nike is. Nike's creative advertisements and well-designed products attract more and more customers not only female but also male customers. In the market, Adidas tries to keep their 3 stripe lines design on their shoes, apparel, and accessories. However, there are some customers that do not like their stripe lines and avoid to by those products. Now is the time to show consumers that how well Adidas can design the products that can be attract consumers of Nike, New Balance, and other brands.

Work Cited

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