Prepared by: Group 3

Adelia Yolanda, Atifa Mahmoodi, Hareet Chadha, Liuyin Chen, Shumeng Dong, and Yao Zhang

Due: April 14th 2016

Secondary Research: Examine the importance of young consumers in the sports industry and how to build its brand loyalty

Professor: Emily Gaszynski

Business Research Methods (RSMT-5001)

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Letter of authorization

3

Table of Contents

Executive summary ......................................................................................................................... 4

1.0 Introduction ........................................................................................................................ 5

2.0 Background ......................................................................................................................... 5

3.0 Objectives............................................................................................................................ 5

4.0 Methodology ....................................................................................................................... 6

4.1 Research design .............................................................................................................. 6

4.2 Sample Design ................................................................................................................. 8

4.3 Data collection and field work ........................................................................................ 9

4.4 Analysis ........................................................................................................................... 9

5.0 Results ................................................................................................................................. 9

5.1 Discussion: .......................................................................................................................... 10

6.0 Limitations......................................................................................................................... 11

7.0 Conclusions and recommendations .................................................................................. 12

8.0 Appendix ........................................................................................................................... 13

8.1 Data collection forms .................................................................................................... 13

8.3 General tables ..................................................................................................................... 18

8.4 Bibliography ........................................................................................................................ 30

8.5 Other support material ....................................................................................................... 33

4

Executive summary

Brand loyalty is one of the most important factors for business to develop and have sustained

growth. Companies that have large amount of loyal consumers tend to have a larger market share

compared to those who don’t. With the need to understand customers, the purpose of this study

is to explore the young consumers’ opinions, attitudes and beliefs towards Adidas and how brand

loyalty is created within this community.

After stating the objectives and sub-objectives, the study begins with a brief overview and the

history of the company being analyzed. Adidas is one of the most well-known sports brands in

the sportswear industry, and the demand for health and wellness related products is increasing

rapidly.

In order to understand the development of brand loyalty, primary data is collected through an

online questionnaire in Humber College. The online survey contains both quantitative and

qualitative design, it includes aspects such as demographics, brand awareness, brand usage and

brand attributes.

5

1.0 Introduction In recent years, more and more individuals are trying to boost their health through diet

and exercise. There is a tremendous opportunity exists for marketing to fitness-conscious

consumers (Vong, 2012). Consumers now look for products and services to help them

maintain and improve their health, changing the type of products they purchase for their

family, the sports they play, and how they spend their leisure time. The demand for health

and wellness-related products is increasing rapidly, and 31% of Canadian consumers are

willing to pay a premium for health enhancing products (Business Development Bank of

Canada, 2013).

2.0 Background Sportswear industry has grown significantly and become a fashion trend among young

people. It appears that many people wear sportswear on a daily basis for comfort

purpose. Sportswear in Canada was one of the fastest growing apparel-related categories

in 2015. It was driven by increasingly active lifestyles in the wake of health and wellness

trends across many Canadian industries, as well as a continued interest in fitness and

exercise, and a traditional passion for sports (Euromonitor International, 2016).

Adidas was founded in 1949 and named after its founder "Adi" from Adolf and "Das" from

Dassler. Nowadays, Adidas is one of the largest sportswear brands in the world and it is

well known for its three stripes logo. The company offers a variety of products which

include footwear, clothing and accessories. Adidas Canada Ltd retained its second rank in

sportswear in Canada with a 7% value share in 2015 (Euromonitor International, 2016).

3.0 Objectives We chose Adidas as our target company is because Adidas is one of the leaders in

sportswear industry and we would like to know the consumers’ view of this brand today

and how has purchasing behavior changed for the past years. The primary objective of

our research on Adidas is to explore young consumers’ opinions, attitudes and beliefs

towards Adidas and how brand loyalty is created within this community.

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3.1 Sub-Objectives a) Evaluate people’s current attitudes towards Adidas endorsement (athlete

or celebrities).

b) Define Adidas’ biggest target market and which target group is increasing

or declining?

c) Identify whether celebrities can fit in with the Adidas’ brand image and can

influence people in terms of fashion and trend.

