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Promotion Post #13

Promotion refers to any type of marketing communication used to inform or persuade target audiences . The aim of promotion is to increase awareness, create interest, generate sales or create brand loyalty.

In today’s culture, much promotion is done via social media not only by the company, but also by the consumers. adidas has a strong social media presence. The media mix seems to be working as the brand is gaining in popularity. In fact, adidas has the MOST shared logo of any other brand on social media.  Our world is increasingly visual with the growth of photo-based platforms like Instagram and Snapchat, this ranking of logos' appearances on social media demonstrates the power of brand imagery.  It is estimated that the adidas logo is shared 154 times every minute!!

One can search any media outlet and adidas is there.  However, it seems that Twitter is a favorite for its target audience! 

@adidas 

The adidas page on Pinterest has 9.8 million views per month! 

https://www.pinterest.com/adidas/

adidas advertises everywhere from billboards to TV.  

Publicity is an effort to capture the media’s attention. For example, Nike recently capitalized on Colin Kaepernick.  adidas has celebrities and influencers like Kanye West promoting its products as well. One recent TV commercial from adidas featured athletes and pop stars: James Harden, Lionel Messi, Von Miller, Pharrell Williams, Candace Parker, DeAndre Hopkins, Pusha T, David Beckham,  and Aaron Rodgers to name a few. This campaign is called “Calling all Creators” emphasizing the uniqueness of their products.  

However, the ROI (Return on Investment) on having consumers promote your product is amazing - it’s inexpensive (free) and highly effective when everyone wants to see what others are wearing or using.

Works Cited

Williams, R. (2018, May 04). Adidas has most-shared logo on social media. Retrieved from https://www.mobilemarketer.com/news/adidas-has-most-shared-logo-on-social-media/522825/

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Place (Distribution) Post #12

adidas has an interesting distribution strategy.  In that, it uses a variety of marketing channels allowing a set of interdependent organizations ease the transfer of ownership of their products to the consumer.  Interestingly, the internet and “Top Cities” are major selling points.  Emerging markets grew to 30-40%  of total sales and profits in lifestyle brand distribution. adidas has seen some of these markets as a “gold rush.” (Schild) However, according to Schild, if you want to become a truly global brand, reaching all parts of the world is NOT the most important factor. Instead, you become global by winning over consumers and tourists in the global retail capitals like New York, Tokyo, Hong Kong, Paris or London. In fact, in March 2015, adidas introduced its three-pillar Top City Strategy 2020, focusing on the six global cities Los Angeles, New York, London, Paris, Shanghai and Tokyo to push its sporting goods brand. adidas  doubled sales in these core cities with a new brand distribution strategy.

In other words, by limiting supply - creating exclusivity, adidas increased distribution and sales.   Globally adidas has exclusive distribution, but locally selective. adidas is only sold at select stores - its products are not available at Walmart and other mass retailers or superstores. But, rather can be purchased at many select specialized retailers like Dick’s Sporting Goods or Foot Locker. 

Another channel for distribution is direct from their website and stores.  For limited edition shoes and customizable options, consumers must go to adidas exclusively. Honestly, my brother can spend hours designing his own football cleats and interacting with their website.  Click one of these links to visit the adidas website and learn more about there products and services:

https://www.adidas.com/us

https://www.adidas-group.com/en/

Works Cited

Adidas Brand Distribution Strategy - Global Brand Best Practice in Action. (2018, June 20). Retrieved from https://www.brand-experts.com/brand-best-practice/distribution-strategy/

Shah, A. (2018, September 05). The Adidas Brand: Climbing Up Or Decelerating? Retrieved from https://www.forbes.com/sites/alapshah/2018/09/05/the-adidas-brand-climbing-up-or-decelerating/#6a22f37477f4

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Trends/Pricing Post #11

There are trends in the marketplace and right now they seem to be in favor of the sporting lifestyle trends sold by adidas.  Not only are the products popular with many sports from soccer to football, but fashion is also trending this direction and adidas is an industry leader.  However, one of the major threats in this industry is popularity fluctuations.  To account for this adidas is actually trying a strategy and creating demand by limiting supply.  This helps adidas avoid overexposure and excessive discounting of products. (Shah)

The black line below shows “adidas” searched over last 3 months. The pink and yellow lines are year over year comparisons.  Clearly, adidas is seeing an upward trend!

With so much competition in this sector adidas is strong! Gaining market from Nike adidas aims to have 15-20 percent of the US market. With Reebok undergoing a restructuring as well, this will help adidas reach their US goals.

Consumers don’t always choose the least expensive option.  Simply stated, “Price is that which is given up in an exchange to acquire a good or service.” Especially, when it comes to brand recognition. Perceptions by others is that higher prices can convey the prominence and status of the purchaser to other people.  So, this strategy of reducing supply to increase desirability is nothing new in fashion and explains how adidas decides on pricing.  

