AMITY INSTITUTE OF COMPETITIVE INTELLIGENCE

AND

STRATEGIC MANAGEMENT

AMITY UNIVERSITY, NOIDA, UTTAR PRADESH

RESEARCH REPORT ON

THE GROWTH STUDY OF ADIDAS

GUIDED BY: SUBMITTED BY:

Mr R. BHANDARI ROHAN SINGH

(A0679417036)
 Content

S.No Topic

1
Introduction
2
Objective of study
3
Objective of Adidas
4
Company mission
5
Adidas's brands
6
Why is it important to wear shoes?
7
Company history and logo
8
Workers and employees relationship

9
Changes in its marketing strategy
10
Workforce management
11
Marketing strategies
12
Evaluation using strategies
13
Conclusion and recommendation
14
Bibliography
 Introduction
Adidas was registered as a company in post-war Germany, 1949. The
Adidas group as we know it was founded by one man named Adolf
Dassler and was then the sole producer of sports shoes. Since its
establishment the company has been associated with many sporting
events and world renowned athletes such as Jesse Owens, the FIFA
world cup whose footballs are manufactured by Adidas but even
marathons and Euro cups.

The company was originally focused on making sports shoes and its
focus was on sales but the fantastic growth spur ever since could be
achieved only due to the constant marketing practices which
included sponsorships to great athletes and teams; and also the
consistent innovation being achieved. For example; Adidas was the
first company to develop football shoes with removable spikes and in
2005 they built the world's first shoes with a built-in microprocessor
in it which adjusted its cushion according to the runner’s needs.

The Adidas group consists of other major brands such as "Adidas

marque", " Adidas originals" and " Taylor Made-Adidas(golf range)
and most notable of them all being " Reebok" which they acquired
for about $ 3.8 billion which made it the world's second best shoe
maker ranking only below Nike. Due to good outsourcing practices,
Adidas could achieve its growth with most of its manufacturing
coming from countries such USA, Russia, China, and Brazil which
account for almost 60% of total growth.
 Objective of study

 To study how Adidas has grown into one of the world's leading
shoe manufacturer even though they started from just a
laundry.
 Analysing the key internal factors and measures the company
has taken over the years to keep both consumers and
employees happy.
 Evaluating the company’s internal and external factors using
strategies like SWOT analysis and 6 force analysis

Objectives of Adidas
The success of any company lies in the hard work put in making it
behind the scenes. This includes keeping good relations with the
employees and the shareholders as well as regular communication
with the customers to better manage customer base.

Adidas believes that as a passionate sports enthusiast they need to

take life as it is which is a marathon and look at the long term goal
and success to create a legacy. Thus they take every step in
accordance with this and have a responsibility towards the
environment as well.
Performance, passion, integrity and diversity are the values which
Adidas operates by. These values help Adidas to reach customer's
volatile expectations.

Adidas takes every action publically and involves the customers with
them in every part of their journey so that they can leave a more
positive impact on the people. Even their daily operations take place
with the mentality to give back to the environment by taking
environment friendly post operation measures.

From the very start they have always taken care of the employees
because of whom the company has come so far. This means they
ensure the employee can receive a safe and secure environment and
are motivated to work every day so they deliver their best efforts.

As athletes need to constantly improve themselves and keep cross

checking themselves from time-to-time, how could the sport
enthusiast giant forget this philosophy? Adidas plans their goals way
ahead of time and takes time out to review their progress and keep a
check on them to give their best.

These are the few basic outlines the company has kept in mind for
achieving consistent growth and to become better in every aspect
not just profit which includes-social affairs, environment affairs, HR
management, community affairs etc.

Company mission
The Adidas group has always focused on a vision of becoming the
world's leading shoe manufacturer and they have come a long way
since their foundation on the principles of being passionate about
sports and continuing to innovate their products.
Passionate: passion is the sole thing which drives an athlete even
when he loses all strength and Adidas believes in this passion for
sports and this is their strength.

Authentic: Adidas was a trusted and authentic brand back then when
it was founded by Adolf dassler and this Authencity will always stay
because they want to deliver best products to their customers

Innovative: ever since the very start, the company has been
consistently innovating and finding solutions for every problem that
has come in its course way.

