The product range I would like to recommend for retail sales with the existing manufacturing capabilities and brand for Private Label Worldwide is “REEBOK”.

Reebok is an American-inspired, global brand that creates and markets sports and lifestyle products built upon a strong heritage and authenticity in sports, fitness and women’s categories. The brand is committed to designing products and marketing programs that reflect creativity and the desire to constantly challenge the status quo. It produces Athletic shoes, apparel, and accessories.

Following are the reasons:

Reebok is the first company to introduce athletic shoe designed especially for women called the Freestyle. Reebok anticipated and encouraged three major trends that transformed the athletic footwear industry: the aerobic exercise movement , the influx of women into sports and exercise and the acceptance of well-designed athletic footwear.

Reebok continues to produce the Freestyle as it is popular with cheerleading, aerobic dancing, the gym and consumers. Not only was the Reebok Freestyle popular as athletic wear, but also as casual wear.

Following the Freestyle success, Reebok also introduced an athletic shoe for men, called the Ex-O-Fit. It came in low-top and high-top versions.

(Above: Ex-O-Fit picture 1980’s)

In 2002, Reebok launched ‘Rbk’ – a collection of street-inspired footwear and apparel hook-ups designed for the young man and woman giving exactly what they wanted : cool and edgy, authentic and aspirational.

Reebok's was founded cause athletes wanted to run faster. Reebok is the first brand to ever make running shoes with spikes in them creating a new product in the market

Reebok has more product categories. It also has explosive growth with new product categories. Reebok’s focus area is: Men- Training, Running, Sports and Classics. Women – Fitness, Running, Walking and Having Fun, Staying in, Shape for random.

In April 2004, Reebok's footwear division became the first company to be accredited by the Fair Labor Association.

Reebok launched EasyTone footwear. Featuring first-of-its-kind balance pod technology, the shoe’s proprietary technology was invented by a former NASA engineer.

First company to engineer walking comfort in all types of dress and casual shoes.

Also Reebok began a transition from a company identified principally with fitness and exercise to one equally involved in sports by creating several new footwear and apparel products for football, baseball, soccer, track and field and other sports.

In INDIA :

Reebok sponsored sports kits for the great rich Indian Premier League teams, such as the Royal Challengers Bangalore, Kolkata Knight Riders, Rajasthan Royals and Chennai Super Kings in the first edition of the league held in 2008.

However for the second edition held in 2009 the sponsorships included (Royal Challengers Bangalore, Kolkata Knight Riders, Chennai Super Kings, Kings XI Punjab) kits.

INTERNATIONAL :

Reebok is the official sponsor of the International Cricket Council. It manufactures uniform for ICC International Panel of umpires and referees.

Reebok is the world’s leading producer of hockey apparel and equipment with its acquisition of The Hockey Company with all 30 NHL teams.

Reebok then formed partnerships in the non-athlete field with rap musician Jay-Z for the “S. Carter Collection by Rbk" and another superstar of the rap world, 50 Cent for “G Unit Collection by Rbk.”

In the field of Football Reebok has Thierry Henry and Alexander Ovechkin as ambassadors.

Driving ace Lewis Hamilton announced a multi-year partnership at a spectacular 3-D event in Amsterdam,

Reebok also signed Scarlett Johansson and introduced her own line of apparel and footwear called Scarlett Hearts, an Rbk Lifestyle Collection.

Reebok also produce shoes for Emporio Armani under the label EA7. These shoes are marketed to the high-end fashion market.

WHY RBK –

Reebok’s global marketing campaign, ‘Your Move’ kicked off successfully. Reebok's positioning as the brand that celebrates individuality, and supports those who choose to do things their way.

“I AM WHAT I AM” Articulates Brand Positioning. “I AM WHAT I AM” expresses the attitude at Reebok. It is an emotional call to action and a celebration of the consumer’s individuality, courage and accomplishments.

