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A case study on individual research- For marketing interventions and approaching global markets

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Executive summary:

Adidas has emerged to be one of the most emerging shoe brands today with rich brand equity and strong loyal base of customers. The report tends to evaluate the case study of Adidas with reference to its existing marketing campaigns and interventions that was followed by the London Olympics. Adidas is recommended to extend its social media presence by making use of content marketing interventions with the use of subject matter experts and the tangible results must reflect across storytelling, blogs, articles and amount of positive word of mouth marketing being performed by the potential customers (Delener, 2009). The social media space is capable of taking

the new product lines of Adidas such as women’s shoes, kid’s shoes and shoe for handicapped. Thus it could be inferred from the analysis that Adidas needs to involve in product diversification that is capable of enhancing the core competencies of the firm and also offer a competitive edge over the current performance of rivals (Collinson, 2012).

 

 

 

1. Analyse the importance of using both above-the-line and below-the-line communication for Adidas.

 

Adidas is a German based public company into sporting industry and their product portfolio ranges from sports footwear, clothing, accessories like bags, watches, eyewear and other sports-related goods and equipment. Adidas products are designed especially for sportsman that helps to perform to the best of their ability. For Olympic Games, London Adidas is the main supplier of  all sports wears and equipments that has explored the market for Adidas all over UK Invalid source specified..

 

Marketing is a promoting activity that takes the product to the knowledge of customers to promote selling. Marketing has many strategies in the market marketing mix like 4 P’s i.e., product, price, place and promotion. A company may use any mix of marketing strategies and practice that is best suitable for them to promote selling. One of such strategy with respect to promotional activities is above-the-line and below-the-line marketing strategy Invalid source specified..

 

 

Above-the-line and below-the-line communication of Adidas

 

Above-the-line marketing aims at taking the product to the reach of mass people i.e., public for an advertisement to gain popularity, fame, brand, etc from which the interested customer will approach the company for purchase orders Invalid source specified.. It is a kind of pull strategy of marketing, where the company does not need to meet each individual target customer to advertise the product, but the company involves making mass advertisement and customer arrives to the company in search of product. Mass advertising means in the form of newspaper, magazine, bill board and TV advertisement which is more expensive to the company. One time mass advertising wont be beneficial as the targeted customer may or may not look at the advert. For eg. in case of TV advert, some viewer pass on the advertisement session, thus repeatedly advertising will capture more viewer Invalid source specified..

 

Below-the-line communication is a kind of push strategy of marketing, where the company takes the product to the reach of targeted customer alone. In case of Adidas, its customers are the sports related young people, who can be collectively found in Olympic and other games. Thus Adidas has tie up with London Games and Great Britain (Team GB). Adidas conduct a ‘Take the Stage’ campaign where the youngsters have the chance to engage the stage and meet the talents. Excited youngster keeps on uttering the event that plays as an advertisement for the product, reaching youngster prone to promote the product 6 times more than other kind of advertisements Invalid source specified.

The event of ‘Take the Stage’ two youngster with David Beckham has been published in YouTube  and this has attracted 3.2 millions of viewed in the social Medias & YouTube.

Importance of using both above-the-line and below-the-line communication for Adidas

From the above two kind of marketing strategy used by Adidas, it could well reveal the fact that above-the-line communication less reachable to targeted customer comparing to below-the-line communication. Push strategy through ‘Take the Stage’ Campaign has attracted more viewers and viewers are specifically the targeted customers Invalid source specified..

 

Excitement and attraction of viewers

 

In the case of above the line in Adidas, they promoted through TV adverts and the response through such advert is very less. As it is know that many viewers only interest on sport game duration at the rest of the time i.e., during advertisement session the viewer record, passes or get forward to the sports programmer neglecting the TV adverts. So however TV advert attracts only fewer viewers. Also it does not create any excitement and attraction as compared with the ‘Take the Stage’ Campaign (Dahringer, 2010).

 

Attracts people with High degree of interest

 

The people with high degree of interest and passion towards sports can be found more on the place of Olympic game than compared to other TV sport viewer Invalid source specified..