Pricing is extremely important as it leads to revenue and ultimately profitability.  There is a fine line when margins aren’t that high.

                                      Price x units sold = Revenue 

This revenue pays for expenses of a company and what’s left is the profit.  In recent years adidas has been very profitable growing revenue between 8-10% Net profit over the second quarter this year rose 20 percent to $485 million. 

The marketplace is very competitive, pricing objectives need to be specific for success. There are three basic categories of pricing: profit oriented, sales oriented, and status quo. adidas focuses on profit maximization meaning they’re setting prices so that total revenue is as large as possible relative to total costs. By limiting supply and avoiding deep discounts adidas is demonstrating profit maximization. 

Works Cited

Adidas targets US market share of 15-20 percent: Paper. (2018, January 15). Retrieved from https://www.reuters.com/article/us-adidas-outlook/adidas-targets-us-market-share-of-15-20-percent-paper-idUSKBN1F20HQ

Shah, A. (2018, September 05). The Adidas Brand: Climbing Up Or Decelerating? Retrieved from https://www.forbes.com/sites/alapshah/2018/09/05/the-adidas-brand-climbing-up-or-decelerating/#6a22f37477f4

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Services Post #10

When thinking about services provided by a sneaker company - not a lot comes to mind.  However, adidas is changing this trend... Yes, they have a customer service department, bulk sales and retail services, but uniquely they also have a creators club that helps consumers design customizable products.  

Compared to products, services tend to exhibit fewer search qualities.  However, with more and more online reviews available a companies services may be just as important if not more than their goods.  The services adidas offers are experiences.  For example, they cannot can be judged until after use. Unless you use the online or telephone customer service, you cannot determine whether or not they provide adequate service.    As for retail spaces, one can easily determine if service was good, was the presentation nice, were sales people helpful. In a retail setting there is inseparability - the quality of service definitely depends on the employees. These are all factors in the services provided by adidas.

The official adidas help page begins simply with:

What can I help you with?

Some of the topics and services they provide are returns, deliveries, ordering and customization.

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Brand Detail Post #9

The Adidas brand has accomplished strong growth in the past few years, due to the success of its unique sneakers and solid endorsement deals with non-athlete celebrities like Kanye West and Pharrell Williams.  According to many, including John Williams, a writer for Entrepreneur.com, branding is one of the most important aspects of any business.  It doesn’t matter the size or type of business brand is critical to success and is a “promise to your customers.”  Specifically, “Your brand is derived from who you are, who you want to be and who people perceive you to be.” 

Many global companies have major brand recognition.  For example, Coca-Cola uses the same branding and name everywhere. Other companies may make modifications because of language and interpretation.  McDonald’s is another global company whose logo is recognized world-wide.  However, they do modify the names of menu items to fit local markets.  Logos are iconic and often set expectations.

Specifically, The adidas brand name is that part of a brand that can be spoken, including letters, words, and numbers.  For adidas the name alone is said to be acronym for “all day I dream about sports” which actually is NOT true, but does fit the the brand.  Others refer to the number 3 for the “3 Stripe Life” referring to the adidas lifestyle.  You will notice below how there are 3 stripes in the brand mark or logos.

Brand strategy is what, where, when and how you plan on communicating and delivering your messages. You’re communicating visually as well as verbally. Consistently, delivering products that are high quality leads to brand equity. This expectation of perceived quality allows some brands like adidas to charge more.  adidas uses a branding family in that they market multiple products from hoodies to shoes under the same brand. Interestingly, to create more interest and demand recently adidas has also used individual branding for some new products.

Another product line for adidas is Reebok. Reebok which used to be a more casual stylish shoe has gone through major changes in recent years.  In fact,  “Reebok is “regrounding the brand” in its fitness roots and looking to ramp up partnerships with CrossFit, Spartan Race, Les Mills and UFC as its aims to become the top fitness brand in Western Europe by 2020.” (Millington)

Works Cited

Millington, A., Joseph, S., Tupper, H., Woollen, P., Bonn, R., Hammett, E., & Joy, S. (2015, July 22). Reebok in 'relaunch phase' as it looks to become top fitness brand. Retrieved from https://www.marketingweek.com/2015/07/22/reebok-in-relaunch-phase-as-it-looks-to-become-top-fitness-brand/

Shah, A. (2018, September 05). The Adidas Brand: Climbing Up Or         Decelerating? Retrieved from   https://www.forbes.com/sites/alapshah/2018/09/05/the-adidas-brand-   climbing-up-or-decelerating/#6a22f37477f4

