Adidas Is One of the Largest Companies in the Sporting

ADIDAS MARKETING communication theory EFFECTIENESS ADIDAS MARKETING COMMUNICATIONS EFFECTIVENESS TABLE OF CONTENT 1. administrator stocky 3 2. Introduction 2. 1 Adidas Overview 3 2. 2 europium sports equipment grocery overview 4, 5, 6 3. Situtational summary 3. 1 PESTEL epitome.. 7, 8 3. 2 porters Five Forces Analysis 9 3. 3 SWOT Analysis. 10, 11 4. Consumer Analysis12, 13 5. trade Objectives.. 14 6. Communications mix in 6. 1 Sports sponsorship. 15, 16 . 2 Celebrity smiler 16, 17 6. 3 Product organizations. 17 7. Recommendations 18 8. completion 18 9. Bibliography19 1. Executive summary This report take away meatiree the effectiveness of Adidass advertizing campaign. To achieve this goal this report leave behind go through the french foodstuff analyse and the target consumers. Moreover, SWOT, PESTEL and porters beers Five Forces compendium demonstrate the disparate opportunities in future for Adidas and the multiple factors influencing the sports equipment indus try.Adidas is one the leadership smart set in the sports equipment industry (with Nike, Reebok), recognizable with its three bands, and since few geezerhood he is launching very effective campaigns. This effectiveness its payable to the celebrity secondment. This report will be introduced by the introduction of the overview of Adidass securities industry and secondly the sport equipment food grocery in general. 2. Introduction 2. 1 Adidas Overview Adidas is one of the epicst companies in the sporting goods industry. The group has divided its operating activities by study leaf blade into three divisions Adidas, Reebok and TaylorMade-Adidas Golf.The group operates through much(prenominal) than clxx subsidiaries in Europe, the US and Asia, each concentrate oning on a incident market or part of the manufacturing process. After the financial crisis of 2008 and economic difficulties of 2009, Adidas came patronise strongly in 2010 and poop show an excellent course of stu dy. The Group generated a record 12 billion in sales, a egression of 9%, clearly outpacing his major competitors. 2. 2 Europe sports equipment market overview Adidas offers sports equipment for in solely sports. It provides footgear and app atomic number 18l for each sport (cricket, football game game game, running etc)England cricket team, sponsor Adidas R. capital of Spain football team, sponsor Adidas As we female genitals see in the duck 1, in Europe the sports equipment market grew by 2. 1% in 2011 to guide a value of 13. 9 billion (Marketline 2012). And according to recent figures this exploitation will continue to increase, for much than 10% between 2011 and 2016 (Marketline, 2012). Table 1 EUROPE SPORT EQUIPMENT MARKET FIGURES Year Billion % Growth 2007 12. 7 2008 13. 1 3. 1 2009 13. 3 1. 9 2010 13. 6 2. 0 2012 13. 9 2. 1 theme MarketlineThe graph above clearly demonstrates that the cut market is the nigh important as far as the sport equipment market is con cerned, with a total value of 3. 7 billion in 2011. The German and UK market, with respectively 18% (3. 5 billion) and 18. 3% ( 3. 5 billion) of the market shargon, assume it. And then comes the Italian and Spanish market (Marketline, 2012). These five markets cover to a greater extent than 72% of the European sports equipment market. Source Marketline The nearly valuable segment in this industry its clearly the ball sport equipment segment.Adidas is well present, as they framing footballs for the World transfuse, UEFA Euro and the Champions group discussion. These three tilts are the most watched all round the world (715 gazillions people watched the 2006 World Cup Final). FIFA World Cup 2010 UEFA Euro 2012 Champions League 12/13 According to the graph the less valuables segments are enjoy sport equipment (9. 5%) and golf equipment (13. 6%). By adding both figures they are still inferior comparing to the ball sport equipment (25. 5%). 3. Situtational AnalysisAs mentioned above this report will analyse the leading sports equipment market, in this case the french market. 3. 1 PESTEL Analysis with this PESTEL analysis we will analyse which factors any phoner has to consider, while laying the French sports industry. governmental France is a highly centralized country an elite group is ascendent in the state and the corporation sectors. This situation persists despite attempts to decentralize ability in last few years. Further more, according to the recent report subversive activity is perceived to be widespread in French politics. Datamonitor, 2011) efficient From 1999 to 2007 Frances exports share in eurozone felled by 16%, and French exports were of a value of $595 billion in 2010 (declined by 4. 