In this article, we talk about the SWOT Analysis of Adidas, a brand which is known for its superior quality of sportswear and apparel.
But before we dig deep into the SWOT Analysis of Adidas, let’s check out few important aspects that made the brand that it is today:
Over the years the brand has faced tough competition from the existing and new players which have entered the sportswear market, but it the right marketing strategy of Adidas that helped it emerge strong. Click on the link to understand different strategies that the brand has used over the years.
Before a brand hits the market, it is important for it to define its target market and how it wants to project itself. Check out the positioning of Adidias to understand different factors that helped the brand position itself in the market.
After it has been decided as to what needs to be achieved comes how to achieve, and that’s where defining the marketing mix of a brand comes in place. Marketing Mix of Adidas will let you know about the different strategies be it promotional, pricing and location, etc that Adidas used for its success.
SWOT ANALYSIS OF ADIDAS:
SWOT analysis of Adidas will give you an idea about the strengths, Weaknesses, Opportunities and the threats that the brand has or is facing in internally as well as externally.
Let’s check out the SWOT Analysis of Adidas:
The first thing to discuss in the SWOT analysis of Adidas are the strengths of Adidas and how well it uses it.
STRONG LINEAGE: Founded in the year 1924, Adidas over the years has slowly and steadily become the brand it is today. Regarded globally as a premium sportswear manufacturer, Adidas has created a strong niche for itself with its own set of audience.
GLOBAL PRESENCE: The next key strength of Adidas is its global presence. The company is operating in Asia Pacific, Western Europe, North and Latin America, Emerging markets and Russia/CIS.
INNOVATIVE BUSINESS STRATEGIES: Some of its subsidiaries like Reebok, TaylorMade, and Runtastic has helped Adidas push its gross margins well above its competitors.
INNOVATIVE PRODUCTS AND MARKETING STRATEGIES: One of the major strengths of Adidas is the innovative way it approaches while manufacturing its new products. Products like Yoga Collection made from recycled ocean plastic and AlphaEdge 4D sneakers made by using light and oxygen through a process called Digital Light Synthesis are some of the innovative products that Adidas introduced in the market and got a phenomenal response.
Adding to the strengths of Adidas is the aggressive marketing strategies Adidas adopts to promote its products. Adidas targets the “innovators” and “early adopters,” consumers in the 15-30 age range, with new products that create instant sales bonanzas using digital and offline channels.
COLLABORATION: The celebrity-infused strategy involving High profile collaborations and partnerships with celebrities and companies such as Pharell Williams, Run DMC, Kanye West, Bape, and Beyonce has helped the brand outdo its competitors and create a buzz in the market which no other sportswear maker managed to create.
The second in the SWOT Analysis of Adidas is the Adidas weakness.
NARROW PRODUCT LINE: Despite having t-shirts, shorts, etc in its product line, Adidas lays more emphasis on its footwear, thus limiting its market share. Adidas needs to have a holistic approach while promoting its products so as to eat up the market share from its competitors.
PRICE POINTS: One of the major weakness of Adidas is its pricing strategy, which targets only upper-middle and affluent classes. Competitors like Puma have successfully got their pricing strategy right and target both the middle class and upper-middle-class customers with its products.
ABSENCE OF BRAND LOYALTY: Unlike its competitors like Nike and Underarmour, Adidas has failed to create loyalty among its customers. Launching the Yeezie brand was a good attempt by Adidas to create brand loyalty but it still has miles to go to reach where Nike is.
BRAND ENDORSEMENTS: Nike endorsements with athletes are very high in number than Adidas, Under Armour or any other brand. In 1980, Adidas was passed on a potential endorsement with American basketball player Michael Jordan. But Nike was able to snagged Jordan endorsement deal and even today the brand is generating billions of dollars revenue for one of the leading brand Nike.
The third in the SWOT Analysis of Adidas is Adidas Opportunities
PRODUCT INNOVATION: At Adidas, innovation is at the core of all the products it manufactures. The choice of materials and how they are manufactured are the two main ways by which the innovation team of Adidas influences the environmental footprint of our products.
Approaching the innovation challenge from an environmental perspective helps Adidas make products that are better for consumers and better for the planet, too. Some of the main examples of innovative ideas and new technologies that have been used in the creation of the Adidas products are:
- Sport Infinity
- Parley for the oceans
- Biosteel fiber etc
COLLABORATIONS: Sneakers like the Raf Simons x adidas Originals Ozweego and the Kanye West x Adidas Originals YEEZY Boost 350 have been canonized as some of the biggest status symbols in the footwear world.
- Pharrell Williams x Adidas Originals
- Palace x adidas Originals
- Bedwin and The Heartbreakers x adidas Originals
Are some of the famous collaborations that Adidas has come into.
INCREASING PURCHASING POWER OF CUSTOMERS: The last in the list of Adidas opportunities is the Increasing purchasing power of the customers. With the increasing income of customers, people tend to purchase more products allowing Adidas to increase the sales of their products.
COUNTERFEITS: Counterfeits or fake products are one of the major threats of Adidas. Counterfeits target lower and middle-class customers and are slowly eating away the company’s market share in underdeveloped and developing countries.
COMPETITION FROM LOCAL AND INTERNATIONAL PLAYERS: One of the major threats of Adidas is the fierce competition it faces from local as well as international players. Competitors like Nike, Puma etc are giving the company a tough run for its money in the fight to get the largest pie of the market share.
Conclusion: This concludes the SWOT Analysis of Adidas, let us know your views on the articles by dropping a comment below.