NIKE AND ADIDAS
Promotional strategies of Nike and Adidas
Nike is an American multinational firm which was started in September 8, 1969. It is a firm which designs, develops, markets and sells footwear, apparel and accessories on a worldwide scale. NIKE is a top seller in athletic shoe wear category as well as athletic apparel worldwide. Nike is not only the leading supplier of athletic shoes and apparel but also sports equipment and miscellaneous other products. The company was born in 1965 by Bill Bowerman and Philip Knight under the name of blue Ribbon Sports. It came to know as Nike in 1978. There are multiple brands Nike operates like Nike Golf, Nike+ and subsidiaries including Hurley International.
It is present in around d190 countries around the world. The slogan “Just Do It” was first used by Nike in June 1971 and then it was registered with the US Patent and Trademark office in January 1974. By 1980, 50% share of market in athletic shoe wear belonged to Nike and the company was made public by the end of the same year. “Just do it” is the first line that comes into our mind when we think of Nike. But Nike is doing a lot more in terms of promoting its brand. Nike has a broader vision which is defined as “if you have a body, you are an athlete” through which it involves everyone in its products. Nike’s focus is to provide customers real value. There are key points which we can conclude from its strategy which are; Nike puts customers first, Nike is based on a felt need, Nike truly believes in the products which it is selling and their products are easily identifiable due to being such a strong brand. Two of the Nike’s key powerful tactics are its swoosh logo and the use of hero athletics in the advertisements such as Tiger Wood or Michael Jordan. Nike paid a fine on Michael Jordan’s shoe color for $5,000 and it created buzz everywhere. Nike uses media and sponsorships to create its presence, and it spent $4 million dollars to sponsor the Olympics of 1984 and it continues to do so. They launched video commercials with strong personality endorsements which create their brand image as being sporty and real.
The other top company in the sport apparel is Adidas. It is a German multinational for sports shoes, clothes and accessories. It was found in 1949 by Adolf Dassler. Just like Nike, Adidas also promotes through a strong brand image, sports sponsors and advertisements through celebrity endorsement. The global slogan for Adidas is “ Adidas is all in” which unifies all its sub-brands under one slogan and relates to fashion, music and pop culture as well. The brand has featured itself in a number of games including Sony PlayStation, Adidas power success and Commodore 64.Their “take the stage” campaign is one of the most popular one that was used to garner support for the country’s Olympic team. They used the concept of AIDA( awareness, interest, desire and action). They have involved celebrities such as David Beckham and Derrick Rose for video commercials as well as print media. Take the stage campaign was a chance for youngsters to meet their sporting idols through showcasing their talents on social media which encouraged a lot of customer involvement. They heavily engaged in social media marketing through Youtube and other active sites. Both the companies are focused on celebrities endorsement and understand the use of sponsoring sports events which are viral around the world to create their global presence. It is hard to say which company wins over the other as both have a strong brand equity and exceptional brand loyalty around the globe and it is a matter of prestige for the athletes to associate themselves to either of the brand.
However, while both the companies engage in sponsorships in the events, there are around 50 other sponsors communicating the same message to promote their brands, what differentiates their individuality is promoting through your unique selling point and promoting to set yourself exclusive from all the competitor’s brands. Nike has been ruling over its competitors through its technology and innovation. Both have a similar target market which makes it even more crucial to differentiate. Adidas has sponsored every possible sport event and both Nike and Adidas are known for spending millions of dollars on signing athletes to represent them on the media. Both the brands are focusing on “”exclusivity” Nike made use of Michael Jordan to take over the basketball fans around the world, Adidas relied on quality of products which customers love. But the true advantage of Nike is its presence around the globe, through which it can differentiate itself. Nike has production and retail facilities in more geographical areas than Adidas. Nike has placed itself in USA in the regions with highest foot traffics and Nike Town is a continuous promotion tool which sets Nike apart. Nike promotes even in the retail experience, by giving them a feeling or premier store and sensation. Both companies have similar marketing mix, similar quality and communication as well. For Nike, it is important for them to continue what they are doing as it is perfectly aligned with their brand image. For Adidas, it needs to focus on areas which Nike ignores, to create a distinct identity. Nike has more focus on basketball while Adidas has it on football, which means they should both focus on the followers of the respective sport, to make customers feel they are important.
For a sustainable competitive advantage Nike has a proactive responses channel to market trends and consumer preferences. It customizes the market into different countries, develops new and innovative products and tries to keep ahead of competition. A distribution advantage is created by reducing the costs and leaving discounted products at Walmart and other retail outlets. Nike has links with a number of suppliers and has unique competencies. It faces competition from Reebok, Puma and Adidas.
Nike and Adidas are major competitors; however, Adidas targets the age group of 10-30 whereas Nike targets age of 15-35. Nike is focused on USA whereas Adidas is focused on European market. (McIntyre and Perlman, 2000). Recently the sustainability initiatives by Nike have been the focus of various new, such as jersey which is manufactured from plastic bottles or organic cotton. The company has released an Environmental Apparel Design as well to maintain a competitive position. Nike is one the biggest companies striving in its corporate fabric and making sure that profitability and sustainability is ensured for the firm. Adidas is also similar in the strategies for which they are criticized as they both may overlap in its mission for marketing.