 

Thus below the line communication is more effective for Adidas than compared to above the line.

 

Through-the-line communication

 

Through-the-line communication is a blend of both above-the-line and below-the-line. Duration for ‘Take the Stage’ Campaign can be allowed by London Game only to some extend like one hour. Whereas game takes place for the whole day and throughout the season, thus this campaign may miss many of viewers. Thus due to time constraint and periodical issues below-the-line is alone cannot be depended for marketing purpose. Thus it is suggested for Adidas to carry out both above- the-line and below-the-line communication in order to capture all the viewers whomever come across the game programs Invalid source specified..

 

Recommendation in TV advert strategy

 

The TV viewer during the sport program comes to know about the advertisement session from its first advertisement only. So when Adidas make the first advertisement in every break time, it cannot miss out any program passers. Moreover as much as time the company advert to such extent it attract the viewer thus will less advertising time and with repeated TV advertisement Adidas can cut the cost but can capture maximum TV sports viewers. This would be a better strategy for above the line communication for Adidas Invalid source specified..

 

Here Adidas has no meaning of worrying about the cost, because the important thing is its season of sports. During this season, not only Adidas even its competitor will be into play to capture the market in possible ways, thus irrespective of cost consideration making more advertisement is beneficial for Adidas, but can carry out some strategy to cut down the cost or to regret spending more (Delener, 2009). For any company, it is advisable to carry out both above the line (ATL) and below the line (BTL) communication strategy of marketing. In case of Adidas even the same is suggested, this kind of communication is termed as through-the-line communication (TTL).

 

 

 

2. Justify how effective you feel the high cost use of sponsorship has been to Adidas?

The 2012 London Olympics did a splendid job of capturing headlines. People with even minimum interest in the sport were fascinated with the splendor and pomp of the mega sporting event.  Ardent sporting fans were inevitably drawn towards following the accomplishments of some of the world's best players (wild, 2014).

 

The buzz that the London Olympics created provided Adidas with a chance of grabbing a major share of the global audience’s attention. This provided Adidas with a unique business opportunity.

 

The advantages of sports sponsorship

One of the greatest benefits of sponsoring the Olympics for Adidas was that the even provided the company with a platform using which a broad demographic audience could be reached. This is a major feat to achieve using any other means of marketing. The concept of targeting audience is becoming increasingly difficult in a fragmented media landscape. The factors that helped Adidas zero in on capitalizing the opportunity provided by the event were sports competitiveness, friendly and

 

dynamic nature of the event itself; and the connection of the event with team spirit and sportsmanship (Dahringer, 2010).

 

Adidas’s sports sponsorship was a tested way of linking their brand with the positive values of the games; it proved to be a successful way of creating brand awareness.

 

In the late 1980s, the company’s brand awareness in countries Asia was very marginal compared with developed markets in Americas and Europe, but after regular sponsorship of sporting events the awareness about the brand increased significantly in Korea, India, Japan and Taiwan (Dahringer, 2010). Had Adidas tried the process of creating awareness incrementally in one country after the other, it might have still been in the process of becoming a universally recognized brand (wild, 2014).

 

Sponsorship is not the same as advertising

 

When Adidas aimed to get the most of their Olympics 2012 sponsorship there was a need to do more than just put up their logos everywhere. If it merely done that it would have been considered as another form of outdoor canvassing (Gillin, 2008).

 

Companies aiming to get the most out of their sponsorship of the World Cup, or indeed any other sporting event, need to do far more than slap their logos on players’ shirts or the stadium’s hoardings – it should not be treated as just another form of outdoor advertising. Sponsorship is different from advertising on various counts (wild, 2014). It can be considered as an exchange between various parties who are trying to pursue their individual objectives. Adidas’s sponsorship was not about merely being seen. It is about meeting its overall marketing objectives and is not aimed at being seen in isolation from other tools of communication (wall, 2010).

