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Adidas SWOT
BusinessManagementMarketingSWOT & PESTLE 

SWOT Analysis of Adidas Gives A Reliable Management Framework

by Shamsul 
 
SWOT Analysis of Adidas Gives A Reliable Management Framework
 
 
 
 
SWOT is a strategic tool to analyze Adidas’s strengths, weaknesses, opportunities, and threats. It involves internal strategic factors (strengths and weaknesses) and external strategic factors (opportunities and threats). Adidas has a reliable management framework that allows a company to set its performance and position. It is a reality that Adidas is a respected brand in the retail and lifestyle industry. Now, you will read about the SWOT Analysis of Adidas. We will also highlight the segmentation and USP (Unique Selling Proposition).
 
 
 
 
Former Name: Dassler Brothers Shoe Factory (1924–1949)
 
Company: Adidas Group
 
Founder:Adolf Dassler
 
Established: August 18, 1949, Herzogenaurach, Germany
 
CEO: Kasper Rørsted (Oct 1, 2016–)
   
 
Area Served: Worldwide
 
Category: Athletic Apparel and Accessories
 
Sector: Lifestyle and Retail
 
Tagline: “Impossible is Nothing”
   
 
Unique Selling Proposition: Sports equipment, Accessories, and Apparel
 
Sector: Men, Women, and Kids Fitness and Sports Equipment
 
Target Audience: Upper Middle and Lower Class
 
Number of employees: 62,285 (Dec. 2020)
 
Revenue: $22.668B, a 14.39% decline from 2019
   
 
Net Income: $0.493B, a 77.7% decline from 2019
 
 
 
 
Strengths of Adidas: SWOT Analysis of Adidas
 
  1. Since 1924, Adidas has had a high brand value and long legacy.
  2. The biggest strength of Adidas is its sponsorship. It is currently sponsoring major sporting events. From Olympics to teams, sportspeople, and more, these sponsorships have proved beneficial for the company in so many ways.
  3. Nobody has any doubt that Adidas is a global company with vast worldwide reach. It is present in every country.
  4. The diverse product portfolio is a major strength of Adidas. They offer sports equipment, shoes, clothes, and accessories.
  5. Adidas has established itself as a robust company due to its innovative and effective marketing.
  6. It currently has more than 62,000 employees worldwide.
  7. Effective use of TVCs, print media, hoardings, online ads etc. shows the value of Adidas.
  8. You will find several famous sports stars who are the brand ambassador of Adidas.
  9. Easily get the products of Adidas from its own website and other leading online sites.
 
 
 
 
You can read on: MARKETING STRATEGY OF ADIDAS | ADIDAS MARKETING
 
 
Weaknesses of Adidas – SWOT Analysis of Adidas
 
  1. Adidas is a luxury brand, so some of its products are highly costly. It creates a weakness for Adidas because it limits its audience. The higher prices of these products are due to the innovative production method and technology.
  2. Various similar brands in the lifestyle industry offer the same products. So, Adidas operates in a highly competitive environment that can damage its profit and revenue game.
 
 
Opportunities for Adidas – SWOT Analysis of Adidas
 
  1. In order to stay competitive in the relative market, Adidas should generate more than 50 latest foot-friendly designs annually.
  2. They should focus on the latest and stylish designs of shoes and clothes.
  3. Adidas should link up with merging players, teams, and sporting events. It increases brand awareness and presence.
  4. They should sponsor sports academies.
  5. In order to increase their consumer base, they must build budget-friendly designs for Gen Z.
 
 
Read on: PESTLE ANALYSIS OF ADIDAS | ADIDAS PESTLE
 
   
 
Threats to Adidas – SWOT Analysis of Adidas
 
  1. Other brands like New Balance, Under Armour, and Nike offer more varieties and styles, which creates a threat for Adidas.
  2. Adidas is continuously facing stiff competition from other similar brands that are producing fitness apparel and equipment at a discounted price.
  3. Fake or pirated brands and products are damaging the reputation and image of Adidas.
  4. Local sports brands are giving tough competition to Adidas in some regions.
 