4.0 Methodology 4.1 Research design

Our research is using descriptive study profiling the consumers’ attitudes towards

Adidas brand, while measuring their brand loyalty. The data for our findings were

collected from primary and secondary data. Primary data is a data that observed

or collected directly from first-hand experience (Business Dictionary, n.d.). We use

our survey results from the questionnaires as our primary data.

Meanwhile, secondary data is a data gathered and recorded by someone else prior

to and for a purpose other than the current project (Zikmund, Babin, Carr, &

Griffin, 2009, p. 161). In our case, we gathered our secondary data from external

sources, such as company website, journals, books and the internet. The survey is

include both quantitative and qualitative design, categorical and continuous

variable, covering the demographic, brand awareness, brand usage, brand

attributes and purchase intent. Demographic is the statistical data about the

characteristics of a population (Demographics, n.d.).

In our questionnaires, we use factors such as age, sex, level of education and

income level to examine the population. In the other hand, brand awareness helps

us to better understand on how familiar consumers are with Adidas brand. Brand

usage measures on how frequently do consumers purchase the product, and

finding out if they were purchasing from Adidas competitors. Brand attributes

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shows how the customer perceived Adidas brand, what do consumers think

Adidas brand should do for them and whether Adidas are meeting their

expectations. Getting consumers’ opinion about the brand attributes will help

Adidas understand where they are doing well, and what Adidas need to improve.

Purchase intent would examine the customer's buying habit and what products

were customers mostly purchased which will help Adidas to find the right niche.

There are five type of questions included in the questionnaires. The first one is

simple-dichotomy (dichotomous) question which requires the respondent to

choose one of two alternatives (Zikmund, Babin, Carr, & Griffin, 2009, p. 340). The

second one is determinant-choice question which requires the respondent to

choose one response from among multiple alternatives (Zikmund, Babin, Carr, &

Griffin, 2009, p. 340). The third one is frequency-determination question which

asks for an answer about general frequency of occurrence (Business Research

Method, pg. 340). The fourth is checklist question that allows the respondent to

provide multiple answers to a single question by checking off items (Zikmund,

Babin, Carr, & Griffin, 2009, p. 341). The last type is a contingency question, in

which the question need to be answered only when the respondent provides a

particular response to a question prior to it (Explorable, n.d.).

This questionnaire is designed to ensure relevancy and accuracy, accompanied by

status bar and interesting layout to keep respondents engaged. A copy of the

survey questionnaire is included in the appendix. This particular design suited well

to the study because it provide information regarding activities that will help

Adidas to increase their consumers brand loyalty. The online survey also provide

convenience for our respondents, since they were able to access the survey in

anywhere and anytime. In addition, gathering information via surveys is quick,

inexpensive, efficient, and accurate.

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4.2 Sample Design The population targeted for our study are young people in Toronto. Our sample

units are students in Humber Lakeshore College in the age group between 0-35

years old. They were selected by random sampling which means every individuals

within those constraints has equal and independent chance of being selected

(Business Dictionary, n.d.).

33 respondents were sampled and 30 respondents were completed the survey. In

other words, the response rate for this survey is 91%. The detailed statistics to

support this result is supplemented in the appendix. Sample size is correlated to

random sampling error. A smaller sample makes a larger error in estimates more

likely (Zikmund, Babin, Carr, & Griffin, 2009, p. 440).

Demographic Profile of Respondents

Gender Income(monthly)

Male 34% $1000 or below 32%

Female 66% $1001 - $2500 44%

Age $2501 - $3500 12%

Below 18 4% $3501 and above 12%

18 - 25 68% Marital Status

26 - 35 29% Unmarried 93%

36 - 45 0% Married 7%

Above 45 0% Other 0%

Education

High School 7%

Undergraduate 39%

Postgraduate 46%

Other 7%

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4.3 Data collection and field work This being a descriptive research, a close – ended questionnaire was prepared

using online tools. The sample was intended to capture demographic

heterogeneity (except for the age group) among the students at Humber College,

Lakeshore, which we believe represented our sample requirements of the

“young” people. The survey was sent out online on social networking sites,

blackboard and emails, garnering a quick and complete responses, which made it

easier to analyze the data.

