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Adidas Advertising Strategy
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Adidas Advertising
Strategy
Ethan Chen
Adidas
Adidas is a German shoe, clothing and apparel company that also owns Reebok, Taylor Made and Rockport.
Adidas is the largest sportswear company in Europe and is the second only to Nike as the largest sportswear company in the world.
Introduction
Adidas specializes in the design and manufacturing of footwear, sportswear, sports equipment and, yes, even toiletries, most notably, deodorant.
Over the years...
1954
1967
-
1978
1900
-
1949
Executive Summary
2017
-
Future
1982
-
1994
2000
-
2017
Lina Radke
Jesse Owens
What a Dassler !
When the German national football team faced the unbeatable Hungarians in the 1954 World Cup final, they won so much more than just a trophy. Their unbelievable victory would be heard around the world for decades to come. And it made adidas and its founder a household name on football pitches everywhere.
Franz Beckenbauer
Official Match Ball to 1970s FIFA World Cup
Run DMC and Adidas Collaboration
(1986)
Acquisition of ReeBok
(1982-89)
Evolution of social media
More focus on Social media and E-commerce
Creating the New
Mass Products and Niche Products
Mass products are the opposite. They are targeted to the whole market with no attempt on targeting any specific group
Niche Products are targeted to a very section of the whole market and maybe one that has not yet been identified and filled by competitors.
Advertisements for Mass and Niche Products
Mass Product Advertising
Here is how Adidas promotes its Mass products
Mass
Market
Niche Marketing
Cost - $10,000
While Adidas may not have a wide range of Niche products, they do fill in a 'niche' for the small group of shoe collectors who would purchase their products at even an exhorbitant amount.
Advertised through celebrity endorsement.
Niche
Market
Cost - $5000
Cost - $4500
Ways Adidas have advertised themselves
TV Advertisements
Covert Advertising
Methods of Advertising employed
Our Team
Celebrity
Endorsement
Celebrity Endorsements
Stan Smith
Jesse Owens
Franz Beckenbauer
American tennis player
American Athelte
German Footballer
A celebrity endorsement is when a celebrity uses their notoriety to assist a company in selling a product or service.
They are either involved in the various ad campaigns of the company or in the case of Adidas, only wear and share their products.
This attracts customers as they see their favourite celebrities use a particular companies product which causes them to purchase the product.
In the recent ad 'Calling all Creators' features famous celebrities such as James Harden, Pharrel Williams, Messi,etc. which is an example of celebrities endoring Adidas.
Derrick Rose
Katy Perry
David Beckham
American basketball player
American singer-songwriter
Football
Player
Social Media Profiles
Social Media
YouTube
https://www.youtube.com/watch?v=t2D0NOKVWXo
Reasons as to why internet marketing is used
1) Imrpoved audience reach 2)Targeted marketing
3)Interactivity
4)Performance metrics
5) Speed of transmission
6) Viral marketing - The use of social sites or text messages to rapidly increase brand awareness or sell products. Companies want their products to undergo a 'viral sensation' as it spreads like wildfire on social media.
Our Team
Celebrity
Endorsement
TV Commercials
- TV advertising is considered to be one of the most effectiveness way for a company to advertise their products as reflected by the high prices TV networks charge for commercialairtimeduring popular TV events.
Adidas has a large amount of TV commercial advertisements in theworldwide TV network like BBC, CNN etc.
- This is going to change however as Adidas is reportedly moving more of its ad budget away from TV and into digital channels and is looking to quadruple its online sales by 2020.
Covert Advertising
- Covert Advertising or Product placement is when a company sublimly places its product or service in a form of entertainment (say in a movie). without 'directly' advertising their product.
-Many films and other media use covert advertising because advertisers pay big money for the inclusion of their product within a film.
Current Market
Share
and
Growth
What is Market Share ?