 

By ensuring that the event is in alignment with the brand values and the interests of the target audience (the youngsters), adidas was completely able to successful in transferring the values form the event to its Brand. The company utilized the power of sponsorship to build a long term- partnership with the Olympics (Dahringer, 2010).

 

Measuring the success of the Sponsorship

Adidas's bid for the sponsorship of the Olympics was around £80million. Any organization that is sponsoring events this big are bound to know whether the returns are profitable. Here are the sales figures of adidas after sponsoring the Olympic Games. The sales for the Adidas brand in the UK alone were up by 24% in the first 6 months of 2012; the demand was for Team Great Britain themed products and accessories (Spiller, 2013). There was a significant increase in the UK for products that were developed under the Olympic license. This was a 250% rise compared to the Beijing 2008 Olympics. In the global market, Adidas grew by 11% and 16% in absolute terms (Diamond, 2011).

 

Having the distinction of being the official sportswear partner of the London Olympics, Adidas was instrumental in equipping more than 85,000 volunteers and organizers with sustainable products. It also provided sporting and clothing accessories to more than 3000 athletes participating in 25 of the 26 games (Diamond, 2011). The company worked with 11 Olympic committees nationally including the team GB.

 

We have identified a number of key measures against which a sponsorship arrangement’s success should be measured:

 

Here are some elements that can be used as factors against which Adidas’s sponsorship success can be measured (Inkpen, 2009).

 

Quantitative

• Fluctuation in the Market share in a target geography.

• By monitoring the shift in attributes such as; brand preference; and increase in purchase intention

• Satisfaction surveys on customers, consumers and employees

 

Qualitative

• Media opinion

• Enthusiasm of Consumer/customer

• Observers’ feedback

• Employee motivation

 

Adidas AG, one of the world's largest sporting goods manufacturer has been highly successful in 2012 Olympics (Inkpen, 2009). Adidas has used various marketing techniques to maintain its market position. Adidas communication conveys an image of continuity and tradition. From its origins Adidas has used marketing techniques as a tool for customer acquisition. The techniques used by the brand have always been strategically designed to increase sales by increasing brand awareness. They are a set of activities designed to meet the needs of consumers, providing a benefit to the company that offers a product or service (Kumar, 2011). Successful companies who want to soak up success today have to give great importance to marketing. Marketing is not just advertising. The company can be proud that it has been able to contribute to the phenomenal success of London 2012. The company was the official sponsor in sportswear in Athens in 2004 and Beijing in 2008. Adidas wants to use the Olympics to show the world that it is truly an Olympic brand which will allow the company to improve their competitiveness and positioning (wall, 2010).

 

Sponsoring events is an excellent method of increasing brand awareness. Associating a product or service with a sport can reap huge benefits.

 

 

3. Evaluate the effectiveness of Adidas’ use of social media in its ‘Take the Stage’ campaign.

 

There is a sudden explosion in the usage of social media usage around the world. Thanks to affordable access to computers and internet technologies, it is possible for millions around the world to connect and engage with other people and brand. When there is a surge in the number of internet users, brand like adidas are keen on making using social media as a platform to strengthen the brand (Delener, 2009).

 

Considering that the numbers of internet user are increasing by thousands a day, it makes perfect sense for organizations to promote their services or brands online in a way that generates interest and curiosity among its followers. In recent years the only advertising channel that has shown

 

growth is the Internet (McGaughel, 2009).Nowadays every new product launch is preceded by a combination of internal and external marketing concepts, including promotion through social media. At present there are several advantages that make social networks and the digital world a great ally for companies (Kassotakis, 2009).

 

The London game sponsor came up with an inspirational ad featuring some of the greatest athletes of the Great Britain team including Louis Smith, Victoria Pendleton and Tom Daley. The campaign "take the stage" was designed to showcase London, but is also highlighted the talent that exists within the Great Britain. The campaign allowed adidas to provide the youngsters a once in a life time opportunity.

 

Adidas has focused on the effective use of various social media platforms to create campaigns.  These campaigns have enabled the company to achieve both long term and short term goals. Here are four successful factors that have helped “Take the Stage” be a successful all time campaign (Ronkainen, 2011).

