A PROJECT REPORT

on

MAREKTING STRATEGIES OF ADIDAS

SUBMITTED BY :
someshwar gautam

ROLL NO : 629

New Delhi

The matter contained in the project is authenticated and purely based on the understanding of the subject matter of the project and copied from the any published source or media or website.

A lot of effort has gone into this project and my thanks are due to many people with whom I have been closely associated. First of all, I gratefully acknowledge the continuous assistance and inspiration given to me by College Faculty. Finally, I would like to thank my family for providing me monetary and non monetary support, as and when re uired, without which this project would not have completed on time.

TABLE OF CO TE T!

AB!T"ACT I have made a research on marketing of Adidas by questionnaire method. The main aim of my research is to find out that how Adidas hold to the market and what are the areas in which Adidas can improve upon, in the questioner itself I have emphasis on the marketing of Adidas and also about the current position of Adidas in market. According to the response of my questionnaire, I have found that Adidas and Nike are main competitors but Nike is more preferred brand then Adidas. This is mainly for two reasons first Nike has more variety and good looks then Adidas and second there outlets are more then Adidas so the company must work upon these two thing to be the world number one.

CO CL#!$O
Turbulent is the word that aptly describes the scenario in sports industry in last two last financial years. By frequent price cuts in market and larger than live arketing game plans, competition reached its new

highs and lows. It is no longer sufficient to !ust be competitive. A "ompany, which has to survive, has got to have competitive advantage. #ne needs to take strategic initiative in the short run to achieve the desired $positioning% in future. #ne has to foresee &tomorrow'. There are three type of competition that pre%ail and they are& (e have so far identified the various areas on which A)I)A* and other ma!or sports companies need to improve upon to achieve the desired level of competitiveness. These improvements would give A)I)A* and the other sports companies base to compete with the the Indian companies to reduce the impact of N"s and help

N"s on the Indian

arket in the future. Indian manufacturers will have to react quickly because any delay in reacting to the threat posed by the only give the N"s would

N"s time to establish themselves in the market. (ith

their e+pertise and financial capacity they would be nearly impossible to compete with once they get a firm foot hold in the market.

$ntroduction&
y pro!ect topic is ,Adidas, which is a shoe company and I am analy-ing its arketing *trategy. I have chosen this particular topic

mainly for two reasons. .irstly, since my childhood days I had great interest in the shoes and I like to buy new shoes as and when it comes in the market. The *hoe "ompany that I most admire is Adidas. *econdly my brother is also working in this particular company /in New )elhi0 and he has provided me facts and figures of the company. 1ence I have decided to do my pro!ect report on this company. Turno%er and Brand $mage The turnover of Adidas company has grown to 23 illion 4* dollar

in 5335. Almost 678 of the turnover is from sale of apparel and accessories with the rest from footwear. The Adidas brand is one of the most popular brands as determined by a within brand survey of sportswear brands in the year 5332. Future 'lans Turnover is e+pected to rise to 25.6 illion 4* dollar for Adidas

India in 5337. cash break even is fore cast during calendar year
7

5337 and an operating break even during 5339. the other Adidas : owned brands, salomon ; taylor made are e+pected to hit Indian Adidas stores during 5337 and 5339.

Literature re%iew&
!ome of the theory $ ha%e used in my project are as follows Theory& what is mar(et research and why it is important. arket research is a method of collecting data which will make you /as a business0 more aware of how the people, you hope to sell to, will react to your products or services. questions like< (hether your products or services are needed (ho might want to buy your products (hat age, se+, income occupation etc. are the people I want to sell to. If there are changes taking place and how this might affect what you sell 1ow well your products or services might sell 1ow much demand there is for what you hope to sell
9

arket research will answer

 (hat price would people be prepared to pay Conducting mar(et research There are number of ways in which you can carry out your research but you need to carefully consider why you made this choice and what you hope the evidence will suggest to you. =uestionnaires and personal interviews are one of the most common ways in which you can conduct market research, and there are many methods of gathering data this way< )irect Interview, ail *urvey and Telephone interview. )epending on the

type of data you hope to collect will have a impact on what you choose to use. $ ha%e made use of two type of sur%ey methods) *uestionnaire and mail sur%ey. I have asked some question about the company my mail and also by direct contacts. The =uestion I have asked are given in $questionnaire part% below.

