PROJECT ON “The Adidas Story”

Master of Commerce

Semester-III

(2014-2015)

Submitted

In Partial Fulfillment of the requirements

For the award of degree of

M.Com- II

By

Suraj Shridhar Tripathi

Seat No: _______

Tolani College of Commerce

Sher-e-Punjab society,

Andheri (East),

Mumbai-400 093

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PROJECT ON “The Adidas Story”

Master of Commerce

Semester-III

(2014-2015)

Submitted

In Partial Fulfillment of the requirements

For the award of degree of

M.Com-II

By

Suraj Shridhar Tripathi

Seat No: _______

Tolani College of Commerce

Sher-e-Punjab society,

Andheri (East),

Mumbai-400 093

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 CERTIFICATE

This is to certify that Suraj Shridhar Tripathi of M.Com

Semester III (2014-2015) has successfully completed the project on
“The Adidas Story”

under the guidance of Mahalaxmi Ramaprasad.

Project Guide: ____________________________

Course Coordinator: ____________________________

External Examiner: ____________________________

Principal: ____________________________

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 DECLARATION

I, Suraj Shridhar Tripathi, the student of M.Com

Semester-III (2014-2015) hereby declare that I have completed the
project on “The Adidas Story” In the Course Entrepreneurship
Management.

The information submitted is true and original to the best of

my knowledge. References have been cited wherever necessary.

Date: ___________

Place: Mumbai

Signature of Student

Suraj Tripathi

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 ACKNOWLEDGEMENT

Preparing the project on “The Adidas Story”has given

me extensive practical knowledge related to the course.

I would like to first thank our principal Dr.A.A.Rashid, for

his valuable support in preparing this project.

I express my deep sense of Gratitude to the Course

Coordinator, Ms.Sadhana Venkatesh for the valuable guidance
and support during my project work.

I am thankful to my guide Mahalaxmi Ramaprasad for

providing me the guidance throughout the course of this project. I
am also thankful to her for patiently and critically evaluating the
content of this project.

I would like to take this opportunity to express my gratitude

to all the staff of the library and the computer lab for their
support.

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 Index:

SR NO PAGE NO
TOPIC

1 Introduction 7

Overview of the Group:

2 9

3 History 11

4 Life and Career 13

The Marketing Strength

4 15

5 Adidas' Strategies 18

Measuring a promotional campaign

9 24

Adidas's Three Guiding Principles

10 26
& Values

20 Conclusion 27

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 “The Adidas Story”

By Suraj Shridhar Tripathi

Introduction

Brand positioning:
Every purchase of the consumer is not guided by the cheapest of the prices,
but by the benefit that the customer perceive for the investment planned.
Hence , it is critical to be appealing to the image seekers while being relevant
to the value for money seeker. With lifestyle improving and becoming

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important to the individuals’ personalities, the brand’s postioning and its
relevance to the consumer will become more important then ever before.

Customer Relationship Management: The experience that the

consumer goes through during the entire purchase cycle and the post purchase
cycle and the post purchase usage experience is critical to the organizations
future business. Managing customer relations and the experience that is
offered to her throughout will be a challenge for all players.

Channel Management: A strong influencer on the buying decision is the

network, and the organization that manages the network better, has a
substantial edge over others.

The past couple of years could be termed as the most dynamic years in the
history of this industry. The rise of MNC brands and its adverse effect on the
Indian counterparts. Many Indian brands have become almost extinct. Few
Indian brands who have not only survived but have grown during this period.
Today, Beckham and Messi enjoy a high brand silence and its seen as a
trusted and reliable brand, with a very high degree of product satisfaction
among its users.

Quality: Given that sports goods is a high-ticket purchase, the consumer

needs a strong reassurance from the brand in terms of reliability. Longstanding
brands that have proven track record of trouble free product performance score
on this parameter. Like any product, electronic goods suffer wear and tear

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 Adidas

Overview of the Group:

For over 80 years the Adidas Group has been part of the world of sports on
every level, delivering state-of-the-art sports footwear, apparel and
accessories. Today, the Adidas Group is a global leader in the sporting goods
industry and offers a broad portfolio of products. Products from the Adidas
Group are available in virtually every country of the world. The guiding
principle of Adidas Sport Performance is to make athletes better by making
them faster, stronger, smarter, cooler and natural.