Reebok rolled-out an integrated marketing campaign that fused together sports, music, technology and entertainment, and was designed to connect the Reebok Brand to millions of new consumers around the world.

Creating innovative products that generate excitement in the marketplace has been a central corporate strategy ever since Reebok introduced the Freestyle. In the late 1980s, a particularly productive period began with The Pump technology and continues today, with breakthrough concepts and technologies for numerous sports and fitness activities

Reebok uses footwear factories in 14 countries. Most factories making Reebok footwear are based in Asia In India.

In the late 1980s, Reebok began an aggressive expansion into overseas markets and Reebok products are now available in more than 170 countries and are sold through a network of independent distributors.

PRICING AND PROMOTION

"Marketing mix" is a term used to describe the "four Ps" of marketing, which are price,

product, place and promotion.

Price is determined by supply, demand, and competition--and within these parameters

marketers can choose three types of pricing strategies: skimming, penetration or

competitive.

The competitive price of a good is set by the market, and marketers can set their price on

par with competitors (competitive strategy), higher than competitors (skimming strategy),

or lower than competitors (penetrating strategy).

The different kinds are :

Premium Pricing : Use a high price where there is a uniqueness about the product

or service. This approach is used where a substantial competitive advantage exists.

Such high prices are charge for luxuries such as Reebok Armani collection or the

Rbk collections by Rap artists.

Penetration Pricing : The price charged for products and services is set artificially

low in order to gain market share. Once this is achieved, the price is increased.

Economy Pricing : This is a no frills low price. The cost of marketing and

manufacture are kept at a minimum. Supermarkets often have economy brands for

soups, spaghetti, etc.

Price Skimming : Charge a high price because you have a substantial competitive

advantage. However, the advantage is not sustainable. The high price tends to

attract new competitors into the market, and the price inevitably falls due to

increased supply.

For Sports Label India the following pricing strategies can b applied:

Competition-based pricing: Setting the price based upon prices of the similar competitor

products. Competitive pricing is based on three types of competitive product. Products

have lasting distinctiveness from competitor's product. Here we can assume

o The product has low price elasticity.

o The product has low cross elasticity.

o The demand of the product will rise.

Products have perishable distinctiveness from competitor's product, assuming the product

features are medium distinctiveness. Products have little distinctiveness from competitor's

product assuming that:

o The product has high price elasticity.

o The product has some cross elasticity.

o No expectation that demand of the product will rise.

Cost-plus pricing : Cost-plus pricing is the simplest pricing method. The firm calculates the

cost of producing the product and adds on a percentage (profit) to that price to give the

selling price.

Creaming or skimming: Selling a product at a high price, sacrificing high sales to gain a

high profit, therefore ‘skimming’ the market. Usually employed to reimburse the cost of

investment of the original research into the product. This strategy is often used to target

"early adopters" of a product or service. These early adopters are relatively less price-

sensitive because either their need for the product is more than others or they understand

the value of the product better than others.

Limit pricing : A limit price is the price set by a monopolist to discourage economic entry

into a market, and is illegal in many countries. The limit price is the price that the entrant

would face upon entering as long as the incumbent firm did not decrease output. The limit

price is often lower than the average cost of production or just low enough to make

entering not profitable. The quantity produced by the incumbent firm to act as a deterrent

to entry is usually larger than would be optimal for a monopolist, but might still produce

higher economic profits than would be earned under perfect competition.

High-low pricing : Method of pricing for an organization where the goods or services

offered by the organization are regularly priced higher than competitors, but through

promotions, advertisements, and or coupons, lower prices are offered on key items. The

lower promotional prices are targeted to bring customers to the organization where the

customer is offered the promotional product as well as the regular higher priced products

Value Based pricing : Pricing a product based on the perceived value and not on any other

factor. Pricing based on the demand for a specific product would have a likely change in the

market place.

Promotional Pricing : Pricing to promote a product is a very common application. There

are many examples of promotional pricing including approaches such as BOGOF (Buy One

Get One Free).