Williams, J. (2005, May 02). The Basics of Branding. Retrieved from  https://www.entrepreneur.com/article/77408

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Post 7 - Packaging

Differentiated packaging can help attract new customers. Some things to consider, include: Design, box size and labeling.  These features are not only important for aesthetics but also for logistics and distribution.  Not only should the packaging look good, but it also needs to be space efficient and strong.  Specifically, packages hold contents together and provide protection during the distribution channel. Interestingly, now packaging is also a container for promoting the product and used for display.  Last, but not least, a major factor to consider is the green aspect and the environmental impact of certain materials.  “We consider the environmental impact of the materials we use and support the use of recycled or sustainable materials...Based on a life cycle approach, we take several factors into account when we evaluate the sustainability of materials, such as land use, elimination of hazardous substances, animal welfare, energy consumption and water consumption.”

Fun Fact:

Did you know that adidas has the most popular logo on social media? So, it’s important to see it on the packaging, as well.  Here’s a picture history of the packaging for adidas. You can see the famous 3 stripes on every box from each decade.  

https://www.adidas-group.com/en/sustainability/products/materials/

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Post 6 - Competition

“Impossible is Nothing” ~ adidas

adidas has many competitors; some stronger than others.  The number 1 competitor is Nike.  Other competitors include: Under Armour, Puma, Callaway, Fila, Converse, New Balance, and K Swiss.  Nike is also a multinational company and for this reason adidas and Nike must have global vision where they identify and respond to international marketing opportunities, effectively using global marketing strategies while staying aware of things in the external environment that could affect marketing, production, or sales.  

adidas is a price and innovation leader.  Placing a premium on technology and demand for the latest and greatest products.  For example, adidas recently set-up a pop-up Speedfactory Lab Experience to Brooklyn, New York. Where people were able to experience motion capture technology, see data analysis software at work, and have shoes 3D printed - creating a pair of shoes tailored to your exact needs.  

adidas is growing their market share increasing sales and taking customers from other brands.  In fact, adidas recently reported net income rose 17% in the first quarter with sales up 21% in North America.  Interestingly, a recent study found that adidas has the most shared logo on social media beating out Nike, Google and Puma. This further demonstrates how they understand their target market and are looking to capture market share early and build brand loyalty for long-term growth and success.

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Adidas sees a future where motion capture tech. (n.d.). Adidas' vision for the future: Personalization, fast. Retrieved from https://money.cnn.com/2018/07/06/technology/adidas-speedfactory/index.html

Bhasin, H., BhasinI, H., & Facebook. (2018, September 07). Top 10 Adidas competitors in the world - Competitor analysis of Adidas. Retrieved from https://www.marketing91.com/top-10-adidas-competitors/

George-Parkin, H. (2018, August 03). Adidas Is Still Taking Market Share From Nike and Under Armour. Retrieved from https://footwearnews.com/2018/business/earnings/adidas-market-share-nike-under-armour-2018-1202557651/

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Post 5 - Target Market

The target market for adidas is young (15-30 years old), middle to upper class sport and fitness minded individuals. Definitely because Gen X is a smaller demographic, adidas is focusing on Gen Y and Gen Z.  adidas maintains a marketing mix intended to meet the needs of this group by creating products that are innovative in technology, design and style.  The marketing mix is a unique blend of product, distribution, promotion, and pricing strategies designed to entice and enhance customers needs and desires.  For example, the higher price point gets customers thinking better quality and adds to the allure of the product.  Also, the the promotion done through celebrity, athlete and team endorsements increases the popularity.  “its list of ambassadors is not limited to just sports personalities. Selena Gomez joined the list in 2013 as a global style icon through a partnership with the Adidas neo label.”

Additionally, because Gen Z is the first generation  born into an era of smart phones and social media, adidas has taken this demographic and lead the industry. adidas markets to these demographics very effectively through social media. Utilizing YouTube, Facebook and Twitter very effectively to reach their young, affluent and innovative target market.

Psychographic segmentation divides the market based on personality, motives, and lifestyles. For example, the popularity of athleisure clothes first made popular by athletes in urban areas has carried over to suburban yoga women and adidas has been the benefactor of this.  “One brand that is feeling the love is adidas, the official Olympics sponsor that has caught on with the younger set as not just a sportswear brand but also a fashion statement, with the revived Stan Smith shoe going strong and its three stripes ubiquitous on rappers such as Kanye West, the creative power behind the adidas-backed Yeezy line, and brand fans including models such as Cara Delevingne and other celebs.”

It is safe to say that adidas that adidas has found their niche and the right target market for growth!