10

Theory& mar(eting mi+

The arketing i+ /The 9 >?s of generally arketing0 fall into the following four

arketing

decisions

controllable categories< >roduct >rice >lace /distribution0 >romotion The term ,marketing mi+, became populari-ed after Neil 1. Borden published his 2@A9 article, The Concept of the ,ar(eting ,i+. Borden began using the term in his teaching in the late 2@93?s after Bames "ulliton had described the marketing manager as a ,mi+er of ingredients,. The ingredients in Borden?s marketing mi+ included product planning, pricing, branding, distribution channels, personal selling, advertising, promotions, packaging, display, servicing, physical handling, and fact finding and analysis. C. Berome

11

c"arthy later grouped these ingredients into the four categories that today are known as the 9 >?s of marketing, depicted below<

The ,ar(eting ,i+ These four >?s are the parameters that the marketing manager can control, sub!ect to the internal and e+ternal constraints of the marketing environment. The goal is to make decisions that center

12

the four >?s on the customers in the target market in order to create perceived value and generate a positive response. 'roduct -ecisions The term ,product, refers to tangible, physical products as well as services. 1ere are some e+amples of the product decisions to be made< Brand name *tyling =uality 'rice -ecisions *ome e+amples of pricing decisions to be made include< >ricing strategy /skim, penetration, etc.0 "ash and early payment discounts >rice fle+ibility >rice discrimination

13

-istribution .'lace/ -ecisions )istribution is about getting the products to the customer. *ome e+amples of distribution decisions include< )istribution channels arket coverage /inclusive, selective, or e+clusive distribution0

(arehousing )istribution centers Transportation 'romotion -ecisions In the conte+t of the marketing mi+, promotion represents the various aspects of marketing communication, that is, the communication of information about the product with the goal of generating a positive customer response. arketing

communication decisions include< >romotional strategy /push, pull, etc.0 Advertising

14

 >ersonal selling ; sales force *ales promotions

Theory& !wot analysis

This theory tells about the company strength, weakness, opportunity and Threats. This theory is very important for the company because this theory tell the weakness and the strong points of the company and if company knows it weakness and it strong points then company becomes easy operative and also the profits as well as the market share of the company get increased. Adidas0 "ange of 'roducts in $ndia A month after announcing the !oint venture, Adidas India Dtd. launched its range of sports footwear, apparel and accessories in New )elhi on November 2, 2@@A. *ubsequently, Adidas products were also launched in umbai, Bangalore, "hennai, 1yderabad

and "alcutta. "urrently, Adidas products are available in 73 cities in India. The range of Adidas products available in India include sports footwear featuring some of the most popular innovations and
15

technologies developed by Adidas such as .eet Eou (ear, Torsion system and adi wear. The sports footwear available in India includes a wide range of core categories such as adventure, basketball cricket, golf, indoor, running, tennis, training, soccer and workout. Adidas has introduced in India, a wide range of sports wear for both men and women. These include apparel for athletics, basketball, cricket, golf, running, soccer, swimming, tennis and training for en. The women's range includes apparel for athletics,

golf, running, swimming, tennis, training and workout. Accessories include bag packs, campus bags, medium and large kit bags, caps, socks, wrist and headbands. Adidas arkets its products in India through a combination of

mega e+clusive stores /area of 2333 sq. feet and above0, e+clusive stores, multiFbrand stores and distributors. At present, Adidas is available in G6 e+clusive outlets out of which 79 are company : owned with H new "ompany : owned stores planned for 5335 and in 963 multiFbrand outlets in India.

16

,A"1ET$ 23,$4 . FO#" '0!/& A-$-A! T5E '"O-#CT& (hatever your athletic preference, you can now purchase an e+tensive range of Adidas footwear and apparel online. .rom running shoes to baseball cleats, eye wear to lanyards, collegiate licensed !ackets to good old fashioned cotton TFshirts, all things sport are available at the Adidas store. 5O6 -O A-$-A! C"EATE $T! '"O-#CT! Adidas goal is to create a product that is honest : it must perform. The rule is simple< form follows function. Technology and functional design. A development team makes the actual prototypes. These prototypes are then presented to the retail market by the marketing department. An Adidas product is the result of the intense thought and creative energy of many different people. The following is a general outline of how we create our performanceFbased products.