Since it was established in Germany in 1949, by Adolf Dassler,adidas has

been synonymous with the sporting industry. Today, adidas is a global public
company and is one of the largest sports brands in the world. It is a household
brand name with its three stripes logo recognised in markets across the world.

The company’s product portfolio is vast, ranging from state-of-the art sports
footwear and clothing to accessories such as bags, watches, eyewear and other
sports-related goods and equipment. Employing over 46,000 people
worldwide, the adidas Group consists of around 170 subsidiaries including
Reebok, TaylorMade-adidas Golf, Rockport and CCM-Hockey. The Group's
headquarters are in Herzogenaurach, Germany. In the second quarter of 2013
the Group’s revenue was €3.383 billion.

The adidas brand is built on a passion for sports excellence and innovative
design to help athletes perform to the best of their ability. It is therefore no
surprise that adidas has supported many iconic athletes to achieve great things
at the Olympic Games. In the UK, adidas has partnered and supplied Team
GB since 1984. The company’s heritage with the Olympic Games dates back
to the Games in Amsterdam in 1928 when adidas’ running shoes were
debuted. Footwear and clothing by adidas has been seen on athletes at every
Olympic Games since. In fact, all British medalwinning athletes at the last 8
Olympic Games wore adidas products There are countless historic sporting
achievements that have taken place in adidas products. These include:

• Jesse Owens’ 4 gold medals in Berlin 1936.

• Cassius Marcellus Clay (Muhammad Ali) taking gold in the boxing light-
heavyweight division at Rome 1960.

• Dick Fosbury’s revolutionary new back-first high jump technique at Mexico

1968, known as the ‘Fosbury Flop’.

• Gymnast Nadia Comaneci’s perfect 10 at Montreal 1976.

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This case study demonstrates how adidas used innovative marketing strategies
in its sponsorship deal with the London 2012 Olympic Games to engage with
young consumers in the UK and across the globe.

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 History
Adidas was formed by German sports apparel by the founder Adolf (Adi)
Dassler during the 1920’s. While Dassler was in his mother’s wash room he
decided to begin an athletic shoe. After he made the shoe he had help from his
brother and twelve other people to produce around 50 handmade athletic shoes
per day for running and training. The company Adidas thus was found in
Herzogenaurach, Germany. The family company split in 1948. After the split,
Adi Dassler founded Adidas and his brother Rudolph founded Puma. The
three-stripe logo was designed in 1941 by Adi Dassler and he registered it as a
trademark for Adidas after the split. The strength of Adidas was its product
innovation. Adi Dassler registered more than seven hundred patents. Summary
of the Adidas Group's history:

• 1949- The foundation: 18 August - Adidas is registered as a company,

named after its founder: 'Adi' from Adolf and 'Das' from Dassler.

• 1950s- The 'Miracle of Bern': 1954 - The 'Miracle of Bern' Germany

battle Hungary with a competitive advantage. They are wearing Adidas soccer
boots which for the first time feature removable studs.

• 1960s- Higher: Driven by a desire to help all athletes committed to

performance, Adidas manufactures equipment for what some consider "fringe
sports". Unconventional high jumper Dick Fosbury launches himself up and
over in Adidas footwear.

• 1970s- The "Adidas" team wins Crowning moment: Franz

Beckenbauer, the "Kaiser", raising the World Cup in victory salute. Germany
had just beaten Holland 2-1 in the 1974 final.

• 1980s- The transition after Adi Dassler's death, Adi's wife Kathe, his
son Horst, and his daughters carry on the business.

• 1990s- With a new management- Under the CEO Robert Louis-

Dreyfus, Adidas is moving from being a manufacturing and sales based
company to a marketing company.