4.4 Analysis The data so collected was tabulated individually and the percentages represented

in pie charts that answered the questions pertaining to the respondents’ buying

behaviour towards sports goods in way of price, buying frequency, influencing

factors, preferences, Adidas’ standing against its competitors, the mode of

promotion etc. The responses to above were also compared against the

demographics, to get a better understanding of consumer’s brand loyalty on the

basis of gender, age, income and education.

5.0 Results Within 34% male and 66% female interviewees, aged 18-25 at 68%, 26-35 at 29%. The

median of amount money spend on sports is in the range from $91 to $130 and standard

deviation is 1.51. The variance which is square of standard deviation for deciding brand

of sports affected by marketing is only 0.59. This figure shows the low brand loyalty, also

happened in brand choosing, since only 14% chose it before other brands. Product

features like comfort (32%), quality (29%) and the price (21%) voted by interviewees could

influence loyalty. Consumers more loyal shopping in Clothing (32%) and Sportswear

(25%), then sportswear (14%) and sporting equipment (7%). More than half of People

who engage Adidas brand interested in sports games, rather than the price (11%).

Internet promoted the latest product to help Adidas build brand relationship most at 57%,

as in-store promotion come at 36%. Please refer to Appendix C for details.

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5.1 Discussion: The report outlines the findings of identifying and gain insights into the marketing

strategy that Adidas group is lacking in the North America. To figure out the reasons and

method of improvement, online questionnaire and interviews have been taken from

group to the public. Hypothesis, Adidas does meet the stylish and fair price requirement

from generation and competitive market among other brands.

There are 30 responses including 66% female and 34% male, mostly are from 18- 25 and

single.

Marketing mix in media is definitely making progress online and in-store promotion. After

finding out the new arrival, approximately 90% are willing to recommend. Based on all

the distribution data, price and promotion online and in-stores could do better to attract

the young generation in order to increase the market in North America.

The research can be regarded as a descriptive glimpse of the young consumer’ attitudes

and beliefs towards Adidas in the Canadian market and how brand loyalty is created

within this community. According to the data analyzed, it can be safely assumed that the

said consumer’s attitude doesn’t put Adidas as the frontrunner in the market.

Since the study targets the young consumer, the results were calculated representing the

age groups of 18 – 25 and 26 – 35 year olds. Illustrated in Appendix A, the majority of

respondents prefer Nike (57%) over all the other alternatives offered, including Adidas.

Also, 68% of the represented sample is not loyal to Adidas, as in, they would buy whatever

brand offers them a better value (Appendix A).

Independent Sample tests conducted compare the effect of demographic characteristic

of income on the frequency of purchase. 37% of respondent of income of $1000 or below

and 36% of people who make $1001~$2500 buy running shoes once a year. This is where

the majority lies (Appendix B).

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Independent tests were also conducted to study the effect of age on the impact marketing

techniques like celebrity endorsement and team sponsorship on the choice of sports

brands. Herein, 45% of 18 – 25 year olds and 37% of 26 – 35 year olds are both somewhat

affected in sense that it doesn’t affect their choice a lot (Appendix B). When looking at

the effect of age on the preference on the products purchased, a significant number of

18 – 25 year olds, 30% of them buy clothing from Adidas (Appendix B). Whereas, 50% of

26 – 35 year olds prefer to get footwear the most. Majority of our sample purchases

Adidas products from retail stores. This includes 40% of 18 – 25 year olds and 62% of 26

– 35 year olds (Appendix B). The younger part of the represented population i.e. 70% of

the 18 – 25 year olds stay up-to-date on the new products via the internet. Whereas, 50%

of 26 – 35 year olds get to know about it in store (Appendix B).