17

2.

The marketing department evaluates athletes' needs and develops a basic concept of how those needs

should be met. This concept is then presented to the design department. 5. Based upon this the concept design from the sketch marketing possible

department, prototypes. 7.

teams

The people from design and marketing consider the prototype sketches together, narrowing the selection to those they anticipate will most successfully meet athletes' needs.

9.

The development department then works with the design department to create an actual prototype from the selected sketches.

6.

Three

separate

groups

marketing,

design

and

development : meet and discuss how to improve the prototype. A. *amples are wearFtested to ensure the product meets Adidas standards for performance and durability and
18

stands up to the demands of the sport for which it was designed. G. >review samples are presented to key accounts and consumer focus groups for feedback. Based upon this information, final changes are made. H. *amples are distributed to Adidas sales representatives for presentation to retailers. @. The finished product is delivered to retailers.

A. As A B"A At Adidas :you have got to be sporty. At Adidas the brand awarding is been taken rather seriously at its headquarters. Adidas wants to bring inline skates into India. (hat that kind of stuff got to do with Indian marketI Ees, it won't really be a hot seller, but it will contribute a lot to Adidas brand image. That's the Adidas way of doing it : image is a critical part of branding strategy the world over. The idea of the company is to introduce performance specific sports shoes in the Indian market by building images around
19

the world ; at the same time create the need for these shoes at the ground level. Adidas already has heavy weight sportsmen such as *achin Tendulkar, Deander >aes ; ahesh Bhupathi endorsing the

brand in India. They had the image, apart from endorsing the performance element in the brand. Adidas steps out of crease with a clear sports positioning. Adidas will take on arch Nike with almost the same positioning. Its working with promising athletes to give them a taste of its products. Adidas nowadays is capturing an attitude that is sports related. Adidas in fact did go through a limited fashion phase. Adidas says : that you are tempted to make quick buck but we would like to stick to the sports brand image because that make us fashionable. B. 6ords of 2. 1annan .-irector 7 ,ar(eting/ $#ur *ecret is our commitment to the sports process. (e develop shoes that take into account the needs of a

20

particular sports ; the role of this brand is driven by this factor%. Jood news for Adidas is that even in the casual market, the trend is towards being sporty. Joing to Jym is fast graduating from a mere fad to serious body building, strengthening ; toning. This is reflected in the clothes that people wear today. The three stripes, for instance is unique property which can be reinvented in various forms as trends changes. C. For Adidas the product plays an eminent role in the enhancement of their corporate as well as sports image& A)I)A* *AE* : $Nothing compromised. The most innovative Adidas products created specifically to help make you a better athlete. .or Adidas, product is not !ust a assortment of few items. But it involvesK developing of the right product : which can then be put to right place ; sold with the right promotion ; price.

21

8AL#E OF $T0! '"O-#CT! FO" A-$-A! #ur goal is to create a product that is honest : it must perform. The rule is simple< form follows function. As studied earlier an Adidas product is the result of the intense thought and creative energy of many different people. If a company sell an automobile, is it selling a certain no. of nuts and bolts, some metal sheet, an engine and four wheelsI If a company sell a delivery service, is it selling so much wear and tear on a delivery truck and so much operator fatigueI As per Adidas the answer to these question is instead what we are really selling is the satisfaction, use or profit the customer wants. Adidas says that all the customer wants is, that whatever product they purchase should fulfill all their needs and preferences. They don't care how they were made. .urther they want that when they order something, the don't really care how much out of the way the driver had to go or where

22

heLshe has been. They !ust want their package. That means for them only the final service matters. As per Adidas the idea of product potential customer's satisfactions or benefits is very important. Adidas says that the total product is not !ust a physical product with its related features, but it includes accessories, installation, instruction on use, the package, perhaps the brand name which fulfills some psychological needs a warranty and confidence that service will be available after the purchase.