• 1995- Adidas goes public- Flotation of the company on the Frankfurt

and Paris Stock Exchange.

• 1996- A splendid year- The "three- stripes company" equips 6,000

Olympic athletes from 33 countries. Adidas athletes win 220 medals,
including 70 gold. Apparel sales increase 50%.

• 1997- Adidas-Salomon AG- Adidas AG acquires the Salomon Group

with the brands Salomon, TaylorMade, Mavic and Bonfire in December 1997.
The new company is named Adidas-Salomon AG.

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• 1999- The new brands- The integration of the new brands is gaining
momentum. The new TaylorMade FireSole clubs boost sales. Salomon in-line
skates take off with high double-digit growth during the first half of 1999.

• 2000- New management- Following personnel changes, the new

management initiates an ambitious Growth and Efficiency Program. Major
sports events such as the European Soccer Championship EURO 2000 and the
Olympic Summer Games, where swimmer Ian Thorpe takes three gold
medals, contribute to the company’s success.

• 2005- Sale of Salomon- The Salomon Group (including Salomon,

Mavic, Bonfire, Cliché and Arc’Teryx) is being sold to Amer Sports in
October 2005. The new Adidas Group is focusing even more on its core
strength in the athletic footwear and apparel market as well as the growing
golf category. The legal name of the company will change to “Adidas AG” in
May/June 2006.

• 2006- Adidas-Salomon AG acquires Reebok- The closing of the

Reebok transaction on January 31, 2006 marks a new chapter in the history of
the Adidas Group. By combining two of the most respected and well-known
brands in the worldwide sporting goods industry, the new Group will benefit
from a more competitive worldwide platform, well-defined and
complementary brand identities, a wider range of products, and a stronger
presence across teams, athletes, events and leagues.

• 2010- Adidas Group presents strategic business plan- In November

2010, the Group unveiled its 2015 strategic business plan named "Route
2015". This plan is the most comprehensive the Adidas Group has ever
prepared, incorporating all brands, sales channels and Group functions
globally.

• 2011- Adidas Group acquires Five Ten- On 3, November 2011, the

Adidas Group announced the acquisition of the outdoor specialist Five Ten.
Five Ten is a leading brand in the technical outdoor market and within the
outdoor action sport community. The brand represents an excellent addition to
the Adidas Outdoor portfolio and allows the Adidas Group to expand into
complementary market segments.

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 Life and Career

Adolf Dassler
Also known as Adi Dassler was born in Herzogenaurach, Bavaria, Germany
on November 3, 1900. The son of Christoph Dassler, a shoe factory worker
made his foray into the shoe making business when he was 20 years old. Adi
was an avid sportsman and had a passion to create a shoe specifically for
athletes.

He started in his mother’s laundry room using canvas and spare materials.
With the assistance of his brother Zehlein (who made the metal spikes) and
later his older brother Rudolf (who joined in 1924), the brothers formed the
Dassler Brothers Shoe Factory. Adi made it a point to attend every major
sporting event in an effort to convince athletes to wear his shoes. By the 1928
Olympics in Amsterdam, several athletes were wearing special shoes from the
Dassler workshop.

Early on, Adi concentrated his efforts on the shoes of track and field and was
experimenting with spikes. By the early 1930s, the company was making 30
different shoe brands for 11 different sports and had a workforce of nearly
100. At this same time, the rise of Hitler in Germany was occurring,
consequently, the brothers joined the Nazi party and signed their party papers
with a ‘Heil Hitler’.

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The 1936 Olympics in Berlin offered a great opportunity for Adi as he
equipped Jesse Owens with spiked shoes that reportedly helped him to win 4
gold medals. Adi is purported to have driven to Berlin to meet with Owens
just before the games were to begin. He visited Jesse Owens in the Olympic
village and handed him a suitcase full of spikes. After persuading Owens to
wear the shoes, Owens, over the next week won an unprecedented 4 gold
medals (a feat unmatched until 48 years later).

