A Comprehensive Analysis of Adidas: SWOT, Marketing Strategy, and Mix

This report provides a detailed analysis of Adidas, a prominent player in the sportswear industry. It begins with a comprehensive SWOT analysis, examining the company's strengths, such as its global brand recognition, product range, and research and development capabilities, while also addressing its weaknesses, including lower marketing spending compared to competitors like Nike. The report then delves into Adidas's marketing strategy, focusing on its positioning as a performance-oriented brand and its segmentation approach with different labels for various segments. It explores Adidas's target market, primarily young adults aged 14-29, and its positioning as a premium brand. The marketing mix is also examined, including pricing strategies, distribution channels, and promotional activities, such as endorsements by sports icons and its 'Impossible is nothing' tagline. The report concludes by highlighting Adidas's competitive landscape and the importance of adapting to market changes.

[ ADIDAS COMPANY]
2017
MARKETING
FUNDAMENTAL
Student Name

Adidas SWOT Analysis & Marketing Strategy1
6. SWOT ANALYSIS
Adidas has various strengths and some weaknesses associated with it. It is a recognized brand
worldwide and is a strong player in the sportswear sector. It has gained enough experience
over decades of operations and enjoys the loyalty of a large number of professionals, for
whom good quality sportswear is crucial to their performance. It has a long range of products
catering to requirements of sports like tennis, football, sprint etc. As new generations of
sportspersons evolve, their icon players inspire them. This is beneficial for Adidas since it is
a widely accepted brand by eminent sports personalities. Adidas can also afford a well-
focused and technically advanced research and development unit, which in turn helps it make
superior products like ultra-light running shoes, which helps in increasing an
athlete’sperformance. It has also introduced a technology known as optimum shock damping
that uses sensors and a computer chip to reduce stress on the foot while running. It is widely
regarded as a next level innovation. Adidas also has some weaknesses, one of which is its
marketing activity. In US, its strongest competitor Nike spent $1.47 Billion in the year 2016
(Statista, 2017). Compared to that, Adidas spent just $ 415.4 million during the period
(Statista, 2017). This has also resulted in an inferior ad campaign for the brand. While other
brands such as Puma and Nike are increasingly pursuing theme-based campaigns, Adidas
simply looks to highlight its products and quality, while relying on its brand recognition to
connect with the consumers. Adidas has a good opportunity to expand in emerging markets
where it can tie up with local players to better understand the needs of the consumers. With
big events like Olympics, FIFAworld cup and other premier events being held around the
globe, the enthusiasm for sports, and therefore the demand for sportswear, is bound to
increase (WiseGuyReports, 2017).Adidas also faces threats on various fronts, more serious
among them coming from competing brands like Puma, Nike and Underarmour. While Nike
is already the number one brand in the sportswear segment, Underarmour is also gaining
market share in certain regions, which can be a cause of concern for the company. Recently it
overtook Adidas in the crucial North- American market (Germano, 2014). If these issues are
not addressed, it can cause Adidas to lose its position among its competitors. While making
SWOT analysis of Adidas, few highlighted points those were analyzed are shown in the
figure below.

Adidas SWOT Analysis & Marketing Strategy2
Figure: SWOT analysis of Adidas
Source: (WiseGuyReports, 2017)
7. MARKETTING STRATEGY
Adidas has always focused on positioning itself as a company that makes performance-
oriented products for sportspersons. As such, it has adopted a strategy to keep its core brand
Adidas as its main product, and has promoted Reebok as the brand, which offers casual
sportswear. Adidas Fun and Rockport labels offer products catering to Sports Fashion
segment. Thus, Adidas looks to maintain its brand essence in each of the sub categories by
projecting different labels for each of them (Bhasin, 2017). This strategy of segmentation
reduces risk of brand dilution as one brand is perceived as specially made for that particular
segment.
7.1 Target Market
Adidas produces goods that are mostly used by people in the age group of 14-29 Years
(Morgan, 2012). As such, it has to understand the basic psychology and needs of its target
consumers, and it is crucial for the company to get young adults’ loyalty towards its brand. In
addition, since Adidas is a premium brand associated with high quality products, its target
consumers further shrinks to upper and upper middle class of consumers (Shetty, 2017). It is

Adidas SWOT Analysis & Marketing Strategy3
important for Adidas to maintain that status so that its brand is always looked at as a high
value choice.
7.2 Positioning
Adidas has to maintain a difference between itself and mass-market products in order to keep
its brand image and appeal among its target consumers. The young generation of sports
enthusiasts is more likely to adopt the brand if they perceive it as a specialist, which will help
them perform better. Even if they are not sure about its performance enhancing effects, they
are likely to judge it by its brand membership. If they see elite sportspersons wearing it and
acknowledge the fact that it is not a regular run of the mill product, they will respect the
brand more. Thus, the company has positioned its product as a performance oriented and in
the premium category.
7.3 Marketing Mix
Adidas has devised two different types of pricing strategy in its marketing mix. For its
premium and newly launched products, it uses skimming price strategy, whereas for other
regular products like caps etc., it uses competitive pricing strategy in order to compete with
its main competitors (MBASkool, 2017). Adidas also has an adequate line of exclusive
stores and presence in multi brand retail chains, so it has a good exposure among its
consumers. It has also made an online presence through websites like myntra.com, while also
maintains its website where it sells to retail consumers directly. Thus, Adidas maintains a
good chain of supply for its products through exclusive outlets, multi brand showrooms as
well as through online fashion websites. Adidas also has a good promotions strategy in its
marketing mix, where its association with popular sports icons like Lionel Messi, Sachin
Tendulkar and others help it in creating a formidable brand image for its products. Its tagline
“Impossible is nothing” seeks to associate the brand with a powerful statement that can be
remembered (Bhasin, 2017). This tagline features in large billboards where the company
portrays images of the likes of Muhammad Ali or Roger Federer and underlines the image
with this line. The idea behind this strategy is to associate the brand with great achievers and
whenever people look at the brand logo, they are filled with a sense of confidence that they
too can achieve what they aspire. It also generates a lot of fan following through social media
and promotes its products through YouTube videos as well. These medium provide an instant
connect with the youth and the use of print and television media completes the overall reach
of its promotional campaign.

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