84026690 marketing assesment abt adidas

IDM City Campus #3 Course Work Banner

Branch : Wellawete Student ID : WEL004118Course Title : HND in Business Management Semister : 2

Assignment ID : ASGREF/2011/25 Module Name

: Marketing

Full Name Student

: Sukkri Muhamed Muzan

InstructionThe Course Work or Assignment is setting and conducting via the board of HND evaluation. The evaluation and grading will be conducted by the two persons. The lecturer or the tutor is the first person to evaluate the course work and assignment. Then second person is the member of board of evaluation.The answers and explanation for the assignment must be done by the student with his own work. If the student refers any kind of resources he must put the correct reference in wanted area. If the student’s work will be found as matching with another or senior students’ work the assignment will be rejected by the board of HND evaluation. So, Student must do his assignment in his next session.When the student uploads his course work he must obey the rules and regulation. Student can upload his course work only three times and if the student uploads his course work after the dead line, the system will indicate the late submission.If the student will submit the excuse form for the late submission with the acceptable reason student can get the full marks. After the course work submission, the conformation document will send to the student e – mail address. Then student must submit that document with his hard copy.

IDM cc#3/HNDM/Marketing of 39

1.1Try to relate organization with the AMA, PHILIP KOTLER and CIM

marketing definition (Identify core concept of marketing and differentiate

with different organization scenario)

Adidas (Impossible is nothing)

Vision: Be perceived as a leader.

Mission: To be the best sports brand in the world.

“Marketing is management that process identifies and satisfies customer’s requirement

profitability” (CIM Definition)

“Satisfying the needs and wants by exchanging” (Philip kotler)

According to AMA “Marketing is the activity set of institution and process of creating,

planning, communicating, pricing and delivering of ideas, goods, services that satisfy

individual and organizational goals.

CIM Definition

In further explaining this definition it has been interpreted deeper manner, it says that the

marketing is the procedure of the management which includes achieving the organizational

targets; the organizations should first recognize the needs and wants with the awareness of

the competitor’s strategies and should earn the positive and healthy revenue through the

customer satisfaction.

The businesses must give the first priority to the customer’s requirement where it says that

the customers are the king. According to the definition the company staffs should work hard

and should provide them the best. It is a responsibility for the managers to identify, analyse,

monitor, and plan how to provide the best to the customers. If an organization can run their

business according to this with finding customer needs and wants and satisfying them, they

can survive and succeed in the market.


PHILIP KOTLER’s Definition

This definition explain in a different manner which says that the marketing is an

administrative and societal way which fulfilling all the criteria of the customer’s (can be

individual or group) expectation with the base of value. Simply to say the exchange and

transaction customers will only turn the value to the other side if they fully satisfied by the

fulfilled requirement.

Here, this definition is highly matching with the current scenario because, only concerning

about the profitability of the organization will not going to lead to achieve the target easily.

Addition to that, the company must be able to find and evaluate the customer’s values and if

that has been done by the organization, definitely the organization will gain the customer

loyalty in the market. So it is all about the social approach which gives the preference to the

social factors. Satisfying needs and wants through an exchange process,

AMA Definition

According to AMA marketing it is how the process of creating goods, planning,

communicating, pricing and delivering of ideas and goods that benefit the organization and

its stake holders. The company should always think of creating innovative product than their

competitors and pricing should be made as a reasonable one where the customer will be

satisfied. It is all about satisfying the customers at a most appropriate way which benefit our

organization and the society.

ADIDAS with CIM definition

According to CIM definition it talks about how to identify customer needs and wants and

satisfy them at a profit. In looking into ADIDAS company according to their mission

statement “To be the best sports brand in the world” ADIDAS produce the goods

according to the requirement of the customers what their expectation which is in high quality

providing to the customers at a profit.


Net sales for 2009 = € 10381 million

Net sales for 2010 = € 11990 million

Net profit 2009 = € 4712 million

Net profit 2010 = € 5730 million

1.1.1. This diagram mentions the sales and the profit of ADIDAS for two years.

ADIDAS with Philip kotler’s definition

According to Philip kotler he says satisfying customer needs and wants through an exchange

process, ADIDAS has created a geed brand image among the customers and there are variety

of products in the brand name ADIDAS after producing the next will be the exchange process

where selling it and gaining the profit through it.

ADIDAS with AMA definition,

According to the above definition the company ADIDAS it plays a major role in marketing it

always tries to capture the market share by advertising their product with most famous sport

players and other such as: WINGER NANI, LIONEL MESSI, SACHIN TENDULKAR, and

LASITH MALINGA, it targets it’s customer’s by advertising, It always think of how to

satisfy their customers in improving the products according to their requirement. The

managers continuously try to improve the look, feel, quality and image of the product. Adidas

has a wide range of products for men and woman Such as: Sport shoes, Perfume, Body spray,

shower gel, watches, caps and etc… it has a good selection and they create innovative

product than their competitors to capture the market share. It always keen on satisfying the

customer needs and wants according to their requirement at a profit.