PROMOTION

These promotional strategies are ways companies communicate information about their

products and services with the end goal of increasing sales . Examples of promotional

strategies in marketing include advertising, public relations, personal selling and

sponsorship

Advertising :

Advertising is a promotional marketing strategy companies use to create awareness

about their products and services. The goal of advertising as a promotional strategy

is to generate a response from your target customer.

Sports Label India can use a variety of different types of advertising - television and

radio advertisements; print advertisements in newspapers, magazines and journals,

direct mail advertisements and outdoor advertising such as posters, banners, signs

and bus ads.

Public Relations :

Public Relations is a promotional strategy that seeks to establish and maintain

communication and understanding between your company and the public. Public

relations is a long-term promotional marketing strategy that helps communicate

positive updates about your company, product or service, and helps you control

damage when a problem arises that puts your business in the public spotlight.

Examples of public relations strategies you can use include press releases, media

interviews, corporate web videos, company blogs and interactions in social media.

Personal Selling :

Personal selling is another promotional strategy you can use to market your

business. Personal selling involves hiring one or more sales people to manage

personal customer relationships and sell your products and services.

Whether you have a large sales force or you do all the selling yourself, personal

selling is an important strategy for the majority of businesses.

Sponsorship :

Sponsorship is a promotional strategy in marketing in which your company pays to

be associated with a certain event, cause or other organization .

In exchange for sponsoring these events, companies get brand exposure and

publicity. Sports Label India could use sponsorship from brands already tied to

Reebok.

MARKETING STRATEGY AND MARKET SEGMENTATION: -

Market segmentation and the identification of target markets, however, are an important element of each marketing strategy. They are the basis for determining any particular marketing mix. Basic steps in marketing strategy are as follows:

Market Segment Variables - Consumer Characteristics::

Geographic : Region, city size, metropolitan area, density,etc.

Demographic : Gender, age, race, life stage, birth era, HHDsize, residence tenure, marital status, etc.

Socioeconomic : Income, education, etc.

Psychographic : Personality, values, lifestyle, etc.

Buying Situations:

Outlet type : Instore, direct, etc.

Benefits sought : Product feature, needs, etc.

Usage : Usage rate, user status, etc.

Awareness & intentions : Product knowledge, etc.

Behavior: Involvement

Product Differentiation: In a broad sense, it involves a firm’s using different marketing

mix activities, such as product features and advertising, to help consumers perceive the

product as being different and better than competing products.

The perceived differences may involve physical or nonphysical features, such as image or

price.  In a narrower sense, it involves a firm’s selling two or more products with different

features targeted to different market segments

Criteria for Target Market:

S i z e : T h e e s t i m a t e d s i z e o f t h e m a r k e t t o d e t e r m i n e

whether or not it is worth going after.

E x p e c t e d G r o w t h : T h e s i z e o f t h e m a r k e t m a y b e small,

but if it is growing significantly it may be worth going after.

C o m p e t i t i v e p o s i t i o n : T h e l e s s c o m p e t i t i o n t h e m o r e

attractive the market.

C o s t o f r e a c h i n g t h e m a r k e t : I s t h e m a r k e t

a c c e s s i b l e t o a firm’s marketing actions? If not it should not be pursued.

C o m p a t i b i l i t y w i t h t h e o r g a n i z a t i o n ’ s o b j e c t i v e s a n d

resources.

Position Planning :

Positions are described by variables and within parameters that are important to

the customers. Common examples are price, supporting services, quality,

reliability, and value for money. Often, customers position a product in relation to

a brand or product that is especially visible to them. This could be the market

leader or any other offer with a high media exposure and an above average

marketing budget.

Therefore, it is advisable to use in-depth market research to

determine relevant parameters in order to understand how customers rate

different products and marketing variables.

MARKETING STRATEGY

 Porter's Five Forces

Barriers to Entry - Low

Reebok should control the costs effectively, giving them an advantage over

emerging competitors in the industry. Their web sites are well- prepared and

updated promotions attract online shoppers.

