ADIDAS STRATEGIC MANAGEMENT ANALYSIS

EXECUTIVE SUMMARYThis report sets out the different aspects of strategic management at the Adidas group. Sometimes the two are used interchangeably, but there is a lot of difference between the two. They can partly be distinguished on the basis of different ways of financing them and partly by comparing the sizes of the companies involved.Adidas was started in 1920 by Adi Dassler because of his passion for sports and shoemaking and with three guiding principles in mind - to produce the best shoe to serve the needs of sport, to protect the athlete from injury and to make the product durable. With profits and with more family members joining in, the company expanded in the next decade.Adidas has streamed into three divisions- Performance, Style and Originals. With these divisions, Adidas diversified into fashion and style for the general public. Adidas, as a brand, is quite popular especially among sports persons/ athletes. It boasts of an attractive consumer value proposition. The tangible and intangible resources of the company are integrated with the brand in terms of brand image and reputation.Adidas has a strong brand image in the terms that it is recognised as a company that provides durable and sporty products. The three stripes logo of Adidas is well recognised and the consistency in the use of this logo has created a strong association of three stripes with Adidas. The clothing and accessories of Adidas are not so popular in the general public as its footwear. This is because the brand image is mainly related to footwear, especially sports footwear.In addition to examining the situational analysis of the company this paper has also described Adidas strategy analysis. A thorough assessment of Adidas industry analysis, industry attractiveness and competitor analysis, environmental analysis and value creation, and comparative analysis has also been carried out. The last section of the paper is dedicated to offering recommendations to enhance the productivity and performance of the company.

IINTRODUCTION

Adidas-Salomon is one of the major sports apparel manufacturer. It consists of Reebok Sportswear Company, Taylormade Golf Company, Maxfli Golf and Adidas Golf. It is the second largest sportswear manufacturer of the world after Nike. The company was founded by Adolf (Adi) Dassler in 1948 and is named after him. But the story started way back in 1920 when Dassler and his brother Rudolf Dassler started making shoes Herzogenaurach, near Nuremberg. Rudolf Dassler is also the founder of other sports goods manufacturer company, Puma.The group is actually named as Replica Adidas Shoes.

ADIDAS FOCUS ON THE CONSUMERThe consumer and creating consumer desire for our products is at the heart of everything we do. By constantly developing desirable products and inspiring brand experiences, we can drive sustainable and quality growth, building a strong reputation and loyalty with consumers. Moreover, we also understand that, in order to have credible and authentic connections to create such desirability with our consumers, we must have the right market segmentation strategy. As part of its function, Global Brands has mapped out our target consumer universe, which spans from our roots in sport, the pure performer, through to todays style setters who have embraced sporting goods brands as part of their lifestyle.To be successful across consumer segments, we acknowledge that a strategy of mass production or mass marketing is no longer sufficient. Only by identifying and understanding consumers motivations and goals for doing sport, their individual lifestyle, their fitness level and their buying habits can we create meaningful products, services and experiences that build a lasting impression and brand loyalty. In this respect, we have identified five key global trends which will be important to address with our brands and sub-brands over the duration of Route 2015: Fit for life:Sport is no longer just about competing and winning. Sport is becoming more embedded in consumers everyday lifestyles. Motivations and goals are becoming more holistic, fun, socialising and life-enhancing. You are what you know and what you do:Society is embracing a life-long learning attitude, and placing more emphasis on what we know and do versus what we have and where we come from. Celebrating individuality:Consumers increasingly fulfil their desire to differentiate themselves from one another by being more creative on the one hand mixing and matching products and services they need, and on the other hand seeking personalised offerings tailored for them. The growth in social media continues to fuel more and more opportunities to display individuality, making it even more important. Together is better:There is an increasing need for meaningful social interaction, both online and offline, as consumers become more mobile, and digital technologies and social networks make it easier for them to connect with like-minded people. Back to basics:For everyday life, products and services are desired to be simple and authentic, making consumers lives easier. There is a growing interest in outdoor activities and minimalistically designed products, reflecting the desire to reconnect and be in tune with nature.To match these trends and fulfil consumer demands, Global Brands teams adhere to the following principles: Create the unexpected through product and brand experience. Create the highest emotional connection between our brands and the consumer. Be prepared for the next generation, anticipating change. Simplify to the maximum. Show excellence in execution, being consistent in what we do, from idea creation to communication.

