Case

Study

Dinh Nguyen Linh

Tran Ngoc Anh
Vu Quoc Viet
Nguyen Thi Minh Ngoc
Nguyen Dieu Linh
Nghiem Thuy Duong

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TABLES OF CONTENT

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Overvi
ew

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ADIDAS BACKGROUND
1. History
Adolf Dassler was a German shoes
maker living in Herzogenaurach, a city
close from Nuremberg. He made up
his first sport shoe in 1920, which he
wanted to be durable, efficient and in
response to athletes needs. His fabrics
was named Schuhfabrik Gebrueder
Dassler, which means Dasslers
brothers shoes fabric because Adofl
was ruling it with his brother, Rudolf.
The latter was the one in charge of the marketing part of the business, whereas the former was
focused on the product development and management. The two brothers were making a very
successful team. Dassler handmade the shoes Jesse Owens wore while dasing to four Gold
Medels in the 1936 Olympics. In World War II both brothers were reportedly members of the
Nazi Party. After the war they had a falling out, and Rudi withdrew from their partnership to
establish his own shoe company, Puma, while Adi Dassler incorporated his business as Adidas
AG in 1949. (nndb, http://www.nndb.com/people/163/000168656/)
2. Development
Adidas Group is a multinational corporation that consists of the Reebok sport wear company,
TaylorMade golf company (including Ashworth), Rockport. From 1950 up to 1980, Adidas kept
launching new products for many sports: soccer balls, handball balls, boxing gloves But the
most genius project implemented by the company was to offer specialized, performing and
quality apparel for almost every sport: tennis,

soccer, running, athletics, boxing, rugby,

basketball, golf... Over those 30 years, Adidas became more and more globally recognized and
used, by being a general reference in terms of sporting goods.

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In the beginning of the 60s, Host, Adolfs son, became CEO of the Adidas AG group, and keep
emancipating the company as his father did, sponsoring world famous athletes such as
Mohammed Ali, Joe Frazier, Sepp Herberger and Franz Beckenbauer. After Hosts died, in 1987,
the group entered in a crisis period, which led the heirs to turn the company into a corporation
and to finally sell it. Bernard Tapie, the French entrepreneur, bought it for 305 million euros, but
did not make a good job at its head. During this time, the company is not in a good mood: it
exhibits difficulties in facing the increasing competition of the US Reebok and Nike, and despite
of employment shrinking and subcontracts, the company showed large financial losses. Tapie
will be compelled to resell it to an investors group.
Things are going to get better up to 1994, thanks to the takeover for 701 million euros from
another French businessman, Robert Louis Dreyfus. Dreyfus is going to implement new
fundamental strategies for Adidas. First of all, he started by giving a fresh image to the

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brand: a younger product ranges was launched, but also classic Adidas style from the
70s (nicknamed vintage range) was brought back, celebrities of the moment such

as

Madonna, worn them over the world most famous discotheques. Brand new events were
also implemented, such as the Adidas Predator Cup, a soccer tournament for the young
German talents all across the country. Dreyfus won his bet: the company was doing
better and better, recovered its fame, to be finally introduced on the fluctuation stock market of
Frankfurt, in 1995, for 1,677 billion euros.
1997 is known for being a very important year for the Three Stripes brand. Indeed, Adidas
bought out the huge ski manufacturer Salomon, a group which also includes TaylorMade,
Mavic and Bonfire, and switched his name to Adidas Salomon AG . This made the Adidas
family one of the largest sports group on the market, among Amer Sports and Nike, bringing its
total number of employees to 12, 829 worldwide.
The last decade witnesses the current success of the brand. By reaching a new record in annual
sales (5.8 billon) the new group was selected to be part of the Dow Jones Sustainability Indexes
(DJSI) in October 2000, which tracks the performances of the leading sustainability-driven
companies worldwide. The Dow Jones annual reviews highlighted that Adidas-Salomon
AG has made a huge effort in improving the social conditions through its various
factories which supply its product: the company has taken a another global and trusted
dimension.
In March 2000, Herbert Hainer replaced Dreyfus as CEO and Chairman of the Executive Board
of Adidas-Salomon AG. At the end of the year, the company broke a new record in terms
of

sales,

reaching

6.1

billon,

and acknowledged its share value rise up to 28%. This

success was notably due to efficient strategic choices (takeover of 10% of the best German
soccer club Bayern Munich for instance), opening of its firsts own official stores (Berlin, Tokyo,
Amsterdam and Paris) and major innovations (allowing customers to customize personally
products they are about to purchase).