Committed: Adidas has been and still committed to providing the

athletes with world class shoes and continues to listen to their needs
for bringing about the best quality shoes.

Consumer focused: The best thing about Adidas is probably that it is

willing to listen to their customer and understand their needs be it in
the pricing or better comfort or a new idea, they are always all ears
to their customers for new ideas.
 ADIDAS's brands
Adidas has lot of world famous daughter brands under it and
together they all strive for greatness.

REEBOK

REEBOK is all about fitness. While Adidas had the vision to deliver
quality shoes to the athletes, Reebok focuses on the overall concept
of staying fit and that is what which has driven them to wake up
every morning and stay fit while having fun. They want to prove to
the public that staying fit doesn't come by easy but it sure can be
turned into fun and that's why at Reebok they strive to deliver
products that motivate you and make you feel comfortable while
working out.

Taylor Made
Taylor Made was acquired by Adidas along its journey and has
revolutionized the golf industry since 1979 after having made metal
wood driver which easily overpowered the wooden ones and proved
to provide better distance, aim, grip and quality. Professionals and
amateurs soon shifted to metal drivers instead of wooden ones and
the golf industry focused on innovating the gold equipment. The
game-enhancing performance and fashion-forward style of Adidas
Golf footwear and apparel appeal widely to tour pros and
recreational golfers alike. Across the globe, the world-renowned 3-
Stripes are worn by an ever-growing legion of athletes, making
Adidas Golf the fastest-growing golf footwear and apparel brand in
the world.

Why is it important to wear proper sport shoes?

Midsole feet cushioning: midsole is the area between ball and heel
of the foot and the cushion provided by the shoe can reduce some of
the stress placed on the heel making it easier to exercise.

Arch support: people with flat fleet do need arch support as running
shoes support their feet and make it less painful.

Injury prevention: wearing sport shoes can definitely prevent

injuries as wearing those shoes with soft cushions reduces the
impact on the heel of foot resulting in rare fractures and joint pain.

Athletic performance is enhanced: wearing sport shoes meant for a

specific purpose will definitely enhance the performance exhibited
by athlete due to better comfort and less stress on the feet.
 Company history
Adidas wasn’t always the company we have heard of. After all every
big story once had a small beginning. It took a lot of ups and downs
of the company as whole and their constant willpower to create a
legacy that a once small shoe maker made a company worth billions
today and won the hearts of people all over the world. But this story
had to start from somewhere so let’s take a glimpse of their journey
and how it all started.

1900-1949

Adolf dassler, the man behind the shoe giant was just following
family business when he started making shoes in his mother's
laundry. The First World War had shaken Germany and Adi used to
collect scraps of whatever he could find ranging from soldier's
uniform to used cycles to manufacture shoes. Being a sports fan he
wanted to make shoes for athletes and thus joined hands with his
brother 'Rudolf dassler' who was an excellent marketing and sales
person. Together they formed “Gebrüder Dassler Schuhfabrik" ( The
Dassler brothers shoe factory) in 1924. They continued to grow when
the people who used their shoes reviewed the shoes to have actually
been really comfortable. In fact they managed to partner up with
world class athletes such as Lina Radke ( 1928 Amsterdam gold
medallist) Jesse Owens(1936 berlin 4 time gold medallist) and thus
people of the world were introduced to the quality shoes of Adidas.

Around 1945

The WWII left Germany in ruins and the Dassler brothers had change
of mind-sets. While Adi stuck to the company he began, Rudolf left
to form a company of his own which is now known as PUMA!
1949

Having to start again now that his brother had left the company, Adi
dassler started the “Adi Dassler sportschuhfabrik" on 18 august 1949
with just 47 employees in the small town of Herzogenaurach. The
famous three striped logo was actually meant for more stability of
the spikes underneath the shoes but eventually became the
company's iconic logo.

1967

Adidas paid tribute to the German football legend Franz

Beckenbauer by making a tracksuit after him and this won the hearts
of public and was a success in being the company's first apparel
model which would later on go onto become yet another major
business for Adidas.

