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Features of our product/service that distinguishes our business from our competitors.
? Mission Statement
? Goals/Objectives
? Marketing and Product Objectives
? Competitive Advantage
? SWOT Analysis
? Company Analysis
? Competitor Analysis
? Customer Analysis
? Industry Analysis
? Market-Product Grid
? Target Markets
? Points of Difference
? Positioning
? Product Strategy
? Price Strategy
? Promotion Strategy
? Place Strategy
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The following report is about the marketing plan of Adidas for the various kind of products such as Adidas Running shoes and Adidas Originals, and their implementation of the plans of the campaign by using the combination of marketing communication to attract their target customers.
The company named as Adidas was brought into life by Adolf (Adi) Dassler, who was also helped by his older sibling Rudolf Dassler in the decade of 1920 as Gebruder Dassler Schuhfabrik, at Herzogenaurach in Germany. The first major event which made the company to be recognized was the 1928 Olympic Games which were held in the city of Amsterdam where they were the main suppliers of the shoes for the German track and field teams. In the year 1948, a new brand was brought in front of the world named as Puma by Rudolf when he decided to part ways with his brother. The main founder of Adidas was thus Adolf Dassler as he decided to patent the three-strip logo in the year 1949 and named it Adidas after his own name. The growth of Adidas has been substantial since that day (Baker, 2014). The main family running the company, Dassler family, decided to retire in the year 1989 and Robert Louis-Dreyfus became the chairman of the main board in the year 1993. The new CEO of the company was appointed in 2001 in the name of Herbert Heiner.
The Saloman group was taken over by Adidas in the year 1997. This takes over changed the name of the company to Adidas-Salomon AG. However, in the year 2005, Adidas decided to sell its subsidiary, Saloman to Amer Sports Corporation. In the year 2006, Adidas took over one of the best sports brands in the world, Reebok, and again the name was changed to Adidas AG.
Nike is the only brand that leads Adidas AG in sporting goods and sportswear in the world. Adidas brand is operational in America, Europe and Asia. The main headquarter of the company is at Herzogenaurach, Germany, and with 39,596 employees approximately.
Adidas AG enjoys a global success by manufacturing apparel and accessories for multifarious sports such as Baseball, Basketball, Football, Cricket, Golf, Running, Gymnastics, Lacrosse, Skateboarding< Tennis and even Kabaddi. And because of such variety of products, Adidas AG is estimated to have employed 60,617 employees by the end of the year 2016.
Mission statement
The Adidas group has always incessantly striven to lead the global market for sportswear and goods industry by maintaining the passion and zeal for sports and an active lifestyle which is etched in the foundation of the company. We are persistent in committing to strengthen our competitive niche as much as we can by constantly improving the quality and marketing of our brands and products.
Financial goals
We will also organize a number of promotions and better advertisements for our brands and products that have a competitive price, however, a better design and innovations than other brands.
Adidas 'differentiation strategy aims to make the house of finest and extremely pioneering brand which not merely trades sportswear but nonetheless also have a positive impact on consumers' lifestyles. To attain this approach, the brand has established an amount of extremely groundbreaking products and also teamed up with top designers of the fashion industry who helped in creating both fashionable and functional sportswear (2016 model of Adidas). This decision has steered a large number of buyers across the globe to practice the products of the Adidas as a trend rather than sportswear, which has allowed the share of the market of Adidas’ to rise in streak with the share of the market. Commercial policy, as a portion of the product line of the Adidas, Adidas Popular (pop) will use a variation policy which is similar to user-centric to stand out in the markets which are developing in Asia. In spite of the relatively high-priced retail, Adidas Popular (Pop) will be appealing to the 19 to below 30-year-old consumers basically targeted who wish to adopt the lifestyle of Adidas. This variation policy will need the input from production and marketing departments, and even from the unit of R & D, to capture the consumers' desires and in a product which precisely meets the needs of their requirement. To analyze the achievement of the variation policy, the organization will assess the product rates with the authentic sales and development of the company (Solomon, 2014).
Unions
Planned partnerships are very important for businesses, as it is witnessed by the decision of Adidas to build an association with Reebok to enter the outsource making to some other party in China and market of the North America to reduce the cost of production. In tally, this brand has also made an agreement with distributors such as franchisees and the wholesalers to make a step in the markets which are costly for the association. In the absence of these planned alliances with distributors and manufacturers in China, Adidas Pop's visualization would be extremely expensive or impossible to keep it in a place. In result, as planned collaboration become more and more popular in the business world, these brands are not all time useful to the various parties who are involved.