 

Adidas was successful in develop a comprehensive social media strategy.

Although Facebook and Twitter are considered as the two most used social platforms, Adidas has used a comprehensive strategy to incorporate numerous other platforms to reach customers and followers who have an interest in the company or its products. Examples include:

Platforms for business networking – LinkedIn

Travel industry related platforms such as travel trailers and trip advisors. Media (Videos & Image) sharing websites such as YouTube and Pinterest

The company has also used various country specific platforms to connect to its customers.

This diversified use of various social networking platforms has enabled Adidas to know which platform is the most effective to reach a specified target audience.

 

Established a model of two-way communication

Organizations are seeing the importance of creating and developing a community around its brand. It allows communities to establish a dialogue with its consumers, where both parties can communicate and interact (Naidu, 2009). Most companies used social media as a tool to only disseminate information about itself and its products. Adidas has made it an important rule to make social media interactions a two way one.

? Having a two way communication with customers can have various benefits. There are many tactics that Adidas has used to encourage this way of interaction.

? Engaging customers through questions and quizzes

? Posting general and business related surveys

? Posting updates on general topics of interest, like sharing videos and music.

? Relating to the customers.

 

Maintaining control of the content being published on behalf of the company

No one company can have a complete control of what is being published on its behalf. Most of the times, effective social media marketing or promotions require various teams to co-ordinate from different locations (Naidu, 2009). Adidas is known to follow strict approvals to facilitate workflow

 

and what is being said about the company. A great online presence, professionally done to be able  to be seen worldwide, provides access to multiple markets with a small investment compared to traditional ways. It is also true that social media is not a channel that should be treated the same way as the other channels (Minocha, 2010).

 

 

Setting goals and measure performance

Adidas understand the critical need to set goals while undertaking social media initiatives, it helps the company to measure it performance in relation to these goals, and compare their performance against competitors (Minocha, 2010). There is a simple rule of statistics that implies what gets measured gets improved. There are many key performance indicators that are being tracked by the company:

? Participation by followers in social media threads of the company

? For and against sentiments about the company

? Increase or decrease in the monthly followers

? Time taken by page administrators to respond to queries or comments

 

WHY ONLINE CAMPAIGNS HAVE BEEN SUCCESSFUL FOR ADIDAS?

Effective Segmentation: Offers the ability to create segmentation at different levels and helps in targeting audience in a specific market.

 

Reduced Costs: Carry the campaign message to a large number of users can be achieved at a very low cost. Communication in social networks is higher and cost effective than in any other medium.

 

Scope: The message of the advertising campaign can be seen by thousands of people in matters of seconds. Although users of social networks are there for leisure or to find useful information, Internet users are very receptive to the actions of companies (Delener, 2009).

 

Measurement and Feedback: In social media users talk about brands, say negative and positive reviews of products and services. This gives Adidas the opportunity to collect feedback and improve their products or services.

 

By successfully incorporating the above mentioned practices Adidas has been able to convert its campaigns into success stories (Inkpen, 2009). For large companies, networking is the vehicle to reach a young audience that eludes them, despite making huge investments in traditional media. That social networks have become the platforms for the world of online business to promote its business and without active presence in them it is practically impossible to achieve a strong brand reputation. Social networking has truly broken down the greater part of the age hindrances that once went with the ways individual’s pondered social media (Inkpen, 2009).

 

4. Young people are a central market segment of Adidas’ target market. Do you feel that this restricts the market for their products or do you feel that they are doing the correct thing?

Adidas has pioneered its place in the Shoe market with sheer focus on youth segment and this has yielded the company superior branding and distinctive competitive advantage for the firm (Ronkainen, 2011). Even though Adidas has been able to grab major part of the market share in the sports shoe segment there lies abundance of scope in diversifying in to new markets with new products. Currently youth between 15 to 29 are the perfect target audience for Adidas and its products which is about to see a saturation due to the dominance of rivals such as Rebook,Puma, Jordan and Fila respectively (Collinson, 2012). The current target marketing strategy of Adidas is about to meet the short term goals of the company there is a huge amount of risk underlying the reliance on youth segment. Adidas currently is exposed to a threat of depending too much of athletes and youth segment to sell its products which imposes long term issues of meeting the saturation in sales (Delener, 2009).