1.2. Briefly explain the elements of marketing concept, to a selected

organization

Organizations can be successful after they find the market what really customer wants and

then produce the goods where it makes the customers satisfy than the competitors

The marketing concepts are:

● Target market

● Customer needs and wants

● Coordinate marketing

● Profit through customer satisfaction

Target market

Target market means a selected set of market people who is satisfied the best is known as

target market the targeting people in ADIDAS is in between 10 to 30 years old. In targeting

the market ADIDAS spend some time to search the market what they really want. ADIDAS

advertise, do plenty of sales promotion and so on ADIDAS is concern on producing new

products it will look into the target market who will be using the new product and launch it

according to the requirement of the customers.

Range of products Turnover (€) Target market

Perfumes 0.9 bn Men/ women looking for freshness

and fragrance.

Clothing (bottoms, jersey,

socks, bands etc)

1.8bn Celebrities, trainers and sports people

Shoes 2.2bn Men and women preferring best

designer and quality footwear.

Football boots 1.9 bn Professional footballers around the

globe.

Jeans 1.2bn Urban youth.

Sports jackets 1.7bn Professional sport people.

t–shirts 0.9 bn Market looking quality casuals.

Figure 1.2.1 describes the target market of adidas


Customer needs and wants

Every human being are having needs to satisfy the needs you have to find what customers

wants, E.g.; A man is in hunger he need something to eat but his want is to eat a pizza, So we

have to find customer needs and wants to satisfy them. In finding customer needs and wants

ADIDAS always does Market and Customer research, and it always expecting for feedbacks

from the customers. In developing a new product ADIDAS always do market and customer

research it is very important it describes the needs, wants, complaints and problems of the

Product. After the research process it concentrate on the product what customer wants, their

thoughts, feels, and according to that It develop and improve the product ADIDAS always

keep on increasing innovative, variety, quality, features, and packaging which gives a good

value to the product

After concerning about the products next it thinks about the production where you should

produce to satisfy the target market people. It should be available in the market where it is

convenient to customers and to purchase at a reasonable price. Always the production

managers will be concern on increasing the output of the product which brings down the

price per unit. It helps the company to distribute to the market at a reasonable price which

ADIDAS does to satisfy their customer’s needs and wants.

Coordinate marketing

This is the type of marketing where it is also concern on satisfying the customer where in the

entire department they discuss how to satisfy the customer needs and wants in this point of

view ADIDAS has a group for coordinate marketing where they identify customer needs and

wants and sometimes the marketing manager may want a change in the product but

production manager may against it since it raises the cost of production so coordination with

each department is very important and you should always think of how to satisfy customer

needs and wants and work according to the requirement.

Profit through customer satisfaction

After selling the product and when customers are satisfied what we get is profit through

customer satisfaction so the managers always make decisions keeping the profit in mind.

There are many ways to keep the customers satisfied providing them the best than what they


Really want. According to ADIDAS they mostly do societal marketing to satisfy customer

such as: avoiding under age employees, Supporting construction of sports ground, It produce

cheaper goods for selected country and it use recyclable materials for packing it products

which keeps a good image on the brand.

Financial Highlights 2010

01

Financial Highlights (IFRS)

2010 2009 Change

Operating Highlights (€ in millions)

Net sales 11,990 10,381 15.5%

EBITDA 1,159 780 48.6%

Operating profit 894 508 76.0%

Net income attributable to shareholders 567 245 131.1%

Key Ratios (%)

Gross margin 47.8% 45.4% 2.4pp

Operating expenses as a percentage of net sales 42.1% 42.3% (0.2pp)

Operating margin 7.5% 4.9% 2.6pp

Effective tax rate 29.5% 31.5% (2.0pp)

Net income attributable to shareholders as a percentage of net sales 4.7% 2.4% 2.4pp

Operating working capital as a percentage of net sales1) 20.8% 24.3% (3.5pp)

Equity ratio 43.5% 42.5% 1.0pp

Net borrowings/EBITDA 0.2 1.2

Financial leverage 4.8% 24.3% (19.5pp)

Return on equity 12.3% 6.5% 5.8pp

Balance Sheet and Cash Flow Data (€ in millions)

Total assets 10,618 8,875 19.6%

Inventories 2,119 1,471 44.1%


Receivables and other current assets 2,324 2,038 14.0%

Working capital 1,972 1,649 19.6%

Net borrowings 221 917 (75.9%)

Shareholders' equity 4,616 3,771 22.4%

Capital expenditure 269 240 11.8%

Net cash generated from operating activities 894 1,198 (25.3%)

Per Share of Common Stock (€)

