Nike project
- 1. FORE SCHOOL OF MANAGEMENT, NEW DELHI PROJECT REPORT Of Communication and Internet Technologies and E-commerce On Digital Marketing TABLE OF CONTENTS SERIAL NO. TOPIC PAGE NO. 1 ACKNOWLEDGEMENT 2 LETTER OF TRANSMITTAL 3 MACRO ENVIRONMENTAL ANALYSIS 4 INTRODUCTION TO THE INDUSTRY 5 MACRO FACTORS FOR THE INDUSTRY 6 MICRO ENVIRONMENT FOR NIKE 7 MICRO ENVIRONMENT FOR ADIDAS 8 MICRO ENVIRONMENT FOR UNDER ARMOUR 9 DIGITAL MARKETING ANALYSIS OF NIKE 10 DIGITAL MARKETING ANALYSIS OF ADIDAS
- 2. 1 11 DIGITAL MARKETING ANALYSIS OF UNDER ARMOUR ACKNOWLEDGEMENT The report has been done as an end term project for the course titled “Communication and Internet Technologies and E-commerce”. We are really thankful to our course instructor Prof. Shilpi Jain, Professor, FORE School of Management, New Delhi for her invaluable guidance and assistance. We also wish to thank her for providing us with this opportunity to learn more about the working and the applications of various methodologies studied in the course of Communication and Internet Technologies and E-commerce for the corporate sector. We are also grateful to the various resources available in the FORE School of Management for providing us with invaluable information and hence helping towards the successful completion of the project. Lastly, we would like to thank our peers and batch mates for a constant support and enthusiasm in the course of the study. The motivation and courage provided by them always helped to us proceed with our study in a progressive manner.
- 3. 2 LETTER OF TRANSMITTAL December 13, 2016 TO: Prof. Shilpi Jain FROM: Group 15 Section C, Fore School of Management SUBJECT: A Project report on Communication and Internet Technologies and E-commerce As part of the course, we are submitting a project report on Digital Marketing This report briefly defines the study of Digital Marketing Campaign by Nike, Adidas and Under Armour to understand and analyze the difference with which they approach Social Media Marketing and to see the overall business strategy which they use to increase revenues through Social Media Platforms. Thank You. Group 15 FMG25, C-Section
- 4. 3 Introduction of the Industry India’s sportswear market has evolved from a niche segment, which was exclusively aimed at sportspersons, to a burgeoning consumer sector. The industry has witnessed rapid growth over the past few years, driven by growth in income levels, changing lifestyles and the entry of foreign players after liberalization. The ever-increasing popularity of cricket, combined with the growing interest in sports such as football, hockey and tennis, has contributed to the growth of the functional sportswear market in the country. In addition to this, the trend of using sportswear as casual wear has expanded the definition of target consumers for leading brands. Some brands also offer collections to cater to this demand for casual wear. s Trending Increase in the number of fitness clubs and Gyms has spurred the demands. Consumers desire to make a fashion statement drives development of fashionable athletic fabrics. Expanding middle class population propels sales in developing markets. Blurring lines between casual wear and sports apparelexpands frequency of purchase. Key revenue spinners are the fashion conscious women. Increased participation in mountaineering, trekking and cycling fuels demand for performance apparels.
- 5. 4 Growth, CAGR and Future Demand Numerous key players are operating in the market which includes Nike, Inc., Ralph Lauren Corporation, Umbro, Ltd., Fila, Inc., LululemonAthletica Incorporation, New Balance Athletic Shoe, Inc. and Columbia Sportswear Company. They have adopted various growth strategies to capture a larger market share and increase their customer base. Product launches, partnerships and acquisitions are the prime growth strategies adopted by these companies to sustain the intense competition in the market. In July 2014, Adidas entered into partnership with Manchester United, one of the most successful and popular football clubs in the world, to promote its products globally. This has helped the company to strengthen its market position in various geographies. The sports apparel market is expected to generate revenue of $196.2 billion by 2020, growing at a CAGR of 4.3% during the forecast period, 2015-2020. Sports apparel market is mainly worn during workout sessions or while playing sports. Sports apparel is designed to provide comfort and agility during physical movements. The world sports apparel market has witnessed significant growth owing to growing health awareness and increasing fitness activities such as aerobics, swimming, running, and yoga among consumers. The market is further supplemented by the increasing participation of women in sports and fitness activities. Based on geography, North America was the largest revenue-generating region in the world sports apparel market in 2014. However, Asia-Pacific would be the leading revenue-generating region by 2020, owing to increasing disposable income and improving living standards in the emerging countries such as China and India. However, availability of low quality and counterfeit products has restricted the growth of the world sports apparel market.
