SWOT Analysis Adidas Essay

Strengths

1. Established brand name – this means that Adidas has already built up a good reputation and it has a large market share within its industry. 2. Good retail links – Adidas has established good links with shops and outlets, which sell Adidas’s products. 3. Established worldwide distribution network – this means that Adidas’s products are shipped to a large number of countries. 4. Famous sports stars advertising products – Adidas has a series of football superstars who wear and advertise their products, including David Beckham, Zinedine Zidane, Stephen Gerrard etc.

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5. High level of sales – Meaning Adidas sell a large amount of products.

6. Good reputation for quality – Adidas have built up a good reputation over the years for the quality of their goods. 7. Adidas is a globally know brand name. International Brand awareness and recognition. Popular for sports footwear, clothing and accessories. Adidas is the biggest brand in the sport market, so it enjoys long term relations with the Olympics, FIFA World Cup etc. 8. Diversity and variety in products offered.

9. Adidas is known for its innovative and functional designs. The electronic communication of Adidas is well developed. Its website is also user friendly and promotes business. 10. Large market share (16% of global footwear market). Major sponsor for a number of global sporting events. Purchasing of Reebok.

Weaknesses

1. A large amount of finance is required for research and development of new products, therefore their prices are high, this means that Adidas require a large amount of funds so that they can carry on producing top of the range products. 2. Reliant on the sport industry – This means that if there was no longer a market in the sport industry, Adidas wouldn’t be able to survive as they only produce goods within this industry. 3. High prices in some products. Online customer service not “helpful” or easy to find. 4. High cost due to the small order quantity. Competition from Nike. Loss of trust. 5. Love the brand more than the products. Not utilizing Reebok.

Opportunities

1. New products – One option, which Adidas could take, is producing new products. 2. Make deals with sports stars – Adidas could try to persuade more sports stars to wear their products by offering them deals. 3. Expand distribution network – Adidas could also export their products to new countries where their goods weren’t previously sold. 4. New unrelated products – Another option for Adidas is to make new products outside of the sports industry. 5. Entering the Asian market, China is the fastest growing economy in the world. New product development (like fragrance, equipment) 6. New websites (Adidas global hub video website)

7. Entering the female market. Social trend and popularity of social media sites such as Facebook, allowing Adidas to interact directly and build relationships with potential and current customers.

Threats

1. Competition – Adidas’s competition includes Nike, Reebok, Puma, Umbro, Diadora and Lotto etc. These organisations could ultimately take Adidas’s market share, forcing Adidas out of the market, making them bankrupt. 2. Inflation of materials would cause prices to rise, therefore less customers would buy Adidas’s products – this means that if the prices of materials used were to rise then this would cause the prices of Adidas’s goods to rise, as the products would be more expensive to make. This would mean that not as many people would buy their goods at higher prices. 3. Nike competition. Nike has strong reputation in the footwear and apparel industry. Increase in the Price of Raw materials. Continuing challenges in import/export duties. Global economic downturn.

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