Adidas Growth Strategies

Topics: Adidas, Vertical integration, Brand Pages: 8 (2403 words) Published: May 1, 2010
IV. Introduction
This analysis is about the company adidas that belongs to the adidas Group. The adidas Group sells products under the brands adidas, Reebok and TaylorMade-adidas Golf. Adidas is on the market over 80 years and sells products for every kind of sports. The adidas group was founded in the year 1949 by Adolf Dassler. A company that started with selling soccer shoes contains today a wide product assortment with footwear, apparel and accessories. The brand is further divided into three subbrands called adidas performance, original and sport style. TaylorMade-adidas also offers wide range of golf equipment and matching golf apparel and accessories. On their homepage the adidas Group claims to be “a global leader in the sporting goods industry” (adidas group, what we do). The company can be described as a global player because they have 170 subsidiaries in different countries that are directed from their headquarter in Germany which is the home of the adidas brand. Headquarters of Reebok and TaylorMade-adidas Golf are in the US in Massachusetts and California. Besides the international subsidiaries of the company, products of the group are available in every country through their online store. Their strategy to success is “continuously strengthen our brands and products to improve our competitive position and financial performance”. The following paper is going to analyze external and internal situation of adidas. Further, their marketing and growth strategies will be analysed. Major focus of this paper will be on the customer analysis.

Growth Strategies
The evaluation of the performance of a company is often measured trough growth in sales. Growth strategies determine how companies want to increase their market share or sales. They are crucial for the success of a company and should be selected carefully. There are different strategic options that companies have. Many companies pursue different types of growth strategies. Main decisions of a company are if they want to stay in existing markets or enter into new markets and further if they have existing products or if they develop new products. A combination of those four elements leads to the different types of growth strategies: penetration strategies, product-market expansion strategies, vertical integration strategies, differentiation, and diversification.

Penetration Strategies (existing products/existing markets)
Penetration Strategies means that companies sell their existing products on already existing markets. Companies choosing this strategy have to gain competitive advantage through pricing, marketing, etc. They want to gain market share and convince the customers of their competitors to buy at their stores.

Adidas is definitely using penetration strategies. For over 80 years adidas is selling sports apparel and accessories. Through a successful established brand image adidas still sells their sports apparel all over the world. Their marketing efforts as described in the part promotion strategies help them to remain competitive.

Product expansion strategies/Product Development (new products / existing markets) You can speak of product expansion or product development strategies if a company develops new products and try to sell them to existing markets. Adidas made also use of product expansion strategies through introducing adidas performance, originals and style in October 2000. The company expanded their products through a new style line that focuses more on fashion than on sports clothes. You can speak of product expansion because although the style is different it is still in the apparel sector. Further, adidas modifies their products continuously. In February 2010 they just introduced their new developed womens’ Body Mapping Technology that “defin[es] female-specific heat and sweat zones in order to place fabrics directly where they are needed the most, delivering optimised function to provide maximum comfort during workout.”...
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