CHAPTER 1

INTRODUCTION

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1.1 INTRODUCTION

The following report describes and analyses Puma business 's generic and distinctive
marketing strategies, as well as providing accurate industry, competitor, market, and SWOT
analysis'. Evaluation of Puma businesss marketing strategy is conducted, thus analyzing the
strengths and weaknesses of the strategy. Lastly the report recommends probable future
courses of actions obtainable to Puma business, in order to get better profits and stop
mistakes in the future.

1.2 BACKGROUND

According to the companys annual report The Puma business was originally founded by
legend fashion designers who first patented a disinfectant fashion in France which is still
marketed today as Puma Fluid. Puma was granted the Royal Warrant in France and is still a
proud supplier to the Royal Household.

If we analyzed then we come to know that Puma be familiar with that ultimately the
consumer buys products which solve consumer desires and requirements. These desires
repeatedly expand and it is vital that products are developed to assemble these requirements.
Puma has two research & growth centres in France and the UK where the solitary focal point
is to produce ground-breaking new products.

According to the annual report of Puma Business:

Puma Group Management Team

Chief Executive officer-

Bjrn Gulden has been Chief Executive Officer (CEO) of PUMA SE since 1 July
2013 and is a member of the Kering Executive Committee. He brings to PUMA an extensive
international experience of nearly 20 years in the sporting goods and footwear industry,
where he held a variety of management positions.

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Chief Financial officer-

Michael Lmmermann has been responsible for Finance and Legal since January 1,
2013. Prior to his appointment as Managing Director of PUMA SE, he had been General
Manager Finance.

Chief Opertaing officer-

Lars Srensen has been responsible for Operations as well as Supply Chain
Management, Logistics and IT since 1 August 2014. He joined PUMA in November 2013 as
Global director Business Processes and Intelligence.

1.3 Research Objectives

The main objective of this dissertation is to improve the company's supply chain or strategic
management and the relations with its suppliers to reduce costs so that company will support
its cost-saving competitive advantage. Supply chain partnerships are relationships between
two or more independent entities in a supply chain to attain specific objectives. Basically,
these partnerships are generally created to augment the financial and operational performance
of each channel. These objectives are accomplished throughout reductions in total costs,
reductions in inventories, and augmented levels of common information. Over a period of
time these partnerships can develop and lead to improved service, technological
improvement, and product design. The biggest portion of the duties is left to the company to
direct and improve the suppliers.

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 CHAPTER 2

PROFILE OF THE INDUSTRY

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PUMA AT A GLANCE

PUMA is one of the worlds leading sports brands, designing, developing, selling and
marketing footwear, apparel and accessories. For over 65 years, PUMA has been producing
the most innovative products for the fastest athletes on the planet. PUMA offers performance
and sport-inspired lifestyle products in categories such as Football, Running and Training,
Golf and Motorsports. PUMA engages in exciting collaborations with renowned designers
like STAPLE, STAMPD or TRAPSTAR to bring innovative and fast designs to the sports
world. The PUMA group owns the brands PUMA and COBRA Golf as well the subsidiary
Dobotex. PUMA distributes its products in more than 120 countries and employs more than
13,000 people worldwide and is headquartered in Herzogenaurach/Germany.

OUR BRAND VALUES

The PUMA brand is grounded in four values: brave, confident, determined and joyful. They
Motivate us to surpass our Potential and use our knowledge and history in sport to further
establish credibility, authenticity and an appreciation for the games we play.

BRAVE: We are unafraid to take risks.

CONFIDENT: Whatever we do, we do with conviction.

DETERMINED: Nothing comes between us and realizing our dreams.

JOYFUL: We live to play the game and we play with heart.

BUSINESS UNITS

At PUMA, we offer performance as well as sportstyle products across six Business Units.
The Business Units are comprised of Teamsport, Running and Training and Golf which
represents our Performance business as well as Motorsport, Fundamental and Sportstyle and
Accessories and Licensing.