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- 7. 6 Macro Environment for the Industry: Legislations- China has passed 2 new laws in 2007 to improve workers rights, bans, imports laws in sweat shops, pressure groups, Europe referendum- 50% of UK products go to Europe, so if we break off from Europe it will effect organizations. Vat 20%. In Japan importation of sports shoes requires a submission of notification to the ministry of economy, trade and industry Pressure groups. There are environmental pressure groups that are against particular aspects of the brand. There was criticism on some of the adverting campaigns, which has some backlash e.g. T-shirt slogans included ‘dope’ and ‘get high’. There was a huge disputes and criticism over wages and working conditions in the production of Nike shoes in Asia. Economical- Sales tax is added onto the imports of Nike shoes for example in some countries like Ireland it is 23%. Inflation= 2.7% and interest rates are low at the moment; this means that consumers may spend more. The Chinese footwear market is expanding rapidly and it’s expected to surpass the US in the next decade as the world’s largest consumer market, unemployment levels in UK fall to 7.7% (2.49million people), we are going into a triple dip recession. Social- Ageing population, obesity- 60.8% of adults and 31.1% of children are overweight (BBC 2009) There is an increased focus on doing physical activity to help control weight loss and even control diseases such as heart disease and cancer. There are also programs/action plans to help raise awareness for sports for example Sainsbury’s sports for kids. The Government invested £300million funding package into UK Sport and the Olympics Technological- There has been growth in technology within the production and development of the footwear products. There has also been developments and growths within advertising using technology for example online media, apps etc. There has been a huge increase in online shopping and new products being brought into the market for example IPods and smart phones which enables buying online or on the move much more efficient and common. Environmental- Global targets set by 8 richest countries in world; by 2050 they wish to have halved emissions. There are pollution permits in place to regulate the amount of pollution a company can emit 100 units of carbon dioxide per year. This is an incentive for firms to cut pollution.
- 8. 7 NIKE Micro Factors: Collaborations- Apple and Nike have collaborated together to sell a Nike IPod sports kit (branching out into new markets). Suppliers- Nike outsources almost all of its footwear production to independent third-party suppliers (Asia). As Nike gets its merchandise from foreign manufacturers, it has little control over the product quality. For instance, there have always been concerns over unsafe Chinese consumer products. Publics- Many colleges and universities, especially anti-globalization groups as well as several anti- sweatshop groups such as the United Students against Sweatshops, took campaigns against Nike. These kinds of instances show that Nike has limited control over its contract manufacturers. Thus, any future instances like these could damage the company's reputation. Intermediaries- These are companies that also sell Nike footwear: JDSports, ASOS, Sports Direct, Schuh, Office, Footlocker, Very, Amazon. Company- These are other brands that Nike own: Converse, Cole Haan, Converse, Chuck Taylor, All Star, One Star, Star Chevron, Jack Purcell, Hurley, Umbro. Missionof Nike: "To bring inspiration and innovation to every athlete in the world." Vision of Nike: Nike doesn't have a vision statement but it has thinking that “If you have a body, you are an athlete."
- 9. 8 Introduction: The Company is headquartered near Beaverton, Oregon, in the Portland metropolitan area. It is one of the world's largest suppliers of athletic shoes and apparel and a major manufacturer of sports equipment. As of 2012, it employed more than 44,000 people worldwide. In 2014 the brand alone was valued at $19 billion, making it the most valuable brand among sports businesses. History: Nike, originally known as Blue Ribbon Sports (BRS), was founded by University of Oregon track athlete Phil Knight and his coach Bill Bowerman in January 1964. The company initially operated as a distributor for Japanese shoe maker Onitsuka Tiger (now ASICS), making most sales at track meets out of Knight's automobile. CEO: Mark Parker Why we chose NIKE: It is one of the best examples of digital media promotions and it is also one of the top 20 brands which have high social media presence. Social Media presence: Facebook Like most global brands Nike has separate Facebook pages for each of its product categories. This includes golf, snowboarding and FuelBand, as well as two football pages – one for the American version of the sport and one for the version everyone else in the world plays. Twitter As with Facebook, Nike has individual feeds for its subsidiary brands, including golf, basketball, FuelBand, Nike.com and football. For each of the feeds the focus is very much on responding to @mentions rather than pushing out marketing messages, and the rate at which some of the more popular accounts respond to users is quite astounding. For example, the Nike.com feed (766,000 followers) responds to more than 100 tweets per day regarding order queries, stock information and product details. Pinterest Nike has clearly researched the demographic profile of the average Pinterest user, as the only account it has established is for Nike Women. It has created 10 boards and amassed a respectable 9,900 followers; however all of its pins are product related and link back to official Nike websites. Nike+ Not only does Nike do a decent job of marketing itself using the four main social networks, but it has also taken the time to establish its own unique social platform through Nike+. It now has more than six million members that use it an average of three times per week. Since 2010 Nike has developed a range of training products that are digitally linked using the Nike+ FuelBand. Users can then accumulate ‘NikeFuel’ points and set themselves goals or compete against other users.