6.0 Limitations The study was conducted to gain insights into young people’s opinions on brand loyalty.

Studies that contain a large sample size tend to produce a narrower interval for the

results, which means a more precise results. Therefore, one of the limitations of this study

was the sample size. The population of the sample size was relatively small and the areas

for distributing the survey were narrow.

Another limitation was that the data was only collected from students on campus. Thus,

the results cannot be generalized. Using students as primary samples might create

restraints on external validity and the representativeness of the data was limited. Low

response rate is also another limitation of the research project. The study used online

survey to collect data, it’s possible that people tend to receive a large amount of messages

on a daily basis and it’s easy for people to delete the survey request. Thus it created

difficulties in interpreting the findings. To achieve better results for futures studies, a

larger scale of sample size should be selected. Furthermore, using a focused group might

help the researchers to gain more specific insights into consumers’ opinions, attitude and

beliefs.

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7.0 Conclusions and recommendations

In conclusion, as the aim of this study was to understand the consumption behavior of

young people towards Adidas and how to expand brand loyalty among this community,

therefor our target was young people in Toronto. The research is descriptive, a close

ended questions were prepared using online tools. The survey was quantitative and

qualitative in nature. Where primary data was collected through online survey. And

secondary data was collected from Humber library academic sources, and internet. The

survey had 30 responses including 66% female and 34% male, mostly are from 18- 25 and

single. Adidas do meet the stylish and fair price requirement from generation and

competitive market among other brands, however our finding demonstrates that there is

low brand loyalty where only 14% of the survey population choose Adidas compare to

other brands such as Nike, Reebok, and Puma. In terms of products features such as,

(comfort 32%), of the population.

Based on the survey findings, it’s recommended that Adidas should work on its product

quality and design to meet the expectations of people in this city. Additionally the prices

should be lower, and cutting style should be more fashionable to meet the young people’s

expectations. And also Consumers purchasing behavior is affected by the advertisement

and promotional offers such as sale, therefore it’s recommended that Adidas should

advertise through internet, domestic TV channels and endorse promotions.

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8.0 Appendix

8.1 Data collection forms Dear Participants,

We are Humber Business School students conducting research to examine the importance of youth consumers in the sport industry to build brand loyalty. Thank you for your time to take part in this survey. Please be assured that all of your survey responses will be kept in the strictest confidentiality and your identity will remain anonymous.

If you have any questions about the survey, please email us: group3@humbermail.ca

Completion instructions:

Please complete the provided questions in the questionnaire. Your answers have to reflect your opinions as accurately as possible and answer factual questions to the best of your knowledge.

1. Gender

a. Male

b. Female

2. Age

a. Below 18

b. 18-25

c. 26-35

d. 36-45

e. above 45

3. Marital status

a. Married

b. Single

c. Other_________

4. Highest Education

a. High school

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b. Undergraduate

c. Postgraduate

d. Others_________

5. Income group (monthly)

a. $1000 or below

b. $1001-$2500

c. $2501-$3500

d. $3501 or above

6. Which brands you would likely to purchase from when considering sporting products?

a. Nike

b. Adidas

c. Reebok

d. New balance

e. Skechers

f. Fila

g. Other_________

7. How much do you usually pay for the sports those items per year?

a. $30-60

b. $61-90$

c. $91-130$

d. $131 - 150

e. Above $150

8. What factors affect your choice of buying the sports merchandise you want the most?

a. Price

b. Comfortability

c. Quality

d. Convenience

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e. Special offers

f. Stylishness

g. Other_________

9. How often do you wear your running shoes?

a. Almost Everyday

b. 2-3 times per week

c. At least once a week

d. A few times a month

e. Almost never

10. How often do you purchase a new pair of running shoes?

a. Once or more than once a month

b. Every 2-3 month

c. Every 6 month

d. Once a year

e. Less than once a year

f. Other_____________

11. How would you rank Adidas among other brands? (Highest (10) to Lowest (0) )

a. _____New balance

b. _____Reebok

c. _____Nike

d. _____Adidas

e. _____Puma

f. _____Fila

12. Are your choices of the sport brands affected by the types of marketing, such as

celebrity endorsement or team sponsorship?