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TEAMSPORT

In line with PUMAs mission to be the Fastest Sports Brand in the World, PUMAs
Teamsport business focuses on regaining credibility in sports performance, in particular
through football. Our football strategy is designed to optimize a portfolio of globally relevant
assets on both a club and international federation level such as Arsenal London, Borussia
Dortmund as well as the Italian Football Association (FIGC), along with a player asset list
with strong international credibility such as Mario Balotelli, Cesc Fabregas, Sergio Aguero,
Marta, Yaya Toure, Olivier Giroud, Marco Reus, Radamel Falcao and Santi Cazorla.

In 2014, PUMA became the official kit partner of English Premier League Club Arsenal
Football Club. Arsenal represents a major commercial and marketing opportunity to reinforce
PUMAs credibility as a global sports brand as well as a perfect platform to showcase our
performance products through the clubs significant global fan base, profile and reputation.

Furthermore, PUMA continues to excel with new and exciting product innovations. In
January 2014, PUMA launched its most innovative football boot to date, the evoPOWER.
Inspired by the freedom of movement of barefoot kicking, it is designed to enhance players
natural kicking ability and optimize a players power and accuracy when striking the ball.
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Another example is PUMAs football apparel innovation PWR ACTV, a first-to-market use
of both athletic taping and compression within the apparel.

At the 2014 FIFA World Cup in Brazil, the prominent pink and blue interpretation of
PUMAs revolutionary evoPOWER and evoSPEED football boots Tricks created lots of
positive headlines and could be seen in three quarters of all games.

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RUNNING AND TRAINING

PUMA has had a heavy impact in the Running industry through numerous stories that tell of
records and innovation. Starting with the introduction of the 5-bristle running shoe
MAKANUDO in 1950, PUMA has continued to revolutionize running shoe technology with
innovative high-performance spikes, CELL cushioning technology and the groundbreaking
Mobium Elite running shoe.

Throughout its long history in Running, PUMA has had an extensive portfolio of Track and
Field legends through the years including European Gold Medalist, Heinz Ftterer; Armin
Hary; Olympic Gold medalist, Tommie Smith; hurdling Gold Medalist, John Akii-Bua;
World and European Champion, Colin Jackson; Olympic medalist, Linford Christie; multi-
medalist, Marlene Ottey; record breaker, Evelyn Ashford; World Record holder, Wilson
Kipketer and today, the Worlds Fastest Man, Usain Bolt.

In terms of our Running product range, we focus on expanding our consumer base by
developing innovative, more commercial products in line with PUMAs Forever Faster
brand strategy of simplifying and harmonizing our designs and executions to improve

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commerciality. Spring/Summer 2015 saw the launch of the industrys most innovative
running technology to date: IGNITE, a running shoe with the highest energy return PUMA
has ever created. In subsequent seasons, additional styles will be introduced and the IGNITE
line will be expanded further within our Running and Training category.

Within the Training category, PUMA has had an array of successful products for men and
women including PUMA ACTV, which was awarded the ISPO Gold Award in 2013 and
introduced the first-to-market use of built-in athletic taping within a garment. 2014 also saw
the product introduction for a new key training family, Pulse. In Spring/Summer 2015, Pulse
XT kicks off a new product family of versatile, training products to transform our customers
wardrobe and workout and will continue to grow throughout 2015 and into 2016.

The Training ambassador portfolio now includes global cultural icon Rihanna. Through this
new multi-year partnership, established at the end of 2014, Rihanna will serve as a global
brand ambassador for PUMA. Besides playing a role in PUMAs campaign Forever Faster,
she serves as one of the Creative Directors for PUMA, specially focusing on women.

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GOLF

In our Golf Business Unit, we continue to bring our message of Game Enjoyment to life
through innovative, technology-rich products, athletes with swagger, creative campaigns and
unique events.

Cobra Golf, founded in 1973, is one of the worlds most renowned golf club manufacturers.
In 2010, PUMA purchased Cobra, and created COBRA PUMA GOLF. The merger leveraged
PUMA Golf's footwear, apparel and accessory designs with Cobra Golfs high performance
golf clubs. Together COBRA PUMA GOLF offers the full 360 package that help golfers of
all levels Look Better. Feel Better. Play Better.