Basic earnings 2.71 1.25 116.8%

Diluted earnings 2.71 1.22 121.8%

Operating cash flow 4.28 6.11 (30.0%)

Dividend 0.802) 0.35 128.6%

Share price at year-end 48.89 37.77 29.4%

Other (at year-end)

Number of employees 42,541 39,596 7.4%

Number of shares outstanding 209,216,186 209,216,186 0.0%

Average number of shares 209,216,186 196,220,166 6.6%

Figure 1.2.2 Mentions the annual report to show the profit through customer satisfaction


1.3. Briefly explain the cost and benefits of marketing approach in your

point of view to a selected organization

In concerning of marketing a product first and foremost you should conduct a marketing cost

analysis and research what customer needs and wants according to that you should market the

product. It cost a lot of money for surveys and market research it is worth it even though its

expensive you can get fresh ideas from the market to create the product. The benefit on

investing huge money to a product is to gain a profit through selling the product to customer

should be aware of it so advertising, sales promotion and etc… is very important.

Adidas spends a lot on advertising its product; it’s a way of increasing the sales you should

place the advertisement at a high popular area where they can see, hear such as: Movies,

Radios, Television and etc… where it target all Radio listeners, TV and movie viewers.

I would select ADIDAS shower gel to approach the market ADIDAS shower gel was first

marketed in 2007 in china Guangzhou, it was given to the Procter and gamble Hong Kong to

market the product in marketing the product approximately ADIDAS company fixed a budget

sum of HK $ 1.5 million to complete the project. ADIDAS shower gel was marketed all

around the china market first to monitor how the product is moving in the market In creating

the product there were many purpose of achieving goals, profit through sales, Volume, image

and customer satisfaction After producing the product ADIDAS always was doing market

research to identify the customer needs and wants and to create many verities than the

competitors Adidas does regular market research to provide best to the customers it has good

benefits such as: Profit, Customer loyalty, long term goals, reputation, and company image

increases.

In marketing the shower gel ADIDAS did a huge marketing campaign in 2007 in china its

budget to market the shower gel was only for six month period it cost HK $ 1.5 million and

it spent HK $ 750,000, in market research it spent HK $ 375,000 advertising and promotion

and HK $ 375,000 to Maintenance and management of media relationship. According to

today ADIDAS spend much on advertising for E-marketing compare to 4 to 5 years before it

were spending money on advertising in TV and print medias but now it reduced to advertise

their product on TV and print media now it mostly spends on E-marketing, since its target


market is in between 14 to 19years most of the people in the world who use internet is in

between that age and they mostly spend their time on social network sites so it targets social

network to market its shower gel, it advertise on face book, Hi5,twitter, My space and etc…..

all other famous social network where the product will be reached around the world up to

today only on face book there are more than 20,55,723 fans for reference visit

http://www.facebook.com/adidas only on face book most of the fans are in between 10 to

30years it’s a strategic planning where it use to market the product. After the marketing

activities there was good feedbacks by the customers then after they were finding customer

needs and created more verities to them after words the product growth were moving fast so

they market it around the world after marketing the product in social networks it’s sales

increased so ADIDAS Shower gel today is available around the world where ever you are

you can buy it. ADIDAS invested only HK $ 1.5 million to market the product and its

benefit in return after 3 month was HK $ 18million around the world.


2.1. Identify the macro and micro factors that influence the organization in

marketing activities and decision making

Marketers maintain a lot of interaction with in and out of the organization the factors that

influence the organization is Micro factors and Macro factors

Micro Factors

Micro factors can be defined as the problems that occur internal of the organization there are

many such as:

Customers: They always cannot stick into one product or design easily; customers’

wants and needs change very frequently. Therefore when a new product is developed

they are able to stay with us without changing into a competitor’s product so always

you should create something new for them if not you cannot survive in the market.

Supplier: Suppliers always will not like a company staying in the same position and

not purchasing anything new from them, just impressed with the same old type of

raw-material they purchase make the supplier feel bored and in the meantime make

less profits to them

Employees: They also demand for increase in their salaries where as their living cost

and lifestyles keep changing. They won’t be getting anything as they expect if the

same work is done over and over also their ideas and co-operation is very important

for a firm to succeed so you should also motivate them to get the best out of them.

Competitor: Competitor holding a strong brand or product is a threat. Since it’s very

difficult for a new product to enter the market and compete with an already leader in

the market. Strong advertising methods and creative promotions should be done in-

order to compete Ex: Coca-Cola And the all new KIK Cola in the Sri-Lankan market.


Media: Media makes an attention to the customers when Adidas is launching a

product when they advertise the product in media the customers can be aware of the

product.

The Diagram 2.1.1. Mentions about the micro factors of an organization

SWOT Analysis of Adidas

Swot analysis means it is a strategic planning which is done by business organizations

to evaluate the Strength, weaknesses, Opportunities, and the threats involved in the

business or a particular project is known as SWOT analysis.

