BUAD 497 Class Project: Adidas Consulting project
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Transcript of BUAD 497 Class Project: Adidas Consulting project
Nash Consulting
David Hudson Jane Jung Marco San Filippo Alex Sugano
Adidas
Internal Analysis
Company CultureVision Statement: “Our passion for sport makes the world a better place.”
Mission Statement: “The adidas Group strives to be the global leader in the sporting goods industry with brands built on a passion for sports and a sporting lifestyle. We are committed to continuously strengthening our brands and products to improve our competitive position.”
Objectives: Be the #1 sports company in the world.
Company History● Dassler’s athletes won golds in 1928 and 1936
● 1949 - Adidas founded by Adolf Dassler after a feud with his brother, Puma founder Rudolph Dassler.
● 1954 - German National Team won the world cup wearing the first ever cleats, making Adi Dassler- the
company’s founder - a “household name.” (Adidas History)
● 1967 - the famous track suit (Athletes, then hip hop stars)
● 1978 - Adolf Dassler dies, son takes over as innovator and marketing guru
● 2006 - Adidas acquires Reebok
● 2011 - acquires Five Ten and TaylorMade
Current Strategy
Diverse Brand Portfolio
Focus on High Potential Markets and Channels
Creating a Flexible Supply Chain
Leading Through Innovation
Sustainability
International Expansion
Financials
Adidas
Nike
Under Armour
U.S. Market Share
NikeUnder Armour
Adidas
External Analysis
Macro: PEST Analysis
.
Macro: PEST Analysis- Growing popularity in e-commerce and Internet- Increase in online purchase
- Unemployment rate- Global recession Decrease in demand
Porter’s 5 Forces
LOW - MEDIUM
● Economies of scale● Strong distribution
network● Loyal customers● Low capital
requirement
LOW
● Abundant natural resources
● High competition● Diverse & broad
distribution channel
LOW
● Substitutes - inferior, lower quality
● Limited alternatives
Porter’s 5 Forces cont.
HIGH
● Price < quality● Low customer
switching cost
VERY HIGH
● Competitive industry● High competition
among sports clothing brands
● Rising e-commerce and Internet
Porter’s 5 Forces cont.
Competitor Analysis: Nike
Objectives StrategyPredictions
Competitor Analysis: Under Armour
Objectives StrategyPredictions
Segmentation Analysis: A cross tabulation between Sports & Countries
The 3 Main Challenges Adidas has been facing
1.Losing Market Share in the shoes and apparel industry.
2.Slowly losing popularity in the sports they dominate such as Soccer, Tennis, Golf.
3.Failing to adapt the company image/culture to an ever changing environment.
All issues stem from heavy competition
Challenge 1: Slowly giving up shares in their product market
Strategic Option 1: Hit the US hard with an American image campaign
Pros: Americans can identify with the brand more easily
Cons: Capital expenses for advertising and domestic brick and mortar
Strategic Option 2: Be more active in the US dominated sport segments
Pros: Natural connection between the brand and professional grade equipment
Cons: Competition, Capital, Distraction from other resources
Challenge 2: Bleeding out popularity in sports they dominate
Strategic Option 1: Retain customers by increasing customer service (innovative=twitter)
Pros: Can be implemented with little disruption + ⇧’s customer satisfaction
Cons: This probably won’t have a big enough effect on its own
Strategic Option 2: Withdraw from sports Nike completely dominates
Pros: Can focus resources on segments they can dominate themselves
Cons: Voluntarily giving up industry power to competition
Challenge 3: Failure to adapt to market changes fast enough
Strategic Option 1: Increase investments in market research and design (constantly)
Pros: Better understanding of how to addressing the shifting customer tastes
Cons: Expensive & could jeopardize customers who like the current culture
Strategic Option 2: Increase celebrity and athlete endorsements
Pros: Can aid in controlling customer tastes rather than trying to catch them
Cons: Very expensive and relies on the celebrities’ images
Recommendation as to how Adidas should move forward
Long-term: Gain popularity in the US.
Short-term: Focus on sports they already dominate.
Mid-term: Once momentum is gained, ramp up efforts to completely beat out competition in these sports.
(Adidas needs to be thinking long-term)
Thank you1 question please
ReferencesNewstex Finance and Accounting Blogs. "American Banking and Market News: Adidas AG Downgraded by Credit Suisse to "Neutral"
(ADDYY)." ProQuest. ProQuest LLC, 08 Aug. 2014. Web.
Phelps, Stan. “Culture is King: Three Ways Adidas Is Striving to Build a Caulture of
Extraordinary.” Frobes/CMO Network. Forbes. 20 Oct. 2015. Web. 15 Apr. 2015.
Peopalove. "A German Brand With Strong Brand Identity." Peopalove.com. Peopalove, n.d. Web.
Porter’s Five Forces Model. (n.d.). Retrieved December 1, 2015, from
http://crackmba.com/porters-five-forces-model/
Smith, Diana. "Fitness Clothing - US - October 2014." Mintel Academic. Mintel Group, 2014. Web.
Statista. "Number of Retail Stores of the Adidas Group Worldwide 2008-2014, by Store Type | Statistic." Statista.com. Statista, n.d.
Web.