Our roster of iconic golfers comprises the likes of Rickie Fowler, who remains one of the
most influential and recognizable players on the PGA Tour, power girl Lexi Thompson,
along with Graham DeLaet, Jonas Blixt, Will MacKenzie, Jesper Parnevik and Sophia Popov
along with brand ambassadors: Greg Norman, Holly Sonders, Kelly Slater and Blair ONeal.
In the coming seasons, COBRA PUMA GOLF will continue to bring key breakthrough
technologies to the market, coupled with exciting industry announcements and trend setting
collections.

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MOTORSPORT

Since the end of the last century, PUMA has been designing and creating footwear and
apparel for top motorsport racing teams and drivers. Today, PUMA Motorsport is a proud
partner within Formula One, DTM, and other motorsport series such as NASCAR and
IndyCar. We are associated with Scuderia Ferrari and MERCEDES AMG PETRONAS
within Formula One and BMW Motorsport in DTM and Team Penske in NASCAR and
IndyCar.

For ten years, PUMA has worked with Scuderia Ferrari to develop innovative, ergonomic
designs inspired by performance. In 2015, we celebrate this unique partnership of iconic
products inspired by the race track, designed with functionality and fast-forward technology.

Through continued innovation and creativity, PUMA has constantly improved the
technological and safety needs of the outfitted teams and drivers, kitting the drivers in high
performance racing products. These pure performance products transition into the sportstyle
and fashion arena, with PUMA producing licensed apparel, footwear and accessories
collections that leverage PUMAs heritage in the world of Motorsport. Each collection offers
Motorsport fans across the globe a range of sportstyle products that are inspired by the
performance gear that the drivers and teams wear.

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SPORTSTYLE

PUMAs Sportstyle Business exemplifies how we influence and shape culture and lifestyle
through the lens of sports under our Forever Faster brand platform. Our great heritage and
our roots in sports serve us as an inspiration in order to deliver innovative performance and
sports-inspired products as well as classical basic products.

In 1998, for the first time in its history, and as the first sports brand ever, PUMA began to
merge sports and fashion by launching a partnership with the very influential designer, Jil
Sander. Ever since, we have been venturing into our archive, creating iconic design classics
from the PUMA Suede to the re-launch of the PUMA Trinomic series, leveraging our clear
positioning in sports to enthuse customers around the world.

Under the PUMA SELECT Label, PUMA engages today in exciting collaborations with
renowned design brands such as McQ by Alexander McQueen and unique assorted design
houses and street fashion designers such as Vashtie, ALIFE and KITH.

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In January 2015, global cultural icon Rihanna joined the PUMA brand ambassador roaster.
These collections represent Rihannas fresh, forward thinking and non-traditional approach to
sports, fitness and lifestyle fusing Rihannas personality, love of sports, spirit and style into
the growing footwear and apparel segment.

KIDS

For our young consumers, PUMA takes the latest key styles and top sellers from across our
general product portfolio and converts them into kids and baby sizes. In our partnership with
Warner Brothers, PUMA fulfills childhood dreams by offering co-branded apparel,
accessories and footwear collections for the Superman franchise, including Superman,
Supergirl and Superbaby.

Through our licensing agreement with the non-profit educational organisation Sesame
Workshop, we launch co-branded footwear, apparel and accessories collections for characters
such as Elmo and the Cookie Monster. Sesame Street product ranges span all age groups,
starting with toddlers and combine entertainment with sports.

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ACCESSORIES AND LICENSING

PUMAs Accessories round off the collections of our other Business Units in order to build
strong, comprehensive packages and to create a complete look. We have a clear vision for our
Accessories and Licensing offering, which not only represents a unique mix of authenticity
and modernism that complements our sports and lifestyle collections, but also enhances our
credibility in the world of accessories: We want to be unique in all the categories we play in
from backpacks to fitness bags, and from fragrances and body care to the glasses and watches
which sport the PUMA logo.

Our Licensing strategy focuses on brand enhancement, concentrating on four key categories
to support our core business: Fragrances and Bodycare, Glasses (optical and sunglasses),
Watches and Security Boots. With our segmented Accessories collection structure, we
continue to address the needs of both our performance and lifestyle consumers. And we keep
using our most distinctive original silhouettes to inspire new design classics.