'LACE A - '59!$CAL -$!T"$B#T$O & A& 'lace Adidas is very much concerned about its second $p%. as per Adidas place and physical distribution of the product is something on which almost every company spends a handsome amount of money. 1ence Adidas takes a good care of its place and physical distribution process. Adidas has appointed marketing

23

specialists who are taking care of the supply of the product and their distribution channels and process. >rocess used : assorting progress Cntire range, which is available is put together to give a target market what it wants. arketing specialists put together an

assortment to satisfy some target market. 1is is usually done by those who are close to the retailers only. B& 'hysical distribution As per Adidas nearly half of the costs of marketing is spend upon the physical distribution. To take care of this problem Adidas has appointed marketing managers who decides how the transporting and storing functions should be divided within a channel. ote& >hysical distribution can be varied endlessly in a marketing mi+ and in a channel system. TRUCKS In Adidas, e+cept the e+port products, trucks are considered to be the best medium for transport. The fle+ibility of trucks makes them
24

really good for moving small loads for short distances. They can travel on almost any road. According to Adidas they can give e+tremely fast service. Also trucks causes less breakage in handling. '"O,OT$O & Adidas is one of the India's biggest company of sports that spends nearly M23 million on its sales promotion and advertising in Indian arket. Adidas believe that it !ust cannot be taken lightly. It is a very important aspect of products life cycle. It is the process which is responsible for the growth or decline in the sale of the product. Adidas thinks that promotion is communicating information about the product between the seller and the buyer to change attitudes and behavior. To handle the company's promotional activities Adidas has employed marketing managers, wherever the Adidas is located. These marketing managers look after process of the promotion of the products of their company.

25

As per Adidas the marketing managers promotion !ob is to tell the target customers that the right product is available at the right place and at the right time and especially at the right price. Adidas thinks that only taking the product to the customers is not a task of the company. But company takes a very important look about how the product works and this message is communicated to their consumers. Because a wrong message can lead to the end of their products life. !ales 'romotion Adidas is the most popular amongst its rival for its e+cellent sales promotional activities. As per Adidas they say that they themselves are responsible for the encouragement of the customer to by their products. Adidas believes sales promotion tries to compliment the company's selling efforts.

26

!TE'! T5AT A-$-A! TA1E TO '"O,OTE !ALE! In the last years the Adidas has almost given sale to its

products A to G times i.e. almost twice in a year Adidas goes for discount on sales. They arrange contest. In order to motivate the employees of the company Adidas also prepares training material for the company's own sales force. They even design the sales materials for the

company's own sales force to use during the sales calls. As per Adidas, people see same message in different ways. They may interpret the same words differently. *o Adidas always tries to deliver the message which everyone can easily understand. A-8E"T$!$ 2 As per Adidas advertising can get results in a promotion blend. Jood results are obtained at a cost of course. The amount spent in the 4nites *tates for advertising is growing. "ontinuously, from (orld (ar II to 2@H3 it went from M2 billion to M63 billion.

27

Adidas also spends nearly M5.@ million on its advertising throughout the world. Adidas in India is spending almost M2G million on advertising. The heavy weight players like *achin Tendulkar, Deander >aes and ahesh Bhupathi are already attached with their

adFcampaigns. '"$C$ 2& Adidas is clear, it wants to become the no. one sports brand in India, a choice brand for all brands. *o far so good, but how will it tackle a price conscious market like IndiaI Adidas feels that being a high energy business Adidas introduces A33FG33 articles every si+ months : enables the brand to remain fresh and bring on an international and Indians the brand from the price stand point. >rice, that's the most critical factor in the Indian conte+t. Adidas believes it has to deliver a functional at an affordable price. It's a tough !ob : to maintain the integrity of the performance and still come out with a product a right price point. Jlobally shoes start at M63. But in India as the
28

perceived need is lower, you have to make the product more affordable. To tackle this, Adidas came out with speed 5333, a product priced at Ns.@@6 with the help of local and 1ong Oong source people. Adidas however feels that its !ust the matter of time before India coverage's the world on this front. It is very difficult to operate on a lower price point and maintain integrity of product, but its been barely 7 years since the sports market has taken off. The original sector is !ust 538 of the total market and H38 of the volumes comes from sporty shoes. But our market is producing products at a price that is relevant to the consumers. Adidas feels that as the volume go up, Adidas will try and work out price points as people graduate with better