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In 2004, the new campaign Impossible is nothing is officially launched, and supported
by many famous sports actors: David Beckham, Jona Lomu, Tracy McGrady and Mohammed
Ali will be part of it. Adidas has now a strong message to really face the legendary Just do it
from Nike. Despite of those great results and strategic plans, Adidas decided to sell its Salomon
segment (with all the brands it included excepted TaylorMade) because the profits related
to this sector were not as good as expected. Salomon will then be purchased by Amer Sports
Corporation. But Adidas wished to enjoy its current good move and took a new position on the
sports market. This will be done, thanks to the Acquisition of the American competitor
Reebok in 2006. By combining two of the most respected and well-known brand in the
worldwide sporting goods industry, the group will

benefit

from

more

competitive

worldwide platform, well defined and complementary brand identities, a wider range of
products, and a stringer presence across teams, athletes, events and leagues. We are delighted
with the closing of the Reebok transaction, which marks a new chapter in the history of
our Group underscores Herbert Hainer. On the bounce of that operation, the board of directors

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agreed to rename the group by its original name Adidas AG, to spread a little more the fame of
the brand in the worlds mind.
3. Brand Architecture

4. Headquarter
The headquarter of Adidas Group now is located in Herzogenaurch (Germany) and the aditional
key locations are in Carlsbad, Portland, Canton, Panama, Amsterdam and Hong Kong.

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5. Executive Board

Herbert Hanier Chief executive officer

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Roland Auschel Global Sales

Glenn Bennet Global Operations

Eric Liedtke Global Brands

Robin J. Stalker Chief financial officer

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MARKETING ENVIRONMENT IN UK PEST ANALYSIS

1. Political:
Following the market reforms instituted by Prime Minister Margaret Thatcher in the 1980s,
Britain experienced steady economic growth throughout the 1990s, but government spending
grew significantly under successive Labor governments. Since 2010, Prime Minister David
Camerons Conservative-Liberal Democrat coalition government has made government austerity
the core of its strongest growth since 2007. In 2004, the GDP surpassed pre-crisis levels due to
bullish performances by its three main sectors: services, manufacturing, and construction.
Unemployment is at a five-year low, and retail sales are robust. Euro-skepticism is on the rise in
the U.K., and the United Independence Party won the most seats in the 2014 European
Parliament elections.
Corruption is not pervasive, although a few high-profile scandals have damaged political
reputations in both major parties. The 2011 Bribery Act is considered one of the worlds most
sweeping anti-bribery laws. Rule of law is well established within an independent legal
framework. Private property rights and contracts are secure, and the court system is efficient.
Protection of intellectual property rights is effective.
The top individual income tax is now 45 percent, and the top corporate tax rate is now 21
percent. Other taxes include a value-added tax and an environment tax. The overall tax burden
equals 35.2 percent of the domestic economy. Public expenditures amount to 48.2 percent of
domestic output, and government debt equals 90 percent of GDP.
The regulatory environment is transparent. The labor market is relatively efficient, and nonsalary costs are moderate. Inflation has fallen rapidly, reflecting the end of administered price
increases, and the government has pledged to end subsidies for onshore wind farms.
EU members have a 1.0 percent average tariff rate. Although some non-tariff barriers exist, the
EU is relatively open to external trade. The U.K. generally treats foreign and domestic investors

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equally. The government still holds substantial stakes in the banking sector but is trying to sell its
shares. A bank levy applied to both domestic and foreign banks has been in replace.
2. Economic
Currently, in 2013, the population of the U.K. is 64.1 million with GDP (PPP) is $2.4 trillion,
and $37,307 per capita. Economy grows 1.8 percent in 2013, but 5-year compound annual
growth is -0.1 percent. The rate of unemployment is 7.5 percent, and inflation (CPI) is 2.6
percent. In addition, FDI inflow is $37.1 billion, and public debt is 90.1 percent of GDP.
Most of Adidas shoes is imported from non-EU countries, such as China, Vietnam So, Adidas
needs to declare their imports to customs, and pay VAT and duty on them. Adidas also need a
commodity code and an import license.
3. Social
People in the U.K. currently prefer sport shoes with higher quality and better design. They are
attractive by shoes design by famous fashion company or people. So, Adidas has to make more
effort on designing and cooperate with other companies to satisfy customers tastes.
4. Technology
Adidas is influenced by the modern manufacturing and designing techniques applicable to their
business brands of shoes. They focus on the latest distribution market techniques, such as online
retailing

