Adidas by Jordan Dabney

Table of Contents Introduction Company and Market Overview Current Positioning and Placement Current Communication and Promotional Strategies Current Target Consumer Omni-Channel Audit New Strategic Initiative Visualizations Market Analysis Proposed Target Consumer Communication and Promotional Plan Financial Plan Conclusion Appendix

Company & Market Overview

Introduction

We chose Adidas after doing research from case studies and see that Adidas is falling behind on their innovation and we saw a need for them to step up their game. Adidas is competing with power houses such as Nike and Under Armour.

history 1924

Founded “Dassler Shoes” by brothers Rudolf and Adi Dassler in Germany

1948

Adi changed the name to Adidas after Rudolf left the company to create Puma

1954

Adidas cleats were used by the German national football team in the 1954 World Cup Final

1967

The Franz Beckenbaur tracksuit made its debut, this was the first piece of apparel for Adidas

1968

Adidas gained trust from Olympic athletes

1970

Created the first Adidas soccer ball

1972

The trefoil logo was created representing performance

1978

Adidas became a multi-sports specialist brand

1986

Adidas’ collaboration with Run DMC was to symbolize the merge between arts and sports

1987

The family business came to an end with Horst Dassler’s sudden death

1998

Adidas committed itself to its roots and moved into new headquarters just outside of Herzogenaurach.

2002

Adidas introduced a lifestyle segment focusing on sports-inspired streetwear and partnered with Yohji Yamamoto

2015

Presented a five-year strategy that includes growing in six key cities: New York, Los Angeles, Shanghai, Tokyo, London, and Paris.

company and market overview

company and market overview Number of Stores Worldwide

316 300

254

193

295

279

152

851

872

1,746

1,698

779

184

725

755

734

730

681 1,661 1,352 1,019

2008

1,355

1,437

1,203

2009

2010

Concept Stores

2011

Factory Stores

2012 2013

3rd Party Retailers

2014

2015

Positioning and Placement

CORPORATE STRUCTURE

Expensive

Adidas employs 58,566 employees worldwide, with more than 4,403 employees from each 86 nations.

Kasper Rorsted CEO

Roland Auschel Global Sales Performance

Robin J. Stalker CFO

Fashion

Glenn Bennett Global Operations Less Expensive

Positioning and Placement

FUTURE GROWTH PLANS

TOP PERFORMANCE $17,928 BILLION $15,405 BILLION $15,360 BILLION

In 2015, Adidas presented a five-year strategic business plan for the Adidas Group. “Creating the New” is the new attitude of Adidas and what they’re hoping will lead them into the future. The company works hard every day to inspire sports lovers. The also try to empower there sports into streetwear and fashion. Everything Adidas does is rooted in sports no matter what. With this five-year plan, Adidas hopes to get closer to their consumer than ever before. The five-year plan includes: Speed: Adidas will become the first true fast sports company: fast in satisfying consumer needs and fast in internal decision-making.

$15,774 BILLION $14,119 BILLION

Financials

Cities: The company has identified six key cities in which they want to grow share of mind, share of market and share of trend: New York, Los Angeles, Shanghai, Tokyo, London and Paris.

$12,708 BILLION

Open source: Adidas will be the first sports company that invites athletes, consumers and partners to be part of our brands.

2010

2011

2012

2013

2014

2015

http://www.adidas-group.com/en/group/history/

FUTURE GROWTH PLANS

Adidas will try to introduce less-expensive shoes. King said the bulk of business in the United States needs to fall in price to a range of $70-$100, versus shoes like the Adidas Boost (more expensive shoe Adidas offers), which can cost between $120-250 dollars. “If we are going to win market share in any footwear category, we have to have strong franchises in these midpoints,” he said. The brand hopes to make use of shoe technology it calls Bounce, which is similar to what goes into the Adidas Boost, but which costs less. Y-3 X Adidas 2005

Adidas expects profit growth of 15 percent per year until 2020, with currency adjusted sales reaching $24 billion, from $14 billion currently. That would put Adidas back in the No. 2 spot; Nike is targeting $36 billion in revenue by mid 2017. -CNBC

“To be the best sports brand in the world, we have to be the best sports brand in America.” - Mark King, Adidas

SWOT

Analysis

Strengths

Threats

Global Presence

Market competition

Strong promotional strategies

Dependence on third-party manufacturers

Strategic Partnerships Growing counterfeit goods market

Weaknesses Declining net working capital

Opportunities Key developments

Innovation of new products

Growth prospects: E-retail

Caters only to a few sports

Strategic initiatives

DISTRIBUTION

DISTRIBUTION MARKETING

Adidas Group

PRODUCT DEVELOPMENT Supplier

Agent

Licensee

DESIGN Sub-Contractor

Supplier

Agent

Adidas has an “idea to shelf, from shelf to you” outlook on distribution. Adidas strives to be innovative with their products. Marketing, product development, design, sourcing, and supply chain management are the strongest gears for the brand. These gears allow the brand to get products to the consumer in a timely manner. As of August 2016, Adidas has sold 364 million pieces of apparel, 301 million pairs of shoes, and 113 million units of hardware.