understanding of quality and price perception. Polumes are bound to go up. Adidas started at the time when India had no strength out in the sports products market in 2@H@ : @3. Its then licensing partner Bata, and it had limitations of what it could have put behind the brand. *o company took the ne+t
29

best step when the licensing agreement ended to take a bigger share in business. To conclude we can say that Adidas is putting all efforts to bring down the price consciousness in the Indian market. "ompany is trying to make products, which are easy to afford and still maintain the integrity of their performance. Jrowth has been phenomenal for Adidas even given the base is small. In 2@@H Adidas grew by 568, 2@@@ by over 638 and this year Adidas is e+pecting more than 638 in terms of value in both shoes and apparel, while the industry growth as a best case estimate has been 53F568.

30

,A"1ET$ 2 !T"ATE29 7 A-$-A! OT5E" !T"ATE29

Adidas, the brand with three stripes, seems to use the elements of highFtension in its ads. Nemember the *achin Tendulkar commercialI 1ow everything is nearFfro-en, and the shattering glass signifies release. Nelease of tension. Adidas gives you a chance to but the boundaries : in every sphere. #nly now, the setting is not the playground or the track or the court, it is the urban landscape : with its omnipresent traffic !ams, crowded streets and so forth. This way, Adidas becomes a part of life. Anyone's life. Eou don't have to be the highFvoltage performer to be a part of the Adidas family. And it goes beyond that : Adidas becomes something that makes you better. Not !ust as an athlete, but as a sports person, a better human being. #ne of the ad%ertisement& The spot featuring Boldon, shows him chasing a thief /who'd stolen a TP set when its owner was in the bath0 through the dark streets. To help a man /the

31

owner, in a towel0 in distress. And he uses all the power that he can, to do what he has to do and what he needs to do. And Adidas helps him perform better, than he would otherwise have been able to. This is perhaps shown in an oblique way when the spot ends at the feet of Boldon and the bather. #ne is wearing a pair of Adidas shoes while the other is barefoot. Adidas makes you better, goes the base. In short, the other man could have done as well as Boldon. The bather reads any man. Any man who wears Adidas. And Adidas goes beyond athletic performance : it becomes everyday life. In stark reality. Though humorously and light, it has a deep meaning. ,A"1ET$ 2& A-$-A! In 2@@G, Adidas became AdidasF*alomon with its 4* M2.9 billion purchase of *alomon, a .rench manufacturer of skis and other sporting goods. The deal put Adidas one step closer to competitor and world market leader Nike, and one step ahead of Neebok.

32

*alomon, aside from its winter sport equipment, also owns golf club brand Taylor ade and cycle brand avic. The merger

makes AdidasL*alomon the second largest sport marketer in the world, and number one in Curope. *alomon is currently very strong in North America and Bapan, and Adidas has the largest market share in Curope. Adidas is, like Nike, very active insuring sponsorships advertising deals with celebrities. *ome of the most famous are /tennis0, Oobe Bryant /basketball0, >eyton artina 1ingis

anning, >aul >almer

/swimmer0, !an 4llrich /racing cyclist0 and the New Eork yankees. )avid Beckham, >atrick Oluivert and Qidane all wear Adidas boots, the >redator Accelerator. LE8E"A2$ 2 O !AC5$ & O E ,A:O" 'A"T OF

,A"1ET$ 2 !T"ATE29 $

$ -$A

"ontinuing its association with trump card *achin, the local fourFad print campaign tries to connect Adidas' product attributes with *achin's magic. $Instead of presenting !ust one dimensions <