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Market
ing Mix

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PRODUCT

1. Product description
Adidas is German sport equipment produce group. Adidas Group included small company such
as Reebok produce sport equipment, Taylor Made specialist in producing golf equipment,
Adidas is one of the famous brands in the world that provide sportswear such as shoes, clothing,
accessories, bags, shirt, hoodies, socks. With the history of more than 100 years, Adidas
products always be on top of sportswear industry with its diversity, design and features.
Adidas is a worldwide group, its target market is young man and woman, also kids. In the future,
Adidas is trying to focus in young woman, let the design more fashionable and trendy. In our
group assignment, we mainly focus on Adidas original product, shoes.
Adidas shoes is original product from Adidas group. Started with football pitch, now Adidas
shoes is created with a lot of features. The categories of Adidas shoes are divided by its usages

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for each kind of sport activities: football, running, training, tennis With each categories,
Adidas design a special, specific shoes to satisfy customer needs.
Nowadays, sportswear is more fashionable, even become a fashion trend. This trend especially
blooms in the Spring Summer of 2014: One of this season's lead stories, the athletic trend
comes brimming with old-school attitude. (Olivier, 2014). People wear sportswear (sport shoes)
not only for the purpose of playing sport, but fashion. Adidas shoes is a great item match your
fashionable outfit.
Core product:
Sport shoes
Actual Product:
Design,
Packaging,
Brand
Augmented
Product: Aftersale service,
delivery and
credit

Core product: Shoes design for various sport activities: running, training, golf,

swimming
Actual product:
Packaging: Colorful design, use environmental material, can recycle, no use of glue.

Consolidating hashtag.
Brand name: Adidas which has over 100 years of history. Smaller groups: Adidas

NEO, Adidas by Stella McCartney, Adidas Original, Adidas Performance

Design: Various design, satisfy consumers benefit sought. Collaboration with famous

designer and car brands to come up with trendy, fashionable outlook.

Augmented product:
Delivery: All orders over 100 are delivered for free within 2-5 days

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After sale service: Customers can return the product if it is not the right size or
color at any time, any place.

2. Classification of the offerings

Adidas
shoes

Sport

Football

Running

Swimmi
ng

Basketb
all

The chart above is a sample of Adidas shoes classification. Adidas classify its product mainly
based on customer gender, age, benefit sought. Adidas also has multi brand small brands for
shoes: Performance, Originals, Adidas NEO, Adidas by Stella McCartney, and Porsche design
sport by Adidas. Two oldest brand of Adidas are Performance and Original. During the mid to
late 1990s, Adidas divide the brand into small groups, which conclude of Adidas performance
and Adidas Originals. Adidas Performance was designed to maintain their devotion to the
athlete; Adidas Originals was designed to focus on the brand's earlier designs which remained a
popular life-style icon. Adidas NEO has the tendency of young, strong which provide bright
color products; lower price than Adidas Performance, diverse design.

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Performance

Original

Porsche
Design

Stella
McCartney

Pharrell
Williams

NEO

As we can see, Adidas shoes is a shopping product. These brand shoes specialist in sportswear,
but now its becoming more trendy and fashionable. Adidas shoes (Original brand) have the price
in the range of 90 to over 200.
Adidas biggest rival is Nike. Both brands have its all unique, reputation, but have the own style.
In general, product (shoes) from two brands have so much in common, but the differences is
marketing strategy and design. Adidas product seems to be more affinity than Nike. But Nike is
more innovative, Adidas focus on fashion side than shoes features.
3. Brand strategy
Adidas has strong advantages in spending cash to collaboration with designer. To celebrate its
10th anniversary, Adidas incorporate with famous designer Stella McCartney, created new brand:
Adidas by Stella McCartney. The very first Adidas-Stella collection was premised on the idea
that workout clothes should be stylish, a tip of the hat to the reality that women wear their gym
togs on the regular, and not just to the gym (or Spin class or the yoga studio)..[] To the extent
that this new Adidas-Stella collection distinguished itself from the competition, it was in those
garments that put Adidas' technical know-how to Stella-ish use (Singer, October 13, 2014).