What is MArket SHare ?dv
Market share can be described as the percentage of sales in the total market sold by one business. Its formula can be written as :
Market share % = (firm's sales in time period/total market sales in time period) x 100
Adidas Market Share
2016
-> Market share - 6.3%
-> Net Sales of Adidas - 18,483 (per million euros)
-> Total market sales - y
=> (18,483/y) * 100 = 6.3
=> y = 293,381 (per million euros)
2017
-> Market share - 11.3%
-> Net sales of Adidas- 21,218 (per million euros)
-> Total sales - x
=> (21,218/x) * 100 = 11.3
=> x = 187,770 (per million euros)
Market Growth
Due to proper promotional and sales campaigns , Adidas has managed to increase its market share, almost doubling it, over the past two years. Adidas had actually even surpassed the more well-known Jordan Brand after hitting a record 13% market share, which dipped due to market fluctuation.
Approach of Marketing
Adidas' marketing attitude
Product Orientation - An inward-looking approach that focuses on making products that can be made - or have been made for a long time - and then trying to sell them.
Market Orientation - An outward-looking approach basing product decisions on consumer, as established by market research.
There are several ways by which a firm can approach marketing but only two, which are the product oriented approach and market oriented approach , will be discussed in this prsentation.
In reference to the 4 Ps of marketing, Adidas' marketing approach will be discussed and evaluate to decide which category Adidas falls into.
Price
When it comes to selling their product, Adidas resorts to two ways of pricing their product :
Competitive Pricing
Price
Skimming
Price skimming is a pricing strategy in which a marketer sets a relatively high initial price for a product or service at first, then lowers the price over time.
- For example , Adidas' NMD R1 costed around 150$ on its debut but now only cost 60$.
- Opposite of price penetration.
Competitive pricing is setting the price of a product or service based on what the competition is charging. This pricing method is used more often by businesses selling similar products.
- Both shoes cost around 100 - 120 $.
- Both are affiliated with a famous NBA Player.
- Both have almost the same specs.
The Boston Consulting Group Matrix or
The BCG
The BCG - It is a method of analysing the product portfolio of a business in terms of market share and market growth.
Product
Adidas specializes in the design and manufacturing of footwear, sportswear, sports equipment and, yes, even toiletries, most notably, deodorant.
Adidas group has several subsidiaries through which their various products are sold. The main ones include :
Place
- This decision is involved with how products are passed from the manufacturer to eventually the customer.
- Channels of distribution are the various stages at which a product passes from the producer to the final consumer.
- Adidas has 3 main channels of distributions :-
Manufacturer
Multi-Brand Showroom
Consumer
Manufacturer
Adidas Outlets
Consumer
Manufacturer
Online Website/Adidas Website
Final Consumer
Promotion
This has already been dicussed to some extent in the second line where ways by which Adidas advertises their products have been discussed such as :
Adidas , in an effort to draw in more customers , often times send an impactful message along with most of their ad campaigns in order to leave an psychological impact on the viewer.
An example of this would be the "One in a billion' ad where the title is self - explanatory of what agenda Adidas is trying to push.
Conclusion
- Out of the two approaches it seems to be that Adidas has more of an market orientated approach to marketing having a diverse range of products with a number of subsidiaries, all having prices which adhere to the current conditions of the market as well as the need of its customer.
- However there are some elements of the product-orientated approach to marketing. It can be seen in Adidas' line of Superstar shoes as well as in their BB Original Tracksuits. These products have become the signature of Adidas' products and is what people easily recognize the company for.
The Brief
Innovative
Marketing
Strategy
Innovative Marketing Strategy
Adidas' most innovative marketing strategy would be.....
Combination of :
- Covert Advertising
- Celebrity Endorsement
- Social Media advertising
- Closer interaction with customer
Team Great Britain
https://www.youtube.com/watch?v=TzwSWgCNe7c
Interaction with fans
Conclusion
In the past few years adidas has seen its brand bolstered by smart partnerships with influencers such as Kanye West and Pharrell, as well as a shift in focus from creating and selling basketball shoes to putting a premium on running. Now, the company will be challenged to continue its rapid rise up the leaderboard in the apparel and shoe category, and close the still large gap between itself and Nike.