33

The first ad connects *achin's choice of a heavy bat with Adidas' .alcon )orf light weight shoes. *ays the headline< &*achin likes his bat heavy, not his shoe.' The second new shoe range to be introduced for the first time in India. *ubFbranded &Aksu' and priced at Ns 5,5@@, these are athletic sandals primarily meant for waterFbased adventure sports. .inally, The ne+t ad will convey that Adidas covers various price points by promoting its e+isting >ortland range priced at Ns 2,9@@ and 2,G@@ /the leather version0. The importance of celebrity sponsorship and events to Adidas is illustrated by Nobert DouisF)reyfus' letter in the company's 2@@H annual report < $(hen it comes to showcasing our brands, 2@@H was truly e+ceptional. Carly in the year, the (inter #lympics focused the attention of sports enthusiasts on Nagano. In summer, the *occer (orld "up in .rance attracted more spectators than any single sports event before. (hen the .rench team, promoting the three stripes, won the (orld "up, we could not have wished for more. These were great times for our brand.'

34

Adidas has reached an agreement with I*D

arketing J of

*wit-erland to become an official sponsor of the 5333 4C.A Curopean "hampionships. Adidas will have access to the official emblems, mascot and trophy for the design of its own products.. In 2@@H, the overall Adidas budget for promotion and sponsoring accounted for nearly 268 of turnover. The positioning is being communicated through its global campaignFreleased worldwide in .ebruary 2@@@ but in India, only in ayFas well as through a fourFad print campaign developed

locally by NO *wamyLBB)#. *ays J Oanan, general manager, marketing, Adidas< $(e are the only brand with heritage in sports. As a brand, we're not an attitude that's fashionable. (e're an attitude that is relevant all the time.

35

T5E A-$-A! LO2O

The $Trefoil% was adopted as the corporate logo in 2@G5. It represents the heritage and history of the brand. In 2@@A, it was decided that the Trefoil would only be used on heritage products. C+amples of product featuring the Trefoil logo include the *tan *mith, Noad Daver, AF26 warmFup, and "lassic TFshirt.

E*uipment
The Adidas Cquipment line was launched in 2@@2. This line of footwear and apparel represents the most unique and functional of Adidas products. Cquipment is the ultimate e+pression of what is uniquely possible by design when form follows function.

In Banuary 2@@A, the ThreeF*tripes brand mark became the worldwide Adidas corporate logo. This logo represents

36

performance and the future of the Adidas brand. This logo is used in all advertising, printed collateral and corporate signage.

*ince 2@9@, the Three3!tripes have been an integral part of our brand and product designs. This trademark has become synonymous with Adidas and its dedication to producing highF quality athletic products to help athletes perform better.

37

,ET5O-OLO29
!TA2E O E The pro!ect study started with collection of *econdary )ata. The sources for the secondary data are as follows< -ata !ources News >apers aga-ines

Internet >ress articles on Adidas. !tage Two I visited the Adidas India Dtd., which is located In )elhi0. I Also et *ome #f The ehrauli /new

arketing C+ecutives (ho 1elped

e Jetting The Nequired Information.

38

I Also Jot *ome #f The Information .rom The #ther Nesources #f The "orporate #ffice Dike < Company :ournals Company Catalogs ;uestionnaire .!tructured < on -isguised/ And Other "elated !ources. 'rimary data& I have prepared a questionnaire for the general public asking about the marketing strategy of Adidas, in that particular questionnaire I have asked some question give in finding and analysis section< /the questioner is filled by H3 people0.

39

F$ -$ 2! < A AL9!$!
Company research report .A/ Company -escription AdidasF*alomon AJ/A)I)A*0. >roduction and marketing of sports equipment, footwear and apparel under the brand names of Adidas, *alomon, Taylor ade and avic. *ales of .ootwear

accounted for 968 of 5335 revenuesR *ales of Apparel, 768 and *ales of 1ardware, 538. .B/ Competitor Analysis AdidasF*alomon AJ operates in the en's ; boys' clothing sector.