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The Pharrell Williams x adidas Stan Smith Solids Pack sees the first retail release from
Skateboard P and the Three Stripes. Tonal takes of the red, royal and black variety see
collaborative nods on the insoles and heel detailing, with standard tongue tagging getting an
embroidered update (Stonebrook, Sep 16, 2014) In Sep 20, 2014, Adidas introduce to the world
the whole new collection, is the collaboration with designer Pharrell Williams. This impressive
collection release limited quantity of leather track jackets, solid Stan Smith in bold monochrome
red, black, and blue.
Adidas also collaborate with Porches to create a new brand. The models of this brand is modern,
mostly for high class people.
PRICING
1. Pricing policy and strategies:
There are various pricing strategies that Adidas follow depending on which product. With the
shoes line, Adidas mostly uses premium pricing. It means that this product is served to the
market with a premium price and compete aggressively in the high-volume mid-price segment.
The price for a pair of shoes as shown in their Adidas UK official website ranges from 13 to
350 per pair.

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Porsche Designed Sport: BOUNCE:S4 Shoes

2. Management of pricing:
Adidas is a big group. Its aims not only stop at profit point but it is the leading in sport wear
industry that Adidas always make effort toward. Hence, it is not a big surprise when Adidas offer
many brands with different price and functions. The graph below shows the positioning in price
and function of some Adidas brands in comparison with other competitors.

There are 3 of Adidas brands that are included in the graph. The first one on the left of the
vertical premium line is Adidas Sport Performance. This line of products offer low premium
price with not much fashion. The others on the right of Nike and New Balance represent the
Adidas Originals & Sport Style with the approximate money value as the Sport Performance but
more functionality. Therefore, they can cover a larger market.

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The pricing strategies Adidas use for each brand is adapted, depending on the target market they
serve, so as to achieve its goals. The company is able to penetrate the market as it is cheaper than
some other competitors yet classed as premium product or using market skimming strategy.

3. Competitive pricing strategies:

Generally it uses Market skimming strategy. Price skimming is a pricing strategy employed by
some businesses that involves using different prices for the same product over time to generate
profits (Shawn Grimsley, Price Skimming: definition, examples and strategy). In case of Adidas,
the price skimming is mostly used for new released products. For examples: the price of the
product depends upon its color, white color shoes of Adidas is more expensive than other color
shoes.
Other than these it also follows TaylorMade-adidas Golf Strategy, which combines golfs three
most respected brand, TaylorMade, adidas Golf and Ashwor.
As compared to Adidas, Nike adopts different and competitive pricing, which is based on the
basis of premium segment as target customers. Nike brand has high premium, so the price of its
products is often higher than Adidas. For new products, Nike uses Market penetration. It uses
low prices to generate demand for a product and increase market share (Melanie J. Martin,
Demand Media).
Occasional discount is of course an indispensable factor in competition. Adidas provide a lot of
discount (sometimes up to 50 70% for each product) so that they get more sales. Normally
discount products are sold out very fast. Thus, this way attract a large market share.
4. Public policy and pricing:
According to UK tax law, each year Adidas have to pay a coporation tax, depending on its profit.
The table below shows the marginal coporation tax rate in the United Kingdom (Micheal P.
Devereux). Because we are not able to find any information about the detailed revenue of Adidas
UK, we have to get the information indirectly from some of their financial reports. As a result,
there might be many errors with the exact number.

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Of course, offering shoes products to UK market require Adidas to pay VAT tax, which has a rate
of about 20% (GOV.UK, VAT Rates).
PLACEMENT
Place or placement has to do with how the product will be provided to the customer. (Marc,
2014). As a part of the 4Ps, or Marketing Mix, Placement plays an important part of Marketing
Strategy in any companies. Knowing that, Adidas has built their placement system all over UK to
meet various customers wants. It not only includes the place where the product is placed, all
those activities performed by the company to ensure the availability of the product to his targeted
customers. Availability of the product at the right place, at the right time and in the right quantity
is crucial in placement decisions. (Desk, 2009)
According to (Desk, 2009), Placement decision includes:

Placement

Inventory

Selection of channel
members

Distribution channels

Order processing

Logistics

Market coverage

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i.

1. Placement

a. Head Quarter
ii.

Adidas Groups Head Quarter in UK is Adidas UK Ltd., The Adidas Centre,

Pepper Road, Hazel Grove, England

iii.
iv. URL:
https://www.google.com/maps/@53.377924,2.140845,3a,75y,325.54h,79.45t/data
=!3m4!1e1!3m2!1s97E_tHfrMMMsyS4cdhy_cA!2e0!6m1!1e1
v. b. Supply Chain Structure
Main suppliers. They have a direct contractual relationship with the Adidas Group for the
supply of products, whether for export or domestic market consumption.
Subcontractors. These are factories that have been subcontracted by the suppliers to
perform manufacturing operations the main suppliers are not capable of doing in their
own facility.
Material and other service providers. These suppliers may not have a direct business
relationship with the Adidas Group, but supply goods and services to its main
suppliers.
Licensees. Independent companies which manage the design, production and distribution
of specific products, under license to the Adidas Group. In 2013, the Adidas Group
worked with 57 licensees whose suppliers sourced products from 401 factories in
50 countries.
Agents. Independent companies that act as intermediaries to source product manufacturing,
manage the manufacturing processes, and sell finished products to the Group.