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 CHAPTER 3

Project Design Methods and Techniques to

Gather Data

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3.0 Project Design Methods and Techniques to Gather Data

Exploratory research is the research into an area that has not been studied and in which a
researcher wants to expand initial ideas and a more alert research question. I will be using
this method supporting the research with a sturdy literature review.

I have mainly used secondary data from the previous researches, surveys and some
contemporary issues to support the idea. The minor information services register and describe
main documents for the reason of retrieval and documentation. Secondary literature such as
subject bibliographies, citation indexes, library catalogues and databases analyses, describes
and registers primary literature (mainly but not exclusively) in these bibliographical
instruments. The central working processes of the secondary sources are analysis, storage and
dissemination. In the model abstracting and indexing services, libraries, information centres,
clearinghouses and data centres are considered secondary information services, but each with
particular functions to perform.

One of the foremost advantages of using secondary data is that it helps the researcher
formulate and understand better the research problem, broadening at the same time the base
for scientific conclusions to be drawn. Nevertheless, it should be taken under consideration
that other researchers, organization or government departments for studies with different
objectives and purposes collected the data; therefore, it might not be suitable for the current
research.

I will also use conclusive research design techniques. Conclusive research is designed to
support the decision maker in determining, evaluating, and selecting the best course of act to
take in a given situation. There are two research types; 1. Descriptive, 2. Causal. Descriptive
studies are also called observational, because you observe the subjects without otherwise
intervening. The simplest descriptive study is a case study, which reports data on only one
subject.

Descriptive Statistics will help me to evaluate the success of the management:

Like with most studies, this research had limitations and will offer suggestions for future
studies. To get a more whole portrait of the method, one needs to study the host organization
(in this case TOFAS-FIAT), top management of the supplier companies. Second, this study
needs to be simulated over time to view if advantages are retained over a period of years.
Describing the observations and the relationships among variables will help me to assess the
situation as well as the circumstances under which precise relationships exist. This might be

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completed and presented in the form of a discussion using secondary data as proof to check
the supposition.

3.1 Products Or Services And The Geographic Scope

According to the company annual report Puma sells a variety of domestic and industrial
hygiene and cleaning products all through the world. Branded products account for about
40% of the Group sales and comprise all strategic management policies.

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 Chapter 4
Strategic Position And Business Model

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4.1 The Industry Analysis

Puma is in the department store/large retailer industry, an industry that has very high levels of
competition. Although this industry is extremely competitive and growing at a fast pace in
Australia, it is still not as large as the department store industry elsewhere in the world, such
as the USA. This is partly due to the fact that there are boundaries in this industry,
particularly in Australia, as there are few retail stores that can classify themselves as large
department retail stores. Puma is a very competitive and key participant in this industry, as it
is both a producer and a seller. The large retailer industry can be very volatile due to the
impact the environment has on its participants .

Due to the introduction of the GST in year 2000, retail turnover has been increased and there
has been a sharp sales slump in the retail sector (Inside Retailing, 2001). According to the
estimation of ARA, total sales were up 5%; however there had been a drop in department
store sales of 3% for the seven months prior to July on the previous corresponding period.
The Australian Bureau of Statistics (ABS) also estimated that department store turnover was
up 27.8%, or approximately $1 billion.

4.2 Context For Strategy

PUMAS BRAND STRATEGY

Objectives

PUMAs new overall objective is to become the fastest and most advancing sports and
lifestyle brand

Revitalizing the brand identity (reposition and renew the brand)

Optimize the visual identity

Strengthen and clarify the brand image

To be perceived as a lifestyle brand merging sports and fashion rather than creating a wedge

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Branding strategy

PUMA is one brand assigned to several product categories in different markets, which means
the umbrella brand strategy will suit the new objective to make PUMA the fastest and most
advancing sports and lifestyle brand. Furthermore, it is suggested that PUMA takes co-
branding to the next level. Sports has become a trend within fashion and the other way round
- the tendencies are that sports and fashion are merging more and more due to the active
lifestyle that many people lead.

ANSOFFS GROWTH MATRIX

PUMA will both be using the market penetration strategy and the product development
strategy. When using the market penetration strategy, the organization tries to grow using its
existing offerings (products and services) in existing markets. In other words, it tries to
increase its market share in current market scenario. This involves increasing market share
within existing market segments. This can be achieved by selling more products or services
to established customers or by finding new customers within existing markets. In the market
development strategy, a firm tries to expand into new markets using its existing offerings.
PUMA will still sell their popular classics, however, they will also focus on developing new
products.