6%). This will affect the prospects of the French economy in the near future. (Datamonitor, 2011) For a follow equivalent Adidas, which exports a messiness to Asia with a total market of 2, 972 million in China and other Asian markets, it can ef fects their sales. (Marketline, 2012) SOCIAL The French population is enough aged. Indeed, more than 17% of the population have more than 65 years (Insee, 2012).The Government is expecting to allow 4% of the GDP to healthcare, pensions and habituation care related to the aged people. (Datamonitor, 2011) TECHNOLOGICAL After the industrial age France is moving towards technological age. Indeed, we can see it by the number of patents deposited at the US Patent and Trademark Office (USPTO), the figure reached 124,723 in 2010. (Datamonitor, 2011) In the other hand, the Government will withdraw the concept of Young modernistic Company, it will have is impact on the industrial growth and whitethorn reduce investments in the country. (Datamonitor, 2011) ENVIRONMENTALFrance was very active to prepare agreements on environmental protection and sustainable victimisation and in the military postureening of international governance. In addition, with Norway, France initiated the Global Fo rest Partnership in 2010. (Datamonitor, 2011) But as the technological factors, the country is non encouraging and fulfilling his agreements. Indeed, last year France was appoint to the EU Court of Justice by the European Commission for its lack of attention in the industrial emissions regulations. The European Commission was telling that France has more than 60 factories that have not got environmental authorization of the EU. Datamonitor, 2011) LEGAL orthogonal investments increased by more than 20% couple of years ago, 782 projects lead to nearly 32,000 job. Most of these projects were related to the renewable energy sector. In 2010, non-national companies establish in France created 2 million jobs. Many of the governments value and labour reforms have been met with cynicism and public protests. The government may increase each week working hours from 35 to 39 and abolish the wealth tax limpot de solidarite sur la fortune. However, these moves will subject public outrage and demonstration. 3. 2 Porters Five Forces AnalysisWe aim to measure an industrys bring inive feature and long-term profitability through Porters Five Forces analysis. Adidas and his competitor, as Nike, have reach to branch out in to retail afterwards the industry of sports equipment has seen in recent years a great development of forward integration (as activewear manufacturers). Despite the comportment of major groups, in the French market of sports equipment, the market is still fragmented. Buyer power is becoming very strong, as at that place is a wide range of products available, and the beingness of numbers of retailers and also the fact that some large firms have grammatical constructiond forwards into retail.The expenses in sports equipment and apparel vary following the emergence of trends for picky sports. Another factor that influence purchases is the weather. Its still possible to enter the French market by producing for example small quantities of custom-mad e golf and to have some economies of scales such as bulk buying. But, as seen in recent years the uninspiring revenue growth makes entry a less attractive for new entrants. The reliance on sales of sports equipment is rock-bottom as many firms wander sports footgear and apparel in the French market. Rivalry is weakened as many large companies outsource their manufacturing. Marketline, 2012) Source Marketline 3. 3 SWOT Analysis SWOT ANALYSIS Strengths Weaknesses * Strong portfolio * around-the-clock research and development * Strong performance after 2010 FIFA World Cup * Worldwide presence * Dependence on third party manufacturing * unfunded postretirement obligations will impact cash flows adversely Opportunities Threats * Reorganization to improve efficiency * Sponsoring major sports events * Global footwear market is growing * Counterfeit products * arguing * Fluctuations of foreign currencies Adidas has in his portfolio three brands, as follows Adidas, Reebok and TaylorMad e-adidas Golf. Adidas is well present all around the world, Reebok is improving day by day (for pattern Thierry atomic number 1 is sponsored by Reebok), and TaylorMade-adidas Golf is the less known brand of his portfolio. Because of their policy to shape up research and development allows Adidas to come out with new and better products to looking at competition of Nike. As mentioned above Adidas makes football for major football competition and it benefits of the success of these competitions.After the establishment in the European and American markets, Adidas is targeting Asian market (total market of 2, 972 million in China and other Asian markets). (Marketline, 2012) As Adidas outsource 95% of his production to Asian country (32% of his suppliers are Chinese) it cannot take in the character of his product. Indeed, several products made in China have been anamnesis by many US companies after the publication of the Consumer Product base hit Commission report. The company ca nnot tolerate a lack of quality in front of Nike, in order to keep market shares.The company provides retirements benefits to most of their employees. According to a recent report, the company planned pensions of 67 million but they reached 74 million, so an unfunded status of 7 million. (Marketline, 2012) In order to enhance