- 10. 9 ADIDAS Micro Environment for Adidas: The most influential micro environment for Adidas is competitors. For example, Adidas are working oligopolistic market where other major players such as Nike, Vans and Puma also have large market shares. This means that Adidas have to stay competitive and innovative to compete and keep a market share. Another micro environment factor is Promotion. If they don’t promote their sports footwear in the right way then they will not appeal to their target market, aged in between 16-24. Influential celebrities Yohan Blake, David Beckham and Lionel Messi have all endorsed Adidas sporting footwear. Missionof Adidas – “The Adidas Group strives to be the global leader in the sporting goods industry with brands built on a passion for sports and a sporting lifestyle. We are committed to continuously strengthening our brands and products to improve our competitive position”. Tagline – “Impossible is Nothing”. Vision -"Our vision is clear: to enhance social and environmental performance in the supply chain, thereby improving the lives of the people making our products". Introduction: Adidas AG is a German multinational corporation that designs and manufactures sports shoes, clothing and accessories. The company is based in Bavaria, Germany. It is the holding company for the Adidas Group. Besides sports footwear, Adidas also produces other products such as bags, shirts, watches, eyewear and other sports and clothing-related goods. Adidas is the largest sportswear manufacturer in Europe and the second biggest in the world, after Nike. Why Select Adidas: We selected Adidas AG for our analysis because of many successful digital marketing campaigns that have been undertaken by the company. For Example: Adidas was the sponsor of the official soccer ball (known as the Adidas Brazuca) used in the 2014 world cup. The dual objective of their digital marketing campaign was to bring the excitement of the world cup to their consumer base, beyond just the physical walls of the stadium and to leverage this sponsorship of the official ball for increased consumer engagement, during the world cup.
- 11. 10 Under Armour Inc. We selected Under Armors because it competes directly with Nike and Adidas and is actively involved in various digital marketing campaigns. Micro Environment: Under Armour targets men, women, and children from middle class and upper class backgrounds. A typical Under Armour customer is athletic and health conscious. The company’s high quality lines of performance apparel, athletic footwear, and sporting accessories appeal to a wide range of demographics. Under Armour sells its apparel, footwear, and accessories at a competitive price compared to its competitors. Typical UnderArmour pricing places in-between Nike and Adidas, but unlike its competitors, Under Armour rarely discounts its items and tends to be sold at a slightly higher price. Under Armour’s products are sold on their website as well as in large department stores such as Sears, and in sporting goods stores such as The Sports Authority. Under Armour footwear can also be found at Finish Line and Foot Locker Missionof the company "To Make All Athletes Better through passion, design and the relentless pursuit of Innovation" Vision statement “Empower Athletes Everywhere” Company has short, simple and appealing Mission and Vision statements Introduction of the company: Under Armor, Inc., incorporated on July 01, 1996, is engaged in the development, marketing and distribution of branded performance apparel, footwear and accessories for men, women and youth The Company's segments include North America, consisting of the United States and Canada; Europe, the Middle East and Africa (EMEA); Asia-Pacific; Latin America, and Connected Fitness. What the company sells: The Company sells its branded apparel, footwear and accessories in North America through its wholesale and direct to consumer channels. The Company had approximately 140 factory house stores in North America primarily located in outlet centers throughout the United States.
- 12. 11 Product lines offered by the company include: Apparel Footwear Accessories Digital Marketing Strategy used by the company: Connected Fitness The Company offers digital fitness platform licenses and subscriptions, along with digital advertising. It offers digital advertising through its MapMyFitness, MyFitnessPal, Endomondo and UA Record applications. How we will proceed for the Project? All three companies selected by us have active involvement with the customer through Social Media we will do a comparative analysis of the various campaigns used by these companies and the specific reasons behind success/failure of the campaigns. We will analyze how much (if at all) the Digital marketing campaign success got translated into Actual Sales for the companies We will also analyze the challenges being faced by these companies (if any) in making this transition from traditional channels of marketing to digital media channels
- 13. 12 NIKE on different social media sites Instagram: Nike have really strengthened their brand on Instagram and I can see how and why. From captivating, carefully shot photographs, to arty videos, Nike’s content is always really high quality and befitting with their brand image that encourages high energy activity and adventure. I think that good visual content goes a long way and it seems to be working for Nike as they have 14 million followers on there. Posts generally receive between 300k – 400k likes and dozens of comments from followers, mainly of people sharing the content with their friends. They have developed a number of brand hashtags, including their trademark #justdoit, as well as #nikewomento support their ongoing campaign to empower women in sport and others specific to products or events, such as #airmaxday. These hashtags are frequently adopted by other Instagram users and a huge Nike community has been formed for people to share their own Nike fitness journeys. Twitter: As Nike has grown as a brand, they have branched out into a number of departments, catering for specific sports and setting up new ventures, such as their mobile fitness apps ‘Nike+ Fit Club’ and ‘Nike+ Running.’ For this reason, Nike have a multitude of Twitter accounts representing each of the different sports they have involvement in (e.g. @NikeFootball) for different regions where they have their largest market bases (@NikeNYC), an account specifically for women and also one offering support to athletes from other athletes. Their largest following is on their general brand account @Nike which currently has 4.78 million followers, though they have a further 3.44
- 14. 13 million followers for their Nike.com account (@Nikestore) and an average 1 million for their other accounts. When they do tweet, their posts are brief and tend to be sentence-long motivational statements, most with the hashtag of their catchphrase “JustDoIt.” Despite the simplicity of these tweets, they generally receive a couple of thousand retweets and favourites. The majority of content on the @Nike account is made up of retweets from all of their other accounts and I feel that the purpose of the account has become a centre for Nike followers to receive the highlights from all Nike departments. The Nike UK account shares much more of their own content, from new products, to information about Nike run sporting events; although, they too only post about once a day. Most posts contain a photograph, which makes a huge difference in making them engaging to followers. They do a good job of getting followers involved by asking questions about what their favourite Nike products are and encouraging them to send in pictures of their own Nike gear. An example of this was their recent #airmaxday campaign, where they asked users to tweet photos of their Airmax trainers.