vi.
viii.
-

vii. (Source: adidas-group.com) (UK, 2014)

c. Adidass Channels in UK:

Own retails
E-commerce
Mono-branded franchise stores
Shop-in-shops
Joint ventures with retailers
Co-branded stores with other organization
ix.
x. Aim:
To service multiple customers and customer needs
To be more responsive to the market developments
To manage channel synergies by establishing the best practice worldwide
xi. Own retailers
Adidas has 25 retailers all around UK, focuses mainly in England.
Each retailer has its own characters that attract the customers.

xii.
xiii.
xiv.
xv.
xvi.
xvii.
xviii. Adidas Stansmith shoebox
xix.

E-commerce
xx. Adidas UK uses E-commerce to sell shoes and many other products as a way

to support the growth potential and sales ambition, as well as increase range
consistency globally.
xxi. Adidas uses its own website as a tool to sell the products: www.adidas.co.uk
xxii. Besides, Adidas also sells the products in buying and selling websites such as:
www.amazon.com,https://www.zalando.co.uk/adidas/,
http://www.very.co.uk/adidas/e/b/5620.end
xxiii.
xxiv. Mono-branded franchise stores
To spread its products, Adidas use an effective strategy: franchise
Adidas has hundreds of franchise all over UK. They help to bring a considerable
amount of profit to this brand.

xxv. Shop-in-shops
To get the products to the customer, Adidas UK delivers their products to malls, outlet
centers, shopping centers, etc.

xxvi. York Designer Outlet one of the outlet center that has Adidas store
xxvii. Joint-ventures with retailers
xxviii. Adidas launched a joint-venture line with Stella McCartney, a British fashion
designer best known for her eponymous label, in 2004. The collection, called
simply Adidas by Stella McCartney, has since grown to include a wide range of
different sportswear including yoga, tennis, winter sports and golf.
xxix.
xxx. Adidas Co-branded stores with other organization
xxxi. Adidas and Porsche Design Group have signed a long-term strategic partnership
including licensing agreement. The objective of the cooperation is to jointly
establish a hi-tech premium brand in the sports sector. Footwear, apparel and

hardware for golf, tennis, running and possibly other sports will be designed and
developed under the name "Porsche Design" with the co-branding of the Adidas
and TaylorMade brands
xxxii.
xxxiii.

xxxiv.
-

2. Channels to Order
Through offline channels
o Customers might get to Adidas retailers to try and get the shoes.
o Customers might get to other shops where Adidas places its stores.
Through online channel
o Customer order via its website or other webpages that sell Adidas shoes
o After that, with each bill at each page, the shoes will be delivered to the
customers with or without shipping fee
o In Adidas online store, the shoes will be delivered to customer after 1 day.

xxxv.
3. Order Processing
xxxvi. There is a clear instruction on http://www.adidas.co.uk/help/ordering.html

When you're ready to buy the items in your shopping bag, click the 'Checkout' button

at the top of the page.

If you've registered with Adidas or the online shop you can use your email address to

log in. If you don't have an account, you can check out as a guest or create an account
before you check out.
To finalize your purchase, enter your delivery and billing addresses, then choose a

payment method and enter the necessary payment information before clicking
'Confirm Order'.
Please check all the information on this page before clicking the confirmation button.

Orders cannot be changed after confirmation, so please double check that your
address details are correct and any customized items are exactly the way you want
them.
xxxvii.
xxxviii. 4. Logistic
Customers will receive a confirm email.
After that, the shoes from warehouse will be delivered according to customers
address in the email.
Transportation: trucks, or through courier companies.

xxxix.

5. Adidas Placement vs. Nike Placement

Adidas has smaller number of retailers in UK than Nike does (Adidas: 25 retailers;

Nike: 50 retailers)
In general, Nike has the same Placement Strategy as Adidas, which means Nike has
retailers, E-commerce, franchisee, etc.
xl.

xli.

PROMOTION MIX

PRODUCT

xlii.
xliii.