Although this had propelled sales of the Dassler brand shoes, the impending
war ravaged the company the Dassler brothers had started as Rudolf was
drafted, and Adi was left to manufacture boots for the Nazi Soldiers. At the
end of World War II, Adi and Rudolf had tried to re-organize their company,
however, disagreements by the two had essentially put an end to the former
partnership. By 1948, Rudolf and Adi separated ways as Adi reformed the
shoe company using his nickname and first three letters of his last name to
form Adidas, while Rudolf went on to locate his factory across the river and
calling it Puma.

In 1949 Adi produced the first shoes with molded rubber studs. A
breakthrough in 1954 occurred for Adi when the Germans won the World Cup
Soccer against Hungary, the Germans all wore Adidas shoes. This event
helped Adi recapture his pre-war sales of over 200,000 pairs of shoes per year.
His company was beginning to again become a dominant supplier of athletic
shoes in the world market.

In 1960 Adi introduced a sports clothing line to complement sales of their now
famous three-stripe shoes. That same year in the Olympic Games at Rome,
75% of all athletes wore Adidas brand shoes. Adi courted many sports
celebrities throughout his career as Owner of Adidas to promote the brand
name. Notables such as Muhammad Ali, Max Schmeling, Sepp Herberger and
Franz Beckenbauer.

In 1963 Adidas started Ball production, and ever since 1970 the official match
ball at all major soccer events has been an Adidas product.

On September 6, 1978 Adolf ‘Adi’ Dassler passed away, leaving his widow
and son to carry on the tradition he started nearly sixty years earlier.

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 The Marketing Strength:
The Adidas Group is a well-known and an established one in the market. It
strives to be the global leader in the sporting goods industry. It has brands
built upon a passion for sports and a sporting lifestyle and for those who love
sports.

Porter’s generic strategies: Professor Michael Porter suggested that some of

the choices faced by companies are essentially the range of the markets and
competition in their respective markets. The profit of any organization is the
difference between its total revenues and costs. Therefore high profitability
can be attained through achieving the lowest costs or the highest prices with
respect to the competition. The Porter's generic strategies are:

• Cost Leadership

• Differentiation

• Focus

The main strategy of Adidas is Differentiation Strategy and Focus.

Focus: It basically focuses on a specific target group as follows-

• The target consumers are those who play sports, call them athletes, or
simply those who loves sports.

• Main age group is 20-29 year old people.

• High school athletes 14-19 years of age teenagers.

• The key focus is on the sports like:

• Basketball

• Football/Soccer

• Running

• Training

• And Other Indoor as well as Outdoor activities.

Differentiation Strategy:

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• Adidas’s commitment to product innovation and its rich heritage
differentiates the brand from its competitors.

• Adidas Sport Performance – play to win. This is also a type of strategy

used which tells the customer that if he/she is playing then he/she should win,
and thus use Adidas products for the best performance.

• Adidas has a strong history of connection with sports, which is

stronger than all the other brands (its competitors). It is present everywhere
from the top of the tops like where the world level events are happening like
the NBA or the FIFA World Cup and also locally where the people who watch
and love sports use the Adidas products. So it naturally better understands the
market demand and the sports products.

• Adidas Sport Performance focuses on interactive products, like the

Adidas miCoach. It is the world’s first web-based personalised training
service, it combines state-of-the-art training with a personalised web service
and real-time audio coaching.

It is compatible with all portable music players and is also available as an

application on various smart phones such as iPhone and Blackberry. miCoach
thus help make athletes better and “fit for performance”.

Adidas’s differentiation product strategy helps it in gaining a competitive

advantage over its competitors.

Recent Developments:

• Adidas DryDye: Adidas has always been keen in innovation and with
an even greater global focus on finding solutions to save water, Adidas is all
charged up to reveal its latest sustainable advancement in the apparel industry:
Adidas DryDye. Adidas has supported the development of this new
technology in partnership with the Thailand-based Yeh Group to all together
eliminate the need for water in the dyeing process.