- 15. 14 Facebook: Nike have their largest and longest standing following on Facebook, with just under 22,000,000 followers. Their Facebook page functions as a bit of a hub for Nike’s online activity, as their multi- purpose account not only works as a normal fan page, it also has customised tabs that link followers directly to their Instagram account and Nike Support page. In addition to this there is also a ‘Shop Now’ button that redirects users to their online store. Looks like Nike have Facebook nailed. In terms of content, however, they do not actually post that frequently, posting just a couple of times a month. Like on Twitter, they have multiple Nike accounts on Facebook and I found that the smaller specialised pages are more active than the key account.
- 16. 15 Running has always been one of Nike’s key focuses and their Nike Running page is one of the more popular, where they regularly post all content running-related, from the release of new running trainers, to information about running events that they host. Updates on the Nike Running page tend to receive a high level of engagement and a community of keen runners has been formed, who use the page as a forum for discussing their hobby, sharing tips and finding out about new products and events. Nike+ Not only does Nike do a decent job of marketing itself using the four main social networks, but it has also taken the time to establish its own unique social platform through Nike+. It now has more than six million members that use it an average of three times per week. Since 2010 Nike has developed a range of training products that are digitally linked using the Nike+ FuelBand. Users can then accumulate ‘NikeFuel’ points and set themselves goals or compete against other users. It has proved to be a hugely successful product for Nike as it taps into the social aspect of sports by allowing users to track their progress using an iPhone app and share their progress online. There are dedicated Facebook and Twitter accounts for NikeFuel which are tied into the #MakeItCount hash-tag. It also allows Nike to run novel campaigns, such as the ‘Fuel your team’ initiative that currently allows users to show support for their favourite basketball team by earning them NikeFuel points.
- 17. 16 YOU TUBE Nike spends very less amount on TV ads and depends mostly on the YouTube videos. It does a lot of you tube posts, in the form of small Ads, stories or a series of events. Nike ads are some of the most viewed ads and most popular ads on the youtube. Nike was the top brand on YouTube’s ad leaderboard for June, taking the No. 1 and No. 5 spots with a combined 53.9 million views. At the top of the list, Nike’s “The Switch” features a number of soccer stars (or football stars, if you’re anywhere outside of the U.S.), including Cristiano Ronaldo, Harry Kane and Anthony Martial. The ad generated 48.4 million views, winning more than double the number of views earned by Clash of Clans’ No. 2-ranking spot, “Best Friends.” Nike’s “Worth the Wait” took the No. 5 spot, earning 5.5 million views. With more than 53 million combined views from both “The Switch” and “Worth the Wait” ads, Nike owned nearly half of the 110.1 million total views generated by the top 10 most popular ads in June. CUSTOMER EXPERIENCE OF NIKE Nike has developed the customer experience over time by interacacting and responding to the comments and posts shared by people on social media channels. Instagram: These hashtags are frequently adopted by other Instagram users and a huge Nike community has been formed for people to share their own Nike fitness journeys.
- 18. 17 Twitter: Where Nike really excels on Twitter is their interaction with followers and they respond to nearly every mention they receive on the platform with advice and fun responses that will make the consumers feel valued.
- 19. 18 Facebook: Updates on the Nike Running page tend to receive a high level of engagement and a community of keen runners has been formed, who use the page as a forum for discussing their hobby, sharing tips and finding out about new products and events. Like on Twitter, Nike are really good at responding to comments from followers and they make the effort to write back to nearly every person who writes on the page, whether it is in response to a purchase enquiry or just a general remark about a post. Nike+ Having used a Nike FuelBand before I feel the product is a victory for marketing over usability, but even so it means Nike has a product and a social network that millions of people use on a daily basis which is an extremely powerful tool for driving brand loyalty. My Post: Although, I didn’t get any response for the tweet. TECHNOLOGY ADVANCEMENT Nike is a SportTechie brand which always keeps doing some innovations in its products or media strategies.