a. Yes

b. Maybe

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c. No

13. What do you purchase most from Adidas?

a. Sportswear (e.g. Team shirts, jersey)

b. Clothing (e.g. T-shirts, shorts)

c. Footwear

d. Accessories (e.g. sunglasses, hats etc.)

e. Sporting Equipment

f. I don't buy Adidas

14. How do you buy Adidas? (Select all that apply)

a. Adidas official website

b. Adidas showroom store

c. Outlet

d. Retailer Stores

e. Online retailer

f. I don't buy Adidas

15. Do you watch any North American sports game? If yes, What sports game do you relate

Adidas most to?

a. Yes, ________

b. No

16. Please rate how would you consider the value of Adidas in relation to its cost.

Note: A+ indicate high value, whereas F indicate low value A+ A A-

B+ B B-

C+ C C-

D+ D D-

F

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17. Which of the following do you associate Adidas brand with? Select all that apply

a. Sports

b. Soccer

c. Football

d. Basketball

e. Fitness

f. Running

g. Fashion

h. Quality

i. Expensive

j. Apparel

k. Men

l. Women

m. Active

n. Innovative

18. How loyal are you to Adidas?

a. I never buy Adidas

b. Not loyal at all (I buy whatever I feel like)

c. Somewhat loyal (sometimes I buy other brands too)

d. Very loyal (I only buy Adidas’ product)

19. Which aspects do you think Adidas need to improve on their products?

a. material/quality of products

b. cutting/style of products

c. promotion/discount/price of products

d. no need to improve

e. other ____

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20. How do you find out the latest product in the market? (Select all that apply)

a. Magazines

b. In-store promotion

c. TV

d. Internet

e. Other______

21. Which of the following is the most important for you as consumer when purchasing

Adidas?

a. Recommendation from friends and family

b. Advertisement

c. Celebrity endorsement

d. Quality of the product and design

e. Sale

f. I don't buy Adidas

22. Would you recommend Adidas (as a product) to your friends? a. Yes b. No

8.3 General tables Appendix A

Sports Brand Preference Loyalty Addidas

Nike 57% I never buy Adidas 4%

Adidas 14% Not loyal at all 68%

Reebok 7% Somewhat loyal 29%

New Balance 14% Very loyal 0%

Skechers 0%

Fila 4%

Other 4%

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Appendix B

14%

32%

25%

4%

7%

18%

Preference of Products purchased

Sportswear Clothing Footwear

Accessories Sporting Equipment I don't buy Adidas

7%

11%

21%

39%

21%

0%

Frequency of Purchasing Running Shoes

Once or more than once a month Every 2-3 Months

Every 6 months Once a year

Less than once a year Other

20

Appendix B

21%

21%

25%43%

14% 14%

Mode of Purchase

Adidas Official Website Adidas Showroom

Factory Outlet Retail Store

Online Retailer I don’t but Adidas

29%

43%

29%

Impact of Marketing on Choice of Sports Brand

Yes Maybe No

21

Appendix B

18%

36%

18%

57%

11%

Medium of Promotion

Magazines In-store promotions TV Internet Other

22

Appendix C 1.age

2.Marital status

3.Education

4.Monthly income

23

5.Which sports you would like to purchase from when considering sports

products?

6.How much do you usually pay for sports items per year?

24

7.Factors affect the choice of buying

8. Frequency of wearing running shoes

25

26

9.Frequency of shopping a new pair of shoes

10.Rank Adidas compare to other brands

27

11.Are you choice of the sports brands affected by the types of marketing, such as

celebrity endorse

12. Most purchase from Adidas

13.

28

14.Do you watch any North American Sports game? What sports game do you relate Adidas most to?

Yes 39%

16.Which associate Adidas brand with?

17. Loyalty

29

18. Which aspects should improve?

19. How do u find out the latest product of Adidas?

20. Most important as a consumer

30

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8.5 Other support material

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35

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