Over the past 5 years, with endorsement from Adidas, the DryDye technology
has evolved to remove the need for any water during the dyeing process by
using pressurized CO2 in place of traditional H20. For the summer season,
Adidas has produced 50,000 Adidas DryDye tee shirts promoting this great
innovation in the apparel industry and saving over 1,200,000 L of water in the
process. This is only the beginning as Adidas DryDye will be integrated into
more apparel pieces over the next few seasons. Using DryDye fabric from the
Yeh Group, Adidas DryDye is the first ever launch of DryDye technology
globally. A line of four exciting graphic tees for men, women and kids will be
available in retail locations all around the world starting now. So, this adds on
to the Adidas Product Differentiation Strategy.

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• Adidas Olympic Legends visit Adidas London 2012 Media Lounge:
On July 29 2012, Adidas welcomed Olympic legends Haile Gebrselassie
(1996 and 2000 Olympic Champion 10K), Edwin Moses (1976 and 1984
Olympic Champion 400m hurdles), Daley Thompson (1980 and 1984
Olympic Champion Decathlon), Dick Fosbury (1968 Olympic Champion High
Jump) and Maurice Greene (2000 Olympic Champion 100m). They talked
about their past achievements, answered questions from attending media and
participated in a prediction contest for upcoming track and field events. So,
this helps in keeping Adidas brand in news and popular amongst people.

• Adidas launches the adiPure 360 training shoe: A multi-directional and

multi-purpose training shoe, with both a men’s version, and a model especially
for women. The adiPure 360 is designed to let the customer’s feet move as
nature intended and help him/her get the most out of their workout by helping
to help build natural strength, agility and balance, - and designed to make
muscles work harder during exercise. So, this adds on to the Adidas Product
Differentiation Strategy.

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Adidas' Strategies
Adidas' goal as a Group is to lead the sporting goods industry with brands
built on a passion for sports and a sporting lifestyle. Adidas continuously
strives to generate consumer excitement and enhance brand profitability by
executing a clear strategy. In everything Adidas does, it is focused on
strengthening and developing its brands to maximize the Group’s operational
and financial performance and create shareholder value.

Performance as core Group value

Adidas Group’s mission and strategy are rooted in its desire to provide athletes
with the best possible equipment to optimize their performance. This
philosophy originated with the brands’ founders Adi Dassler, J. W. Foster and
Gary Adams whose passion for sport inspired them to develop innovative
sports products and create new sports categories. Adidas aims to consistently
perform at a level where it not only meets but exceeds the expectations of its
stakeholders. It strives to be closer to consumers than any of its competitors,
and its unique understanding of consumers enables it to enhance their athletic
experience. In support of these efforts, Adidas continuously optimizes its sales
and distribution processes and improves its customer service efforts for its
retail partners. It makes every effort to align its employees’ personal
objectives with the Group and brand targets and reward its staff for high
achievement. Further, Adidas is particularly focused on ensuring best-practice
social and environmental standards. A commitment to constantly increase
value for its share holders is at the core of its activities. This commitment to
top performance differentiates it from other competitors and is a unifying
principle across the multi-brand organization.

Leveraging opportunities across adidas' brand portfolio

The strength of the brands is a key factor in the Group’s success. Within the
brand portfolio, adidas primarily pursues two strategic priorities: Market
penetration – gaining market share across all markets in which we compete,
and Market development – expanding into new markets and addressing new
consumer segments.

adidas' multi-brand approach allows it to tackle opportunities from several

perspectives, as both a mass and a niche player, providing distinct and relevant
products to a broad spectrum of consumers. In this way, each brand is able to
concentrate on its core competencies. Across all brands, it focuses on
increasing awareness and visibility, providing clear and consistent messaging
and supporting product initiatives at the point-of-sale. In addition, adidas'
commercial success also depends on leveraging the scale of the organization
and sharing best practice across the Group. In particular, it continues to

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prioritize the development and further integration of its supply chain across all
brands, turning it into a long-term competitive advantage for the Group.