its efficiency Adidas undertook reorganization. Indeed, the company moved to a function-related structure from a vertically integrated brand structure. Adidas has many agreements for sports events * Australia Olympic committal until 2016 * Japan Football Association until 2015 * Spanish Football Federation until 2018 * Argentine Football Association until 2022 FIFA World Cup 2014 * UEFA EURO 2016 * UEFA Champions League * 11 year global agreements with the NBA (official sponsor NBA, Womens NBA and the NBA Development League) These events will help the company to en enhance its brand image and sentiency among customers and also to strength its profitability. T he global footwear market, not only the European market, has shown a growth in recent years. According to Datamonitor, the global footwear market grew by 2. 6% in 2009 to reach a value of $196. 3 billion. Footwear, clothing, accessories and sportswear are the largest segments, accounting for 67. % of the markets total value. Markets forecast will reach the value of $230. 8 billion by 2014, representing an increase of 17. 6% from 2009. (Marketline, 2012) With the development of Asian countries, and the outsourcing of manufacturing of western companies in these countries, the counterfeit has increased and its a reel threat for companies. Adidas his facing competition of big companies, we happen upon as Adidas main competitors Nike, Puma, Callaway Golf Company and overbold Balance. As last threat we see the fluctuations of foreign currencies.For instance, in India a brand uniform Adidas is for the high-class society otherwise they cannot afford a football shirt, which make up about 60?. (Marketline, 2012) 4. Consumer Analysis CONSUMER SEGMENTATION BASES Behavioural Demographic * drug user status * Usage rate * Usage occasion * Brand devotion * Benefits sought * Income * Age * Sex * Race * Family Psychographic Geographic * Values * Opinions * Attitudes Activities * life elbow room * International * Regional This table shows the consumer segmentation bases that any company can use.They are usually the same regardless of the sector. Companies use segmentation in order to divid into groups consumers that have some characteristics and needs in common (Doole et al. , 2005). Hence, the company can attract easily those groups with specifics products. As his main competitor, Nike, Adidas target specially young and middle age that practice sport. Another category of Adidass consumers has made by teams supporters ( concrete Madrid sold 1. 4 million shirts, Goal. com). Furthermore, there is a turnover of 1. 2 billion in goods related to football (Reuters 2012).Bec ause of is large portfolio the company attract different customer markets with each brand, for instance golf interested consumers with TaylorMade-adidas Golf. The following perceptual map shows the positioning of Adidas as a company offering high quality products for a high gear price. Foot Locker and K-Swiss try to attract people with a pull down income, whereas Nike and Puma apply the same price-quality strategy than Adidas. The competitive advantage of Adidas in comparison to those two companies, however, is its positive brand image. At least, in the decision-making units (D. M.U) we may be influence by friends, the press or by the companys advertising. The person who buys, decides and uses is usually the same. 5. trade Objectives As any company, which is not the leader in his sector, Adidas has as objective to try to extend his market shares and in long terms strategy to be the leader by a continuous research and development of innovation. Through these innovations steps Adid as can provide comprehensive solutions to his customers (Kotlet and Keller, 2009). One of the reasons of Adidass campaigns effectiveness is his brand awareness with his three bands logo.And also is slogan Impossible is nothing, outpace our limits make the impossible possible. In a survey reported by SportsOne (2010), 98. 8% of the respondent pool aged 13 and up that purchased athletic footwear or apparel could associate at each one of the brand elements to the company name. And another key factor is the role of celebrity endorsement. Through this selling tool fans can associate themselves to the celebrity and to the brand. 6. Communications immix In order to target a wide audience and to build its brand equity, Adidas uses several marketing communications tools.According to Duncan and Moriarty the brand delivers impressions, that can build up or weaken customers views of a company, on each contact it has with his customers. Kotler and Keller repay this as they said the shape and colour of the package, the products style and price, the store decor, the salespersons (dress and manner) communicates to buyers. 6. 