- 20. 19 Nike+ Running app for IPhone and android is very popular among people who love running. It Get all the detail you need—pace, location, distance, elevation, heart rate and mile splits— and greater control over what you see during your run. Now for the product innovations, One of the first big reveals from Nike in 2016 is their first ever self-lacing shoe, the HyperAdapt 1.0, which will be made available later this year. The CEO of Nike, Mark Parker, sees their new power-lacing technology as a big part of their footwear future down the line. The new uniforms and jerseys that will be worn by Nike sponsored teams and athletes this summer will feature new technology and materials to keep athletes dry, while also making them lighter and more aerodynamic. New FlyVent technology provides athletes with the perfect amount of tightness on their waistbands. The brand new Nike Vapor jerseys help wick away sweat 20% faster while drying 25% quicker than the previous models. AeroSwift technology has been added to make the uniforms 10% lighter and 50% more stretchable. While their AeroBlades tech is used to reduce air and wind drag on the athlete. Another innovation that is coming this summer is the Nike + App. When it debuts in June 2016, this app will become a one-stop shop for everything Nike and will aim to personalize a user’s shopping experience. Nike + will learn a users’ sizes, from shoes to pants, while offering exclusive deals, (HyperAdapt 1.0 will be sold only on Nike +) as well as free shipping and returns. The app will also bring all current Nike Apps such at their running and SNKRS app into one place. Parker views the app as a unique piece of technology in Nike’s push towards personalization. Nike has been on the forefront of technology for years and it has helped them establish dominance in the sportswear market, especially over the last decade as they have separated from the pack, greatly out pacing their nearest rival, Adidas in market share. Nike has secured over 4,000 patents since they started, including 650 since 2012, while Adidas has secured 275 overall and 30 since 2012. This is not to say that very tech-based endeavour has been a success, as the discontinued Nike Fuel Bands demonstrates. CONVERGENCE OF ONLINE AND OFFLINE CHANNELS Nike has dedicated website (https://secure-store.nike.com/) for the purchase of products and also it has bricks stores for the offline purchase. We can also buy the Nike products from other websites like Amazon, Flipkart etc. As this a sports products company, so customer service is not needed much times. But there are few cases of customer service of the company where people have given mixed reviews about the service of NIKE. Delivery experience of people is also a mixed experience which oscillates between very bad to Excellent.
- 21. 20 DIGITAL INFRASTRUCTURE The sportswear brand has made new infrastructure the base for virtualising its multiple datacentre facilities around the world. The new network also helped the retailer to improve application performance and enhance IT flexibility. Nike has picked network provider Juniper for its cloud infrastructure project and deployed Juniper’s new datacentre architecture - MetaFabric - to support its current and future business goals. Juniper debuted MetaFabric - which ties together its switching, routing and software into a comprehensive approach for datacentre and cloud networking. The architecture that ties networking with datacentre pushes the networking industry beyond a "myopic" approach, according to Andre Kindness, senior analyst for Forrester Research. Networking has lagged behind other elements of the IT industry on the subject of interconnecting datacentres and the cloud, he added. MetaFabric also serve as the basis for virtualising multiple Nike datacentres around the world. The sports brand has more than 18 datacentres globally, co-located within Nike’s campuses or in multi-tenant third party datacentres. Juniper provides Nike with ultra-scalable, secure network architecture for the retailer’s global datacentre refresh strategy. It also makes Nike’s network future-ready and provide orchestration services via automation, management, and data analytics across all domains. CUSTOMER ACQUISITION NIKE keeps doing new and innovative things to grow its market and acquire new customers. Having established Digital Sport, a new division the sports giant launched in 2010 the global sports company, aiming to go further on developing new devices and technologies that allow sports users to track their data: personal statistics in any sport activity in which they participate. These efforts are part of a global complete marketing approach that comprehends the power of tech, big data and social media marketing various 360 degrees channels. As Nike continues to grow as a brand and a digital powerhouse, their teams have branched out into a number of departments, catering for their core business and different specific sports and setting up new ventures, such as their mobile fitness apps ‘Nike+ Fit Club’ and ‘Nike+ Running.’ CURRENT NEWS FOR NIKE Nike e-commerce growth accelerates as it preps for Rio Olympics Nike says its attempts to create a premium experience online are paying off as its ecommerce business sees growth accelerate as the company preps “a pipeline of innovation” ready for big sports events over the coming year including the Olympics in Rio de Janeiro in Brazil next summer.