This analysis compares Adidas with three other sport shoe and apparel manufacturers< Nike Inc. of the 4nited *tates /5335 sales of M@ billion of which 6@8 was .ootwear0, Neebok International Dtd. of the 4nited *tates /5332 sales< M5.HG billion of which G78 was .ootwear0, and Amer Jroup >D" which is based in .inland /5332 sales of A.9A billion .innish arkka S4*M@@A.HH millionT of

which 598 was Nacquet *ports0. Note< not all of these companies

40

have the same fiscal year< the most recent data for each company are being used. .C/ !ales Analysis )uring the first quarter of 5335, sales at Adidas totalled 2.6A billion euro. This is an increase of 5.G8 from the 2.65 billion Curo in sales at the company during the first quarter of 5332. )uring the previous 2G quarters, sales at Adidas have increased compared with the same quarter in the previous year. *ales at Adidas appear to have some seasonally< during each of the previous 6 years, sales have been highest during the third quarter, which has accounted for between 5H.38 and 75.38 of the annual sales. Adidas reported sales of 6.7H billion Curo /4*M6.76 billion0 for the year ending )ecember of 5335. This represents an increase of @.38 versus 5333, when the company's sales were 6.76 billion Curo. *ales at Adidas have increased during each of the previous five years /and since 2@@G, sales have increased a total of 55A80.

41

"ecent !ales at Adidas

(Figures in Billions of Euro)

F A D @ E =??> =??F =??? =.>? @.A= B.A@

C.D>

A.EA

A.CB

@EEE

@EE=

@EE@

In 5335, sales in Datin America were up at a rate that was much higher than the company as a whole< in this region, sales increased 7A.38 to 2G2.33 million euro. Adidas also e+perienced significant increases in sales in AsiaF>acific /up 7.@8 to HG6.33 million Curo0.

42

2"O6T5 !T"ATE29 Adidas is a constantly growing company. It is global in scope with the ma!ority of its sales coming from Curope, followed by the 4nited states, with the smallest percent of Adidas' sales coming from Asia. Adidas sales have grown significantly each year from 2@@9 to the present. Adidas is the leading producer of sporting goods in Curope and it is second in the overall world market, !ust behind Nike. Nearly 668 of Adidas revenues come from Curope, while 7G8 come from the Americas, and only @8 of revenues come from a growing Asian market.

.or anyone not familiar with the structure of this company /since it is not based out of the 4*A0, it is much like 4* based competitor Nike. Adidas has stock traded on e+changes in .rankfurt and >airs, and its ticker symbol is A)))E. The pie chart below shows e+actly how the ownership of the company is spread out across the world. ost of the ownership comes from Curope, while a

43

substantial 738 comes from the 4nited *tates, and the rest from Asia.

Asia CG

Europe DEG

#! BEG

#1 @CG

Adidas is a growing company as stated above, but how much and how fastI As you can see from the graph of net sales over the past five years, sales have grown rather e+ponentially, although growth slowed in 2@@@. This growth in sales comes from not only an

44

improving world economy, but from Adidas' marketing efforts to make it one of the most popular sporting goods brands. This shows that Adidas does not have a large market share in Asia as compare us and Curope and my questionnaire /given below0 also suggest that company can improve a lot the certain areas are marketing distribution and competing with the competitors. The company has to become innovator not follower they must do something differently to come with the flying colors. ;#E!T$O A$"E

2. 1ow do u rate the company marketing strategy as compare to the other competitors company like Nike, Neebok etc.I

45

2. #ut of H3 people 7A had said Adidas have a good marketing strategy and should continue like this only, 59 had said Nike is more better then Adidas, 2A said Neebok is good and 9

reebok 538

others 68 adidas 968

adidas nike reebok others

nike 738

said others.

5. )o u think that the company Adidas is giving its customer what they want in terms of quality and prices or value for moneyI

46

5. #ut of H3 people AH person are satisfy with the quality and happy
not happy

the price of the product and other says that they are not

not happy 268

happy not happy

happy H68

satisfy.

7. )o u think that the advertisements and the brand ambassador of the company is good enoughI 7. #ut of H3 people AA person said yes they like the advertisement very much and rest said no they don't like them.

47

2H8

38 happy not happy H58

9. what things u keep in mind while purchasing shoes will it be quality, advertisement, price or designI 9. #ut of H3 people A@ person had said that the product must have good quality and good design and other said they purchase these shoe for status symbol only.

298

38

quality other factor

HA8

6. If u have to purchase shoe e+cept Adidas which shoe it will be and whyI
48

6. #ut of H3 people 95 have said Nike, 57 said Neebok and 26 others, which shows that the main competitor of Adidas is Nike. They have given different reason for that some said Nike and Adidas are have same range of products and there quality and prices is also same, so different people have different opinion.