 

According to me Adidas has not been realizing the importance of diversifying in to new target segments of customers (Inkpen, 2009). Commercial footwear segment is highly lucrative and there is more number of players battling for the acquisition of market share. If Adidas is going to continue this trend it would not be able to enter in to new markets and also would not be able to realize the complete potential of its brand equity that it has gained till date. Following target segments are proposed for Adidas in order to diversify its product lines and thereby reducing the risks of relying the youth segmentation (Kassotakis, 2009).

 

 

Women segments are still untapped by Adidas and only 17% of the market share under women shoe markets has been realized by the existing players. With the current human resources under research and development department Adidas needs to invest more in market research interventions that will be enabling the top management to launch the shoes for women segments.

 

Amidst these the market for women’s dress shoes is realized only to 13% across the globe and yet again Adidas needs to investigate the consumer behaviour of women with reference to sales of  dress shoes (Minocha, 2010). Adidas is supposed to get in to strategic partnership with retail outlets that are capable of taking the women’s casual and dress shoes to the right set of target audience. Given the current state of brand equity that Adidas has in its inventory it is not doing the right thing by merely focus on youth. One of the most important factors that restrict the company from diversifying is the assumption that if Adidas enters in to other markets it would loose its brand niche across the target customers (Kumar, 2011). This particular assumption is ultimately a wrong perception of the management as it shows a lethargic attitude of the firm in realizing the fullest benefits of globalization. Brands such as Gucci, Louis Vuitton have been able to serve the commercial markets with more focus on women and mens casual dressing (rugman, 2012).

 

Kids shoe segment is yet crucial product line Disney has been able to emerge as one of the world’s leading seller of shoes across the kids segment. Kids segment are increasing at a rapid pace and Adidas needs to capitalize on this by extending the number of investment that it puts in to research and development (Naidu, 2009). Adidas has already been associated with sponsorships for sports and hence this offers an added advantage for enter the kids market. Amidst the women’s and the kids market Adidas is suggested to enter in to shoes for handicapped and shoes for old aged.

 

With the current state product lines Adidas is highly restricting it self to limited market which is unhealthy for the future prospects of the firm (McGaughel, 2009). The current business strategy is restricted to youth segment and that would hide the underlying potential for Adidas across other markets. Adidas has to initiate more ground work on diversifying its product lines that will be able to enhance the overall revenue of the firm (Naidu, 2009). One of the most important critical success factors for Adidas is its ability to realize the benefits of global brand reputation and access to its own individual outlets and retail chains. As Adidas has its franchising mode of displaying its shoe products any initiatives as a part of diversification strategy will be able to reach the wide set of target customers in short span of time (Kassotakis, 2009). Thus the above discussions offer strong discussion to conclude that Adidas has been restricting its business potential to youth segment and hence the suggested interventions will be able to expand the scope as well as profit sheets of the firm (McGaughel, 2009).

 

Conclusion:

It is evident from the research that Adidas has been exposed to both above the line and below the line marketing interventions and both has been able to offer its own set of tangible and intangible benefits in approaching global markets (McGaughel, 2009). Similarly the use of sponsorships has been highly beneficial for Adidas and it is proposed that the top management needs to explore key performance indicators and key result areas that would be capable of enhancing the return on the investment being made in sponsorship programs. Key theoretical issues covered in the study comprise the need of developing product diversification strategy for Adidas and also the importance of integrating social media marketing with the traditional marketing objective is emphasized. Personal observations made in the study comprise the exposure that I was able to gain through gaining access to different case studies and journals that covered the international marketing strategies of Adidas. On the negative note time management was lagging which was influencing my ability to conduct an in depth study. Concluding the work on Adidas I would quote the overall work to be satisfying and I feel accomplished on conducting a successful qualitative research.

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