Competitive Advantage Of Puma And Reebok Essay

Athletics Supreme’s sportswear prices are affordable when compared to higher priced competitors like Walmart Stores and Dick’s Sporting Goods with a pricing strategy designed and employed to offer competition to its rival companies. The company does not compromise on its quality craftsmanhip while still offering low prices because it is confident of its loyal consumers. The company’s pricing methodology is flexible and depends generally on the economic trends that might influence buyer behavior in targeted segments focusing on total customer satisfaction as a way of encouraging brand loyalty in a highly competitive

The concept of market structures and competitive strategies are important when attempting to compete in any market. Understanding what market structure your product falls under can help companies develop better competitive strategies and identify potential for loss and gains. The athletic footwear industry in the United States is highly profitable and continuously growing. In this paper I will identify market structure of the athletic footwear industry, the major retailers, and competitive strategies that can be used to maximize profits.

Obviously, there is a big number of driving forces in the athletic footwear industry. Each of these driving forces has different impacts—some of them can have a more considerable effect than others on figuring out how much cross-company differences influence market shares and a number of units sold. The first line of most influential factors includes comparative prices, S/Q ratings, and a number of models offered among the footwear competitors. These three most important competitive forces affect customer decisions of which athletic footwear brand to choose. Furthermore, the decisions of customers whether to purchase one brand or another are also influenced by such forces as advertising, celebrity endorsements, the number of independent retail

Customers make purchasing decisions based on the information they have among products and the values of goods a company offers. For that reason, companies have to promote their products to increase products awareness. In order to achieve organizational goals, companies must understand the market’s needs to ensure the success of their businesses. Such information can be gained through research. The industry that will form the basis of this paper is Western Canadian Shoe Association. The three brands under study are Reebok, Adidas, and Nike.

success factors. However, the company has a few weaknesses and threats they need to address in

Companies like Under Armour, Nike and Adidas/Reebok have high threats of substitute´s products. These companies share the sport apparel industry and are vulnerable to competitive pressure from the actions of buyers whenever they view that their products can be substituted for others. The availability of substitutes invites the costumer to compare performance, features, and ease of use as well as price. Under Armour’s major competitors are Nike and Adidas/Reebok because they have a similar or competing product offerings. The top sport apparel brands offer similar products and that is why each one of them needs to keep a high standard and produce good quality products in order for customers to keep buying their product.

Business level strategies are plans that a firm forms to describe and project how it intends to build a sustainable competitive advantage, over its competitors in a discrete market (Furrer, 2010, p. 1). These strategies have changed the nature of competition in industries, and paved way for further developments in product quality and cost. Business level strategies employed by Nike work mainly in two forms, that is, competitive strategies and corporative strategies (Furner, 2010, p. 1). By looking at the different business level strategies Nike has employed, this essay will explain how it has had such a massive impact in the Sports and Apparel industry it now leads.

On the other hand, we see that Reebok had a somehow constant Profit Margin around 8.5%.

In the running era, the two brothers were separated and Rudolf began his own company Puma while Adi took over Adidas. The original name Adidas came up with a logo, the three stripes under that today stand out in the market. The company Adidas gradually gained the stance in the market after the logo was introduced in the global market. Adidas products were used in different sports during the Olympics and revolved around renowned athletes. At this time, the business had up to 100 employees who were engaged in the production of sport shoes for 11 different sports. Despite of the separation, the company grew and became the leading sportswear manufacturing company

1. We chose to study Under Armour because of their explosive growth over the last five years in a very competitive industry. From a marketing standpoint, it is quite apparent that the company is doing well and one could assume that because the firm appears to have had great success in aggressively expanding their market share, they are by extension creating value for investors. By studying the financial information, we aimed to confirm or deny whether Under Armour is indeed creating value.

Nike’s main strategy revolves around product branding. Their brand compromises of a swoosh logo which is accompanied by a message of “just do it”. The logo was imprinted on all of their products with the message developed to express the individuality of their target group. The branding was further promoted by Nike’s relentless approach on the quality of their product as demonstrated when considering overseas business opportunities, quality must not be compromised in order to do so. This ensures consumer satisfaction and loyalty towards Nike.

Brands use different strategies to create competitive advantages to beat with their rivals. Some companies use “Overall Cost Leadership” to increase profit by reducing costs and increase market share by lowering price. Some companies use “Focus Strategies” to select a group of market and tailor its strategy to serve that group. The others use “Product Differentiation” as a strategy to obtain a premium price by making unique products. Nike, with its differentiation strategy, the company is continuing to separate its self from the competitors by using its superior technology and innovation. This paper mainly discusses on the company’s product differentiation and analysis how the company using this strategy to build its brand image and become a market leader in sportswear industry. A brief discuss about Nike competitive advantage which related to its broad differentiation aspect and the company product life cycle are also presented on this paper.

Companies in this industry also attempt to differentiate themselves by technical advancements in the apparel. Companies compete to find the technology that consumers believe will help their overall performance in sports and activities; whether it’s a sweat wicking shirt or lighter shoe, consumers seek the product they believe will give them the greatest advantage. Overall, the rivalry amongst competitors is a strong force that ultimately lowers the profitability of the industry.

PUMA is counted in the leading sports lifestyle companies of the world and is famous for designing and developing footwear, accessories and apparel. PUMA commits to serve its customers by supporting creativity, sustainability and peace. It promises to be fair, loyal, honest and creative in its decisions and actions. The unique feature of PUMA is that it manufactures sports stuff keeping in mind the fashion and style (Parasuraman, Grewal and Krishnan , 2007). It has collaborations with famous designers like Alexandra McQueen and Mihara Yasuhiro. PUMA group that was founded in 1948 has now three brands; PUMA, Tretorn and Cobra Golf. It distributes its products to more than 120 different countries across the globe and has a network of around 11000 employees.

Puma is one of the world’s leading athletic footwear, apparel and accessories companies. The history of the company began in 1948, when Rudolf Dassler, the founder of Puma, had separated from the existing business assets “Gebrüder Dassler Schuhfabrik”. Throughout the years they were the first to introduce many new footwear innovations, including vulcanized soles on soccer shoes, uniquely shaped soles on running shoes to enhance natural motion, athletic shoes with a Velcro strap, and the Puma Disc system, which replaces laces with a series of wires. Thereby gaining a great success in football and athletic boots . In 1986 company went public under the leadership Armin Dassler. In 1993 a new CEO Jochen Zeitz manages to turn the company from the law price to premium company that is ranked as one of the three leading brand in the sporting goods industry .