Price leadership
The developer of price leadership is Michael Porter price leadership is means of cost leadership is a means of creating a modest advantage by keeping low prices. If the product prices of Adidas are less than that of other competitors, likely to create a viable advantage. It is vital to note, in result to, the keeping of the lower prices is a task which is not easy. The prices should have a check throughout the process, from commencement to conclusion.
The multinational sportswear conglomerate has created diversified trends for different geographic regions of its sale like in Asia region, Europe, North America and the remaining regions wherein “the maximum amount of shareholding is done by North America when it comes to the value of the footwear products in the world from 2014-2020”, as reported by Reportlinker on Jan 28. Because of the growth in population and changes in lifestyle, the demand for footwear all across the globe is also growing. The segment of footwear is categorized as -
1. Footwear types- athletic & non-athletic footwear
2.Consumer group
3. Geography
For the athletic footwear segment, there are four subcategories- shoes for hiking, insert shoes, sports shoes and shoes that can be used in backpacking. The most number of retail outlets are shared by Adidas and Nike. They also share globally the most loyal fans and a very good department for distribution. Roberts, D reported on June 23 2017, “The market shared by top five brands are Adidas, which holds 23% of the share (this is an increase of 209% in a year), Skechers holds the shares at 20% (a bump of 39%), Converse holds shares at 12% (no change), Sperry is at a share of 4% and Keds occupies 2%”
Customer analysis
The brand Adidas targets several types of customers by our hi-tech sports shoes. The ages between 20-40 and middle-upper group are more capable of purchasing the products according to their higher interest in fashion and sports. High-income customers along with high tech product lovers are the perfect target customers as they are going to find our prices affordable and reasonable. For such customers, functionality has an upper hand over appearance so they can invest in shoe technology that enables them to connect their phones with the shoes and thus set any desirable function for their shoes (Shank & Lyberger, 2014). Also, allowing them to charge their phones by the friction energy produced by working out in their shoes. Lastly, another type of an important customer group is the athletes who indulge in training and running more than any other group. And since most of their activity is practiced outside in the even very inconsistent weather, they will benefit by investing in our hi-tech sneakers which can be changed to a waterproof setting via their smartphones, thus preventing the potential damage.
Although the market of sports goods and products has quite a few competitors such as Under Armour, Lotto and Warrior, Adidas and NIKE among them are the leaders in US markets, US & Europe, respectively. The analysis of the competition can be very crucial as it allows a better understanding of the competitors and the capability to create goals for progression.
Michael Porter's Model of Five Forces (1980) analyzes the major forces which can foster the competition. According to Porter, to get ahead of the competition, the three variables would be helpful. Differentiation, global cost leadership and focus are those three variables (Boone & Kurtz, 2013). The companies that provide the products at lower prices will be profited more if the market has same product range or line. In the market for active wear, there is a great differentiation in products, ranging from style, use of tone to ergonomics. The same opposite can happen if there is a difference in the sports goods and products that there is good and even better capacity that highlights the highest price. Both Adidas and Nike are the leaders in the quality of their products and have set a standard for the same. This previous week, a new kind of boots was launched by Adidas that were without laces. They are known as Adidas ACE 16+ PURE CONTROL designed for better firm releases.
The image compares Adidas vs Nike with the help of the sponsorship they provide to the major soccer playing nations in the last tournament of soccer.
Due to Adidas and NIKE, the sports industry of soccer boots is majorly a duopoly with the world leader being Nike and other brands like Jordans, Nike and Converse.
While analyzing the market shares and trends of New Balance, it is lagging behind in terms of followers and online presence.
Social platform followers on Twitter, Facebook and Instagram:
The above image provides a quick look at all the subscriptions that New Balance gets when compared to Adidas and Nike. This information was recorded in December 2015. It is clearly visible that NB cannot compete with both top brands as of now. As social platform provides a better reach to the people, it is of urgent concern to NB as they do not have followers or likes or any other kind activities that could lure customers.
The conclusion is that Nike's presence on the web is largest and more than Adidas. Porter defines that making a product in a different way can provide an edge in the competition which is accumulated by the same kind of product. But this sports industry has a wide variety of products to choose from, making competition tougher (Holtbrügge & Schuster, 2017). New Balance must work very hard with the help of marketing plans and marketing teams to come up with something that could possibly bring a revolution or even a small crack in this very big sporting products industry. New Balance must come out with an innovation that checks all the boxes of being a great product. This new product will attract the consumers of Adidas and Nike as well to which will help NB to gain some ground over the competition. The same achievements were achieved by NB in the field of running shoes. Stuck at the low subscriptions, New Balance is expanding and is becoming increasingly popular over famous websites such as 'Prodirect' that now stores them.
While the technically strong and superior products are the main market penetration point for Adidas, very good and focused marketing with proper planning and implementation has also been important for Adidas to achieve success.
