PUMA½

 PUMA AG Rudolf Dassler Sport (PUMA) is a

la rg e G e rm a n m u ltin a tio n a lco m p a n y th a t
p ro d u ce s h ig h -e n d a th le tic sh o e s, life style
fo o tw e a r a n d o th e r sp o rtsw e a r.
 Mission Statement

 PUMA½ has the long-term mission of

becoming the most desirable
Sportlifestyle company.
•
 Vision Statement
At PUMA, we
believe that our
position as the
creative leader
in Sportlifestyle
gives us the
opportunity and
the
responsibility to
contribute to a
better world for
the generations
to come. A better
world in our
PUMA½
 Problem Statement
 Puma½ is now facing new
challenges. There is a threat of
weakening the brand’s exclusiveness
as market share increases. The
company has to decide what to do
with emerging market trends -
emerging sports, increasing number
of competitors due to fashion and
niche-focused players, trends in
design and fashion and the trend for
customization.
 PUMA½

• How could the Puma run faster?

•
• How could Puma grow profitable
while simultaneously increasing its
brand desirability in the midst of
limited resources?
•
 Objectives
1.Position Puma as a high-value brand in
sports-lifestyle industry.
2.To increase the company's sales by
30% without reducing the Puma's
desirability in the long-run.
3.To maximize the currently limited
resources to finance and support the
company’s growth initiatives.
4.To increase the company’s international
market share by 0.5% within the next
three years.
SITUATIONAL ANALYSIS½
 FINANCIAL STATUS AND
INDUSTRY RATIOS
2002 Figures ( in Puma½ Nike Adidas Reebok
Euros or %)

Current ratio 2.31 3.17 1.26 2.36

Quick ratio 1.359 2.011 0.729 1.62

Working Capital 241 M 2729 M 583 M 709 M

 FINANCIAL STATUS AND
INDUSTRY RATIOS
2002 Figures ( in Puma½ Nike Adidas Reebok
Euros or %)

Debt Ratio 52% 18.39% 52.64% 31.75%

Equity Ratio 47.90% 81.61% 47.38% 68.24%

 FINANCIAL STATUS AND
INDUSTRY RATIOS
2002 Figures ( in Puma½ Nike Adidas Reebok
Euros or %)

GP Rate 44% 39.30% 56.78% 37.40%

ROE 33% 17.00% 21% 17%

ROA 9% 7% 3% 4%

Net Margin 9.34% 6.75% 3.51% 4.03%

Operating 13.70% 10.76% 7.31% 6.71%

Margin
 FINANCIAL STATUS AND
INDUSTRY RATIOS
2002 Figures ( in Puma½ Nike Adidas Reebok
Euros or %)

Capitalization


Total Assets 526 M 6837 M 4261 M 1637 M
TOWS ANALYSIS½
EXTERNAL
THREATS OPPORTUNITIES
High competition Fitness hype
Imitation products emerging technologies

Acquisitions
Restriction trade
Sponsors
policies on foreign Emerging new sports
governments Falling trade barriers
Challenge of keeping
in attractive foreign
its uniqueness markets
Emerging geographic

markets
INTERNAL Trend for customization

9. Decreasing market

share of
competitors.

WEAKNESSES WT STRATEGIES WO STRATEGIES

Missing sport segments Licensing, Strategic Product Innovation/
Distribution system Alliances, Acquisition
Comparable lower
Development
Activities and Expansion of Product
financial resources Takeovers
No long-term contracts Additional
Categories
with suppliers Capitalization
EXTERNAL THREATS
High competition
OPPORTUNITIES
Fitness hype

emerging technologies
Imitation products
Acquisitions
Restriction trade Sponsors

policies on foreign Emerging new sports

Falling trade barriers in

governments
INTERNAL Challenge of keeping

its uniqueness
attractive foreign markets
Emerging geographic markets

Trend for customization

9. Decreasing market

share of competitors.

STRENGTHS ST STRATEGIES SO STRATEGIES

Experience in R&D

Branding
Strategic alliances
 Market Penetration
Management
and Collaborative Market Development
Strong promotion through
Regional Expansion
sponsorships partnerships
Product innovation capabilities

Strong alliances with other firms

Decentralized structure

Uniqueness

Flexible brand credibility that

could be applied in a variety of

sports
Distinctive competence in marketing

Superior intellectual capital

relative to competitors
Increasing market share
STRATEGIES½
Puma’s “multi-category” Branding
Strategy
 Recognizing the emerging
opportunities of new sports, Puma
may choose to cater new products to
this emerging market. This will make
use of the company’s strength of a
flexible brand credibility that could
be applied in a variety of sport.
•
 Expansion of Product
Categories
 The goal is to expand the
existing product categories and to
tap into new product categories, thus
covering the entire spectrum of
sports, lifestyle and fashion. New
business divisions must offer
opportunities for generating new
growth and for gaining an edge over
competition in a unique manner. (e.g.
Beach/Swimwear Water Sports,
Skateboarding, Snowboarding, etc.)
 Market Development
 To gain an international
recognition Puma should break the
walls and step-up to a new level. It
should seek expansion into
international markets where
competitors doesn't a strong foothold
yet. Asian countries have strong
potentials in earning greater profits
for the company.
•
 Market Penetration
 Staying in touch with famous
influential figures in the music, film,
and lifestyle businesses, should be
Puma's support for this strategy,
whereby its models reflect the values
and attributes that differentiates
Puma from the rest.
•
 Product development and
Innovation
 Puma should continue its market
leadership in terms of innovation
through coming up with new designs
and additional functionality in its
products for it to be perceived a high-
value brand in both sport and
lifestyle categories.
 Strategic Alliances and
Collaborative Partnerships
 Puma should continue building
up its distribution network through
carefully selected partners.
•
 Regional Expansion
 Along with expansion of the
product categories, regional
expansion is also being pursued. To
this end, the takeovers of license and
distribution markets are a
determining factor in consolidation of
the respective businesses in the
PUMA Group.
 RECOMMENDATION ½
 With the understanding that
Puma's core competitive advantage
is its leadership in innovation, it
should maximize utilization of this
through entering new markets with
product banners that reflect the
market's needs, wants, as well as
desirable features that current
players don't offer.
 RECOMMENDATION½
 Puma should position its brand
as a high-valued one with excellent
quality that understands the concept
of comfort and appeals to the sense.
THANK YOU½