Sports marketing is a key focus for adidas marke+ting mix. The growing
popularity of sports as entertainment has led to a huge increase in sports
marketing. To be competitive in the sporting goods industry, brands must build
clear desirability with their target consumer. In order to achieve this, adidas
focuses on creating inspirational and innovative brand promotion campaigns and
developing communication techniques that strengthen their positioning. A key
tenet of adidas's promotion and communication strategy is to harness the emotion
of sport and the benefits of a sporting lifestyle across all communication channels,
creating simple and powerful brand messages to support an array of product
offerings.

xliv.

For a global organisation like adidas its promotion mix is tailored to specific
markets. This is known as international marketing as it takes cultural and social
differences into account when planning marketing activity. Let's see how adidas
use their promotion strategy in the United Kingdom:

1. Adidas's Amazing Advertising

xlv.

Adidas owns a huge part of their success in the United Kingdom to their
advertising campaign. The most special thing about adidas's campaign, which is
also the superior point over the other brands is the great power of making social
impact. They are not afraid to place content ahead of their brand. For Adidas at
this point visibility alone is not driving the brand forward. There are not many

people watching who dont know who Adidas are, it was much more about using
the opportunity to push our message, says Tom Ramsden- global brand marketing
director of adidas.
xlvi.

In 2012, adidas made a very big move by inviting Britishs to "Take the stage" in
the biggest-ever UK campaign, which was also the biggest success of this band in
the UK, winning it the tittle "Advertiser of the year". So what was so special about
this campaign?

As always, adidas were using not only impressive and motivative TV ads, which are
considered the most effective mass-media advertising format on popular UK channels
such as BBC, but also taking advantage of celebrities' power over the population.The
tone of the brands biggest-ever campaign, "take the stage", was set by some glossy
TV spots and outdoor ads that appeared to adorn every bus and billboard. The first
stage of the TV work, by Sid Lee, kicked off in April with a lighthearted spot that put
Victoria Pendleton, Louis Smith and Tom Daley in the unlikely company of the TV
comedian Keith Lemon. This was followed by more dramatically intense work, also
by Sid Lee, fronted by Olympics stars including Jessica Ennis, and supported by a
dedicated hashtag, #takethestage, a website and a torrent of digital outpourings
swamping Facebook and Twitter.

But the thing that made the campaign so successful was the involvement of the
society itself. Through Take the Stage campaign, Adidas encouraged youngsters in
the country to showcase their talents on social media and went on to reward 32
deserving candidates by giving them a chance to meet their sporting idols and favorite
music artistes. Nick Craggs, adidas UK marketing director, said the campaign would
"celebrate London" and "inspire the rest of Britain".He said: "Our new 'Take The
Stage' campaign is designed to showcase London, but also the talent that exists within
Great Britain. Adidas is providing young people across Britain with once-in-a-lifetime
opportunities that could change their lives." Moreover, Adidas created a successful
social media campaign that showcased YouTube videos that featured the athletes
singing to the popular Queens song Dont stop me now. Videos that showed
supporters being surprised at David Beckhams presence in a large photo booth were
posted online and went viral instantly.

xlvii. Adidas positioned itself to convey the right messages through the right channels

and at the right time to create differentiation by Take the Stage campaign, an
innovative promotional activity that was used by the company to garner national
support, gaining a tremedous boost in sale across the country.
2. Sponsorship:
Adidas is famous for being sponsors for a lot of famous sport events. In UK, the
biggest success as being a sponsor of Adidas is the sponsorship of London Olympics
2012". Using that event, adidas targets to beat their major opponent Nike in London,
with a view to getting total dominance in the Great Britian. Mr Steyaert- Adidas's
managing director of market north - the geographical area that includes the UK
believes: "London is a place where we don't have leadership yet. While we do have
leadership in other parts of the UK, London is crucial." Other than that, they also are
the sponsors of many big European events which are very popular in U.K as well such

as European Football cub.

Many extremely well-known athletes are also under the sponsors of adidas. The
British star who are known by the whole world David Beckham is one of them. As
adidas's ambassador, Beckham sends messages in a motivating way through
campaigns and ads, which is a very good way to inspire and influence on British
youngsters- adidas's targeted customers. There are much more to add to the list such
as tennis player Andy Murray- the pride of the Great Britain, Frank Lampard- a

football player that wins the heart of British fans.