Cengage Learning. (n.d.). Retrieved from https://www.cengage.com/

Miller, M. J. (2016, September 15). Brand Growth: Olympics Sponsor adidas Is Firing On All Cylinders. Retrieved from https://www.brandchannel.com/2016/08/04/adidas-olympic-sponsorship-urban-outfitters-080416/

Pratap, A. (2018, May 03). Marketing and Branding Strategies of Adidas. Retrieved from https://www.cheshnotes.com/marketing-branding-strategies-adidas/

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Post 4 SWOT

SWOT analysis is identifying internal strengths (S) and weaknesses (W) and also examining external opportunities (O) and threats (T)

+ Strengths

Brand Image (Legacy and History)

Product and Design Innovation

Sponsorships and Partnerships

- Weaknesses

Increased Marketing Costs

Outsourced Manufacturing (93% of production is done in Asia)

+ Opportunities

Many lifestyles have an increased demand for “athlesiure” products

Expanding in developing countries and emerging markets

Strong innovation and deisgn

-Threats

Competition from Nike and other brands

Government Regulations (i.e. tariffs)

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Pratap, A. (2017, September 30). Adidas SWOT Analysis. Retrieved from http://www.cheshnotes.com/2017/07/adidas-swot-analysis/

Strategic Evaluation for ADIDAS. (2016, April 28). Retrieved from https://audiswot.wordpress.com/2016/04/28/strategic-evaluation-for-adidas/

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Post 3

Strategy

The key differentiator for adidas is that they target young adults; targeting the population that is 13-40 years old (with most buyers being 15-30) primarily creating quality products for the upper middle and luxury classes. adidas product differentiation offers a competitive advantage; their products are of unique in style and color that provide value to buyers beyond lower prices;  These unique features are perceived by the target market as significant and superior to those of the competition giving adidas competitive advantage in this target demographic - adidas is just cooler than other brands.  In fact, adidas often has a higher price point than other brands because of the trend setting styles and technology.  

Like many other companies in this shoe and apparel category the distribution happens on multiple levels called multiple distribution.  First, for example through direct channels by selling from their website or company owned retail stores selling directly to customers.  The direct channels often have special products only available from adidas (creating limited editions or the perception that products are special and elite).  Also, intensive distribution where products are available at mass retailers for sporting goods like Dick’s or Foot Locker.

Clearly, this strategy has been successful as adidas is one of the oldest brands.  Founded in 1949, they’ve been providing products for elite athletes and trend setters ever since.

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POST 2

adidas strives to be a global leader in the sporting goods industry.  They have built brands that demonstrate a passion for sports and an active lifestyle. They design and make apparel (clothing, shoes) and accessories for most activities from golf to football cleats. Many athletes sport three fingers up to represent the three stripe lifestyle a nod to the iconic three stripe logo of adidas.

  The company is headquartered in Herzogenaurach, Germany (North American headquarters are located in Portland, Oregon). Employing 56,888 people from over 100 countries, they produce more than 900 million product units every year and generate sales of € 21.218 billion (all figures relate to 2017).  https://www.adidas-group.com/en/group/profile/  adidas is a publicly trading company; symbol is ADS and is traded on the Frankfurt Stock Exchange and is part of the DAX (30 selected German “Blue Chip” Stocks).

The mission statement: “It is our mission to be the best sports company in the world. Best means that we design, build and sell the best sports and fitness products in the world, with the best service and experience. Best is what our consumers, athletes, teams, partners and media will say about us. Once people are saying that we are the best, market share, leadership and profitability will follow.” Retrieved September 7, 2018, https://www.adidas-group.com/en/investors/group-strategy/#/unsere-mission-das-weltweit-beste-sportartikelunternehmen-sein/ 

adidas is one of the top companies in this category.  One of the main reasons for their success is the “athleisure” or streetwear trend that includes both apparel and sneakers. Roberts, D.  (2017, June 23) adidas has nearly doubled its US sneaker market share - at Nike’s expense. Retrieved from https://finance.yahoo.com/news/adidas-nearly-doubled-us-sneaker-market-share-nikes-expense-153106743.html In my opinion, adidas has revolutionized the industry with cutting edge style and quality.

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Post 1 - Adidas

Choosing Adidas as my marketing project for this semester was an easy choice for me (and not just because it close to the top of the alphabetical list). This is a brand that has been a part of my life for many years and in my opinion is a leader in their industry - influencing style, but also cutting edge technology.

Adidas is a global leader in the sporting goods industry - tapping into all sports, ages, races and genders.  Interestingly, Adidas actually has four brands in their portfolio, including Reebok (however, for my purpose I will focus on Adidas).

As far as marketing, Adidas has consistently taken the right products, put them in the right places, at fair, but premium prices and at the right times. This demonstrates a strong marketing mix that meets the 4 P’s (product, place, price and promotion).   

I’m excited to learn more about this company that I’ve admired year after year!