1 Sports sponsorship Because they benefits of a large coverage, sports activities are more attractive to sponsors (Fill, 2011). Indeed, sport events are the most sponsored because * They attract large audience * Simplistic measure of segmentation Events duration permits to be more visible As shown above Adidass main segment is football with a market share of 34% (Chazouilleres, 2010). Therefore, Adidass sponsorship with major football teams has been motivated because of the attraction of large and specific target audiences with whom a full point of fit is considered to exist (Fill, 2011). Amongst football teams we can mention clubs like Real Madrid (2nd largest fans group in world), Chelsea (6th) national teams as Argentina, Spain and of course the sponsorships of major football competition for years (FIFA World Cup, Olympics). Sponsorship is one of the important move of the communications mix because it allows companies to communicate without the clutter of advertising. Of all types of sponsorship sport has captioned most attention and money (Fill, 2011). 6. 2 Celebrity endorsement In particular, a celebrity endorser should have a high level of visibleness and a rich set of potentially useful associations, judgements and feelings (McCracken, 1989). Therefore, celebrities can ferment a more strategic role for their brands, not only by endorsing a product but also helping to design, position and sell merchandise and services.In these last years Adidas has sponsored many famous football players as Zinedine Zidane, David Beckham. Nowadays the main celebrity endorsed by Adidas is definitely Lionel Messi. They aim to attract football fans, and Adidas launched couple of weeks ago special football shoes for Lionel Messi (AdiZero F50, with a computer chip inside). 6. 3 Product placements Another tool of the communications mix is the product placement. This tool consists of putting his products, usually, in movies. Adidas uses this media because its a billion dollar market (Scevak, 2001).But since a decade product placement is not only made in movies but in all types of TV shows (Steinberg and Vranica, 2004). Since the release of Blades of Glory, we know that figure skating without Adidas is obviously not the truth. The main characters guide you through the whole movie. In 2007 Adidas was already present in Norbit, Stomp the Yard and The Messengers. 7. Recommendations For the future Adidas should be more aware about his brand image. Outsourcing 98% of his production in Asian country can affect his brand image because of the poor quality these manufacturers offer.By outsourcing his production can damage is research and development, which cost a lot. These two things, innovation and lack of quality, dont match. Adidas should handle it as shortly as possible in order to extend his market shares and face the comp etition. The company should continue to sign celebrities as they currently do. The celebrity endorsement is the main key of the marketing campaigns. But Adidas should not only focus on football market (even if is reliable market). It shows that company depends a lot on it. If in the future the market goes down, Adidas can be hard affects by this.An ultimate recommendation can be to reinforce his presence on social networks as its use is growing amongst the youth market. 8. Conclusion In this report we gave an overview of Adidas and the European sports equipment market. And we remarked that Adidas is the leading group in football industry, and the 2nd in sports equipment industry (after Nike). Then the report focused on the French sports equipment market. We analysed the market through two analyses, as follows PESTEL, Porters five forces and we made the SWOT analysis for Adidas. Targeted consumer are analysed nd marketing objectives are given to know how Adidas approach these consum ers. We choose three different tools sports sponsorship, celebrity endorsement and product placement in order to beg off the communication strategy used by Adidas. Finally, recommendations are done on how, in future, Adidas can maintain his leading position in the football industry and how to extend market shares and how face the competition. 9. Bibliography Marketline (2012) Industry visibleness Europe Sports Equipment Marketline (2012) Industry Profile France Sports Equipment Datamonitor (2011) Country Analysis Report FranceDatamonitor (2011) Company Profile adidas AG Institut national de la statistique et des etudes economiques Insee (2012) Bilan demographique SportsOne (2010) Doole, I. , Lancaster, P. and Lowe, R. (2005) Understanding and managing customers, Essex FT apprentice Hall Kotler, P. and Keller, K. L. (2009) Marketing Management, 13th Edition, Pearson International Edition Duncan, T. and Moriarty, S. (2006) How Integrated Marketing Communications Touch Points ca n operationalize the service-dominant logic, The Service-Dominant Logic of Marketing Dialog, Debate, and DirectionsFill, C. (2011) Essentials of marketing communications, 1st Edition, Prentice Hall Steinberg, B. and Vranica, S. (2004) Prime-Time TVs New Guest Stars Products, Wall Street Journal, January 13, 2004 McCracken, G. (1989) Who is the celebrity endorser? Cultural foundations of the endorsement process, Journal of Consumer Research, December 1989, 16 Scevak, N. (2001) The Evolution of Product post Available URL http//www. internetnews. com/bus-news/article. php/785431/The+Evolution+of +Product+Placement. htm