 
 
 
Competitors of Adidas:
 
  1. Asics.
  2. Under Armour.
  3. Bata.
  4. Fila.
  5. Reebok.
  6. New Balance.
  7. Nike.
  8. Puma.
  9. Woodland.
  10. Umbro.
 
 
 
 
 
 
 
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  Marketing Strategy of Adidas  
 
 
BusinessManagementMarketing
 
Marketing Strategy of Adidas | Adidas Marketing
 
 by Shamsul  
 
 
 
 
 
 
 
Marketing Strategy of Adidas | Adidas Marketing
 
 
 
Currently, Adidas is operating in more than 160 countries with nearly 53800 employees. Its product manufacturing and sales show that it is a complex organization. To be honest, Adidas is known for its fast and lean working and things. There is no doubt that Adidas is a popular name in activewear and sports products. In this post, we mainly focus on Adidas Marketing Strategy and you can get the right inspiration for your business. Are you interested? If yes, then you have to go through this post because we have mentioned each and every point of the marketing strategy of Adidas. Let’s get started.
 
Marketing Strategy of Adidas | Adidas Marketing
 
Segmentation, Targeting, and Positioning:
 
As we have mentioned above, Adidas is one of the biggest sportswear manufacturers in the world, especially in Europe. They have segmented their marketing strategy on the basis of behavioral, demographic, and psychographic factors. Currently, the Adidas group has 4 powerful brands in its portfolio such as Reebok, Taylor, Rockport, and Adidas. Every brand fulfills the needs of customers in different segments. The targeting strategy of Adidas is also very effective as they target teens, tweens, young adults, and adults. They have 15-40 years of age customers in their portfolio because of its activewear and other sporty offers. Its consumer base consists of the luxury class and upper-middle-class people. The current positioning of Adidas is based on user and benefit. They always try to create a distinctive image in the eyes of users. They manufacture high-quality products which is the biggest strength of the Adidas Group.
 
Marketing Strategy of Adidas | Adidas Marketing
 
Mission:
 
In the sporting goods, the main mission of Adidas is to become a global leader in its sector. They want to indulge sporty lifestyle and healthy practices with its offerings. They are also improving and strengthening their offerings and products to enhance their competitive position in the market. Its tagline ‘’Impossible is Nothing’’ is one of the most popular taglines. It highlights the significance of fitness and a healthy lifestyle. According to experts, this is one of the biggest assets Adidas has and also summarizes the marketing strategy of the company.
   
 
Marketing Strategy of Adidas | Adidas Marketing
 
Competitive Advantage:
 
Adidas has a competitive advantage in three major sectors such as brand equity, product quality, and distribution network. With more than 2400 stores worldwide, it is a leading sportswear brand in the world. They also sponsored several sports events and activities like Olympics, Cricket, UEFA, NBA, and FIFA. Moreover, they offer long-lasting and comfortable products that give Adidas a solid competitive advantage. On the other hand, the company has strong relationships with various organizations like International Finance Corporation and International Labor Organization (ILO). These relationships give the company a competitive edge over its competitors.
 
Marketing Strategy of Adidas | Adidas Marketing
 
BCG Matrix:
 
BCG matrix assists in recognizing the future course of actions and strategic standing of the strategic business unit (SBU). As we mentioned above, the Adidas group has four brands under its portfolio such as Reebok, Adidas, Taylor, and Rockport. If we talk about Reebok and Adidas, both brands fall in the start category as they produce the major revenue of the company and hold a strong market share. They are really competitive in the fitness and sports segment. Other brands like Nike and Puma are still behind in terms of market share. Taylor and Rockport are still questionable because of their low market share. In my opinion, these brands need some vigorous changes because they have the potential to make a big statement. If Adidas work on these brands then they can easily increase their market share and hold.
 
