Adidas was founded by Adolf Dassler and his elder brother Rudolf Dassler in the early 1920s and is now recognized as one of the most famous global manufacturers of sports products. Adidas is developing its products to serve customers’ needs at best possible level. Adidas works on its products by incorporating new fashion trends and technology and making them more sport-specific. Today, we will discuss the Adidas marketing strategy, marketing mix, and market analysis through SWOT analysis in this case study.
There are three main areas of marketing where Adidas sees an increase in its mix of sales and investment.
- First, the company is expanding into new places, such as developing new products and services, enterprising in new fields, and moving from production to development for upkeeping.
- Second, Adidas’s presence on social media platforms is increasing as people seek out its products for fresh flavors and ingredients.
- And third, Olympics-related advertising will continue to be a major part of Adidas’s marketing strategy.
Marketing Mix of Adidas
Here is Adida’s marketing mix comprised of the 4Ps of marketing: Product, Place, Price, and Promotion.
Product: This product that Adidas markets under its various labels, such as energy boost, running, football training, tropical heat wear, etc.
Place: This is a place where these products primarily sell out depending upon the developed region.
Price: Adidas is aggressive in promoting prices to enjoy a competitive position. In this area, Adidas believes the price will be dictated by the market’s demand, not its shortages or excesses. In 1964 when Adidas began pricing shoes at $12 vs. Nike at $15, Shoe sales went down, but once set price, they stayed the same, becoming more attractive to prospective buyers versus new entrants with their much lower prices.
Promotion: This refers to the strategies of Adidas for attracting consumers to purchase its products, whether it is competition, direct marketing campaigns, or social media messaging and advertising.
Adidas differentiation strategy
Adidas focuses more on the broad differentiation strategy. The corporate level strategy of Adidas focuses on innovation, trying to produce new products, services, and processes to cope with the competition. The group’s multi-brand portfolio gives them an important competitive advantage. That created a global sales function responsible for commercial activities, and international brands serve accountable for the marketing of both brands.
The global sales function was split into two departments, wholesale and retail. That catered to the various needs of both these business models. It has been done to sustain their corporate-level strategy for the long run so that these divisions could emphasize and work hard in their respective departments to make the most of their efforts.
They implemented a multi-brand strategy by having a diverse brand portfolio, allowing them to cater to all market segments, from players to almost everyone. It helped them to keep a unique identity and concentrate on their core competencies.
Adidas’ digital marketing strategy
Adidas uses a straightforward digital marketing strategy to communicate with its current and potential customers. By implementing this strategy, they have been able to take competitive advantage with their top competitor, Nike. By changing the behaviors of consumers with this digital transformation, Adidas has to change how they work. The use of technology has helped Adidas connect with more consumers and build stronger relationships with customers.
Six components aid Adida’s digital marketing strategy, including:
- Digital and technology
- High-speed manufacturing
- Personalized experience to create strong relationships with customers
- Open-source innovations and collaborations
- Strategic cities include London, LA, New York, Paris, Tokyo, and Shangai.
- Improve portfolio of both brands, i.e., Adidas and Reebok.
The past year has witnessed the growing popularity of Instagram Reels with millennials and Gen-Z audiences. Thus, harnessing the popularity & impact of Instagram Reels was the approach to creating visually appealing and stirring content that drove product heat and led the campaign story #OpenForum
Visual Storytelling & Content Output:
Social media has played an important role in bridging information gaps. In contrast, brands have ensured that Indian consumers access the best global launches on the same day as consumers in other parts of the world.
An Instagram campaign was undertaken that engaged 50+ creators from various fields to bring the campaign message to life and drive appeal for the launch of the new Adidas sneakers through relevant storytelling.
SWOT Analysis of Adidas
SWOT analysis is the method of measuring the organization and its environment, whether internal or external. It is the first stage of planning, which helps marketers focus on the key issues an organization can face.
SWOT stands for Strengths, Weaknesses, Opportunities, and threats. Adidas’ strategy analysis focuses on Strengths and Weaknesses, which represent the company’s internal environment. In contrast, the other two represent the external environment with direct and indirect impacts on the business.
- The brand recognition of the product it’s well-reputed.
- High-quality products.
- Provides a diverse range of products (shoes, bags, shirts, perfumes, toiletries, etc.)
- Obeys environmental laws (Adidas has never been accused of pollution)
- Adidas’ policies and management safeguard employees’ rights.
- Online stores are offered only to the USA or some locations in Europe.
- Customer services are not functional, which creates problems, especially in the case of e-marketing
- Price is interwoven to high quality.
- Outsourcing web development and e-commerce/marketing to a third party is possible.
- The growing market for sports apparel
- Joint Venture with partners around the world to increase participation in athletics.
- Unstable economic environment
- Competition at the supply chain management level
- Nike’s strong reputation in the sports industry