Leading position in markets worldwide

As a global organization, adidas targets leading market positions in all regions
where it competes. In Europe, where the Group is the market leader in terms
of sales, its strategy is twofold. First, it continues to strengthen its position in
the major Western European markets and strive to grow its brands through
well-coordinated efforts with key account partners. Secondly, it is capitalizing
on the strong growth opportunities in the region’s emerging markets (i.e.
Eastern Europe, the Middle East and Africa).

In North America, adidas sees significant upside potential. As a Group, adidas

is number two in terms of sales, but it believes it is currently under-
represented in the North American sporting goods market. Therefore, it targets
market share expansion via a strong, consumer-driven product offering, a
diversified distribution strategy, and visible and engaging communication
initiatives.

In Asia, where the Group is the market leader in terms of sales with number
one positions in several markets, adidas' goal is to strengthen and extend its
market leadership position. adidas' key priority in the medium term is
expanding its business in the region’s two most important markets: China and
Japan. In tandem, it will also continue to capitalize on opportunities in other
emerging markets in Asia such as India.

Finally, in Latin America, adidas' Group’s fastest-growing region for the last
several years, it is focused on rapidly expanding its business in the four most
important markets: Brazil, Argentina, Mexico and Chile. adidas' target is to
take over market leadership in terms of sales by 2010.

Leading through innovation and design

adidas' is determined to address every consumer in a specific and unique way
– with product and communication initiatives that generate trade and
consumer interest. As a result, adidas believes that technological innovation
and cutting-edge design are essential to sustainable leadership in the industry.

Innovation plays a significant role in differentiating adidas' product offering in

the minds of consumers. By leveraging the extensive R&D expertise within its
Group, adidas continuously challenges the boundaries of functionality and
performance. It is adidas' objective to launch at least one major new
technology or technological evolution per year.

Through design partnerships and collaborations with Stella McCartney, Yohji

Yamamoto, Porsche Design and Jean-Michel Basquiat adidas is widening its

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design reach and imbuing its products with the excitement consumers demand.
By continually expanding its capabilities in R&D and design, adidas is able to
introduce new products at premium price points, thus contributing to Group
margin improvement.

Customizing distribution
The Group will drive future success by engaging consumers with unique
interactive product approaches and rewarding point-of-sale experiences.
Adidas' brands must be competitive in this environment where consumers
make their final purchase decisions based on availability, convenience and
breadth of product offering. As a result, it is continuously refining its
distribution proposition, concentrating on two areas: expanding controlled
space and improving retail relationships. Controlled space includes: adidas'
own-retail business including e-commerce; mono-branded stores run by retail
partners; shop-in-shops that it establishes with its key accounts; joint ventures
with retail partners; co-branded stores with sports organizations or other
brands.

These formats provide adidas with a high level of brand control, as it either
manages the stores itself (i.e. own retail) or it works closely with its partners
(mono-branded stores, shop-in-shops, joint ventures, co-branded stores) to
ensure the appropriate product offering and presentation at the point-of-sale.
Brand control helps it drive sales and profitability increases and expand its
market position.

Going forward, we will also further differentiate and segment our product
offering to align our distribution more closely with a given retailer’s customer
base. In addition, we are partnering with retailers to increase the level and
quality of sell-through information we receive. This creates a mutually
beneficial relationship that will help us become a more valuable and reliable
business partner to our retailers.

Creating shareholder value

Sustainable revenue and operating profit growth are critical to adidas' success.
Creating value for its shareholders through significant free cash flow
generation drives its overall decision-making process. For each of its brands,
adidas pursues the most value-enhancing avenues for growth, with particular
emphasis on continuously improving profitability.

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Marketing strategies
Within the marketing function of any organisation there will be key goals, or
objectives, to be achieved. For example, increasing the market share by 3% or
entering a new market overseas. To achieve these marketing objectives
requires a plan that details the actions needed. These plans are referred to as
marketing strategies. A key challenge for adidas’ marketing strategies is
finding innovative ways to inspire and engage its 14-19 year old target
audience.