SOURCING

Supplier

SUPPLY CHAIN MANAGEMENT Sub-Contractor

Supplier

Sub-Contractor

Products Adidas is sold in their concept stores, outlet stores, department stores, and e-commerce. Their product is sold in over 75 countries and offer e-commerce in over 90 countries. In 2016, Adidas revenue totaled at $18,796 billion. Adidas expects profit to grow 15% per year until 2020.

364 MILLION PIECES OF APPAREL

301 MILLION PAIRS OF SHOES

113 MILLION UNITS OF HARDWARE

current strategies & Consumers

Current Communication and Promo Strategies Adidas is the first sports company that invites athletes, consumers and partners to be part of their brand. Adidas sponsors major sports such as FIFA, NBA, and the Olympics. Their portfolio of creative influencers and innovative partners include Kanye West, Stella McCartney, Disney, Parley for the Oceans, Red Bull Media House, BASF and Google. This wide range or collaborators makes Adidas a strong brand that appeals to more than sports consumers. Along with these collaborations, Adidas partners with celebrities like Snoop Dogg, Karlie Kloss, and James Harden.

Current Communication and Promo Strategies

Current Target Consumer

Current Target Consumer Behavioral Segmentation: - Sports lovers - Athletes - Image seekers - Brand lovers - Gym users - Healthy lifestyle

Psychographic Segmentation: - Achievers - Well-experienced - Hard workers - Strivers

Demographic Segmentation: -18 to 32 years old - Male and female - Income level: minimum of $15,000 - Social class: upper middle and upper class

“Adidas’ strongest consumer market is with the 18 to 32 year old age group who are athletes or are passionate about sports. Adidas believes this target group is the most influential consumer group in the world” (Reference.com).

Consumer Profile

Alexa Smith Nick Jones 19 24 Lives in New York Lives in Detroit, Michigan Student at FIT Graduated from Winthrop University Paid intern at Paper Magazine Marketing assistant at eDetroit $15,000 $55,000 Single Single Athleisure addict Sports Fanatic Lives for great performance wear

Always looks forward to Adidas designer collaborations

omni channel audit

Omni-Channel Audit Social Instagram ADIDAS - Aesthetically pleasing with colors, but nothing pops out - #heretocreate, repeated a lot through out feed - All about winning, not showing any - Would benefit from having a combination of both celebrities and real people - Same lighting in videos - No posts from fans

Twitter - Updated daily 2x at least - Same content as instagram - Could be utilizing more to engage with consumers, specifically target consumers Youtube - Could be updated more frequently - More engaging content like Originals

Omni-Channel Audit Web

ADIDAS ORIGINALS Instagram & Youtube - Well curated photos and videos - Each platform is easily readable - “ I did it my way” & “Original is never finished” more appealing taglines to inspire

- Search & Browse- good balance of curation and usability - Easy to search efficiently - Tracking available, free shipping on custom items (i.e shoes) - 7 days a week customer service - Layout clean

Mobile App - Only one app Adidas confirmed which is just solely for anticipated releases shoes

Overall, Adidas could benefit from softening their persona on social media platforms, looking to Originals for inspiration. Originals has a strong consumer awareness, they are able to connect with the consumer instantly across all platforms. For example, their most recent Adidas Originals campaign, “I want it my way” showcases many different kinds of artists such as photographers, dancers, and skateboarders. The ambassadors chosen to represent Adidas Originals in their promotional videos get the viewer excited and wanting to know more.

strategic initiative implementation

Strategic Initiative We plan to expand brand awareness and create a unique store experience for the Adidas consumer by, implementing a dome like structure composed of smart foils which interacts organically to human behavior.

Studio Roosegaarde is based in Rotterdam (NL) at the Dream Factory, a 1930s glass factory overlooking cityâ&#x20AC;&#x2122;s harbor. Studio Roosegaarde is the key supplier of the smart foils used on the structure. Studio Roosegaarde is the social design lab of Dutch artist and innovator Daan Roosegaarde and his team of designers and engineers which make ideas of future landscapes become reality. Roosegaarde and his team create interactive innovations which explore the dynamic relation between people, technology, and space.