EXTERNAL ENVIRONTMENT ANALYSISPOLITICALThere are a number of regulations, legislations and processes that have been enacted globally that govern the use and the production of the different products. Adidas Corporation is impacted significantly by the political influences of nations where the firm has business activities. In the Peoples Republic of China, there are debates regarding a transformation of the current system of corporate tax. This will greatly impact Adidas business activities since an estimated 30% of the corporations manufacturing activities are based in China (Aboulian, Charnley & Watkins, 2008). There are also inconsistencies in the labor charges for production of products in Germany where Adidas has its headquarters. This will significantly impact business for Adidas.

ECONOMICThe global financial crisis that occurred from 2008 impacted business but the company has since recovered. Owing to the fact that Adidas is a multinational firm it offers employment to thousands of people in different parts of the world where the firm has business operations (Adidas, 2009).

SOCIAL-CULTURALAdidas products are accepted globally by consumers from different races, ages, ethnicities, religions, genders and lifestyles; any person will find an Adidas product that responds to their clothing or footwear needs (Smit, 2009). The companys main focus, however, is concentrated on the sports and athletics niche in the global market.

TECHNOLOGICALTechnology is a very important aspect of the business activities in Adidas Corporation. It is noteworthy that Adidas makes use of technology such as the internet to market and sell its products, particularly in the American online market. In addition to this, Adidas was one of the companies in the world to create a smart shoe product. This shoe was incorporated with a microchip and a wireless MP3 player (Adidas, 2009). Technology is also widely used in the transportation, manufacturing and packaging activities at Adidas Corporation.

ENVIRONMENTAL

Adidas Corporation is committed to environmental conservation and the protection of human life. This is mostly depicted in the firms commitment to the control and monitoring of harmful emissions into the atmosphere (Dawe, 2009). Adidas is also committed to the elimination of PVC and instead making use of more environmental friendly substances such as polyurethane.

LEGALThe firm will incur significant costs in the accreditation; this will show that it is in full compliance with the different laws that are found in the market. There are also the regulations concerning the use of the labor in the different operations of the firm Adidas Corporation has a policy to ensure that all members of the organization, as well as those that are affiliated to the corporation in different ways abide by the legal decrees that govern business. In addition to ensuring that its products are safe and of a high quality, Adidas also ascertains the health and safety of its employees (Adidas, 2009). The workers in Adidas are offered valuable training sessions on the firms policies and regulations. The firm also abides by the employment laws of the regions where it has business operations (Lussier & Kimball, 2014).

INDUSTRY ANALYSISThreat of substitutesSubstitutes were classified as a high power threat. When determining power magnitude of Substitutes, it is important to distinguish the difference between the US Footwear Manufacturing industry and US companies that have their footwear manufactured overseas. The US Footwear Manufacturing industry encompasses companies that manufacture shoes within the borders of the United States. Due to the trend of outsourcing and the declining US Footwear Manufacturing industry, the threat of substitutes is classified as High. Even if a US company was created and instituting a low cost leadership strategy, it would not be able to compete in the cost of doing business when compared to a company that has outsourced their manufacturing. Wholesalers and retailers are much more likely to purchase footwear from manufacturing industries in Asia, where Adidas does 97% of its total footwear production, or in Vietnam, where Nike does 37% of its manufacturing, because it is cheaper (IBISWorld). The US footwear consumer market continues to thrive off of imported shoes. China remains the single largest importer of footwear into the United States, accounting for 76.3% of total imports, an estimated $14.7 billion in 2010 (IBISWorld). If a company that is currently manufacturing in the United States is unwilling to outsource its labor, it will not be able to compete with the larger companies such as Nike and Adidas on a price based strategy.

Bargaining power of supplierDue to the various geographic locations that are typically associated with outsourcing manufacturing and their abundance of resources, the threat of suppliers was given a moderate power-level. While Adidas produces 97% of their total production in Asia, most of this comes from China. This has forced companies such as Nike to look for other suppliers and have spread out their manufacturing to Vietnam, Thailand, and Indonesia (IBISWorld). The vast majority of these suppliers are not capable of forward integration and look to manufacturing companies to purchase their supplies. With the increase in demand for low-cost labor, came an increase in the amount of suppliers. There is not, however, a surplus in supplies as larger companies seek to engage in contracts with these companies as soon as possible (Driscoll).

Bargaining Power of BuyersIt is high to extremely high for buyers because of the price sensitivity for buyers purchasing bulk orders in the current economic climate. The buyer switching costs for substitutes are low with an industry of only a few major companies, leads to a strong bargaining power for buyers.