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BRAND STRATEGY MATRIX

As mentioned earlier PUMA will take co-branding to the next level. This will be done by
applying product line extension collaborating with a high-end fashion brand. It is already a
huge trend for high fashion companies to engange collaborations with big designer brands
and it has even been seen within some sports brands, for example Adidas who has made
collaboration with Stella McCartney. This means that PUMA will collaborate with a global
design brand and thereby adding new items to the existing product categories under the
existing brand name.

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POP/POD ANALYSIS

This analysis identifies the differences and similarities between PUMA and its two biggest
competitors in the market. It is important to take the competition into consideration,
especially these two brands, when developing the branding strategy. PUMA should find a
way to differentiate from its competitors while still remaining on the same level.

4.3 Porter's Five Forces Analysis

Threat of new entrants:

There are obvious barriers for the industry in terms of economies of scale, capital
requirements, and government policy. Economic scale comes into play as large companies
can decrease of units as volumes rise. For instance, large retail stores may incur cost savings
by buying products in great quantity however; smaller stores do not have the ability to do so.

Government policy could also be another entry barrier; such as the introduction of a new tax
system, which could to a great extent influence the industry. E.g. GST. In addition to this, the

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establishing of a new brand becomes a vital aspect for success in this industry, due to the fact
that entry into this industry is difficult due to the size and scope of existing brand
competition.

The most likely new entrants to the industry are from companies, which have been well
established in other businesses areas. In many cases it would be financially impossible to
enter into a competitive industry with little seed capital and for many organizations large
resource investment requirements deter them from entering. This is especially true for a large
department store such like Jeye, which needs to have a number of different business sectors,
such as: administration, marketing, finance etc. Therefore, entry barriers are considered to be
high.

Bargaining power of suppliers

Large retailers or department stores could choose where to get products from many suppliers;
therefore, suppliers have less power. Retailers are gaining more power in the industry,
described by Craven et al (6). There are a small number of large retailers (e.g., Jeye, Kmart,
Target, David Jones) that could use 'systemic relationship power' over their suppliers.
Brookes systemic power is defined as "the power that one party has to affect the whole
system of the other". Retailers are increasingly gaining more bargaining power; therefore this
trend indicates that suppliers are becoming less powerful than they used to be.

Bargaining Power Of Buyers

The influential part is that the price of products can be different mainly, even for the similar
group of product, in a large department store and also of those in a further discount type of
department store. Due to the dissimilarity, buyers have additional products to select from,
when trying to locate and purchase an exacting product; thus switching costs of buyers are
low.

This normally means that customers in the retail industry have high bargaining power. On the
other hand because of Jeye's position and its image, customers do not have much influence on
price, because Puma cannot simply reduce its prices by sacrificing quality, due to their brand
image.

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 Substitutes

For Puma, which has large-scale department stores selling a wide range of products,
individual retailers of apparel, kitchen appliances, furniture, fashion e.t.c could be substitutes
for consumers. Furthermore, electronic stores such as Harvey Norman may be cheaper and
have a high standard of quality or discount department stores could also be alternative
choices, if the buyer doesn't mind forfeiting quality for price. The new trend of online
shopping is another possible substitute for certain consumer groups.

Industry rivalry

There are many competitors existing in the large retailer industry, the biggest of which is
Nicholas Goodwin; even though they direct their promotions at different target markets.
Nicholas Goodwin sells very similar products to Puma and so rivalry can be intense at times.
In addition, dissimilar types of department stores, which include reduction department stores
like Target, Kmart are competing inside the similar industry.

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 Chapter 5
Competitor Analysis

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5.0 Competitor Analysis

The main competitors of Puma stores are middle- upper class department stores that stock a
wide variety of products. Competition mainly comes in the form of premium positioned
stores in the high-class category. In Australia, the main higher class competition would come
from Nicholas Goodwin and Michel Jones, which are both fashionable stores that offer alike
products at a competitive price.