Strategic Initiative

It will take six months to complete the structure of the Lotus. The structure includes hologram projections, lighting, and the smart foils. It will then take two days to install the structure into the Melrose Avenue location. The installation will take place starting on August 6th and end on August 7th at the end of the day. The installation will be ready to make its debut on August 8th. The installation will remain in the store from August 8th to December 20th. The store will have an electrician on call in case the employees have any issues with the technology.

HologramUSA is based out of Beverly Hills, California. HologramUSA is the key supplier of the hologram technology we will be using in the initiative. We will use HologramUSA to project photos of our newest products and videos of our newest campaigns. The holograms will be on a loop throughout the day and will change locations on the dome. The lighting we will be using will be supplied by First LED Lighting Center. First LED Lighting Center is a premier distributor of high quality LED lighting products for commercial and residential applications. The lighting will constantly change colors throughout the day to keep consumers engaged with the installation.

Step 1: Consumers come into the store and notice the Lotus dome. Consumers will then walk up to the technology and interact with it Step 2: While consumers are interacting and seeing the lighting change colors, the smart foils will then blossom Step 3: Once a foil opens up, a hologram of our newest products or campaigns will appear

The smart foils included on this structure cost about $9.15 each. There is a total of 5,680 foils on the Lotus structure. The total cost of the foils will come to $51,972. There will be five LED lights included in the structure, costing about $150. Total cost for the lights will come to $750. Holograms will also be implemented into this structure. There will be fifteen locations on the dome where holograms will appear. Each hologram will cost $200 which will total to $3,000. The complete total for this structure will be $55,722.

Strategic Initiative

Visualizations

Operational Plan for Lotus Dome

January 2018 Research & Development Technology Sourcing - Sourcing Materials Consultation Installation Training Budget Product Testing - Lighting - Foils Ad development Promotion Launch

February 2018

March 2018

April 2018

May 2018

June 2018

July 2018

August 2018

Visualizations

Market Analysis To test our initiative, we decided to choose a location in Los Angeles because it is one of the cities the brand wants to focus on. The store location we chose is located on Melrose Avenue. The Melrose location is the newest concept store in Los Angeles. This location is perfect because it features Southern Cali-inspired artwork, furniture, and installations. We believe our initiative will do extremely well in this location and bring in even more foot traffic.

DEMOGRAPHICS OF MELROSE AVE: Population → 3,792,621 Sex → Male 49.85% Female 50.15% 15 to 19 years old 10.91% 20 to 24 years old 13.12% 25 to 34 years old 23.47%

COMPETITORS: Sportie LA → 7753 Melrose Ave, Los Angeles, CA 90046 Sportie La is specialty retail and ecommerce store that offers a variety of footwear, apparel, sneakers and accessories brands. The company was founded in 1985 and is based in Los Angeles, California. Sweaty Betty → 8551 Melrose Ave c, West Hollywood, CA 90069 Born in Notting Hill, London in 1998, Sweaty Betty was founded by Tamara Hill-Norton to redefine the way women dress for fitness and beyond. Famous for reversible yoga pants, statement prints, bum-sculpting leggings and technical fabrics, say hello to pieces that take you from bar to barre. Nike The Grove → The Grove, 189 The Grove Dr, Los Angeles, CA 90036 NIKE, Inc. fosters a culture of invention. They create products, services and experiences for today’s athlete while solving problems for the next generation. The company was founded in 1964, as Blue Ribbon Sports, by Bill Bowerman and Phil Knight, and officially became Nike, Inc. in 1971.

Market Analysis There are no other fashion retailers in the area employing this initiative, but Nike is one other fashion retailer that is able to engage in this type of initiative. They are number one in the rankings for a reason. Nike is a strong brand and we believe by implementing this technology before our competition, we may be able to be the top dogs once again.

Proposed Target Consumer “The company is focused on targeting and strengthening its brand with the next generation of athletes in the 14- to 19-year-old age group. Adidas believes this target group is the most influential consumer group in the world.” (Reference.com)

We chose to maintain Adidas’ target consumer while focusing on a younger demographic as well. The brand believes the next generation of athletes is the most influential consumer group in the world. We strongly believe that this iniative will appeal to the 15 to 32 year old age group because this age group is very technologically driven.

We believe future competition with the technology would be retailers using body scanning technology or smart mirror technology. For example, Rebecca Minkoff’s futuristic store in Los Angeles using smart mirror technology. Using this technology in a retail space allows for consumers to have a unique shopping experience. Another competitor we believe Adidas would have would be contemporary museums. The Museum of Contemporary Art in Los Angeles would be a competitor for the Melrose location because the museum features a lot of new artist and has interactive installations. Along with a retail experience, the Lotus initiative will add a contemporary, museum-like feel.