Threat of New EntrantsThe threat of new entrants into the market is a low to moderately low because the lack of barriers for entry. However, with dominant players like Nike and Adidas, competition would make it difficult with the necessary capital to invest for a start up, R&D, marketing and advertising, endorsements of popular and upcoming athletes who do not have a contract with a company yet, and the ability for production whether outsourcing or in-house.

Industry RivalryRivalry is a high-power threat in the Footwear Manufacturing industry. This is partly due to a diminishing US Footwear Manufacturing industry and the increase in buyer power. IBISWorld forecasts industry revenue will decline at a five-year annual rate of 1.5% to $1.6 billion by 2015 (IBISWorld). Less revenue and the shift of the power to the buyers makes each buyer more and more important to a manufacturer. Also, with their increase in power, buyers are able place orders infrequently which increases the threat of rivalry. To further the threat of rivalry, there are many competitors that are roughly the same size. Nike, Adidas AG, and The Timberland Company are 3 of the largest footwear manufacturers (IBISWorld). The threat of rivalry is even more prevalent in offshore manufacturing. The opportunity for low cost labor has driven many manufacturers to transplant operations abroad. Because of this you have these large companies such as Nike and Adidas competing for resources in the same regions. Some companies, like Nike, are posting revenue declines even with these opportunities for low-cost labor. Nike's revenues dropped to $19.0 billion at the end of the 2010 fiscal year (Nike).

INDUSTRY ATTRACTIVENESSIn my evaluation Adidass line-up of business in 2008 looks more refined and focused towards their corporate strategy. Adidas reorganized their business units into three core brands such as Adidas, Reebok, and Taylor Made-Adidas Golf to expand their leadership in product innovation and differentiation.Adidas has significantly increasing their market share since their restructuring of business. Sporting goods industry is highly competitive industry having few more strong competitors. Though Adidas reach the second highest position in the worlds sporting goods industry, due to the strong completion and price cut strategy Adidas have to continuously focus their attention on innovation and differentiation.Overall, Adidas three of its business units (Adidas, Reebok, and Taylor Made-Adidas Golf) seems more attractive and profitable. Since Adidas have core competencies lies on athletes footwear Adidas business unit looks more attractive and profitable. Similarly primary focus of Reebok business unit is also shoes and sporting accessories which enable Adidas Company to have a good strategic fit into their value chain and make company more profitable. While Adidass equipment is less attractive compared to three of its business unit.

COMPETITOR ANALYSISFactorAdidasStrength/AdvantageWeakness/DisadvantageNikeUnder Armour

Product Quality and designHigh quality products and design and room for improvementThis is a strength and advantage for Adidas as improvement on products will increase market shareHigh quality products and designHigh quality products and advanced products incorporating new superior technological innovation

Cost efficiency and PriceRelatively cost efficient, hence a relatively lower price than NikeStrengthNot as cost efficient as its industry competitors, hence relatively higher pricesCost efficient with more than 95% outsourcing and Reasonably priced

Brand portfolio and diversificationVery diverse brand portfolio and a large number of products to choose fromThis is a strength for Adidas group because it provides customers with more choicesLess brand portfolio and diversity than AdidasProducts not as diverse as competitors, but the company is steadily building its portfolio

Market Share and market growthLargest market share in Europe and Asia, but Nike closing in on the Europe Marketweaknesses for Adidas because it is losing its market share and not attracting new emerging markets like Under ArmourLargest Global market share and steady growth especially in EuropeSecond largest market share in N. America after Nike and rapid market growth rate.

Brand recognition and ReputationAdidas brand is globally recognized but is more famous in Asia and European markets.Strength as the Adidas Brand name and logo are globally known and associated with sporting productsMost globally recognized brand for sporting goodsBrand recognition growing, especially in America.

Advertising and promotionLargest number of athletes and ambassadors, official sponsor of FIFA world cup. Marketing targets youth who are physically activeStrength Using popular athletes, teams and sporting events as a platform to promote the Adidas brand name and products will help increase salesMost successful Sports ambassadors, marketing targets both fashionable and physically active youthVery few popular athletes and teams, but targets youth between from ages 9-12, hence long-term building more brand loyalty

From the Competitive analysis table above, it is clear that whereas the Adidas Group is a strong brand, it needs to re-evaluate its strategies to achieve its goals as newer companies and competitors like Under Armour have a higher growth rate than Adidas.INTERNAL ENVIRONTMENT ANALYSISBecoming the global leader in the sporting goods industry depends upon the potential, dedication, knowledge and performance of employees and the excellence of leaders. Therefore, Adidas Group fosters a corporate culture of performance, passion, integrity and diversity, as they are convinced this is crucial to stimulate innovation, team spirit and engagement.