The Swot analysis of Adidas is:

Strength

● Adidas sponsor ship on matches such as football and cricket.

● There are more than 39,600 employees working in Adidas around the world.

● Many variety of products such as: T-shirts, watches, perfumes, and etc…


MEDIASHAREHOLDERS

COMPETITORSSUPPLIERS

CUSTOMERS EMPLOYEES

COMPANY

● Adidas and Reebok together they are interconnected and doing the business.

● Quality and conformability of the products where it makes to the response of

customers

● Customer care service is very kind and taking care on customers when the call for

feedbacks, and specially on e-marketing

Weaknesses

● E-commerce is limited in U.S.A.

● Online customer service is poor

● Poor advertisement agencies

● Customer service is poor

Opportunities

● Adidas and the Reebok Company is interconnected

● It increases the demand for goods because the product is available online

● New technology and innovate which makes standard products

Threats

● Fake brand of Adidas are available in the market because original is expensive and

cannot afford by everyone.

● Nike is the competitor of Adidas, Nike leads in footwear than Adidas.

● Nike spends more on advertisement than Adidas.

● Competitors increasing day by day.

Macro Environmental factors

The Macro environment includes all factors that influence the organization but it’s

outside the organization where they cannot control. The marketer needs to

compensate on the culture, political, and economical factors.


PESTEL factors of Adidas

PESTEL stands for Political, Economic, Social, Technological, Environmental, and Legal It

describes the Macro environment of an organization where they do strategic planning.

The PESTEL analysis of Adidas is:

Political

● Employees standard and HR system should be maintained well.

● Health and safety of employees is important to the company.

● Employees rights should be followed.

Economical

● Adidas decreases unemployment in countries by providing jobs

● Adidas has given manufacturing contract to many countries to manufacture such as:

shoes, T-shirts, etc… which reduce cost.

● Labour chargers are cheap in china compare to German, U.S.A., and France this is

the reason where most of the factories are located in Asian region.

Social

● Adidas always concern on target market such as: age, sex, religion, lifestyle and so

on.

● In U.K. people who go to shop and purchase is less because they have no time so

Adidas should recognize the fact and sell the products online.

● Adidas should identify which season they can sell more for E.g.: A person would

buy 1 or 2 pair of football boots per season taking that into consideration Adidas

should advertise the product on the football season where it will increase sales.

● In U.K. there are many people living under different religion such as: Muslims,

Christian, Tamils, Jews and etc… so Adidas should cater all these religion people.


●The place of selling the product is very important in taking an example In U.K. there

are many large cities such as: Manchester, Birmingham and etc… There are many

potential customers to Adidas.

Technological

● Adidas should use the latest technology equipment to cut down its cost of

production, to reduce the labours in work and which also speed up the production if

Adidas dint use latest technology the competitor will grab the market share.

● Adidas should make sure that they update their webpage because most of the people

buy products via online nowadays technology places a major role in marketing.

● Adidas should concern and use the latest technology and provide the customer the

best than the competitors.

Environmental

● Adidas raw materials to produce a football boots is taken from animals so it should

concern on reducing animal skin to produce.

● Most of the Adidas production plant is in China, Vietnam, Indonesia, and etc…

which reduces the cost of a product, because the labour charges are cheap in those

countries this cause to people not to buy Adidas products since the produce under the

cheap countries with low quality this is not good for Adidas because it get publicity

and people will stop buying Adidas products.

Legal

Adidas should concern on the legality that has been linked in sport wear, Adidas

would be fined if they didn’t follow the laws and the legality such as:

Advertisement standard, Radio Authority, sales and supply act and so on.


2.2. Segmentation of two products in different markets

Marketing Segmenting

Marketing segmentation is about dividing the market into distinct group of buyer with

different needs, Characteristics, or behaviour. According to the customers requirement the

company will produce the good, In the market there are different kind of people every single

of them have different wants every person differs from each according to this they divide the

market into different segmentation according to the buyers wants in order to satisfy each and

every person in the market. When segmenting the market there is four different segmentation

to be considered they are:

● Geographic Variable

● Demographic Variable

● Psychographic Variable

● Behavioural Variable

Geographic Variable

Geographic variables means collecting and analysing information to see where the product

are being selling the most to increase sales and advertising there. This includes: Region, size

of the area, population, and climate.

Demographic variable

Demographic variable is dividing the groups according to: Age, sex, family gender, Income,

education, status, race, generation etc….

Psychographic variable

Psychographic variable means divided in to groups according to their opinions, beliefs,

thoughts, values and interest.