Psychographic Segmentation:

Behavioral Segmentation:

Demographic Segmentation:

- Achievers - Well-experienced - Hard workers - Strivers

- Sports lovers - Athletes - Image seekers - Brand lovers - Gym users - Healthy lifestyle - Into the athleisure trend - Like to look put together while working out and playing sports

-14 to 32 years old - Male and female - High school students - High school graduates - College graduates - Income level: minimum of $13,000 - Social class: upper middle and upper class

Proposed Target Consumer

Ashley Parks

Jamie Reeves

Lives in Los Angeles, California

Lives in Brooklyn, NY

Attends Los Angeles High School $13,000

Income $35,000

Likes to express her personality through her clothing

Single

Future Fashionista

Athleisure addict

Enjoys visiting Venice Beach with friends

Always looks forward to Adidas designer collaborations Does yoga in her free time Leads a healthy lifestyle

Proposed Target Consumer

Aidan Clarke 29 Lives in Portland, Oregon

Communication and Promotional Plan The Lotus technology will be in the store from August to December due to the high demand of back to school foot traffic and holiday shopping. The communication and promotional calendar shows the specific dates in 2018 that Adidas will be promoting the strategic initiative. We will start promoting the new initiative in May with social media teasers and emails to customers to the Melrose Ave. location. During the first week of launch, we will have a store event debuting the new technology and customers will receive a free Adidas shopping bag. Customers will be able to mingle with other customers and employees while testing the new technology. Post launch will be social media posts about how the new technology did in the Melrose Ave. location. The activities for pre-launch will occur three months before launch which is August 8th. During pre-launch, launch, and post-launch the brand will be able to focus on social media and direct activities. The promotional plan will start May 8, 2018 and last to February 8, 2019.

Graduated from University of Oregon

12 Month activity plan 2018-2019

Freelance photographer $62,000

SOCIAL MEDIA Facebook

Married Sports Fanatic Has season tickets to the Oregon Ducks football games

Adidas Instagram Adidas Originals Instagram Twitter

DIRECT E-mail

Lives for great performance wear

Website

EVENTS

Bikes the Oregon trails in his free time

LAUNCH (2018)

PRE-LAUNCH (2018) May

Launch Event

PRINT Signage Billboard

TV Enertainment Tonight Local News

June

July

August

September

October

post-launch (2019) November

December

January

February

March

April

Communication and Promotional Plan

Social media platforms including Facebook, Instagram, and Twitter will be used to promote the upcoming events and infromation on the strategic inititative. This will allow the consumers to be up to date with everything pertaining to the new initiative. All social media platforms will be active during pre-launch, launch, and post-launch activities. We will also include signage on the windows of the store to provide another form of promotion.

Instagram

Twitter

Communication and Promotional Plan

Website

Communication and Promotional Plan

Billboard

Financial Plan HUMAN RESOURCES UNITS HOURS COST PER UNIT TOTAL COST Store Manager 2 3,650 $40 Employees 10 3,100 $13 Construction Workers (12 weeks) 5 96 $150 Training (2 weeks) 2 112 $300 Electricians (6 weeks) 3 240 $150 TOTAL HR COST TECHNOLOGY Hologram Display Unit (4 weeks) Smart Foils Light Installations TOTAL TECHNOLOGY COST PROMOTIONAL Social media TV Website Billboards Radio Print TOTAL PROMO COST TOTAL OVERALL COST

15 5,680 5

1 1

$6,500 $9 $150

Conclusion

$292,000 $416,000 $72,000 $67,200 $36,000 $883,200

$97,500 $51,120 $750 $149,370

$ 10,000.00 $ 15,000.00 $ 5,000.00 $ 10,000.00 $ 7,000.00 $ 12,000.00 $ 48,200.00 $1,080,770

Adidas is a global leading retailer in the sportswear industry. With it’s passion for athleticism and exceptional customer service, it has appealed to a very large customer base. By implementing this new strategic initiative we are hoping to create an even more seamless customer experience, while also having them engage with art. Using this technology is another way for the brand to tap into the younger demographic they’ve been trying to reach out to, while also maintaining the current one. Adidas will be given the chance to expand their business ventures through this interactive platform, which will increase foot traffic and profit, whilst also making the brand more innovative.

Appendix

Lotus 7.0 Daan Roosegaarde Leonardo, Volume 43, Number 4, August 2010, pp. 408-409 (Article) Published by The MIT Press

For additional information about this article

https://muse.jhu.edu/article/387629

Access provided by Savannah College Of Art & Design (3 Mar 2017 02:57 GMT)

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