There is no end for sports. This is not only Adidas slogan in the world, but also is one aspect of the enterprise culture. Another aspect is diversified employees. Adidas employees come from different trades as well as different countries and regions. Fair competition with team spirit is the third aspect. Adidas staff is promoted via one's own performance to confirm one's own competence and dedication.

Enterprise culture needs to be specified. Enterprise culture should not be just in oral form. It should be specified actions and let employees could touch and feel that it is reflected around our work.

There are six Adidas values, believable, inspiring, creative, conscientious, sincere and experienced. This is the concrete embodiment of their corporate culture also every employee's work rules.

Three-pillar Human Resources strategyAdidas Group strives to have the right team in place by focusing our activities on the implementation and execution of our Groups Human Resources strategy, which is based upon three pillars: Creating a working environment that stimulates team spirit, passion,engagement and achievement Expanding their performance culture based upon strong leadership Being an employer of choice

Engagement drives performanceThey believe that employee satisfaction drives commitment, commitment drives engagement, and engagement drives Business performance. Consequently, thery have defined engagement as one of our Groups key performance indicators for measuring their efforts to sustain a performance culture. To capture employee perceptions, they carry out formal engagement surveys to evaluate their position as the employer of choice for their employees and to provide a Framework for benchmarking. The adidas Group also took action at a global and strategic level, focusing on areas such as workspace, collaboration and knowledge management, employee careers, work-life integration and more.

Enabling employees to reach their personal bestTo reach their personal best, the Group employees are offered a wide variety of training and development opportunities, building on their strengths, improving their skills and overcoming their own challenges. Their highest priority is to match individual employee aspirations with their organisational needs.

Performance-driven remuneration systemThey are committed to rewarding their employees with compensation and benefit programmes that are competitive in the marketplace. Remuneration throughout the Group comprises fixed and variable monetary compensation, non-monetary rewards, as well as other intangible benefits.

Internal communication activities to drive employee engagementThey believe that a robust internal communication platform is Essentials for driving employee engagement and fostering open collaboration within the organisation. For example, the Group Intranet has been transformed over the past few years into blogs, allowing departments and teams to quickly build and edit their own internal Communications platforms. It also enables employees to comment on news, share knowledge, collaborate and discuss current topics.

Creating an attractive work environment

They aim to harmonise the commercial interests of the adidas Group with the private and family needs of their employees. The Work-Life Integration Programme includes family-oriented services, flexible work time and place, people development and leadership competente related to work-life integration.Diverse workforce to achieve global goals:As a global company, they understand that it takes people with different ideas, strengths, interests and cultural backgrounds to ensure they achieve their goals. A high degree of diversity is already represented within their workforce.Increasing proportion of women in management positions:The adidas Group has set specific goals which are in line with their corporate culture as well as their employee structure. They plan to increase the proportion of women in management to between 32% and 35% by 2015 (currently: 27% worldwide)In addition, the adidas Group is focusing on programmes which give employees with children the option to combine their careers with family life, regardless of gender.Diverse sports activities for employees:In addition, they offer employees a wide range of sports activities at their major sites, in which partly also their partners and family members can participate. Employees in Herzogenaurach, Portland, Canton and at other subsidiaries have access to a company gym and numerous other Sports facilities.

VALUE CHAIN ANALYSISWhen assessing the how competitive are a companys price and costs with that of its industry rivals can be analyzed using the value chain analysis. The analysis is broken up into two parts, the primary activities and the support activities. The primary activities are what is mainly responsible in creating value for customers while support activities facilitate and enhance the performance of the primary activities.Primary Activities.

The efficient supply chain management initiative, World Class Supply Chain, allowed the Adidas operation to produce enough products at a low-cost to distribute to the market on time and in force by the means of factories in Asia and new inventory methods for its retail operations. Adidas used heavy marketing and advertising techniques to grow its market share in the United States after its restructuring to gain back the region it once dominated by being the innovator in athletic marketing. The development and expansion of its retail and online operation provided a service to the consumer by being able to try to the product, shop at convenience and consult with an employee about different lines.