For adidas, London is a key focus for the sportswear market, for both
performance sportswear and sports fashion. This market sets more trends than
anywhere else in the country. London 2012 gave adidas a platform to target
this audience but with a global reach. The sponsorship deal obtained by adidas
was the broadest set of sportswear rights in Olympic history. It became the
Official Sportswear Partner of the London Games and the exclusive licensee
of all branded (adidas + London 2012) and event branded (London 2012 only)
clothing. From these rights adidas set four key marketing objectives:

• To ensure a clear association as Sportswear Partner of London 2012, Team

GB and Paralympics GB.

• To engage and excite the 14-19 year old audience in order to drive brand
preference in the UK.

• To deliver a Licensed Product Return on Investment (ROI) (branded and

event branded licensee rights).

• To become the most talked about sports brand in 2012.

A major aspect of this sponsorship deal was the athletes’ kit. The kit provided
the opportunity to be innovative and excite the target audience whilst creating
products to meet commercial sales targets. Market research undertaken by
adidas showed the youth audience wanted something ‘untraditionally British’.
Designer Stella McCartney fulfilled this brief with her deconstructed union
flag design.

Preparations to equip the team started 21/2 years before the Games were due
to start. Over 550 athletes were fitted for over 680 items of kit. This meant the
marketing activity for the campaign also started long before the Games in
2012. A photo booth shoot captured every athlete in their kit. These images
were used to create excitement around the Team GB kit product launch.

Promotion
All elements of the marketing mix are important. However, in increasingly
competitive markets innovative methods of promotion can create a

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competitive advantage. Promotional activity is used to communicate with
consumers about the brand and its products. As there were more than 50
London 2012 sponsors, adidas needed to ensure it communicated the right
messages, at the right time, through the appropriate channels for its target
audience. It aimed to create national support for Team GB through its ‘Take
the Stage’ campaign.

The acronym AIDA is useful when planning promotional activity, promotion

should aim to:

• initiate awareness amongst consumers

• generate interest for and desire to have the product

• ensure action to purchase.

There are many different methods of promotion. Above-the-line promotion

refers to traditional methods of advertising, such as, print adverts in magazines
and newspapers, billboards or online and TV advertisements. This form of
promotion is expensive. As mass audiences become harder to reach through
advertising, for example, an increasing number of people record TV and fast-
forward the adverts, innovative methods of below-the-line activity is
becoming increasingly important to engage the audience.

Above-the-line activity for adidas’ campaign included TV adverts that

showcased the best UK talent across sport, street and style. The adverts
contained carefully planned product placement. Amongst those featured were
David Beckham, Wretch 32 and Derrick Rose. In addition to a significant
outdoor media spend, adidas featured artist impressions of athletes on 17
London Metro front pages.

TV adverts featuring athletes such as Jessica Ennis and Tom Daley were used
to rally support for Team GB. In these adverts athletes shared their intimate

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goals, fears and thoughts, something which was dramatically different to other
sponsors of London 2012.

In contrast, below-the-line promotion aims to reach more targeted groups of

consumers. For example, through sponsorship deals, direct marketing, public
relations and social media. Below-the-line promotion targeted at the youth
audience was a key method for adidas to achieve its marketing objectives. It
used a wide range of promotional activities to create deeper engagement with
its audience, mixing traditional media with an innovative use of social and
digital channels. The scale of the activation of this campaign was an industry
first.

Its TV adverts aimed to drive consumers to a website where they could

demonstrate their talents for a chance to meet their idols. Through ‘Project
32’, adidas had already rewarded 32 talented youngsters in London with the
chance to meet leaders in their chosen fields, such as the sporting and musical
industry, giving undiscovered talent the chance to ‘Take the Stage’.