- 22. 21 ADIDAS Adidas AG is a German multinational corporation that designs and manufactures sports shoes, clothing and accessories. The company is based in Bavaria, Germany. It is the holding company for the Adidas Group, which consists of the Reebok sportswear company, TaylorMade- Adidas golf company (including Ashworth), 9.1% of FC Bayern Munich and Runtastic, a former-Austrian fitness company. Besides sports footwear, Adidas also produces other products such as bags, shirts, watches, eyewear and other sports and clothing-related goods. Adidas is the largest sportswear manufacturer in Europe and the second biggest in the world, after Nike. Stake holders: The adidas Group stakeholders are a diverse group and include the following: Employees of the adidas Group Authorisers: government, trade associations, shareholders, Executive Board Business partners: unions, suppliers, service providers Workers in our suppliers’ factories Opinion-formers: journalists, community members, special interest groups Customers: professional athletes, distributors, retailers, consumers Peers: other multinationals, consumer goods companies and brands Value Proposition: Value proposition consists of the whole cluster of benefits the company promises to deliver to its customers. Adidas promise their customers sports shoes which will provide them with comfort and durability. They have a brand value and have established themselves as style statements. Adidas have a wide range of athletic footwear specialized for various sports like football, cricket, running, gym etc. Adidas has a lower price range offering almost the same products compared to its competitors. Business Model: Adidas business model is highly focused on creating innovative products designed to meet consumer needs. Rather than investing in product endorsements, the company attempts to demonstrate its value by creating a high performance product line based on the specific needs of athletes and consumers
- 23. 22 Current Market Valuation: Adidas is headquartered in Herzogenaurach, Germany and trades as an American depositary receipt (ADR) in the United States. The company boasts a market capitalization approaching $19 billion and trailing 12-month revenues over $16 billion. Marketing Strategy: Biggest sportswear manufacturer of Europe & one of the biggest in the world, Adidas is segmented based on demographic, psychographic & behavioral factors. The Adidas group has four brands in its strong portfolio – Reebok, Adidas, Rockport & Taylor made meant for different segment customer groups. Adidas uses differentiated targeting strategy to target young adults, adults as well as children who have passion for fitness & sports. Although it targets customers in the age group of 13-40 years but majority of its customers are of 15-30 years of age who hail from upper middle class or the luxury class of customers. User & benefit based positioning are the strategies Adidas uses to create distinctive image in the mind of the prospective consumer. By emphasizing the value of quality products from a trusted brand Adidas is able to maintain its brand essence. The portfolio is divided as follows. They have Adidas-performance in Competitive sports, Reebok & Reebok classics in Active sports & casual sports, & Adidas originals, Adidas Fun, Rockport in Sports fashion. Fight over with the NIKE: It agreed to pay 750 million pounds ($1.1 billion) to replace Nike as sponsor of English soccer side Manchester United for a decade, a record kit deal for the sport. It has also taken over from its U.S. rival at Italian champions Juventus, while extending its contract with Germany’s No.1 team Bayern Munich. Adidas on different social media sites Instagram: Adidas has really strengthened their brand on Instagram. From captivating, carefully shot photograph. Content is always really high quality and befitting with their brand image that encourages high energy activity and adventure. Good visual content goes a long way and it seems to be working for Adidas as they have 11.8 million followers on there.
- 24. 23 Twitter: #findfocus is launched for the promotion of the Z.N.E Travel hoodie. #teamadidas is the team which they used to tag whenever the launch of the product takes place #nmd is a new sneaker style by adidas that features footwear that combines old design concepts with new technology, particularly Prime knit and Boost cushioning. Currently, it is one of the most popular running shoes to date. #boost is also a new running shoe and sports shoe as well. #heretocreate is a campaign to make creators. The graph shows that the number of posts made by Adidas in the last 10 days. Facebook: Facebook page of Adidas is continuously updated with the new posts. The same post updated in twitter is also posted in the facebook page. More importantly they are using single platform to maintain all the social media platforms through dlvr.it website.
- 25. 24 TECHNOLOGY ADVANCEMENT Adidas has launched Tango squads which provides the opportunity to get close to the best players in the world and wear the latest adidas gear before anyone else. All the latest news and hottest invites direct to their phone. In product category, When it comes to innovation in the sportswear industry adidas may have been slow to start out of the gate, but in the past two years the brand has finally managed to find its stride. The reason for celebration is the Three Stripes’ introduction of an innovative cushioning technology dubbed ‘Boost’. The products are launched with the new technology under the adidas boost category to meet the requirements. DIGITAL INFRASTRUCTURE The IT organization of the adidas Group is a globally operating corporate function. Worldwide, a total of 1,000 IT experts cooperate closely with all brands and functions of the company. The goal is to provide consumers and employees with a 'digital ecosystem' in order to remain in constant dialogue with consumers and enable sustainable growth of the adidas Group. Currently, information technology within the adidas Group is undergoing a paradigm change: IT is increasingly developing away from being an internal process supporter and into a strategic instrument with direct contact to consumers. CUSTOMER ACQUISITION Adidas is hoping to change the face of influencer marketing with the launch of Tango Squads, communities of hyper-connected football obsessive’s operating on direct messaging apps such as Facebook Messenger, WhatsApp and Line. Named after one of Adidas’ first footballs, the Tango Squads are groups of socially savvy 16-19- year-old football content creators living in 15 key cities worldwide. While the squads are between 100 and 250 people, Adidas hopes to reach a maximum of 500 members per squad by 2017. Each group is managed by an Adidas in-house team, who share exclusive content and new products with the group, before they are even unveiled on Adidas’ Twitter or Face book channels. So, like this method Adidas is trying to acquire the new customers. Adidas has tied up with the Custora Company which provides a customer-centric marketing platform that helps e-commerce teams make customer acquisition and retention programs more profitable. Custora’s software uses advanced statistical models to identify distinct customer segments and predict how customers will behave in the future. This enables e-commerce companies to deliver more relevant and effective communications that promote long-term customer relationships.