1970

The question of what business to take up next after having

conquered footwear industry by providing shoes for gold winners
and creating apparels for record holders; didn't seem difficult for
Adidas as they saw the opportunity lying in another sports event-
FIFA. In 1970 Adidas created its first official FIFA match football-
TELSTAR. As the name suggests, TELSTAR was created to make
visibility of the football better on the Black and White T.V. This
created history as Adidas signed a partnership deal to deliver new
footballs for every FIFA world cup to take place from then.
THE TREFOIL AND THE OLYMPIC IDEA

In 1972, the world turned to Germany when the Olympic Games

opened in Munich. Just in time for the event, Adidas presented a
new logo that was here to stay: the Trefoil. Then, symbolizing
performance. Today, the Adidas Originals collection stands for
lifestyle and street. Times may change, but trefoil quality will always
remain
1978

The era of Adi dassler came to an end when he passed away on 6

September 1978 at the age of 78. Leaving behind a legacy which
started by him sole handily carrying his family business and turned it
into a giant over the years, he was sure to be remembered for
decades to come. The company was handed over to his son Horst,
and together with his mother he took over the legacy and continued
to innovate products.

1984

Despite technology constraints, Adidas managed to put a microchip

in its shoe at the time when computers had just started to get
popular amongst the public. The invention provided athletes with
performance stats.

1986
The then famous group Run DMC released “My Adidas" and it was
about people loving their sneakers and their passion about art and
sports. The group signed a staggering $ 1.6 million deal then in which
they held the 3 striped shoes in their hand during their concert and
urged fans to do the same. The song helped Adidas to be associated
with not just sports but with art and leisure as well.

1993

When all hope seemed lost and company was up for sale and no one
really wanted to buy it as it was suicide, a man named Robert Louis-
Dreyfus believed in the recovery and became the new CEO. He
understood that the company could survive only if they followed
their legacy which was to deliver world class shoes; but it just
needed a new approach and thus the company focused on marketing
strategies to rebuild the weak foundations. After going public in
1995, the company's new slogan summed up everything- "They knew
it then, they know now."
1997

Having acquired the Salomon group and now owning brands like
Salomon, Taylor Made, Mavic and Bonfire the company was gaining
back its lost confidence.

2001-2004

Herbert Heiner became the new CEO of the company and once again
the company started re-innovating things. The company created
some of the most famous products during this time such as the
ClimaCool in 2002, Adizero in 2004 and the invention of probably
one of most favourite football shoes f50 right before the onset of
FIFA world cup 2006 in Germany. Alongside this Adidas was signing
deals with celebrities and sportsperson like partnerships with Yoshji
Yamamoto(2002) , Stella McCartney(2004) and the new slogan "
Impossible is Nothing" was promoted by people like David Beckham,
Haile Gebrselassie and Muhammad and Laila Ali; to indeed prove
how these people rose from hardships and conquered their dreams
just like the company itself.

2005-2006

Some must have thought that with the exit of Salomon group and
taking away all brands but Taylor Made, Adidas would suffer loss. But
the shoe giant acquired Reebok including the brands such as
Rockport and Reebok CCM hockey. With having alongside two of
world's best companies Adidas sailed to great heights with the new
name of company being Adidas AG.

2006-2010

Adidas continued to grow individually and alongside other brands

under it which included Taylor Made. They eventually acquired
Adams golf; making Taylor Made the world's biggest golf company
and reached new heights. This came around 2011 which was part of
a new business plan "Route 2015" and it meant to grow the company
at a never seen rate by focusing deeply on the inner and outer
factors.

2011
By now Adidas was a catchy name not just in the sports world but
also amongst the normal public. What other way to conquer the
market than to combine all aspects of life and not just focus on
sports. In 2011, Adidas brought out its new campaign which said "All
In or Nothing" which meant the company was ready to put behind its
ego and bring everything together so one could follow their heart.
“All in” (featured by Lionel Messi, David Beckham ,Katy Perry and
Derrick Rose) lived from the idea that, no matter your goals or
challenges, you have to go all in for the ultimate success.