Social media played an integral part in adidas’ campaign. For example, on

Twitter #takethestage became the summer trend for supporting Team GB.
Videos on YouTube created hundreds of millions of views, including a video
of Team GB athletes singing along to Queen’s ‘Don’t stop me now’. In
addition, a large photo booth was set up at Westfield shopping centre in
Stratford. Members of the public then entered the booth to show support for
Team GB. Videos of peoples’ reactions to David Beckham making a surprise
appearance received 3.2 million views, as well as international TV coverage.

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Measuring a promotional campaign
Promotional activity is very expensive. Organisations want to see a return on
investment (ROI) for the money they spend on a promotional campaign.
Sponsorship of London 2012 was no exception. Every aspect of its
promotional campaign, both online and offline, was continuously monitored
and measured. This enabled adidas to demonstrate that becoming the Official
Sportswear Partner of the London Games and the exclusive licensee of all
branded (adidas + London 2012) and event branded (London 2012 only)
apparel was cost effective.

Throughout the campaign adidas monitored all of its media coverage. This
data was then used to establish whether the marketing objectives had been
achieved. The table below demonstrates the significant return achieved
through this campaign and how adidas successfully achieved its marketing
objectives.

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 Marketing objective
Ensure a clear association as
Sportswear Partner of London
2012, Team GB and
Paralympics GB
Engage and excite the 14-19
year old audience in order to
drive brand preference in the UK
Deliver a licensed product ROI
(branded and event branded
licensee rights)
Become the most talked about
sports brand in 2012
Measurement
• adidas generated the
highest number of articles
amongst local sponsors
(ranked 3rd behind
McDonalds & Coca-Cola)
• 44% of 16-24 year olds
were aware of the
sponsorship (adidas’ closest
competitor achieved 16%)
• YouGov (a measure of public
opinion) score increased
from 4.2 to 16.5 during
the Games
• adidas ranked #1 by London
2012 Nielsen audience
tracking for categories
‘inspiring’ and ‘empowering’
• adidas’ ‘Don't stop me
now’ video was the most
viewed video on
www.bbc.co.uk during
the Games
• 8 million views of
#takethestage content on
YouTube with 2.5 million
views from 14-24 year olds
• 2% market share growth
• 100 million total licensed
product sales in 2012
• More sales at adidas’ Oxford
Street store in London in 1
week than any other adidas
store ever
• Increased Twitter followers
by 25%
• 32% share of sponsor traffic
on Twitter
• 128 million Twitter
impressions respectively for
#takethestage
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 Adidas's Three Guiding Principles
Adi Dassler followed three guiding principles in his development work, driven
by his passion for sports and shoemaking:

1. To produce the best shoe to serve the needs of the sport,

2. To protect the athlete from injury, and

3. To make the product durable.

Adidas' Values
The adidas Group strives to be the global leader in the sporting goods industry
with sports brands built on a passion for sports and a sporting lifestyle.

adidas is consumer focused and therefore continuously improve the quality,

look, feel and image of their our products and their our organizational
structures to match and exceed consumer expectations and to provide them
with the highest value.

They are innovation and design leaders who seek to help athletes of all skill
levels achieve peak performance with every product they bring to market.

They are a global organization that is socially and environmentally

responsible, creative and financially rewarding for their employees and
shareholders. They are committed to continuously strengthening their brands
and products to improve their competitive position.

They are dedicated to consistently delivering outstanding financial results.

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Conclusion

An organisation’s marketing is its own way to uniquely position the brand and
drive sales. For adidas, this includes understanding what its consumers want
and producing innovative products that fulfil these needs. Using innovative
methods of sports marketing, on a scale never before seen in the industry,
enabled adidas to target the youth audience in London whilst also having a
global reach through social media and online promotion.

Sponsorship deals such as adidas’ heritage with the Olympic Games are very
expensive. However, as this case study shows, through well planned
marketing strategies with clearly defined objectives they can offer a way of
creating deeper engagement with consumers. Partnering the brand with
London 2012, Team GB and Paralympics GB engaged adidas’ target
consumers and created huge amounts of support for Team GB before, during
and after the Games.

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