It includes:

• Social class

• Life style

• Personality

Behavioural Variable

Behavioural variable means this is about the consumer buying habits towards the product this

includes:

• Reediness to buy

• Loyalty towards the brand

• User status

• Occasions

Segmentation variables of Adidas body spray

Geographic variable

Adidas mostly consider on the geographic variable before launching the product they concern

on Region where to launch the product, the population in that area and so on. The ADIDAS

body spray was first marketed in INDIA, U.A.E., U.S.A, and etc…

Demographic Variable

Demographic variable which ADIDAS is mainly concern on the Age, sex, Income and Status.

ADIDAS consider on these factors because before launching the product it should know what

kind of customers will be consuming the product. The body spray is mainly targeted for

college students from the age of 18 to 24. This body spray is targeted for upper class and

middle class people its price in SRILANKA is Rs.525/=. This cannot be affordable by lower

class. This will not affect the religion or neither language etc…


Psychographic Variable

Psychographic Variable consider on buyers behaviour most of the lower class people doesn’t

know about body spray and they also doesn’t use it because it’s not affordable for them, So it

is mainly targeted to upper and middle class people where it is easy and convenient than roll

on deodorant.

Behavioural Variable

Behavioural variable consider on the customers behaviour most of the customer for the body

spray will know about the brand and the product quality. They will be waiting for new

product varieties and they get loyalty towards the product

Segmentation variable for ADIDAS Y-3 shoe

Geographic variable

The ADIDAS Y-3 football boot is marketed first in U.K., U.S.A, Canada, Swiss eland, South

Africa and etc…. because most of the population who play football are in that region because

they are much interest on football than any other sports.

Demographic Variable

Adidas is always concern on Age, Sex, Income, and Status before launching the product

Adidas consist of age and sex because size of the shoe will be available for young people,

youth and adults most of the males only play football so it is mainly targeted on Males.

Adidas Y-3 consumer’s income level should be in between 50,000 to 200,000 if it is only it

will be affordable to buy. Its target group is Upper and middle class people because the

minimum price of a ADIDAS Y-3 football boot is £ 150 so it cannot afford by lower class

people.


Psychographic Variable

Psychographic concern on the buying behaviour of customers the customer for the ADIDAS

Y-3 is mostly will be upper class and lower class because the starting price of a Boot is £150

so it is not affordable by lower class. It is targeted mostly for Luxury sport wear and people

from lower class will not know about the product whereas Upper and middle class people

will know how far its benefit on paying £150 for a football boot.

Behavioural Variables

This is about the Buying habits of customers in looking into the ADIDAS Y-3 football boots

most of the people who buy Y-3 boots are football professionals and other playing crowd.

ADIDAS Y-3 is so expensive because its high quality and most of them buy it because they

know how good the shoe is. When they need a football Boot most of them want ADIDAS Y-

3 football boot because it’s in High Quality and has a good grip where it shows the customer

loyalty among the product.


2.3. How Buyers behaviour will affect the organizations marketing

activities

Customer buyer behaviour is very important in an organization it helps the organization to

identify how customers think, feel, and select between different situations

The major characteristics that effect consumer buyer behaviour is:

1) Cultural Factors

2) Social Factors

3) Personal Factors

4) Psychological Factors

Cultural Factors

This is the largest factor of desire and thus behaviour this can be according to buyer’s culture,

which country they are from and which religion they are. For e.g.: ADIDAS shoes some are

made out of Pig sole where Muslims doesn’t consume those shoes because it’s their cultural

issue. Culture also refers to the status, income, occupation, wealth and etc… Each and every

customer defers some will give more preference for a ADIDAS shoe some for ADIDAS body

spray according to the cultural factors it differs.

Social Factors

Social Factors include the culture, Roles and status by taking reference where as a group it

will be considered on family, friends, college, and schools etc…. This will also influence the

buyer behaviour according to their family background and college style they try to adapt to

their culture when they are with groups according to the new trends. So this will make a

change in the consumer behaviour.

Personal factors

The Personal factor is according to the buyer’s behaviour such as: Age, lifestyle, Personality,

Occupation and etc… In this personal factor the customer will look into his/ her status,

prestigious and some prefer for unique products so every customer differs from each other.


Before buying a product customer will consider on his/her economic situation whether he/she

is affordable on buying the product

Psychological Factor

This factor Includes motivation, Perception, learning’s, beliefs and etc… In this

psychological factor the marketer should talk to the customer’s mind where it will motivate

them to buy the product. ADIDAS has a good brand image and customers has beliefs that it is

in a good quality and will last for a long period of time this makes ADIDAS good will among

the product and the customer loyalty among it.


3.1. Briefly explain the different products and services then explain how

they satisfy customers and achieve organizational goals

ADIDAS has many varieties of product such as:

Footwear

Adidas has taken its place as one of the superior rank of sports and fashion

world since 1920, delivering most advanced technologies and best quality in

athletic footwear. The main aim is to design shoes that work with the foot, not

against it, to make it easier for you to reach your maximum level of

performance and ease.