2011-2015

The company focused on all its aspects now that everything was
merged. Reebok focused again on its original vision of a fit world and
and started campaigning again which brought together the people of
activities such as yoga, zumba ,aerobics and gymnasium.

Adidas introduced the Energy boost shoes which meant the shoes
now had a never seen before soft cushion for the best comfort ever
for running.

Today

As the world changes, so do they. While a computer in your shoe

seemed a bit weird in the ‘80s, it now is a professional training
system: miCoach allows athletes to track record and improve their
performance in sports, including football, running or basketball. It
becomes a category of its own. On top, Adidas launches a new sub
brand: Adidas NEO targets the young generation with social tools
such as a social mirror and the opportunity to, literally, shop at the
window with the touch of a button. And the 2012 London Olympic
Games become a happening on the Adidas social channels, bringing
behind-the-scenes events, competitions and athlete news to the
young consumer.

They do not know what the future in sports will bring but it will not
stop us from shaping it. They will keep pushing the envelope with
continuous innovations. And more importantly: they will make sure
that they give you the tools you need to be the best athlete possible.
Just how Adi wanted it.

Company's logo
The history behind the famous 3 triangles logo is quite interesting
and even though might seem simple to have thought of the logos, it
actually has a meaning with every logo changed since the start.

1. 3 stripes: It might fascinate you to know that the original logo

being just the three slant stripes were not really the logo. In fact the
reason behind the 3 stripes was that it was the best design for the
shoes back then. The shoes had spikes underneath them and the 3
stripes were hand-knitted in the shoe to support the spike design. It
later went onto become a logo as by 1967 Adi Dassler wanted people
to recognize the company with something instantly. He wanted to
leave a memory in the minds of public which would be associated
with his company and thus this logo was formed with the slogan
being “The Brand with the 3 stripes" .

2. Trefoil: Adi dassler realised the need to bring together everyone

even from outside the sports community who could just share the
love for quality shoes. Thus in 1972 he designed yet another
beautiful logo for Adidas ; the Trefoil. As the company expanded into
the leisure and apparels; Adi wanted to design a logo which would
best represent diversity and prove to the public that anyone can
relate to the brand. The logo then featured a trefoil with three
stripes running parallel to each other horizontally, at the lower half
of i. The logo is still used in classic sneakers and apparels to this date.

3. The triangle: This was the last modification in the logo which is still
present on most of the products made till today and this time the
company wanted to re-think their strategy and deliver a powerful
message to the public so they came up with the slanted triangles
which represent a mountain. It tells that Adidas as a company is
constantly growing despite facing problems and that they do not
back down but keep overcoming challenges just like the people who
buy their product keep pushing themselves to their limits.
 Workers and employees relationship

Workers at Adidas don't feel like they are working for a living rather
it seems to be a fun activity for them. Anyone would want to love
what they work and Adidas has an environment which lets its
employees feel the same and live life a different way. The only thing
to be noted in this kind of environment is to play safe and to deliver
best possible. Working in a company whose passion is sports they
need to feel like athletes who give their best at all times and this is
what even Adi dassler believed in. The company's vision was to
deliver world class shoes to athletes and keep getting better and
decades after the company was founded is what they still believe in
and continue to work hard to deliver best products and come up
with innovations. Not only do they encourage them to work hard but
they even assist them both on work and off work too. Moreover,
employees are rewarded for their performance to mark the sense of
achievement and promote team work to make bonds stronger.
Adidas believes in uniting everyone through sports and that's what
they have proved.

Benefits working at Adidas

Adidas give their full-and low maintenance representatives with a
liberal, far reaching, furthermore, individualized advantages bundle.
Here is an example of the superior advantages you can anticipate
accepting while at the same time working for the Adidas Group.

