MARKETING STRATEGY

CUSTOMERS
Both nike and adidas are a well known and accepted brands. Their main customers are athletes
and sports enthusiasts but it doesn’t limit there. Men women and even children are well versed
with the brands and use them. Children from the age of 15 to adults of the age group 35 use
both nike and adidas shoes.

For Nike and Adidas, the Beijing games are a brawl for 21st century dominance of the sneaker
world. Both the rivals are looking forward for the Olympics 2010. While every Olympics is a
dogfight for the longtime rivals, this year's games are a bigger deal for adidas especially.
Beijing's the doorway into a vast new market. There are 2.6 billion feet in China, most of them
without sneakers. Both companies expect the country to be its second-largest market, after the
U.S, within a few years. "It's the ultimate land grab," for both nike and adidas. Despite the
relative strength of Germany-based Adidas in Europe and weakness in Nike's flagship U.S.
market, Nike has expanded its global lead over its rival over the past three years. Nike's 36
percent worldwide market share dwarfs the 21.8 percent share for Adidas, according to
Sporting Goods Intelligence. The strategies adopted by Adidas have been successfully
implemented in several areas.   They always ensure that the needs of various consumer groups
are fulfilled by going into partnership with high-end designers and technology. Adidas has been
consistently dragged down by the once-mighty Reebok brand, which contributes about 6
percent to its parent's total.

OUR ANALYSIS (According to customer survey)

The customer analysis for both Nike and Adidas is largely similar and hence they will be
explained together and differences, if any, will be pointed out.

The Consumers are typically professional athletes, amateur sportsmen and young people who
identify with sport as a lifestyle, mostly in the age group of 15-35. But this age barrier seems to
be falling now, as our research told us. More children in the 12+ age category are identifying
with these brands mainly due to their addiction to European Football which has gained a huge
fan following. Also, the consumers are brand conscious adults and girls, who look to them as
status symbols, an image which both these brands strive to uphold by high pricing and premier
status.
The unsatisfied need for most customers in this market is primarily high end footwear which
helps them perform better in their chosen playing field, but at a lower cost than what these
brands offer. For the fashion conscious segment of the market, they come in with their lifestyle
products. The main problem they are trying to solve is the risk of injury and the possibility that
an athlete might underperform due to low quality footwear.

The principal decision makers in the process are the buyers themselves as they know best their
specific need for their specific sport.

Buyers generally buy these products as durable long lasting products that they use specially for
big game days. The quantity bought differs for team and individual sports, as teams generally
order a large number of performance footwear for all its players and individuals usually buy a
single pair. The places where the consumers mostly buy are original outlets and franchises.
Retail stores are largely low key sellers for them. The frequency of buying is less, compared to
other markets.

WAR BETWEEN NIKE AND ADIDAS

The problem for Adidas is that, while it's staked out its turf as an official sportswear partner,
Nike has more top athletes. They include Swiss tennis ace Roger Federer and Australian track
star Craig Mottram, along with old standby basketball legends Kobe Bryant and LeBron James.
But nike’s athletes aren’t guaranteed to win games, there is always a risk element associated
with their performance.

Nike has signed up 22 of China's 28 sports federations to outfit most of its athletes. The deal is
just one of 40 that Nike signed with various national federations, including the U.S, Germany
and Russia, ensuring that team members will be decked out in Nike gear during play regardless
of where they have their individual endorsements. So for many of 3,000 athletes in the Adidas
stable who will compete in Beijing, donning the three stripes will be limited to the medal stand.
During play, they'll be in Nike gear.

COMPETITORS
NIKE is one of the most successful manufacturers of athletic footwear, competing with
Reebok, L.A. Gear and Adidas, as well as with manufacturers of casual footwear. Nike is the
world’s No.1 manufacturer and marketer of athletic footwear. Nike stands for success,
excellence, high performance, fame etc.
  Adidas
 Reebok
 Woodland
 Red tape
 Bata
 Liberty
 Puma
 New balance

Nike is the official kit sponsor for the Indian cricket team for 5 years. Nike beat Adidas and
Puma by bidding highest, US $ 43 million.

ADIDAS

The chief competitors of adidas are PUMA and Nike. In August 2005, the company announced
that it had made a deal to acquire rival Reebok for $3.8 billion. The acquisition would increase
its market share and to establish a stronger foothold in the Sports Industry. This merger is
indeed a success which has achieved significant sales growth. Merger of Adidas & Reebok
complement each other in competing with their competitors, Nike; and is more cost efficient
and beneficiary to both brands with Reebok’s strong presence in US market and the global
recognition of Adidas.

 Nike
 Red tape
 Bata
 Liberty
 Puma
 New balance

Nike
Nike enjoys a 47% market share of the domestic footwear industry, with sales of $3.77 billion.
Nike has been manufacturing throughout the Asian region for over twenty-five years, and there
are over 500,000 people today directly engaged in the production of their products. They utilize
an outsourcing strategy, using only subcontractors throughout the globe. Their majority of their
output today is produced in factories in China, Indonesia, and Vietnam, but they also have
factories in Italy, the Philippines, Taiwan, and South Korea. These factories are 100% owned by
subcontractors, with the majority of their output consisting solely of Nike products.

Strengths of Nike
 Nike is a very competitive organization
 Nike has no factories. It does not tie up cash in buildings and manufacturing
workers. This makes a very lean organization.
 Nike is strong at research and development
 Nike is a global brand. It is the number one sports brand in the World.
 Product Range
 Capacity for innovation
 Distribution expertise
 Single Brand
 Stars endorsement
 Contract manufacturing
 Large portfolio of products

Weaknesses of Nike
 The organization does have a diversified range of sports products. However, the income
of the business is still heavily dependent upon its share of the footwear market.
 The retail sector is very price sensitive. Nike does have its own retailer in Nike Town.
 Single Brand
 Too many stars endorsement
 Contract manufacturing
 Spread portfolio of products
 Reliant on retailers
 Reduction of target market