- 26. 25 Current News for Adidas Adidas Z N E Hoodie The adidas Z.N.E. collection was designed to provide premium comfort to athletes as they go from the street to the game. Built for a full range of motion, this men's hoodie is made of thick doubleknit fabric with plenty of stretch. It's cut for an athletic fit with a high funnel neck, while thumb hole sleeves offer extra coverage. Zip pockets let you keep small essentials close. Its roomy two-layer hood helps block out distractions and get you in the zone. This product is promoted in all their social media websites with the hashtag of #findfocus which has gained well response in the social media platforms. Adidas Parley It is not often that efforts to protect the planet also result in cool new products too. But collaboration between Adidas and nonprofit organization Parley for the Oceans has created the first performance sportswear made from plastics that were recovered from the ocean, proving we can be environmentally conscious and develop better athletic apparel at the same time. Since its founding in 2013, Parley for the Oceans has been dedicated to raising awareness of the threats that the Earth’s oceans currently face. Those threats include climate change, over-fishing, pollution, and acidification, among others. Part of the organization’s efforts has focused on reclaiming plastics that have been deposited in the Indian Ocean and are washing up on the shores of the Maldives. Those recovered materials have now been recycled and used to make performance fabrics for use by Adidas in creating sports apparel.
- 27. 26 Observations: Their E commerce website is very easy to interact and purchase the things and very much user friendly. The Adidas Z.N.E. Travel Hoodie is built to block out distractions and let you ignore the noise to focus on what really counts. Designed with the world’s best athletes, this is the ultimate game day equipment. But the same product was not available at their online website. Twitter Post They are not responsive in the social website platform like twitter. The post made by me tagging with the Adidas has not received any reply from them.
- 28. 27 Hash tags Followed Recently: #findfocus is launched for the promotion of the Z.N.E Travel hoodie. #teamadidas is the team which they used to tag whenever the launch of the product takes place #nmd is a new sneaker style by adidas that features footwear that combines old design concepts with new technology, particularly Prime knit and Boost cushioning. Currently, it is one of the most popular running shoes to date. #boost is also a new running shoe and sports shoe as well. #heretocreate is a campaign to make creators. Social Media Activities Observation: Every post is posted through the single account of dlvr.it which helps in maintaining all the things through one website. On an average in twitter, they are tweeting around 20-25 tweets per month. Likes lie in between 300-600. Retweets on an average lies in between 50-200. Recent Video in YouTube – Promoting the Z N E travel Hoodie On an average the Adidas is updating 4 videos in a month. Their likes also lie in between 400 to 1000. Adidas has taken sportspersons from each sports to promote their products. The main sportspersons are James Harden- Basketball, Paul Pogba- Football, Ana Ivanovic- Tennis In India, Sania Mirza and Ranveer singh are the ambassadors of the Adidas.
- 29. 28 Dark Social Dark social refers to the social sharing of content that occurs outside of what can be measured by Web analytics programs. This mostly occurs when a link is sent via online chat or email, rather than shared over a social media platform, from which referrals can be measured. Adidas is using the dark social media to analyze the data. The brand is focusing its attention around on-the-day learning; listening to users, how they tick, what they like what they don’t like, what motivates them, how they are culturally different - and using these learning’s to gain a deeper understanding of its key target consumers. Followers and Ranking of Nike and Adidas in YouTube:
- 30. 29 Followers and Ranking of Adidas and Nike in Instagram Followers and Ranking of Adidas and Nike in Twitter.
- 31. 30 UNDER ARMOUR Under Armour, Inc. is an American sports clothing and accessories company. The company is a supplier of sportswear and casual apparel. Under Armour began offering footwear in 2006. Under Armour's global headquarters is located in Maryland with additional North American corporate office locations in Austin and Houston, Texas; Denver, Colorado; New York, New York; San Francisco, California; Portland, Oregon; Nashville, Tennessee; and Toronto, Ontario. Founder: Kevin A. Plank (founded in 1996) Stake holders: Fabric Manufacturers- Fabric manufacturers are a huge stakeholder for Under Armour. Under Armour relies on these manufacturers and the manufacturers greatly rely on Under Armour. Employees- The employees of Under Armour are stakeholders for the company. Consumers- Consumers have a huge stake in UA. Under Armour Endorsers- Celebrities that are endorsing Under Armour have a crucial role with the company. Celebrities like Gisele Bundchen, Michael Phelps, and Tom Brady are endorsing Under Armour. Media- The media is another huge stakeholder with Under Armour. They relay new information about UA to the public. Value Proposition: Under Armour mission is to make Athletes better through passion, Science and Relentless pursuit of Innovation. Their value proposition is to provide quality products accompanied with a great service. They enjoy credibility among the buyers in terms of the quality of their products. Vision: “Empower Athletes Everywhere” Business Model: Under Armour follows a Differentiation based strategy. Before entering any new market company examines the viability of the product and the competitive advantage that it will enjoy if it enters the market. Current Market Valuation: As of August 2016 Under Armour has market capitalization of $16.2 Billion. Under Armour is headquartered in Baltimore, Maryland.
