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.