The necessities

-> Health insurance

-> Retirement plans

-> Supplemental insurance

Compensation

Adidas understands the insecurities of employee when they find out

that rival companies pays their workers more and so with their
Adidas group total compensation package they try to match if not
give more than what others get in terms of salary and work benefits
meaning they take feedback from within the organization of what
they expect from the company.
Recreational time

Adidas truly believes in the work getting done right with as much
flexibility as possible which suits the employee so they don’t get
bored nor feel pressurised by managers so the company does offer
vacations and flex-time for their employees to stay full of energy and
balance their work-life needs.

Open to train

Adidas believes that not everyone is born with all the knowledge in
this world and that sometimes employees do need to get trained in
order to keep up with the company's ever-changing and dynamic
pace which is sure to bring constant adventures and challenges to be
faced in future.

The perks
Besides offering the above mentioned facilities Adidas also offers
some perks which makes the work time worthwhile with guaranteed
fun for later times.

Lifestyle:

-> Personal trainers

->product discounts and generous offers for you and your loved ones

-> Track field with basketball, tennis and volleyball courts

-> Onsite gyms

-> Discounted travel and adventure filled weekends

-> Opportunities to meet famous celebrities and athletes

Culture:

-> Free language courses

-> Strong global career opportunities

-> Full-service kitchens offering international cuisine

-> Company cafes

-> Remote connectivity

Balance and community involvement:

-> Adi dassler fund global volunteering programs

-> Wellness support

-> Day-care in selected locations

-> Commuter programs

-> Bicycle share programs

It's not uncommon during lunch hour to find Adidas employees
engaging in their favourite sport at one of their athletic facilities or
traveling to one of their 170+ locations worldwide for a business
meeting. One thing is certain for Adidas Group employees; they are
always ready for an adventure, in life, in work and in giving back.

Changes in its marketing strategy

Adidas wasn't always so welcoming and open to its employees as it is
known for today. In fact before 1993, before Louis-Dreyfus joined as
CEO, Adidas had a bad name for being way more formal and strict
than what was normal. It was not open minded as even all the top
officials were just German and no one else. The legacy which Adi
dassler had left behind was being twisted and broken and a lot of
bureaucracy was going on and the company thought everything they
were doing was perfect(due to their ego). The new CEO realised that
the biggest challenge to overcome this was making this tight to
breathe in environment a bit more employee loving and allow them
to have the freedom to work.

Adidas then tried to learn from its rival, Nike's strategy to become a
better company. Nike at the time was booming with success as what
they stood for is what they asked their employees to exhibit and
behave as. They stood strong as a sports focused company thus
promoting healthy and fitness practices within the organization. They
encouraged employees to cycle to work instead of drive and offered
them to pay more if they did so.

Nike has a sports mantra and this is strictly followed in the

organization. Workers are given more than an hour of lunch break
during which they required to first play basketball or tennis or just
simply exercise. When a new employee joins, they are shown videos
of sports highlight Nike has achieved and what they can contribute to
the company. Nike even communicates regularly with their
employees by exchanging emails regarding milestones achieved and
they encourage public talks by employees to boost their confidence.
Louis-Dreyfus wanted to change this hectic culture of Adidas and the
first thing he did after coming into power was remove all the top
officials who were German to lighten the serious vibe. New American
accounting rules were followed and people from diverse nationalities
were encouraged to come and work with them which resulted in the
total destruction of the prevailing bureaucracy. Within weeks all but
trusted German officials were fired and instead of old managers, new
young managers were hired who proved to be more flexible and
open to ideas. German was no longer allowed to be spoken within
the organization and English was the new language they
communicated through.

Germans are known for their formal culture and a few weeks after
the previous managers being fired, the new and young managers
were required to show up in sweat shirt and sneakers to work. The
freedom which was given from then on was something that of a new
born child and never were new ideas rejected ever again.

Workforce management
Employment standards:

Forced labour: Investors and business holders cannot and shall not
use forced means as a way to get work and the employees should
not be threatened to work under and kind of political pressure

Child labour: Business partners shall not force children or even

employ them any under circumstances employ children under the
age of 15 who haven't even received basic education.

Discrimination: Business partners will not discriminate or be partial

towards employees during any recruiting or operating process.
Decisions against any person shall be made purely on the basis of
their ability to perform a given task and not in any circumstance
based on their caste ,race ,religion,sex,color,nationality,beliefs,family
background etc. Furthermore, proper measures shall be taken to
safeguard the rights of immigrants and make sure they feel safe to
work.

