Adidas How To Deal With Nike And UA Double Attack

Worldwide, Adidas is still in the second place of sports brand, and in the whole 15 years of Herbert Hainer in Adidas, it may be the most difficult year last year: their share price has dropped by 38%, and it has even lost to Under Armour in the North American market, falling to third place.

What should Adidas do?

Adidas has recently started to launch 50 new colors of shoes in one breath.

He is not kidding.

All the executives were present during the 8 hour marathon race on group investor day. Hainer said Adidas would move the production plant back to Asia to shorten the production cycle and accelerate the creation of new products according to seasonal trends and sales.

In this project, the company will test the water with the young brand NEO, so that the brand can break the industry standard of new products within 12-18 months, and shorten it to 45 days.

Adidas stores in the future will directly operate production facilities and may use robots.

The group said that customers will get a pair of personalized sneakers in 15 minutes, almost a cup of coffee time.

"It will shock the whole industry."

Roland Auschel, who is responsible for Adidas's global sales, speculated that sporting goods manufacturers will be the first to adopt this new business model in the industry. It is expected that the sales will increase by 20% and the risk of shorting will also be reduced.

"We will deliver faster, and we will achieve more fruitful results through our strong control network. We hope that total sales will increase by more than 60% by 2020.

All these (25%) require more stringent product mix, while increasing investment in the market and investment in individual products. "

Hainer added.

Adidas said Thursday that speed is not the only pillar of the five year growth plan.

The group said it would focus its attention on six related cities in the future: Losangeles, New York, London, Paris, Shanghai and Tokyo, pointing out that the volume of business in these key cities is larger than that in other countries.

"If we win the market in New York and Losangeles, then we can win the US market."

Auschel gives an example.

In addition, he added that 50% of the world's population lives in these key cities and contributes 80% of the global GDP.

"These are the key areas for our new plan."

As part of the strategy, Adidas also hopes to get closer to terminal consumers. According to Hainer, their goal is to become "the first sporting goods brand that can assemble athletes, consumers, partners and customers."

"We are already cooperating with some creative people.

Current

It is our happy cooperation with Kanye West.

Kanye likes to cooperate with us, in his words, because we provide oxygen for his creation, and his former partner just wanted to borrow his name.

"Hainer said.

The company hopes that by 2017, 30% of the brand content can be created by users.

Adidas further predicts that by 2020, the company's e-commerce business will rise four times, to 2 billion euros, to 2 billion 200 million dollars.

According to Auschel, 60% of the expenditure will be used for the purchase of electronic digital equipment.

At present, the group is investing heavily in digital business, including placing orders online, sending goods directly from the store, and what he calls "endless Gallery" which can display the company's entire line of products, but there will never be no inventory situation due to shortening the delivery time.

Auschel pointed out that online orders were recently implemented in 20 stores in Moscow, and sales increased by 30% in a week.

"This is of great significance."

He plans to extend the model to 200 stores by the end of August.

At the end of 2014, Adidas successfully reversed its losses.

In the new five year plan, the annual net profit target increased by 15%. Until 2020, after the elimination of exchange rate factors, the annual sales will increase by a year and the number of stores will increase by about 500-600.

Hainer acknowledges that the company has learned from past mistakes, "we are not paying attention to consumer demand, too static, resulting in the loss of brand enthusiasm."

But the sporting goods industry is growing at an annual rate of 7%. Compared to the consumer electronics industry (6%) and the personal care industry (5%), he said: "this is very good news for us."

Adidas has been hoping to further develop in the United States because it occupies 30% of the world's sporting goods market.

In the US, Adidas lost to rival Nike because consumers thought Nike was cooler.

"We have not won the hearts of athletes and consumers in the United States," said Mark King, director of Adidas North American market.

He admits that Adidas is too dependent on football, which is the source of sales of 2 billion euros a year.

Although Adidas has won the lead in this category, it failed to capture the unique mentality of American consumers.

Before NIKE, after Under Armour catch up, Under Armour surpassed Adidas in the second half of 2014, and became the second largest sports brand in the US market.

The picture is from curiosity daily.

"If you want to

Being strong, we can't just control the football field.

There are 15 sports groups in every high school in the United States.

There are 35 universities.

In other countries, a sport dominates, but here it is different.

Sports determine social attributes.

To increase awareness in a certain field from the beginning, Adidas plans to pay more attention to basketball, baseball, volleyball, hockey and more important football, which can bring a large number of fans.

"It doesn't bring much profit," King said. "But it can reap the hearts of consumers.

And we need to break this chain to let everyone know that Adidas is also a cool brand.

King cited a recent success story. Adidas and Eastbay collaborated in Compiling "catalogues for high school athletes to buy equipment".

"Since its launch, our football shoe has become a hot selling item," which has surpassed Nike and other competing products.

"So if you say," can we change the status quo? "My answer is," yes. "

We just need to seize this opportunity. It's right in front of us. "

He said happily.

In addition, Adidas will sponsor individual athletes instead of the whole team after the expiry of its partnership with NBA, and rethink its retail mode.

"Today, we have 30 shops throughout the United States, but there are 25 different models, the brand caliber is not the same."

King is slightly regretful.

Stateside,

It's another question.

"If we want to be strong in the US, we need a strong franchise to allow our middle price to be between $70 and $100," King said, which allowed the brand sales to rise from 0 to 7 million double in two years.

The group plans to double the globalization of running series and "invest heavily" in the United States, which also helps Reebok (Reebok) enhance its popularity in the local market.