However, due to the fact that John Adam has just recently announced that two of its
Australian stores will close down at the end of 2001, Puma has experienced a slight fall in the
competition in this industry sector. On the other hand the middle class sector of the industry
is still highly competitive, with the likes of main rivals Sports girl, Kmart, Target and Harvey
Norman insuring the need for regular in-store monitoring and maintenance.

5.1 Market Analysis

Puma main customer base, thus their main target market; are predominantly female. As the
products are of best standing, i.e. premium pricing and brand categories; the market is
customer based, not demand-based. The products fulfill wants and desires based on image,
not needs. Customers seek the product and service benefits of the image of Puma.
Geographically speaking, the market for large department store such as Puma is mainly
concentrated in large shopping centers or downtown. In a large shopping center or downtown
shopping district, the market is strong, with good profit potential.

Department stores positioned as premium are hard to imitate and start because they are built
on the prestige of the brand.

5.2 SWOT Analysis

Strategy Strengths

The first strength of Puma is that of its store positioning within a shopping environment.
Puma is a market leader in Australian retailing industry and is also is the largest department
store chain in Australia.

Another strength of Puma is their strong brand identity with consumers. Puma customers
think of them as a upper class department store, which sells high quality products. This is the
image that Puma is successfully projecting to their consumers, and is precisely why Pumas'
target market is the middle-upper social classes.

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Product quality and range is also a major strength of Puma. The company has built up a wide
range of well-known and prestigious brands. For instance, the ground floor of Puma sells
most well known brands of perfume such as Gucci, and YSL etc.

Another strength of Puma lies within their strong customer relationship marketing techniques.
There are special benefits available to customers who hold a Smarter Shopping Card that
gives customers great features and exclusive benefits at favorite Coles Puma stores; such as
Puma, Grace Bros, Target, Kmart and Megamart. The exclusive benefits include special
interest free promotions, up to 62 days interest free. no annual or joining fees, flexible
payment options, online account management and interest rates from as low as 15.5%.

Another card customers can obtain is the popular Fly Buy card, which is Australia's leading
customer loyalty program. The Fly Buy card offers members a range of awards for regular
everyday shopping, with over two million households of active Fly Buy members.

Members can earn one Fly Buy point for every $5 spent at Puma of Megamart stores. Fly
Buy points can be exchanged for over 1000 'escape' related awards, including restaurant
dinners, shows, air travel, accommodation packages around Australia, store vouchers and
special attractions (http://www.Puma.com.au/cards/cmcard.asp).

Customer service is a principal strength of the company, which is carried through to its well-
known product strategy and Pumas' store image. Puma's uphold this strong moral custom
with its staff and is an attribute that the company carries through to its promotions, helping to
establish warm, personal brand association.

Weaknesses

Price is one of the main weaknesses of Puma; this is because the main perception of Puma
prices along with customers is that of high prices, consistent with their prestige image,
therefore price is a weakness of Puma.

Puma' product positioning can be seen as a weakness of its strategy, for instance, if spending
and overall activity in the economy is down, Puma can't reduce its price. Similarly, Puma
can't reduce its prices in the form of sales promotions to compete with competitors as easily
as other stores can. The reason is that low prices and sales promotions would not be
consistent with its brand image; therefore, it would have a negative effect.

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Opportunity

An opportunity lies within the potential expansion of Pumas' online shopping. Development
of this strategy in the future is an opportunity for Puma to increase sales and customers'
loyalty.

The trends of increasing services and increasing customer relationship managements as

described by Cravens et al (8) form opportunities for Puma. Increasing services means that
Puma can extend its operations into more service oriented functions. Puma can attempt to
increase efforts towards its loyalty programs to extend its customer base in days where
customers are demanding more attention.

Threat

The external environment is a large potential threat for Puma. This threat may come in the
form of government policy e.g. tax, economic downturns, industry changes, etc.

The threat to Puma' online shopping is from the extensive number of competitors who have
online shopping services. Threat of new entrants into the market lies in the form of competing
department stores from overseas.

Generic Strategy

Generic marketing strategies provide a useful, broad structure to guide the formulation of a
firm's marketing strategy (9). It means the ultimate need of each firm is to develop its own,
unique marketing strategy that draws upon its own capabilities and its own assessment of
market opportunities. The four generic strategic focus areas are branding, innovation, low
price-cost and channel management.