Wages: Business partners shall see to it that employees are paid

according to the work they put it or are paid minimum wage of what
the law in a particular country says and are compensated evenly for
overtime which may exceed normal wages. Employees shall also
receive basic facilities and health benefits according to the law and
shall not be denied of their rights.

Working hours: Employees must not be required, except in

extraordinary circumstances, to work more than 60 Hours per week
including overtime or the local legal requirement, whichever is less?
Employees must be allowed at least 24 consecutive hours rest within
every seven-day period, and must receive paid annual leave.

Freedom and association of collective bargaining: Business partners

must realise that it is the right of workers to join or form groups of
their own and bargain collectively. They even need to make sure that
the so called associations are treated fairly with no political practices
involved that shall hurt the sentiments of workers.

Disciplinary practices: All the employees shall be treated with

respect and dignity and will not be subjected to physical or mental
abuse in any case whatsoever. Business partners even need to make
sure that the workers will not be required to pay fine as a disciplinary
measure and factories must have a factory manager to which the
workers can reach up to for any disputes and that they will be given
freedom to speak without any fear of losing jobs.
Health and safety: Business partners will provide the workers with
proper environment which will be safe to work in and not have any
danger which may pose a risk to the health or life of the employee. In
case of any accidents such as fire or toxic substances, certain
measures will be taken to save the life of the victim. The workers will
have access to clean sanitary facilities at all times and will not be
denied basic human necessities such as water, fresh air to breathe(
fully ventilated work place) , access to washrooms, and given breaks
during hours of work.

Environmental requirements: Business partners shall follow

sustainable practices which would benefit everyone. This means all
business decisions shall be taken only after considering sustainable
practice and that no harm is being given to the environment.
Employees shall strive and continue to innovate product, use
adequate resources only and adopt proper waste disposal practices.
 Marketing strategies
It is no wonder that keeping your vendors close and happy will result
in the success of business as when the suppliers are happy, they
better connect with the company and take up their mission as one of
their own. But in this ever changing world, how do companies
manage their inventories and supply chain when one small mistake
could lead to loss in millions and the image being ruined. Hence it
becomes extremely important for a company to manage its
inventories and keep good relations with their suppliers. Let’s take a
look at how Adidas manages to keep its suppliers close and help
them grow into large scale manufacturers.

Supply chain approach

As Adidas outsources a lot of work and different suppliers
manufacture at different level, it gets harder and harder to keep
check on quality of the products being delivered because if the
product doesn't reach the minimal quality, Adidas's name is being
spoilt hence they have a separate division of team and multi-level of
checking process to make sure that the supplier is trust worthy.

If the supplier passes the standard quality check, the company then
decides what and how much work is supposed to be given to them
which they could effectively operate with.
Working with suppliers

Checking the rules are followed

In order to check whether the supplier is able to deliver the required

quality, Adidas hires third party experts who then go onto the sites
and check it thoroughly keeping in mind the Adidas workplace
standards and gives a detailed and impartial report back to the
company which in turn even helps in training and infrastructure
development if possible.

Rewarding good performance

Even after a factory is approved by Adidas, they continue to keep a

close eye on them whether or not they would follow the company's
guidelines as one of their own and give their full potential. The
factories are also expected to keep the environment of work safe
and clean for the workers and not mistreat them. At the end of the
year, close suppliers are given scores and based on that score Adidas
then gives them future orders and give them assurance that they
would like to continue working with them.

Taking action against poor performance

When Adidas finds out that the supplier they are doing business with
are following malpractices and not treating their employees properly
or not meeting the environmental or workplace standards, they issue
out a warning letter to the factory. There are three levels to this
process with the first letter being a casual warning that the supplier
must correct the problems Adidas has pointed out, second letter
meaning they would cancel the order and even then also the supplier
doesn't stop it, the third letter signifies end of business relationship
in future with them and even takes up strict action against them with
the help of government.