Support Activities. Through technology and product R&D, Adidas AG was the first to modify and create what is now the modern track and soccer cleat. The new policy is each of its three units is responsible for at least one new innovation per year. With Human Resource Management, the company hires and trains knowledgeable employees to operate its retail locations while contracting to outside factories in Asia to assemble its product lines which saves on capital. General Administration of Adidas has changed several times since the founder and son passed away but each new administration has similar goals, to overtake Nike and give a new edge to the company through restructuring.

RESOURCESTangible resource Financial ResourcesAdidas steadily improves its financial situation. Their operating profit in 2014 amounted to 580million, an increase of 18%, compared to 2013. Adidas and TaylorMade-adidas Golf augmented their net sales and their profit in the same period but Salomon performed poorly.Surely, this was one of the reasons for selling it in 2015. Shareholders benefited from the firmsstrong position, too. The dividend per share grew 30% from 1 in 2003 to 1.30 in 2014 Technological ResourcesThe most important task concerning technological resources is to secure a full innovation pipeline and launch new, innovative products in regular intervals. Adidas wants to launch one major technological innovation per year. In 2014, one major innovation was the adidas_1 intelligent running shoe. It is able to adapt to its wearer while running by optimizing the cushioning level. A similar approach is included in the new Taylor Made r7 quad driver that allows players to adjust launch conditions to fit to their specific swing characteristics. This is realized by an additional weight, which can be redistributed to produce different launch conditions in one driver. Financial ResourcesStrong financial position (Constant growth) Organizational ResourcesBig and loyal customer base, effective distribution network and control system over the supply chain Intangible resource Human ResourcesAs production is done by independent suppliers, adidas employees are not active in productionprocesses but mainly in the marketing, sales, administration and R&D section. Out of overall17,023 employees, in 2014, 12% worked in the marketing section and only 6 % in R&D. Adidas employees have to be highly qualified and able to deal with and adjust to current trends and market changes. As adidas is a global player with subcontractors all over the world,they also care for the employees of their numerous manufacturers. On reason is their will to be sensitive to the needs of all stakeholders and another one is their image. They have to protect it and cannot accept bad press, e.g., about inhuman working conditions at supplier facilities. Therefore, adidas set up their Standards of Engagement that outlines guidelines, which have to be respected by its suppliers. They include the prohibition of child labour and discrimination of any sort, the protection of minimum wages and the freedom of association. Furthermore, a hygienic and safe working environment has to be guaranteed. Certainly, it does not suffice to only set up these guidelines; they have to be controlled on a regular basis, too. Penalties have to be executed if misconduct exists. The accreditation of the program through the Fair Labour Association proves the credibility of adidas measures. Innovation ResourcesKnowledge transfer, integrated research laboratories, dynamic technological innovation design, exclusive worldwide patents, an online website ideal for customization Reputation ResourceBrand name, identifiable distinctive trademark

CAPABILITIES BrandingAdidas most important assets are its brands. Securing and boosting reputation and brand recognition are therefore a major formula for success. A selection of different capabilities is needed to secure a strong position of the brands in the marketplace. First, adidas stands for technological knowl-edge and expertise. Adidas protects its technological innovations; it holds about 700 patents and similar industrial property rights worldwide a proof of its technological strength12. The numerous adidas trademarks underlie a high degree of protection, too. Second, the design department provides new and exciting designs to keep up with the competition. This is secured through collaborations with famous designers, e.g., Stella McCartney. Third, adidas focuses on the image of its brands and builds connections to leading athletes and style icons, e.g., David Beckham or Missy Elliott. Another important capability is successful marketing. Adequate to the different brands, adidas also follows different individual marketing campaigns. For instance, the Impossible is nothing campaign for the adidas Sport Performance product range or Respect ME featuring Missy Elliott for Sport Heritage and What drives you? for TaylorMade. Impossible is nothing stands for the will of adidas and all athletes to surpass limits. It is their first worldwide brand advertising campaign, featuring present and past athletes from various fields, e.g., Muhammad and Laila Ali. Having started it in 2014, adidas kept the campaign and even widened it in 2015. Respect ME aims at boosting adidas urban street credibility and especially strengthen the brands position among the new Hip Hop generation. The importance of marketing becomes clear when analysing the operating expenses. In 2014, with 878 million out of a 2,478 million budget, over one third of the firms expenses consisted of the marketing working budget, while only 88 million were spent for R&D. Moreover, a clean image is crucial to adidas, especially as most of their subcontractors are situated in low-wage countries. The consumers are more and more aware of what the firms are doing and are able to make use of their freedom of choice if they do not agree to certain practices. Adidas has to be aware of all activities relating to the firm, also the ones located outside the company. If adidas wants to be seen as a global player with authentic corporate responsibility, it has to make sure that its business partners adhere to legal and social standards, too.