Also, knowing the football's culture of the UK, where most young people enjoy
watching this sport, adidas has been the sponsors of many famous football clubs as
Chelsea, Fullham and the most recently, Manchester United after giving a better offer
than their old sponsor Nike. With the huge number of those teams' fans and people
watching matches in the UK, adidas totally can promote widely about their products,
leading to bigger number of sale.

xlviii. Being sponsors of big names in the sport entertainment of the UK is not only the

way to bring adidas name closer to their customers but also a way to compete with
their biggest rival Nike.
3. Adidas's Sale Promotion and Personal Selling
xlix.

Sale promotion and trade promotion are usually offered on adidas's channels and
their partners' channels who are authorized distributors of adidas products.

Together with that, adidas stories also join a lot of big sale events in UK such as
the famous Boxing Day.
Selling at Adidas involves personal contact which is why employees are

l.

constantly urged to approach customers and initiate conversations with them. This
technique is referred to as personal selling and has shown to be very beneficial
when obtaining sales. The main focus for in store associates is to educate and
demonstrate in a consultative manor about the products available.
4. Adidas's product placement in the UK
Using movie as a way to promote their products, adidas has appeared in many

li.

famous scenes and left a lot of good impression on viewers that way. "Skyfall"the phenomenal movie starring handsome actor Daniel Craig, well-known for his
role as James Bond was one of them. The adidas sneakers worn by Jame Bond in
the movie later was "hunted" by a lot fans over the UK.

lii.

5. Adidas Public Relation

liii.

Adidas has been hosting and taking part in a lot of campaign as a way to achieve a
good image and reach more customers. They havve been taking part in charity
events such as "Chilren with Cancer UK" or creating their own events for
customer as #Predatorinstinct the first ever real world football gaming experience
to celebrate the launch of the Predator Instinct Football boot.
Together with that, adidas focuses on their customers communication, especially

liv.

digital communication as the development of technology. They truly believe that

understand their targeted customers' need is what make the success of the brand.
lv.
lvi.
lvii.
lviii.
lix.
lx.
lxi.
lxii.
lxiii.
lxiv.
lxv.
lxvi.
lxvii.
lxviii.
lxix.
lxx.
lxxi.
lxxii.
lxxiii.
lxxiv.
lxxv.

Strate
gies
Evalua
tion
and
Recom
menda
tions
lxxvi.

PRODUCT

lxxvii. Nike always focus on their target in improving the quality of their products and
promote the unique function while Adidas spends lots of money for the design,
collaboration with famous fashion designers such as Rick Owens, Stella
McCartney and fashion icons.

lxxviii.

lxxix. (Adidas x Rick Owens)

lxxx. People can easily recognize this by comparing these two companies commercial
video. In Nikes commercial, they use a lot of visual effect to describe how their
products are different, more functional than the others and the main image in
commercial videos is the shoes. With Adidas, their commercial videos is more
colorful with a lots of ambassadors or famous celebrities wearing Adidas shoes.
Sometimes people may too focus on watching these famous celebrities without
caring about the product promoted.

lxxxi.
lxxxii. (Adidas commercial video)

lxxxiii.
lxxxiv. (Nike commercial video)
lxxxv. Nike develops the brand NIKEFUEL which includes running app Nike+ for
smart phones, sport watch, fuelband SE and training club. This means Nike
always focus on their mission: Bring inspiration and innovation to every athlete
in the world (Nike.com) but Adidas seems to be heedless of their slogan:
Everything we do is bound by one simple thought: we strive to help you perform
at your best. (adidas.com)

lxxxvi.
lxxxviii.

lxxxvii. (Nike+ with the Fuelband)

To compare about the product service, Nike pleases their customer more than

Adidas does with NIKEiD, a customize service. NIKEiD provides customers

choices to customize the shoes in all gender, size, and brands of Nike product. On
the contrary, Adidas customize service gives customers only two choices between
F20 and Predator shoes (performance shoes) to customize.
lxxxix.
xc.

PRICING

Adidas offers lots of discount on their product while Nike keeps the price constant
and focuses on the high premium segmentation. Therefore, with Nike, they
created trademark that their products are high price and high quality. By offering
many discounts seasons, Adidas sales their products more quickly but it is not
good for branding. Customers may have a perception that Nike is high premium
than Adidas. So the recommendation for this point is Adidas should reduce the

xci.

frequency of discount, fix a clearance or sale season in a year.

Another recommendation is that Adidas may create a luxury brand (for example:
gold Adidas shoes) to change the perception of customers about their products.

xcii.

xciii. (An Adidas sale voucher in Singapore)

xciv. PROMOTION
xcv.

The brand ambassador of Adidas that is most often joins forces in promotion
campaign is David Beckham but he is already a retired soccer player. That may be
a weak point to compete with Nike because Nikes ambassador, Cristiano Ronaldo
is a younger and successful players.

xcvi.
xcvii.

xcix.