Apparel

Apparel is not one of the main trades of Adidas though it also is specialized in

manufacturing quality and fashionable apparels to its market. As usual their

apparels are also very well known for its quality and durability. People have

great demand for Adidas apparels as a very good sportswear also as a

fashionable piece of clothing.

Hardware such as bags and balls

Adidas have a variety of hardware’s such as bags, balls, golf sticks, hats,

socks, watches, etc., they are provided to you with the same quality which you

expect from Adidas. Different quality and designs are of different price ranges

in the market, where as different people of different stages are affordable for a

branded Adidas gear.

Accessories

Their accessories vary such as caps, hand gloves, belts, elbow sleeves, socks,

watches, sunglasses, balls, etc. Also Adidas has a brand range of perfumes,

deodorants, aftershaves, and lotions. Which are very well known for its brand,

also meant to be a quality and prestigious sportswear?


In explaining about the product would take 2 products to compare and show the benefits to

the customers as well as the organization in explaining the this we should concern about the

7ps of marketing mix

● Product

● Price

● Place

● Promotions

● Physical environment

● Process

● People

Product

ADIDAS Y-3 football boot is made for the best satisfaction of the football players which is

so comfortable than the other boots. The Y-3 includes all the latest technology with the latest

features in it to maximally satisfy its customers.

Features of Y-3:

• Its light in weight where easy to run while playing.

• Its cushioned inside the boot which makes more comfortable and most of them prefer to.

• Flexibility

• Suitable only for nature surface.

• It is made out of micro fiber

Price

The price of the ADIDAS Y-3 boot will be £ 150; according to the world today most of the

people who really want comfort ability and flexibility will not look into the price so

customers prefer to pay for the quality.

Place

ADIDAS Y-3 boot is available in every country since ADIDAS showrooms also available

worldwide if it is not available in the specific country simply buy via internet visit

www.shopadidas.com you can through this it will be more convenient.


http://www.shopadidas.com/

Promotion

ADIDAS advertise and do many promotional activities they advertise in media, papers,

magazines, websites, and etc… Adidas mainly promote their product via Internet.

Physical environment

ADIDAS main concern about its environment too it makes its packaging disposal which will

not make the environment dirt. It always concern on providing the best comfort to its

customers if you are a customer of ADIDAS you would have felt the comfort if not try once

and feel it.

Process

ADIDAS procedure about the Y-3 football boot after manufacture they will send it to Q.C.

where they check the quality to ensure the requirements are met. To look into that there are

many process firstly the relevant person will wear the pair of boot and stand in the PAD

which will scan the boot and if any errors it will be appearing after that the consultant will

look into and make the faults and then send down to trailing after that ADIDAS invites the

customers to come test and buy the Y-3 boot.

People

ADIDAS is having a good set of employees who really work hard according to achieve the

organizational goals: The managers are concern on the organization goals and motivates the

employees towards the goal which will increase the productivity. ADIDAS provides best

solution to its customers when they call or email on any inquires or complaints immediately

action will be taken. It is how ADIDAS has built up its brand image among its customers.

In below to explain about the product briefly will be taking one product to show the customer

satisfaction and the achievement of organization goals would take the ADIDAS Y-3 boot

As mentioned previously this is a pair of boots specially produced to play football and is

designed in such way that the grip is kept while handling the ball, and also many sports

people suffer from losing their foot arch and therefore the Y-3 has a marvellous arch support

along with a strong toe cap to keep your toe safe while hard shots.


ADIDAS Y-3 is made out of leather and it has 4 attractive colours where it gives a rich look

to the shoe and also it has an Impressive packaging has been done without a usual cardboard

box, this shoe will come in a nice mini-suitcase, since we want the customers to feel that this

shoe worth its price. The Y-3 brand ambassadors are famous FIFA players such as: David

Beckham, Nani, kaka etc…. ADIDAS Y-3 mostly target professional football players so

most of them watch FIFA matches while the match goes the brand get promotes where it

leads customers to consume the product.

Y-3 is available from a size range of 7’’ to 14’’ where it shows that it will fit to a person of

more than 18 years old, it also has a warranty period of 1 year because the initial cost is high

so where it motivates the customers to buy the Y-3 boot. Since this is specially designed for

football its main target market will be professional who play football and other footballers.

.

Figure 3.1.1 shows the Y-3 football boot


The figure 3.1.2 mentions about the ADIDAS BCG matrix

BCG matrix is the developer of a portfolio tool which helps the managers to organize and

work towards the strategy and identify the market share of the business

SBU

Strategic business unit is to identify the BCG; first and foremost you should see the strategic

business units to organize and marketing its own product

SBU can be categorized into 4:

●Stars: SBU’s that are stars having high share in the market and a high growth in the market

and they have enough of money to invest in the business.

● Cash cows: SBU’s that are cash cows it has a large share in the market but the product

growth is slow they have enough of money but the market is not growing.