Working with licensees

The Adidas Group keeps on developing, and one way it develops is by

entering concurrences with other 'claim to fame' organizations to
make, offer or disperse their items. This is the thing that Adidas call
permitting. On account of authorizing and the utilization of
operators, the Adidas Group likewise has numerous circuitous
providers. These are manufacturing plants working not
straightforwardly for Adidas, but rather for other clients. To deal
with this piece of their production network Adidas ask their
operators and licensees to duplicate their own 'in-house' observing
methodology and have individuals check the industrial facilities and
enable them to remain consistent with Adidas rules. As a rule, the
organizations overseeing Adidas aberrant providers utilize outside
social evaluating firms to do the checking. Adidas call these experts
outer screens.
 Evaluation of Adidas using various strategies

Adidas six force analysis

Rivalries: Adidas faces the biggest rivalry with sports giant Nike
which alone controls almost 33% of the world market for athletic
shoes. Companies such as Puma, Asics and New balance also pose as
a challenge to Adidas despite being relatively small. China's Li Nang
would also turn out to be a hurdle as in china the production rate is
higher than other countries. Together these companies pose as a
collective threat but Adidas as the advantage of being in this game
for far too long and with its great leadership skills can’t overcome
problems.
Substitutes: Adidas has numerous substitute brands like Nike, Puma
,Asics,Li Nang which provide athletic shoes at almost the same price.
Athletic shoes fall under the premium product so customers look for
long term benefit which means best quality with lowest price and for
this reason not everyone is willing to stay loyal to the brand. Even
the apparel business is dominated by smaller companies.

New entrants: As the sports market is hard to get into and new
entrants will need to have high capital for hiring labour, land and
invest in R&D; it’s quite difficult to enter in the segment. Even if the
capital is raised to manufacture products, a lot of capital would need
to be spent even after that on marketing strategies to attract
consumers and have a name for their product in their market which
would require time as well meaning the already established brands
would have the edge over the new entrants.

Customer's bargaining power: As there is no shortage of companies

providing the same product but with better quality and low price, it’s
not that difficult to shift to new brands and becomes difficult to
make customers loyal. The fact that consumers aren't limited to
products or companies and will look for the best design, comfort and
price out there makes it really hard to compete in this market.

Supplier's bargaining power: The suppliers’ bargaining power is high

as well, since Adidas makes contracts with Famous athletes or teams
(such as Chelsea FC, Liverpool FC, NY Giants, LA Lakers, David
Beckham), to promote and advertise its products. But famous teams
and athletes most of the times dictate the terms of the contract thus
increasing the suppliers bargaining power. Moreover there is great
competition observed to sign contracts with famous sporting events
(Olympic Games, NBA, FIFA World cup and Euro cup), which is a fact
that makes supplier’s bargaining power bigger. If they can choose
among several competitors they can easily threaten to pick the one
with the best offer.

SWOT analysis
SWOT analysis is a framework used to evaluate a company's
competitive position by identifying its strengths, weaknesses,
opportunities and threats.

Strength Weakness

• Monetary situation • Overpricing

• Great marketing strategy • Focused product line

• Leadership skills • Online platform for

customer service
• International operations
• High cost structure
• Strong supply chain

Opportunities Threats

• Transition of consumer • Rival companies in

lifestyle apparels

• Technologically advanced • Customer bargaining

• Expand customer base • Increase in taxes

• Market diversification • New entrants

 • Supplier bargaining

Conclusion and recommendation:

Adidas is doing a fantastic job as of now in achieving more customer
base and have pioneered some of the products be it from the
original brand or Taylor Made*. The growth Adidas has seen till date
has been phenomenal and proved that hard work beats talent when
talents don’t work hard. Their passion for sports is unbeatable and
they understand the needs of not only consumers but also their
employees which help them grow even today. A lot of lessons can be
learned from them one of them being how to achieve leadership
skills. The areas they can improve at however are no secret; which
includes bringing out new products more often now, conducting
more surveys, proper communications in less advanced areas.
Bibliography:
Wikipedia
scribd.com
slideshare.com
Adidas.com