2@8 nike 658 5@8 reebok others

(hat do u think that the company Adidas must do to improve its marketing strategyI

49

!6OT A AL9!$! OF A-$-A!

!trengths& The main strength of Adidas is his >roduct =uality. The quality and the material uses in Adidas is very good. The company has a good brand image in the market, the publicity and the advertisement is also very good and lastly company hold a heathly market share in the market. 6ea(ness& The ma!or weakness in the Adidas is that the manufacturing of the products of Adidas is not done in India itself it is being import hence the cost become high and the margin of profit becomes low that's why company must give a deep thought on manufacturing their products in India. Another ma!or weakness in the company is that it is not catering to all the segments which I have already discuss above, If these two weakness in the company can be eradicated then the company may earn high profit and better market status.

50

Opportunities& Adidas does have many products for the urban segment or poor people, but there are hardly any product or we can say that there are no products for this segment. India is more a rural country, in the total population of India ma!or part of population lives in rural area and these people can not afford the costly products of the company like Adidas hence company must target this particular segment they must introduce the shoes and other product according to their demands. and also price is one of the ma!or factor which may influence this type of segment hence company should make their policy accordingly. "ompany must also consider the rage of products as compare to Nike and Neebok. In my opinion the company must introduce more rage or more variety in the market to compete with their competitors and also the customer have more choices to choice the product from. Threats& Adidas does not have strong distribution network as compare to Nike and Neebok in India. Nike has more number of retail outlet then Adidas and Neebok has a unique distribution network, the
51

company

Neebok not only use its outlet for the sale of their

product but also use some other shoes company outlet like $Bata%. In a Bata showroom u can find Neebok shoes and other products. But this is not a case with Adidas hence Neebok has a e+tra advantage over Adidas.

Conclusions&
A)I)A* in IN)IA has always been driven by its PalueFforFmoney strategy. The company needs to identify critical success factory and work assiduously towards achieving it. ,easuring $ntangibles < 8aluing -i%ersity The knowledge, worldwide e+perience and diversity that an Adidas employee can bring to the table are valuable. Necently, how

successful companies are in the global world is increasingly derived from intangibles, such as these, that organi-ations cannot own. Adidas is greatly affected by these e+ternal influences since indeed it is a global company. .or some it is not common

knowledge that Adidas is a Jerman company. This is a result of good global business. Adidas has created a product that is global and with that diversity and knowledge greatly affect the company.
52

Adidas must be able to easily adapt to different cultures and must be culturally aware when conducting business. The long list of Adidas subsidiaries where it conducts business proves that Adidas is constantly adapting to cultural changes and must be e+tremely diverse. Because of this necessity, knowledge is greatly valued. Jreat changes occur in this industry and as a result, new ideas, intuition and inspiration are an asset that is a necessity in this industry and to remain a global company. (ho leads this

knowledge and maintains diversity are the managers, yet they too are facing new changes.

Outloo(&
.or 5335, the Adidas brand's new divisional structure will be in place to start delivering positive results for the Jroup. Adidas America will remain a challenge but nevertheless will deliver qualitative sales improvements in the second half of 5337. TopFline growth is e+pected in all other regions. )oubleFdigit growth from *alomon is pro!ected as a result of the continued innovative strength and the increasing profile of their products. The

53

integration of

avic with *alomon, which began in 5333, will

continue in 5337, with further synergies between the two brands. At Taylor adeFAdidas Jolf, increased marketing and sales

support will target ambitious golfers, and solid growth in all the ma!or golf markets is e+pected to continue. In addition to these positive topFline developments, gross margins are e+pected to remain within a range of 928 to 978, operating e+penses will decline as a percentage of sales, and as a result net income is pro!ected to increase by 268.

54

B$BL$O2"A'59
6eb !ites www.adidas.com www.indiainfoline.com www.webcrawler.com www.google.com www.indiatimes.com Class otes is referred

,agaHines A; Business India India Today Business Today ewspapers The Times of India The 1industan Times
The Cconomic Times

55