Adidas Case StudyFirst, I will talk about what we discovered from the frameworksAccording to PESTEL analysis, for the economic factor, in the US market alone, athleisure wear sales totaled 97 million USD in 2015, which increased by 40% from 2010. Also, in 2015, the segment outperformed traditional athletic apparels.As for social factor, athleisure has become a trendAccording to the survey done by LifestyleMonitor and Cotton Incorporated Sports Apparel, 92% of consumers wear active apparel for purposes beyond exercise.Consumers say they want activewear for non-active purposes, as well as performance denim and athletic-inspired jeans.As for Porter’s Five Forces, first I’m going to talk about our main existing rivalry, Adidas, which is the world’s second largest sportswear maker. Mark King, the President of Adidas Group North America, stated that his visions for Adidas are to focus the brand more on running and basketball, which have long been one of Nike’s main revenue sources; and focus more on the stylish everyday wear of their originals brand, which is a part that Nike currently lacks.
The performance of Adidas has soared in the past year, in 2016, the fiscal second quarter sales in North America market increased 23% from 2015Its growth has been fueled by the 60% increase in sales for originals and running footwear, the appeal of ongoing partnership with Kanye West, and the successful designs of on-trend silhouettes, new apparel fabrics, and innovative technology.From this graph, we can see that the stock price of Adidas has grown 67% over the past year, showing their dominance over Nike and Under Armour.For the threats of new entrants, over the last decade, many new entrants enter the market, many of them produce fashionable sportswear that Nike currently does not focus on.In terms of strategic group analysis, our company do have a wide product range, however, from the financial statements, we discovered that most of our revenues come from footwear sales.
Yea, you thought these guys were coming to the US, but we don’t know that. Why? Because they’re Nike.
And this isn’t limited to a single issue.
When the global supply chain has shifted to its current product lines, the brand is already on the cutting edge, according to Nike’s data.
This doesn’t mean they’re here yet, like Adidas, Nike Originals, or some other brand, but they’re all there, and as long as we are able to predict the upcoming years of the brand, we will continue to build the product range based on the current conditions, which can be considered the “new” one.
For what? “new”? To be exact, it doesn’t mean that Adidas’s product line is already out the door.
So there’s still work to do. And this is what will have a big impact on what’s happening.
If the new company does have the numbers, it won’t be as much about the quality of the brand as that of the previous ones, due in some cases to price trends. The longer this holds even on a single issue, the more likely it is to be “out of fashion,” to see the brand grow exponentially, to be seen by consumers while also making money in the process.
When I asked one retailer on a regular basis why not focus on what they believe to be their vision, they replied that when they’re building their new brands, they consider a big picture. In order for it to work, they need to understand what their competitors have to offer – and how to do their job. So how do you do that?
For each new product, you need to understand how it fits into your business model, what that product can do to compete in the market, and how your business will be able to find new solutions to those same issues.
And here I’ve left that out.
It’s true, while there’s no exact date when this will happen, Nike is committed to being a leader in innovation, with many years of experience in these products.
There are a few specific examples, but you’ll find the rest.
For Adidas, the next phase of the “new” segment was one that saw Nike make their first step onto the global market.
This was largely due to the fact that Nike started making their first sneaker as a mid-range line, and now they’ve been following closely behind.
In addition…
We understand that Nike’s interest with the new line is large.
This will be interesting to see when the new line goes mainstream. But, if the new sneaker doesn’t have a lot of traction, or gets too niche or is just not going to work, it won’t be enough for Nike.
There is always a risk to trying and proving that it’ll take a lot of trial and error, but if the results do show it then you can trust your predictions. When you can also try and see if the results hold for the next batch of units, then you’ve seen.
Our biggest point here is this: they don’t want to risk a lot of potential profits here.
And even at what may be a discount, in the short term, we’re going to see them go for the same strategy as Adidas, as long as they want to do the right things.
It’s no surprise they’re