● Question marks: SBU’s that are question marks having a small share in the market but

market growth is high.

● Dogs: SBU’s that are dogs they have a small share in the market of a low growth market.

IN the BCG matrix ADIDAS Company is in the stars because they have high market share

towards the Y-3 football boot and also the Y-3 market is also growing so ADIDAS is in the

Stars.


3.2. The distribution channel of ADIDAS

The distribution of the product will be done directly through the Adidas Showrooms available

worldwide, through retailers who already sell Adidas as Agents and Wholesalers who supply

our products to the retailers and through franchised business. Also through our websites and

other online shopping sites such as: EBay, Yahoo and so on we sell our product

Figure 3.2.1 Mentions about the distribution chain

The above figure clearly gives an Idea about the distribution channel of ADIDAS when

taking the distribution in SRILANKA the intermediate involve is HAMEEDIA they are the

retail agent in SRILANKA who sells ADIDAS product and also ADIDAS is having 3 to 4

showrooms in SRILANKA.


ADIDAS SHOWROOM

MANUFACTURER

CUSTOMERS

MANUFACTURER

RETAIL AGENTS

(HAMEEDIAS)

CUSTOMERS

MANUFACTURER

ONLINE PURCHASE

CUSTOMERS

3.3 ADIDAS Pricing

In fixing the price you should always consider on two main things:

● Internal factors

● External factors

Internal factors is the factor which effect within the organization ADIDAS marketers should

be in control on the internal factors such as: Marketing mix strategy the final price decided to

fix, Marketing objectives the maximizing profit, quick cash flow and etc… When we fix a

price you should fix in a perfect and a suitable price for the product if not it will be a

problem, where the customers always compare the cost against the product so when fixing a

price you should consider in all the factors.

External factors are which effect outside the organization these factors are:

●Nature of market and demand

●Competitors behaviour

●Other environmental elements

In this factor you should concern a lot because this is the external factors which the

competitors and other product play in the market so in this case you should mainly concern

on ADIDAS’s Y-3 boot the pricing method which is used is premium pricing to show the

superiority and the differentiation of the boot compare to others.

In fixing the price for the ADIDAS Y-3 football boot the price of the Y-3 will be relatively

high, since it has many extra’s added in to it. It shows the consumer the value of it while

talking about the unique features it has been equipped with many extra valuable things;

however it will keep adding value and prestige throughout in the game. In the meantime

Adidas do not charge unfair prices for their products also they do not gain less profits, from

all perspectives Adidas products is always worth for money and a main factor affecting the

price of the Y-3 will be the product life cycle, since it is developed mainly for football and

launched during the season, its life cycle will last for a less period and therefore Adidas will


Have to cover up the developing cost of the product whereas the product will get fairly

expensive so the price which will be marketed at £ 150.


3.4. What are the promotional activities done to achieve the target of the

Organization

Promotion

Promotion plays a heavy role in a products life cycle; anyhow the Y-3 will be promoted along

with the Germany football team as the brand ambassadors and media advertisements and also

hoardings will be another way to promote the product, since the product has a very short life

cycle being a football shoe; it has to reach its profits expected from Adidas.

In the earlier days ADIDAS were promoting its product mainly in Medias such as: T.V.,

Radio, Leaflets and etc… The marketers have found that it doesn’t reach to the target market

and now they have followed the latest method of promoting the product.

In the 21st century promotion is very important to a product to motivate the customer towards

it, According to this ADIDAS do many promotional activities it places its advertisement on

Magazines, Bill boards, Banners, Internet and etc…. this makes awareness to the customers

about new products in using advertisement in television they have reduced.

According to the Y-3 boot its target market is in between 18-30 where it targets the football

players, targeting this sector in today’s world the best way of marketing a product is via

internet. Today most of the people in the world when they get spare time they surf internet in

that 90% of the people use social network sites such as: Facebook, Twitter, MySpace, Hi5

and etc… The marketers have found the best place to promote the ADIDAS Y-3 is on the

internet where ADIDAS is already doing it. Since it’s about a football boot the brand

ADIDAS Y-3 football boot is promoted through a famous football player it is David

Beckham.


TASK 4

Two different marketing segments that Adidas can operate and

recommend marketing mix for the segment

Adidas is focusing on target market; when it markets a product it mainly consider on

demographic and physiographic segmentations; where demographic segment before it

markets it identify the consumer groups in: age, sex, education, race, religion, and

occupation. And in Physiographic it divides the market into different levels as: Lower class,

middle class, and upper class to identify their customers, Where Adidas has planned to

market a new product for a different segmentation so it needs to identify the consumers.