Marketing Strategy of Adidas | Adidas Marketing
 
Distribution Strategy:
 
Due to the rapid changes in trends, no one can predict the customer’s buying power and dynamic. Adidas is also boosting its focal point on figuring out these dynamics and reacting with rapidity. Due to this reason, they have focused on a customer-centric approach to understand the customer’s approach. After vigorous analysis, they came to a conclusion that the size of the products really matters and quality is another major factor. They also ensure that their products are available in their stores and other retailers.
 
Marketing Strategy of Adidas | Adidas Marketing
 
Brand Equity:
 
The trend of sports-centric and fitness activities is revolving around the internet and social media. The community connects programs have assisted the company to be the largest player in the relative segment. Adidas has created a solid impact on the mind of users through its offerings, products, and services that set a big platform for the company in terms of profitability and market share. Honestly, Reebok and Adidas each brand has their own unique technology, identity, design, reputation, and heritage, so the future of both brands is really bright and common. Both brands have the ability to derive future sales due to their extraordinary offerings.
   
 
Marketing Strategy of Adidas | Adidas Marketing
 
Competitive Analysis:
 
The Adidas Group has various portfolios that give them a strong competitive advantage. Through these brands, they cover the consumer segments and sports offerings according to the people’s demand. There is no doubt that Adidas Group is doing really well in the competitive market due to its differentiated positioning and effective marketing strategy. According to market professionals, Adidas and Nike have grown hugely over the last few decades and their global reach expanded in various continents and countries. That’s why both brands are considered global brands. They are also focusing on e-commerce and other digital platforms for increasing their reach and market value.
 
Marketing Strategy of Adidas | Adidas Marketing
 
Market Analysis:
 
The sportswear and activewear market is flooded with a number of counterfeit brands and products. They are continuously threatening the sales and profitability of these large firms by providing copies and clone products at a discounted price. Most professional athletes and fitness enthusiasts purchase essential products from these brands but middle-class people prefer counterfeit products. But, this industry has immense potential and it is changing due to the varying demographics, economics, and lifestyle. Now, more people are adopting a healthy lifestyle and it increases the role of Adidas to introduce cost-effective products. Adidas recognized that the strategy of mass marketing and mass production is no longer enough
 
Marketing Strategy of Adidas | Adidas Marketing
 
Customer Analysis:
 
The consumer base of Adidas based on upper and upper-middle-class groups. They need to target middle and lower class groups for boosting their sales. For this purpose, they have to reconsider their pricing strategy and product portfolio. They should introduce customer-centric products and services for targeting more people. Only meaningful and useful products can do this and create a long-lasting impact on customers. This is the best method to make powerful brand loyalty. With a consumer-centric approach, they can earn global brand recognition and increase sales. In short, Adidas is doing really well in all sectors.
   
 
 
 
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Read More:
 
Reebok Marketing Strategy | Reebok Marketing
 
McDonald’s Marketing Strategy | McDonald’s Brand Power
 
Dabur Marketing Strategy | Dabur Brand Power
 
 
 
 
 
 
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  Pestle Analysis of Adidas  
 
 
Better TipsBusinessManagementMarketingWriting
 
PESTLE Analysis of Adidas | Adidas PESTLE
 
 by Shamsul  
 
 
 
 
 
 
 
PESTLE Analysis of Adidas | Adidas PESTLE
 
 
 
In the sporting goods market, Adidas is a well-known brand. They offer plenty of products to health-conscious sporty people. But, the fact is that its products are not essential for health-conscious people. In third world countries, the company has faced huge criticism for its products. In this Pestle analysis of Adidas, we will discuss some important strategic factors and rules and regulations of Adidas. Scroll down to learn these important factors:
 
 
 
PESTLE Analysis of Adidas | Adidas PESTLE
 
Political Factors of Adidas (Many Systems):
 
Adidas is a worldwide brand and delivers its products in every region. It requires a strong and effective supply chain network within the political system of every country. It has a strong online presence and earns major revenue from e-commerce. Moreover, Adidas also utilizes political systems of interference of counterfeit items. Each country has a specific taxation system, so it is necessary for Adidas to follow these rules in order to sell their products internationally. In addition, the company is also focusing on third world countries in order to increase its profitability. In short, it reduces shipping and manufacturing costs. Below, there are some rules that Adidas should follow:
 
