Background
Converse as a brand
Converse Inc. which is based in the USA, is a wholly owned subsidiary of NIKE Inc. which was established in 1908.The Converse brand has built a reputation as “America’s Original Sports Company” and is associated with a rich heritage of legendary sneakers such as the Chuck Taylor All Star, Jack Purcell and the One Star sneaker.
Today, Converse offers a diversified portfolio including mens, womens and childrens and toddler footwear range, apparel and accessories. The Converse product is sold by retailers in over 1001 stores around South Africa, of which Pretoria and Johannesburg is the most densely populated containing a total of 493 stores. Accessed on the 08/05/2015 from http://www.converse-sa.co.za
Converse can account for
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They produce similar rubber soled sneakers which appeal to consumers within the same market. However consumer. Indirect
Indirect competitors include all other footwear brands that appeal to other to other target markets within the shoe industry. Similar looking products in the market
SWOT Analysis of Converse
Strengths Weaknesses
• The brand is an established on for the past 100 years.
• The sneaker design remains the same, the sneaker has various thereby appealing to a larger market. It has different types of collections to cater for the different generational cohorts, for example the Andy Warhol range on the Converse All Stars as well as the Black Sabbath designed as mentioned before.
• Its an iconic brand recognised worldwide.
• It’s a fashion item that never was out phased by time.
• Countless celebrity endorsers from athletes to musicians.
• Has the power of Nike behind the brand. • Lack of promotional activities surrounding Converse All Star brand within the South African market.
• Innovation does not play a role in the brand.
• Athletic
sale of Nike’s high-margin products to high-end customers. Regardless of the low cost of the World Shoes, they
Threat of substitute product is any company can make an athletic shoe. Puma, Adidas, and Reebok all produce athletic shoes and apparel. These companies are Nike’s top competitors. They try to develop alternative brands to eliminate Nike from the market. Nikes utilizes trademarks on nearly all of their products and believe having distinctive marks that are readily identifiable is an important factor in creating a market for their goods. Nike identifies their brands and the company distinguishes their goods from the goods of others. Nike considers NIKE® and Swoosh Design® trademarks to be among their most valuable
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
Second major competitor of Dick’s Sporting Goods is Foot Locker. According to Yahoo Finance, the company is an American sportswear and footwear retailer based in New York, New York and was founded in 1974. The company operates as a retailer of athletic footwear. Foot Locker sells more athletic shoes than any other retailer in the U.S. As of January 28, 2012, it operated 3,369 stores in 23 countries including North America, Europe, Australia, and New Zealand. The company employs 13,080 associates as of 2012.
And all indirect competitors sell the same goods as well. so for example it could even be a store like JC Penny. They sell sneakers and sports apparel as well.
In this portion of the report, I will conduct an analysis of Asics’ two biggest competitors, Adidas and Nike. In 2015, Asics stores totaled at 785 worldwide. These stores were located in the Americas, Japan, EMEA, East Asia, Southeast Asia, and the Oceania. In comparison, Nike had a total stores of 803 worldwide and Adidas doubled with a total of 1,616 stores according to ASICS company documents, NIKE, INC. 2016 Annual Report, and ADIDAS Group Annual Report 2015.
Nike, Jordan, Adidas, Reebok, New Balance, Oakley, Puma, Converse, Lacoste, Saucony, Timberland, Pastry, Brooks, Asics, Under Armour, Skechers, The North Face, K-Swiss and Baby Phat.
You can find Converse shoes as well as tees, hoodies and much more. Look at our website and click through the assortment
Some people are called sneakerheads. Sneakerheads are people who buy, sell, trade, and talk about sneakers. To these people, sneakers are a great thing to meet about and are good collectables. In Calling All Sneakerheads it states “...a sneaker show in Jakarta, Indonesia, dre 13,000 people.” and “ He opened the shoezeum, a museum for his 2,500 sneakers, in Las Vegas, Nevada.” If people are that serious about shoes, the shoes must be really popular and special to them. Many sneakerheads try to collect shoes that have never been worn and rare one-of-a kind
Companies can have a strategy aimed at being the clear market leader in (a) selling branded footwear to retailers or (b) selling directly to online buyers or (c) both.
Many of the big established shoe brands have seen consolidation and hence they have become bigger and more powerful in terms of competing with the rest.
In this industry, the Power of Buyers is low to moderate. It is considered low because athletic shoe producers have two sets of customers, direct consumers and intermediate consumers creating very low buyer concentration. Their intermediate consumers include a variety of stores from discounts stores, sporting goods stores and department stores. Due to the large size of the athletic shoe producers, the majority of intermediate consumers have very little negotiating ability and thus low power, allowing the athletic footwear firms the ability to earn an increase in profits by selling to intermediate consumers at full price. Some intermediate consumers such as large department stores and large sporting goods stores would have the size to be able to leverage some power over the athletic shoe producers giving them moderate power. The industry’s members reach direct consumers through vertically integrated self-operated brick and mortar retail stores as well as through online firms. Direct buyers have moderate power over the athletic shoe producers since there are no switching costs to go between brands. However, athletic footwear is strategically important to people if they are either athletes or people wanting to participate in high performance fitness activities, therefore giving them low power since they depend on the product to fill a
Competition is very fierce due to the number of companies competing for sales. Lots of money goes to marketing and promotions using various channels to reach the young demographic group of consumers who spend the most money on Nike’s products. Growth is slowing down in the athletic footwear industry. But new markets are emerging with high growth rates. These markets include extreme sports market and the corporate merchandise market.
The sportswear industry is very price sensitive and most competitors prices are about the same. Nike sells its products in Nike shops and the selling of its products direct to the consumers conflicts with other resellers of the brand. Most of Nike’s earnings are derived from selling into retailers.
According to What is SWOT Anlysis (2011), SWOT analysis is an analysis used to identify the internal factors (strengths and weaknesses) of the company as well as external factors (opportunities and threats) of the company.