Porter’s five forces for Adidas 1. Analysis framework and market structure * High barrier to enter this field. The sports shoes industry of the USA are made by those brand company, these brand company will have advantage with advertisement, import, sales network and product development.
But most importantly, they set up an obstruct for other companies with their product character and loyalty of the customer. * Other shoes are not suitable for sports, so there is no substitute for sports shoes company. Customer, they really care about the price of the sportswear, and more sensitive for fashion, but there is no negative effect for the profit rate of the company. As we can see, if less profit, the product at development country will be less to compensate for the loss. And on the other hand, most companies are success with the difference of their product which will make customer to get to know their product and prevent to associate with other companies. Supplier power. Almost the sports shoes companies are equal with their input, especially after the the outsourcing trend which is launch by Nike, over 90% of the product are made in those developing countries such as China and Vietnam, who has lower salary and high labor force.
The marketing strategy of Adidas This is two of the strategy for Adidas, and the other is research.They became one of the greatest sports company in 1997 after acquired the Salomen group, these two companies will help each other to coordinate with the product and region, because Salomen group are very strong in Japan and North America, it will help Adidas to increase the market share in USA. And another important thing is they always use sports star as their spokesperson such as David Beckham and Kobe Bryant.
They also become the sponsor of many sports events such as UEFA championsleague and Olympic Games. The other core strategy is research, Adidas has established a new group for technical innovation to make at least one big innovation for customer every year. They introduced their Mass customization system to public in 2003, this system will custom the different shoes for different customer with different foot condition and personal preference.
This are make Adidas to become the leader of the area.