There are many exclusive product differences in this industry that gives brand

identity an immediate competitive advantage.

Reebok brand is well-known globally and plays a major role in consumer decision

making. Selling footwear is highly competitive; however, barriers to enter into this

industry are quite low.

Therefore, the footwear industry is broad with hundreds of retailers. Switching cost

is low for the consumer, and may occur frequently depending on consumer

preference and other factors affecting consumer buying decision. 

Bargaining Power of Buyers - High

There are a large number of buyers relative to the number of firms in this industry.

Therefore, companies like Reebok must continuously market their product and

differentiate their brands against competitors, in order to increase sales and market

share.

The use of online tools has helped to enhance the accessibility among users. Brand

identity plays a critical role in the buying behavior; strong identity will offer

consumers trust and loyalty.

Bargaining Power of Suppliers – Low

There are many suppliers in this industry. In essence, there is very little

differentiation among the suppliers which makes suppliers' bargaining power non-

existent. Leather, rubber, and cotton are commodity items and are available

abundantly in the market place.

Conglomerates such as Reebok have a definite advantage and power over their

suppliers. These suppliers become dependent on these firms as their means to

survival.

Additionally, Reebok has standardized their input procedures pertaining to the

materials used, their labor force, supplies, services, and logistics. Firms are able to

switch between suppliers quickly and cheaply, due to the globalise networks of

cheap labour on various continents.

 

Threats of Substitutes - Low

Buyers' propensity to substitute is low. Consumer substitutes for athletic footwear

products are low because there are little alternatives to switch, some substitutes for

athlete footwear could be boots, sandals, dress shoes or bear feet.

Consumers are not likely to substitute due to the performance specification of the

product. For instance, a basketball player would not wear boots to play basketball.

Therefore, there are no real substitutes for athletic footwear.

 

Rivalry among Existing Competitors - High

The rivalry among existing competitors in the footwear industry is quite high. Large

firms such as Nike, Adidas and Reebok have grown immensely over the last two

decades. Their global reach has expanded through all continents; this is evident

using the Internet and e-commerce.

Online selling has enlarged the reach for these firms allowing them to increase sales

while minimizing operating costs. Almost every large firm has a web site, and most

of these web sites contain virtual stores which provide convenience to consumers.

 

 In an effort to distinguish itself from the competition, each company has developed

exclusive relationships with highly recognizable organizations and individuals. Reebok had

the exclusive rights to market its products for the NBA, NHL, NFL, and the WNBA. Similarly,

Adidas had obtained contracts with professional European soccer clubs such as Chelsea,

Bayern Munich, Real Madrid, and AC Milan. On the other hand, without an established

superstar, Nike's current endorsements lack the influence they once held with the likes of

Michael Jordan. "At the moment, virtually none of the current NBA stars wear Nike. 

While there are many possible avenues to exploit in terms of sales opportunities for these

companies, the market is highly segmented in such a way that it is important for the three

to engage in target marketing.

For example, in this market of athletic shoes, a firm can either offer an all-purpose cross-

trainer shoe or a running shoe and a basketball shoe.  While the cross-trainer shoe has

broad appeal for all consumers it does not satisfy any consumer's needs in particular. In

contrast, the running shoe and basketball shoe combination will each satisfy a particular

market segment but will have modest appeal to the other segment.

This is the point where the particular companies must decide whether they will

individually follow a niche market or a full-line strategy. In order to make this decision, the

firms must weigh the cost of offering an additional product and the revenue generated by

doing so.

By utilizing Porter's generic strategies framework (previously discussed), the methods

employed to compete for customers in the industry become easily apparent. While both

Nike and Adidas make use of a differentiation strategy to attract its customers, Reebok

concentrates its efforts on a broad cost strategy approach. The differentiation strategy of

the two companies, Nike and Adidas, can be seen in action by examining the various

productions of both these companies.