The most effective advertising medium for both the firm is to stick to what they have been conventionally doing as it has always generated positive results for them through sponsors and media advertisements. The brands should however, focus on the market which they are targeting. As mentioned Nike is focused on USA while Adidas is for Europe, and this should be the basis of designing the advertising campaigns to spread messages which are community sensitive. Nike also needs to incorporate environmental concerns in its campaigns. There were concerns regarding ethical work practices which negatively affected Nike which Adidas could use in promoting itself at that time. Brands should keep a watch on the weakness of the other brand to tap into the are where one lacks. This will help them promote differently as they are often seen as overlapping marketing strategies for both.
If we look at the pricing, then Nike is using premium pricing which is not easily affordable by everyone and the people who are passionate about sports spend fortunes to get associated with the brand. From cost plus model, Nike has moved to customer valuation model, in which it claims to provide exclusive value in the pricing. Although is a big risk to charge such a premium given the industry pressures and inflation rates, Nike believes it products to be compelling and charges more. Adidas, on the other hand, charges competitive pricing and skimming prices. For the run of the mill products, they use competitive pricing to maintain competition between itself, Nike, Reebok and Puma. For the products which are newly introduced and launched in the market they use skimming prices. They are higher priced due to brand equity and brand image. The target is upper middle class and passionate for sports people which is why it never uses penetrative pricing because it may negatively impact the brand image. The higher prices for both of the brands play with consumer’s psychology that this means better quality for them and both the companies rarely drop their prices. The companies should continue to do so as they are premium sports brands and have maintained healthy brand equity through pricing.
Recommendations
My first suggestion is guided at Nike's push into computerized games. As I would see it the new accelerometer based Nike+ engineering is the conception of an entire new era of Nike items and an astounding development to inspire individuals to incorporate games into their regular life. Nike has achieved a main part in very nearly every one of the promising new overall wearing occasions, for example, the 2012 Olympics, the 2012 Soccer Euro Cup, the NFL Superbowl, the 2014 Soccer World Cup and the 2016 Summer Olympics in Rio de Janeiro. Subsequently the time is presently for Nike to implant their clients and the enthusiasts of these significant brandishing occasions in the experience through their new innovation. The Nike+ engineering in Nike's footwear items, that tracks data about a players or clients Nike fuel, speed, vertical bounce, calories blazed and redundancies made is in my worry an astounding open door for Nike to bring its clients closer to their top competitors. I prescribe to prepare Nike's top underwriting players with their Nike+ innovation from Fuelband to shoes and track their each development, to give the client a chance to look at him/ herself to their donning symbols, consequently picking up inspiration to be dynamic and to possess Nike+ items. To adequately execute this suggestion Nike needs to contact its clients day by day through social networking and sway them to interface with their Idols with the Nike+ cell phone application. I recommend to improve to application to let the client pick his/ her most loved players and tail them on a Twitter much the same framework, where they are always educated about the competitors Nike Fuel, workouts and diversion time insights.
In light of the all the information I gathered, I can infer that in general client's are truly fulfill with Adidas item and administrations. Client's has most likely in the solidness of material that utilized as a part of delivered Adidas item, however in term of value and configuration, Adidas may need to invest more exertion and turn out with a freshest plan that can pull in more clients. Adidas can likewise dispatch an advancement or give an extraordinary offer of cost in a certain time of times to build the deals volume and draw in more clients.
In addition, Adidas may likewise need to turn out with a superior thought on notice to advance and separate its item from its focused. Since in generally, Adidas ad has less impact in buyer's brain and hence turned into one of its advertising shortcomings. I propose that Adidas can welcome renowned competitors or craftsmen as a brand representative to make it a more noteworthy brand name in buyer mentality.
In term of administrations, clients additionally were truly fulfilled by Adidas administrations they gave and I accept Adidas still ready to enhance their administration to serve their client significantly more sufficient to really expand their deals and make their client fulfill and content each one time they enter and leave Adidas store.
References
Fisk, P. (2010). People, planet, profit: How to embrace sustainability for innovation and business growth. London: Kogan Page.
Mehta, S. N. (January 01, 2009). TECHNOLOGY - Under Armour Reboots - The sports apparel maker is sprinting into footwear -- And trying to take on Nike and Adidas -- With the help of software and science. Fortune International, 159, 2, 14.
Nike and Adidas clash head-on in a World Cup sponsorship shoot-out. (December 04, 1997). Marketing Week, 5.
Libby, B. (January 01, 2001). Nike and Adidas go head to head in the Olympics of corporate-campus design. Metropolis, 21, 50-54.
Levine, J. (January 01, 1996). Adidas: Booted off the field by Nike and Reebok, it is making a strong comeback effort. Forbes, 157, 6, 44.