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 Chapter 6

An Analysis Of Resource And Capabilities

On Its Competitive Advantage

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6.0 Definition of Competitive Advantage and Strategy

The competitive advantage can be achieved if the organization is able to expand an overall
cost leadership with no ignoring quality and service. The competitive advantage of being the
low cost producer of a product is that, even in powerfully competitive markets, the firm will
earn over average returns. Those returns can be reinvested into the firm and used to acquire
new utensils and facilities that will help effect the firm's low cost position.

Porter defines three general strategies for competing efficiently: cost leadership, separation,
and focus. Each involves a dissimilar route to competitive advantage, and winning firms
make a clear choice between these strategic options without forgetting the significance of the
others. Management of such firms recognizes that trying to do all of them jointly generally
lead to poor relation position within its industry.

6.1 Cost Leadership

Cost leadership is possibly the clearest of the three generic strategies. In these days, most
winning firms use this strategy to increase the main market share. Firms pursuing cost
leadership resist to be the low-cost producer in their industry and sell their products/services
either at average prices (to earn senior margins than competitors) or at below-average prices
(to produce market share). A low-cost producer must find and develop all sources of cost
advantage, counting economies of scale, asset utilization, proprietary technology, special
access to raw materials, best outsourcing, and vertical addition, or avoid some costs all
jointly. Instance of firms competing on the basis of cost leadership includes Easyjet and
TESCO.

Achieving a low in general cost position often requires a high relation market split or further
advantages, such as positive access to raw materials. Porter also defines that a cost leader is
the awareness that, within any given industry, only one firm can be the cost leader. When
there is further than one hopeful cost leader, rivalry among them is typically fierce because
every point of market share is viewed as critical. Discrepancy access to factors of production
and technological software advantages sovereign of scale have the most possible to create
cost-based continued competitive advantages.

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6.2 Differentiation

The second general strategy is differentiation. In a differentiation strategy, a firm look for to
be sole in its industry along a few dimensions that are broadly valued by buyers. To adopt
this strategy, a firm must have a product/service donation unique attributes that are respected
by customers and apparent to be more attractive than those offered by competitors.

Differentiation provides lagging against competitive rivalry since of brand royalty by

customers and ensuing lower compassion to price. A firm must offer amazing truly sole if it
is to garner a best price. Though, in contrast to cost leadership, there can be more than one
winning differentiation strategy inside an industry. A cost leader must attain equality in the
basis of differentiation virtual to its competitors to be an above-average performer.

6.3 Focus

Porter describes the last strategy: focusing on a exacting buyer group, section of the product
line, or geographic market; as by differentiation, focal point may take lots of forms. The basis
is that the wants of the segment can be best addressed by alert attention. And the focuser
seeks a competitive advantage with its aim, even though it may lack a competitive advantage
generally.

If a firm achieves sustainable cost leadership or differentiation in its section and the segment
is structurally beautiful, then the focuser will be an above-average player in its industry. Most
industries have a diversity of segments, and each that involves a dissimilar buyer require or a
dissimilar optimal production or release system is a candidate for a center strategy.

6.4 Competitive Strategies through the Supply Chain

A company's competitive strategy defines the set of customer needs that it seeks to satisfy
through its products and services. To see the relationship between competitive and supply
chain strategies, we start with the value chain for a typical organization. To execute a
company's competitive strategy, all the value chain functions play a role and each should
expand its own strategy. A supply chain strategy determines the nature of procurement of raw
materials, transportation of materials to and from the company, produce of the product or
operation to offer the service, and sharing of the product to the customer, along by any
follow-up service.

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A key strategic issue is the aptitude to leverage a partner's capabilities outside touchable
assets and open knowledge. Some of these assets comprise employee know-how, standing
and culture that is resident in the fabric of the firm. It is not easily codified, often not instantly
recognized; yet, it gives the firm a relation advantage.