The most effective promotional methods of the giant sportswear business were the association of famous celebrities such as sports idol or celebrities. The customers are highly satisfied with the quality of the product due to the smart associations with celebrities. This helps in increasing the sales and revenue of the brand (Perrone & Wodonga, 2015). The products purchased from a reputed company provide the assurance of quality and the services provided which will be motivation for further purchases in future.
Adidas has a loyal and big customer base which can be made bigger by increasing the customer loyalty and the engagement of the customer with the product. This will provide Adidas with a competitive edge over others. The best thing that Adidas can do is by taking regular feedback from the people about the improvements that it can do to make better products. This will help Adidas in creating a long-lasting relationship with the customers providing more profit and revenue.
Listening to the customers, conducting different surveys and campaigns, the satisfaction of customers’ surveys online, in stores and in the marketplace, Adidas and the loyal customers can be benefited from the additional value that will help in generating greater profits and this will also help Adidas in providing the exact product desired by customers.
In addition, Adidas’ association with popular athletes and famous people to work on the various clothes, products or shoes helps in creating greater quality sports goods for the masses. This association will attract customers which will, in turn, generate greater profit, sales and revenue for the company and will successfully complete the research and development of the product.
In the end, this translates that Adidas provides customized and performance-centric products for each and every customer. Few apparel companies have the ability to achieve this feat and as a matter of fact, it looks like what famous designers do with the beautiful models.
There are primarily 4 subsidiaries of Adidas group. First: Adidas, present in the clothing and footwear market. Second: Reebok, outperforming Adidas it is considered as Adidas group’s most successful subsidiary. Third: Rockport focuses on outdoor apparel, footwear, and accessories, and the fourth is Taylor made which specializes in golf equipment, clothing, etc. Reebok performs the best among these four subsidiaries (Hertrich & Mayrhofer, 2015).
From the portfolio of several products, footwear acts as Adidas’s primary product. The designs come in different styles without compromising with the athletic and robust finish. Accessories and clothing act as Adidas's secondary range of products. Reebok being stronger in range of footwear, Adidas is considered stronger in the clothing market.
The type of designing, styling, and promotions done by Adidas enables them to use prices that are low and competitive. In order to account for the competitors such as Puma and Nike, the prices for "run of the mill" products are set competitive (Ritter, 2014). Skimmed pricing is done for the uniquely designed products that are introduced for the first time in the market.
The brand value of Adidas apparels market enables them to use price skimming making them expensive to buy. Adidas targets its customers from the high-end and the upper middle class of the society. Adidas avoids using sharp prices as that may impact the Adidas's brand value. According to customer's perception, it is also believed that the higher prices of the products are justification for the better quality. Consequently, prices are rarely lowered by Adidas.
Adidas's points of sale include it's exclusive retail outlets wherein company directly supplies the products. Retail chain showrooms containing products of multiple brands exhibit Adidas's footwear and clothing products wherein a distributor is responsible for all the supplies. Online sales are the last point of sale of the Adidas's products (Chernev, 2015).
Various methods are used by the company to market its products while primarily focusing on the product placement and television. The creative team of Adidas tries to fill adrenaline in the clients using full of energy and very creative advertisements (Armstrong et al., 2015). The ads are potential enough to attract the customers towards the brand by sending an attractive marketing message to them.
The slogan of Adidas, "Impossible is nothing" acts as a very compelling statement for the brand.
The relation of the brand with the great players such as Sachin Tendulkar, Ronaldinho, and Lionel Messi and others makes the brand very popular among the masses across international borders.
Sponsorship is given by Adidas to various sporting giants such as Real Madrid, Great Britain, France (in football), and South Africa and England (in cricket) and other such teams.
The Adidas' products may be less costly than those of Nike or other competitors in order to gain the competitive advantage in the market. Since the cost is managed by all the involving entities of the supply chain from the very beginning to end, maintaining lower prices of the products is not an easy task.
Proper organization of different levels of the supply chain is crucial in maintaining the demand and supply of products in the market. This is achieved by Adidas in the following ways:
1) Manufacturing unit> Adidas points of sale> End customer
2) Manufacturing unit> Distributor/Supplier> Showrooms of multiple brands
3) Manufacturing unit> Online fashion websites / Adidas website> End customer
Distribution channels remain motivated because of high margins of operation which are the result of Adidas' fabulous brand value.
Adidas' implementation plan operates with the sole objecting of providing the best quality of footwear for the customers that are tailored by combining the technology with design (Hollensen, 2015). The company makes efforts to provide an appeal to its products which is not defined by the need rather the products appeal to fulfil the customers' desires and wishes. Similarly, the garments are given an appeal to offer comfort while doing any physical activity.
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