Adidas Case Study – Marketing Mix & SWOT Analysis

Adidas was founded by Adolf Dassler and his elder brother Rudolf Dassler in the early 1920s and is now recognized as one of the most famous global manufacturers of sports products. Adidas is developing its products for serving the needs of the customers at the best possible level. Adidas works on its products by incorporating new fashion trends, technology and making them more sport-specific. Today, we are going to discuss the Adidas marketing strategy, marketing mix, and market analysis through SWOT analysis in this case study. 

There are three main areas of marketing where Adidas is seeing an increase in their mix of sales and investment. First, the company is expanding into new places such as developing new products and services, enterprising in new fields, and moving from production to development for upkeeping. Second, Adidas’s presence on social media platforms is increasing as people are seeking out its products for fresh flavors and ingredients. And third, Olympics-related advertising will continue to be a major part of Adidas’s marketing strategy.

Marketing Mix of Adidas

Here is Adidas marketing mix comprises of 4P’s of marketing: Product, Place, Price, and Promotion.

Product: This is a product that Adidas markets under its various labels such as energy boost, running, football training, tropical heat wear, etc.

Place: This is a place where these products primarily sold out depending upon the developed region.

Price: Adidas is aggressive in promoting price in order to enjoy a competitive position.  In this area, Adidas believes the price will be dictated by the market’s demand and not its shortages or excesses. In 1964 when Adidas began pricing shoes at $12 vs Nike at $15 Shoe sales went down but once the price was set it stayed the same hence becoming more attractive towards prospective buyers versus new entrants with their much lower prices.

Promotion: This refers to the strategies of Adidas for attracting consumers to the purchase of its products, whether it is competition, direct marketing campaigns, or social media messaging and advertising.

Adidas differentiation strategy

Adidas focuses more on the broad differentiation strategy. The corporate level strategy of Adidas focuses on innovation, trying to produce new products, services, and processes in order to cope with the competition. The group’s multi-brand portfolio gives them an important competitive advantage. This created a global sales function that is responsible for commercial activities and a global brands function that is responsible for the marketing of both brands.

The global sales function was also split into two departments, wholesale and retail. This catered to the various needs of both these business models. This has been done in order to sustain their corporate-level strategy for the long run so that these divisions could emphasize and work hard in their respective departments in order to make the most of their efforts.

They implemented a multi-brand strategy by having a diverse brand portfolio which allowed them to cater to all segments of the market from players to almost everyone. This helped them to keep a unique identity and concentrate on their core competencies.

Adidas digital marketing strategy

Adidas uses a straightforward digital marketing strategy to communicate with its current and potential customers. By implementing this strategy they have been able to take competitive advantage with their top competitor, Nike. By changing the behaviors of consumers with this digital transformation, Adidas has to change the way they work. The use of technology has helped Adidas connect with more consumers and build stronger relationships with customers.

There are 6 components that aid Adidas digital marketing strategy includes:

1. Digital and technology
2. High-speed manufacturing
3. Personalized experience to create strong relationships with customers
4. Open-source innovations and collaborations
5. Strategic cities include London, LA, New York, Paris, Tokyo, Shangai.
6. Improve portfolio of both brands i.e. Adidas and Reebok.

SWOT Analysis of Adidas

SWOT analysis is the method of measuring the organization and its environment whether internal or external. It is used as the first stage of planning which helps marketers to focus on the key issues that an organization can face.

SWOT stands for Strengths, Weaknesses, Opportunity, and threats. Adidas strategy analysis focuses on Strengths and Weaknesses are the factors that basically represent the internal environment of the company while the other two represent the external environment with direct and indirect impacts on the business.

Strengths

• The brand recognition of the product it’s well-reputed.
• High-quality products.
• Provides a diverse range of products (shoes, bags, shirts, perfumes, toiletries, etc)
• Obeys environmental laws (Adidas has never been accused of pollution)
• Employees’ rights are safeguarded by Adidas’ policies and management.

Weaknesses                                              

• Online stores are offered only to the USA or some locations in Europe.
• Customer services are not totally functional which creates problems especially in the case of e-marketing
• Price is interwoven to high quality.

Opportunities

• Possibility of outsourcing the web development and e-commerce/marketing to a third party.
• The growing market for sports apparel
• Joint Venture with partners around the world to increase participation in athletics.

Threats

• Unstable economic environment
• Competition in supply chain management level
• Nike’s strong reputation in the sports industry

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