     
  • Product safety laws.
    •  
  • Employment laws.
    •  
  • Consumer safety.
    •  
  • Product regulations.
    •  
  • Global trade agreements.
    •  
 
 
   
 
PESTLE Analysis of Adidas | Adidas PESTLE
 
Economic Factors of Adidas (Counterfeit Problems):
 
It is a fact that the sports goods industry is highly competitive and there are plenty of giants in the market. Nearly, more than 50 biggest companies put in approximately 70 % of the market’s profit and Adidas is one of them. Most of the products of Adidas are considered as leisure items. It means they are not essential users. Most of the sales of Adidas are based on preferences and buyer trends. It is necessary to compare leisure products with different company’s products which gives an opportunity to Adidas to make their offerings effective. Moreover, it is also essential to research before selling and distributing products because this thing ensures growth and profitability.
 
The main manufacturing hub of Adidas is in China because of the availability of workers and cost-effectiveness. The manufacturing cost in North America is higher than in the Chinese market. Additionally, the company should focus on the cost of materials. The main issue they are facing in this system is importing and exporting goods. There are several counterfeit products in the market that continuously damaging the sales of Adidas.
 
 
 
PESTLE Analysis of Adidas | Adidas PESTLE
 
Social Factors of Adidas (Health-Conscious Customers):
 
The company changes the designs of their items in order to catch the interest of customers. You can get any type of sporting goods from Adidas. Adidas is trying to focus on health-conscious people who like sports and outdoor activities. Due to this reason, they should design their products by keeping these factors in mind in order to fulfill the needs of the customers. What is more, is that Adidas also provides corporate volunteer programs. They also help to promote the health of people and support societies. They are a part of the Olympics which gives the company great marketing exposure. This is the best way to grab the attention of new customers globally.
 
 
   
 
PESTLE Analysis of Adidas | Adidas PESTLE
 
Technological Factors of Adidas (Smart Sportswear Opportunities):
 
Adidas occasionally tests their products. Professional athletes used these products, so the company ensures that these products are safe and ideal for users. In this way, these products improve the performance of athletes and coaches. They use natural materials in order to reduce the risk of a nuisance. That’s why its products are durable and great for professional athletes.
 
Adidas uses online platforms like social media and websites to sell its products. They are immensely popular among athletes and health-conscious people due to their innovative products such as Fitbit. Adidas has a big opportunity to adopt new technologies in order to get a competitive edge over the competitors.
 
 
 
PESTLE Analysis of Adidas | Adidas PESTLE
 
Legal Factors of Adidas (Patent and More Patents):
 
The company has possession of IPR (Intellectual Property Rights) and IP systems. They have designed their own patents. Certainly, it helps to defend them against contravention and copiers. In this way, they can effectively fight against counterfeit businesses. As Adidas has a strong connection in the sports world, there are several celebrities and sports professionals who endorse their products which is a great method of marketing. In addition, they follow all the local and international rules to sell their products.
 
 
   
 
PESTLE Analysis of Adidas | Adidas PESTLE
 
Environmental Factors of Adidas:
 
The company is trying to reduce its environmental impact. It is the duty of Adidas to observe and remove harmful substances. They use natural materials in the manufacturing of their products. Moreover, they pursue ethical business practices by following all the rules and regulations of each country in order to sell or manufacture their products. Due to these factors, users and professional athletes love to use its products.
 
 
 
PESTLE Analysis of Adidas | Adidas PESTLE
 
Conclusion:
 
Adidas faces huge criticism due to its low wages policy in the third world regions. But, the fact is that the manufacturing cost is really low in these regions. So, counterfeit products are one of the major challenges for Adidas. But, they have design patents to counter these issues. The main target of Adidas is health-conscious buyers. Adidas has a wonderful opportunity to enter new markets with technological advancement.
 
 
 
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