Adidas has identified that there are more consumers who wants ADIDAS Y-3 football boot in

the age between 10 – 16 who play football so it has identified; in order to increase its sales

ADIDAS has planned to market Y-3 boot for the age in between 13 – 17 at an economical

rate where its affordable for middle-class since it has plan to market it at £ 85 where it is

affordable to consumers

The segmentation of Adidas Y-3 boot for above 18 it’s segmented on considering

demographic segment such as: age, gender, occupation, race, education and etc… it’s

available in all countries at Adidas outlets whereas the other boot which is marketed for in-

between 13 – 17 has been considered as psychographic segment where its considered on

upper class, lower, class, and middle class, in considering all the factor it has marketed at an

economical price where its affordable to purchase the product.

After the segmentation Adidas should consider on the marketing mix it’s also called as the

4ps.

Product

Price

Place

Promotion


Product

The ADIDAS Y-3 for teens has added more value to the football boot than the other which

was marketed to adults. ADIDAS creates a good quality product to its customers. The new

ADIDAS football boot which is going to be marketed on the end of December 2011 has more

features than the ADULTS boot because its specially targeted to teens which should be

created more comfortable for them. It has new features such as:

It’s well packed

It’s more durability than the ADULTS boot

It’s designed to increase friction between the boot and the ball

Its more comfortable than the other because its cushioned inside

Price

In pricing ADIDAS football boot it has set a penetration price for the teen’s boot which is

more convenient to the customers; to purchase since it’s a boot for teens so it will be

marketed at an economical price where they can purchase it.

Place

The availability of product is as same as the other ADIDAS products which will be

distributed via the same distribution channel it will be available all over the world in

ADIDAS outlets.

Promotion

In promoting the boot ADIDAS plays a major role they promote the boot via many online

sites such as: Facebook, twitter, Hi5, MySpace and etc… and where they also have a famous

football player JADEN SMITH to promote the brand; where most of the teens are fans of

JADEN SMITH when he wore the shoes in matches they will watch and they too will buy the

boot where it increase sales.


4.2. Explain the different between marketing products and services rather

than consumers

A product is something which is tangible where as a service is intangible; in marketing a

product and service, a product is much easier than the service because after you market and

sell a product there is something tangible to be seen by the customer for his/her satisfaction

but in services he/she cannot because its intangible. It’s more difficult to understand the

customer needs and wants you should provide services to your customer’s needs and wants.

When marketing a product you should identify who are your customers? What they want?

And when they want it? Anyone can purchase your product if they are able to purchase

whereas with a service it is difficult to identify the customers because they think more times

than buying a product because service because it can be used overtime so in selecting a

service they will need more time to come to an idea. In marketing a product you no need to

consider on each and every person, because if you are selling a product you should only

consider on the demographic factors and physiographic factors; where as in service you

should need to find who are the customers and you should maintain a good relationship with

them and provide a best service in order to keep the customers with you, in service you

should always try to increase the relationship

When you market a product you need to calculate and fix an amount for the product, instead

in service you have to negotiate the marketing cost, it’s difficult to come up with a price for

the service.


4.3. Evaluate domestic and international marketing activities and

differentiate both

Marketing is the efficient and effective management and utilization of a company’s resources

to meet or exceed customer’s demands and company’s target. It involves selling products of

company to satisfy customer needs; this includes planning, pricing, promoting, and

distributing company products in order to satisfy customers. This both marketing are same

when it comes to fundamental principle of marketing.

Domestic marketing

Domestic marketing is selling company products within the local market, where it only deals

with one set of competition and economic issues which make it more convenient to do, In

domestic marketing there will be no any barriers in language, obtaining information and data

about customers, it’s easy to develop marketing strategies that are more effective and

efficient. In this marketing risk is lesser compare to international marketing, it need less

financial resources; all goods are being produced keeping in mind only of local customers.

International marketing

International marketing is the promotion and sale of a company’s product in overseas market

in international marketing you need more financial resources, before marketing the product

the company should know about the company laws, policies, and so on. International

marketing needs more time and effort it’s also risky compare to domestic marketing and you

need to commit more time to succeed in an international market.

Difference between domestic marketing and international marketing

Domestic marketing is the production, promotion distribution and sale of products in

a local market where international marketing is in a global market.

Domestic marketing is easy and less risky to conduct whereas International marketing

is more risky and more complex.

Domestic marketing needs only lesser financial resources where international

marketing requires huge finance.


Domestic marketing deals with single market where as international marketing deals

with several countries and different markets

Domestic marketing with only one set of customers; where international marketing

deals with different type of consumers with different tastes.


Reference

http://www.consumerpsychologist.com/

http://www.oppapers.com/essays/Marketing-Segmentation-Of-Adidas/711825

http://www.imagesfashion.com/content/adidas-deo-in-new-avatar-997.aspx

http://www.da-group.co.uk/index.php?option=com_content&view=article&id=31%3Amicro-and-

macro-environments&catid=2%3Amarketing-lectures&Itemid=3


http://www.oppapers.com/essays/Marketing-Segmentation-Of-Adidas/711825

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