(David Beckham is an ambassador of Adidas)

xcviii.

(Nikes ambassador Cristina Ronaldo)

c.
According to (www.environmentalleader.com) Nikes future plans are to focus on

ci.

the environment and production of eco - friendly products. They mentioned in

their 2005 and 2006 Corporate Responsibility Report that they will become
carbon neutral by 2011 by reducing their Caron Dioxide emissions. They have
decided to design all Nike brand footwear in ways through which they can reduce
waste production during product design and packaging. They will eliminate the
use of volatile organic compounds and use more environmental friendly material
in their products and be carbon neutral by 2011. Adidas on the other hand became
the official sportswear partner of the London 2012 Olympic Games. The London
Organizing committee for the Olympic Games and Paralympic Games (LOGOC)
has few regulations which all of its partners are obligated to follow. These
obligations are focused towards the environment. Adidas, being a partner of
LOGOC has to follow all these regulations as their future plans are to be the
official sponsor of almost all major events in the world, and in order to achieve
this goal their strategy is to produce environment friendly goods as well. They
have to ensure that all their products are produced with environment friendly
materials, which would protect the human health and the environment and their
Adidas retailers in UK

packaging should also be produced with materials that can be recycled. Hence we
can see that both the future plans of Nike and Adidas are quite similar. We can see
that both Adidas and Nike are competing in the same future plans, sharing a share
marketing share. Adidas could develop their promotion campaign in a totally
different field that consumers will notice about Adidas only maybe.
cii. PLACEMENT
ciii. In UK, Adidas has only 25 retailers and gathers mostly in England. Nike does it
better with 50 retailers in whole UK but not only England.
civ.
cv.

cvi.
cvii.
cviii.
cix.
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cxi.
cxii.
cxiii.
cxiv. In general, the quality and dimension of both Adidas and Nike stores are the same.
Adidas is more creative with some unique store like store in shape of shoes box
with 3D Systems Cube in London. Adidas should develop more to make them
different from their main competitor Nike.

Nike retailers in UK

cxv.
cxvi.
cxvii.
cxviii.

One Adidas store in London

cxix. REFERENCES
1. (2010) Nike plans to be Carbon neutral by 2011,
[URL:http://www.environmentalleader.com/2007/05/31/nike-plans-to-be-carbonneutral-by-2011] (accessed: 29 August 2010)
2. Anderson,A.(2010) Nike vs. Adidas: The battle for buzz in the World cup,
[URL:http://www.bizmology.com/2010/06/25/nike-vs-adidas-the-battle-for-buzz-inthe-world-cup] (accessed: 29 August 2010)
3. Environmental Leader [Website] [Viewed 3 February 2015]
www.environmentalleader.com
4. Shawn Grimsley, Price Skimming: definition, examples and strategy. Education
Portal. [Viewed 1 February 2015] http://education-portal.com/academy/lesson/priceskimming-definition-examples-strategy.html
5. Melanie J. Martin. What Are the Disadvantages of the Market Penetration Strategy?.
Schron: Small Business. [Viewed 1 February 2015]
http://smallbusiness.chron.com/disadvantages-market-penetration-strategy19339.html
6. Adidas Group. Adidas Group Annual Report 2013. Germany
7. GOV.UK. VAT Rates. [Viewed 3 February 2015] https://www.gov.uk/vat-rates
8. Olivier, L., 2014. The Sporting Life. Vogue UK.
9. Singer, M., October 13, 2014. Adidas by Stella McCartney. Style .
10. Stonebrook, I., Sep 16, 2014. PHARRELL WILLIAMS X ADIDAS STAN SMITH
SOLIDS PACK. Nice kicks . http://www.nicekicks.com/2014/09/16/pharrellwilliams-x-adidas-stan-smith-solids-pack/
11. Adidas Group. Website: http://www.adidas-group.com/en/group/profile/
12. The Heritage Foundation, 2013. [Online]
Available at: http://heritage.org/index/pdf/2015/countries/unitedkingdom.pdf
[Accessed 1 February 2015].
13. U.S. Department of State, 2013. 2013 Investment Climate Statement - United
Kingdom. [Online]
Available at: http://www.state.gov/e/eb/rls/othr/ics/2013/204756.htm
[Accessed 01 February 2015].
14. Adi Dassler. NNBD [Website] [Viewed 4 February 2015]
http://www.nndb.com/people/163/000168656/
cxx.

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