Efficient Risk Management

Adidas faces external risks, such as macroeconomic and sector risks as well as internal risks, such as value chain and operational risks. The highly competitive nature of the sporting goods industry and the high level of market saturation are significant external risks. Adidas response is achieving further growth by expanding its market share, acquisitions and by maintaining the mix of investments in advertising, sponsorships and R&D. Additionally, the adequate management of the diverse suppliers from mainly Asian countries has to be assured to protect the products quality and price. The high expenses for marketing represent an internal risk for the firms financial health. Therefore, adidas conducts intense market research, includes performance incentives in its contracts and reserves the right to terminate contracts for instance in case of drug abuse. Widespread are also the risks of lost turnover due to piracy and trademark counterfeiting, as well as patent infringements. Furthermore, preventing the loss of intellectual property that has been transferred to subcontractors is very important. Adidas states that classical counterfeiting of adidas brands has an annual volume of 10% of the overall sales. The group has a separate department that is solely dedicated to putting an end to these illegal actions.

ADIDAS CORE COMPETENCIESStrong marketing strategy Distinctive competence, especially in consumer brand awareness and brand power Involvement of world top class athletes and sportsmen in advertising campaign endorse effect Centering on the brand imageExtensive R&D capabilities Innovative product design Main focus is on new product development Comfort and performance

Extensive Supply Chain Management Capabilities

Strongly connected with the previous core competencies Suggesting high quality and stylish sport footwear Adidas make use of suppliers anywhere in the world

SWOT ANALYSISStrengths Large event sponsorships Brand reputation / recognition Diverse product portfolio Culture driven by innovation / R&D Dominant in soccer and hockey Supply chain managementWeaknesses High quality and innovation are costly Controlling subcontractor quality negative effects can be devastating Wasting resources trying to overtake Nike in the US?

Opportunities Increasing female participation in sports E-commerce to increase market share Growth rates for footwear and apparel Central Asia (13%), Eastern Europe (20%) China (15%)Threats Nikes reputation and presence; a leader in marketing and advertising Sponsorships and endorsements may go wrong (Kobe Bryant)

RECOMENDATIONBased on the information of this analysis, Adidas went from fast mover, to a company with no direction and failing, it took a period of about a decade of difficult reorganizations, rose up to become a fast follower to sporting goods equipment king, Nike. The business strategies at first were overzealous with the merger of Salomon SA but the near-immediate divestiture of its declining popularity divisions and retaining TaylorMade Golf was a good decision.Adidas marketers need to enhance their product reputation more. Adidas needs to come out of the family rivalry with the Puma manufacturers and needs to focus on the competition with Nike and modern markets. The three stripes of the Adidas logo which gives it a customer loyalty needs to be justified.Adidas needs to look on the various aspects of competition like workforce, management expertise rather than concentrating on the competition based on sponsorships and advertisements as it seems like this. A common example is that when Nike started its Ads tagline Just Do It, Adidas also started Impossible is Nothing. Adidas can really do well if it focuses more on getting the customer feedbacks in order to improve its brands.The merger with Reebok in 2005 gives an evidence of the companys expansion strategies. But still there a successful integration of Reebok has not been done yet. Adidas needs to integrate Reebok in its business culture so that the two become culturally fit and look forward to achieve the goals. This might involve organisational change of either of Reebok or Adidas.It is also highly recommendable to undergo an analysis of the issues related with the brand awareness. In emerging markets like India, Sri Lanka, etc, where the people do not like soccer much, Adidas should launch more products associated with cricket, hockey, etc in order to target the population. Also, Adidas does not go for more advertisements on Indian Television as the most of the local population in India is not used to read newspapers, surf internet and watching foreign TV channels. So, Adidas needs to look on these issues as well.Overall, unless Adidas AG begins to acquire companies within its core focus and divest unneeded divisions, the business will most likely stay within its price point with a minor fluctuation due to increased or decreased revenues from a bad economy or disappointing returns on foreign investment.