- 32. 31 Customer Experience: Under Armour has made a bigger commitment to and investment in customer engagement than most brands, providing a powerful example for other marketers to turn to for insight and inspiration in planning their engagement programs. It started pursuing an ambitious engagement strategy in 2014-15. Technological Advancements: Under Armour has utilized technology in its campaigns in many ways ,Some examples are as follows: Between 2014-15, Under Armour invested $700M in app development and acquisitions, creating a “connected environment” of UA Record (its proprietary “body dashboard” app), MapMyFitness (fitness training maps and tracking), MyFitnessPal (an excellent and extremely popular nutrition tracking app), and Endomondo (“the personal trainer in your pocket”). First, it has entered a strategic partnership with IBM to create and provide data-backed health and fitness insights, powered by IBM Watson’s cognitive computing technology. The partnership will combine Under Armour’s UA Record app with an IBM Watson cognitive coaching system. The enhanced app will serve as a personal health consultant, fitness trainer, and assistant by providing athletes with real-time, evidence-based coaching. Under Armour also launched HealthBox, the company’s first “connected fitness product portfolio.” Retailing at $400, it includes a Bluetooth-enabled scale, heart rate monitor, and wristband that tracks steps, distance, resting heart rate, and sleep. Customer Acquisition by Under Armour: Contests help you generate buzz for your company, and if the prizes are attractive enough, a lot of people will definitely try to participate. Bonus points if you’re able to make them feel special and shine the limelight on them. Either feature them during the competition, or make them feed badass the way Under Armour did. Under Armour identified a crucial problem that all football players faced, and worked on a product to address that. Players would eventually share it with their teammates because Under Armour’s products simply worked. Kevin Plank passed his shirts to individual players to help them improve their game. It might not have worked as well if he had gone to approach their coaches. Under Armour wouldn’t have been able to impress the female consumer base if they had stuck to the “shrink it and pink it” strategy. Them addressing the strengths in women, and creating an aspirational image for them was probably one of the biggest reasons why their new strategy worked.
- 33. 32 Addressable Markets: International revenues right now only amount to 6% of Under Armour’s net revenues. The company plans to grosw these revenues by expanding internationally. In a presentation on Investor Day, the company’s management revealed that it expects the contribution of international sales to grow to 12% by 2016. Through increased eCommerce sales, higher store counts, elevated average selling prices and increases in “shops within shops” (a concept throughout Dick’s Sporting Goods stores), the company can expect its other divisions (i.e. footwear and accessories) to grow significantly. As distribution centers are built and inventory is able to flow better through various channels, cost reduction will also play a big part in the company’s profitability in the future. Observations: Ecommerce website of Under Armour is dynamic and with an attractive interface. It lists all the products with details and high definition pictures. They started with very few websites in the 1990’s but realizing the importance of Internet , now they have 16 websites and 6 more are being planned in 2016. Responsiveness of Under Armour on Social Media Platforms Facebook Post: As a part of our research, we posted comment on their Facebook page, which got filtered (they did not let the post go on page) and it did not get any response from them. So they are not responsive in their Facebook page Analyses of Twitter handle of Under Armour: Following are the basic statistics of Under Armour *source: SocialBlade.com
- 34. 33 Twitter Post They gave prompt reply to the comment posted on their twitter page saying that they will resolve our query if we send them a detailed message of the issue being faced. After we messaged them with a hypothetical query they were once again fast in their response Overall they are responsive in their twitter handle comments but not on Facebook. Comment on Twitter Page: *source: Twitter account Personal Message conversation: *source: Twitter account
- 35. 34 Following chart shows the progress chart for twitter handle of Under Armour *source: SocialBlade.com As can be seen the number of followers and monthly tweets is upward sloping. This could be attributed to the amount of time and efforts the company is putting in updating and maintaining responsiveness of their twitter page. Analysis of Youtube channel of Under Armour: YouTube channel of Under Armour is regularly updated by uploading the videos of their new products . In the recent times Under Armour has started several campaigns to have a stronger hold in women sportswear segment. One such campaigns named #IWillWhatIWant was done by a model who was shown kicking a punching bag. Company made interesting use of technology by showing the real time comments of the the twitter on the wall behind her. The idea of this campaign was to encourage women to go after what they want and not wait for anyone’s permission or approval. Following are the statistics of youtube channel of Under Armour
- 36. 35 Following chart shows the progress chart of YouTube channel of Under Armour in terms of subscribers and monthly views The above chart shows sudden increase in the number of monthly subscriptions and monthly views. These are occurring around the successful YouTube campaigns launched by the company. Whenever it uploads a video that catches up with people there is a rise in views and subscriptions. General interest generated by Under Armour region wise: Major interest is generated in the region of North America. It is also reflected in their revenue generation. Major revenue of Under Armour is generated from North America.
- 37. 36 *source: Google Trends Comparison of all three keyword search over the years: Nike, Adidas and Under Armour *source: Google Trends As in clearly visible Nike has generated much greater interest among all 3 brands over the years