One important relationship that firms appoint in is with their supply chain partners. Supply
chain management is a continuous improvement process, make certain customer approval
from raw material provider to the vital finished product customer. Using SCM, companies
can make a source for differentiation or cost reduction. Though, coordinating the supply
chain among raw material suppliers, distributors and customers is not an easy job. Two issues
that preserve rising are ensuring quality all through the supply chain at a competent cost and
managing relationships crossways organizational and international borders.

Another important management is managing the quality. The total quality management
(TQM) is an integrative management philosophy intended at incessantly improving the
quality of products and processes to attain customer satisfaction. TQM is based on the basis
that both internal and external customers are the focal point of all activities of an
organization. TQM authorities advocate that organizations work straight with raw material
suppliers to ensure that their materials are of the highest quality probable.

In the present worldwide business environment, firms must expand a competitive strategy
that determines the position of the firm with respect to other firms in the industry. A
structural study, which is basic in developing a competitive strategy, relates the firm to its
environment. The firm have to determine what its serious strengths and weaknesses are, and
in what areas a alter in strategy will yield the most benefit.

6.5 An External Analysis

Puma overall marketing strategy incorporates a few key aspects that help to define its
position in the large retailer market. These key aspects are:

1. Large range of goods in all departments, with a single important relation, that is quality.

2. A competitive pricing strategy that allows Puma to maintain its large customer base, while
gaining an advantage with its high quality range of goods.

3. A strong branding strategy, that projects the Pumas image as a stylish large retailer
catering for the needs of the middle-upper class society.

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4. A store layout and presentation that is in keeping with the overall branding strategy.

It is these basic key aspects that have helped Puma clearly define its overall marketing
strategy and have helped to firmly establish them as the market leader for large retailers in
Australia.

6.6 Generic Marketing Strategies For Puma

Puma uses a "branding strategic focus", as a generic marketing strategy for their organization.
However it isn't as straightforward, as it sounds, they adopt a unique branding strategy, due to
the fact that they sell such a wide variety of different products and brands. Pumas uses their
branding strategy to portray an overall quality assurance and a pleasing shopping experience.
In other words they don't sell a Puma brand as a product, so much as an opportunity to use
their services to obtain high quality products, which consumers need at affordable prices in a
very comfortable shopping atmosphere.

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 Chapter 7

Organizations Current Strategies

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Branding Strategies Focus

7.1 Promotion

When consumers hear the words Pumas, they associate words such as quality, comfort and
accessibility. This proves that Pumas is successfully promoting their overall marketing
strategy. They aim their advertising at a predominantly middle-upper class consumer group
and this reflects in their marketing campaigns. This image is also boosted by their store
layouts and presentation, as well as their genuine concern to stock quality products.

7.2 Product

As previously stated, Pumas doesn't have its own line of products as such, but they do try to
ensure that the product lines that they stock are of a high standard of quality. By high quality,
it doesn't necessarily mean that the product will last the required time period and provide a
satisfactory service for the consumer. It also means that the products that they stock are not
your ordinary products that competitors sell, but that each product has a higher standard or
offers unique features.

7.3 Place

The distribution of Pumas products also coincides with the high standard of quality that they
aim for. They stock expensive brand names such as: Gucci and Country Road, which are not
the sort of products that you would anticipate to find in great retailers like Target or Kmart.

7.4 Price

Although Pumas is definitely not the majority reasonably priced place to shop, their prices
are in keeping with their branding strategy. They sell high quality products and charge
accordingly. They can afford to do this because their target market is for the middle-upper
classes, which can afford to pay for high quality goods and fashionable brands.

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CHAPTER 8
CONCLUSION

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Conclusion

This report has discussed the generic and distinctive marketing strategy of Puma. It has also
covered the background of the company and a situational analysis.

According to the report has evaluated the strategies of Puma and found that its strengths lie
inside its branding strategy (place, image, and identity) and pricing strategy. Further strengths
comprise association marketing, product range and status, customer service, and e-commerce
strategies. Weaknesses lie inside the company's pricing strategy and standing image.

The report has completed with suggestion for development of the Puma marketing strategy.
These comprise rising advertising of its price assure, taking benefit of its competitor's
closing, and closing its food store process. As well recognized Puma makes its stores appear
available to a wider market segment, and they ought to augment the high classes customer by
provide or generate its own private product by important brand image. Raising its customer
association management and its online strategies is also suggested.

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