Adidas Case Study

First, I will talk about what we discovered from the frameworks

According to PESTEL analysis, for the economic factor, in the US market alone, athleisure wear sales totaled 97 million USD in 2015, which increased by 40% from 2010. Also, in 2015, the segment outperformed traditional athletic apparels.

As for social factor, athleisure has become a trend

According to the survey done by LifestyleMonitor and Cotton Incorporated Sports Apparel, 92% of consumers wear active apparel for purposes beyond exercise.

Consumers say they want activewear for non-active purposes, as well as performance denim and athletic-inspired jeans.

As for Porter’s Five Forces, first I’m going to talk about our main existing rivalry, Adidas, which is the world’s second largest sportswear maker. Mark King, the President of Adidas Group North America, stated that his visions for Adidas are to focus the brand more on running and basketball, which have long been one of Nike’s main revenue sources; and focus more on the stylish everyday wear of their originals brand, which is a part that Nike currently lacks.

The performance of Adidas has soared in the past year, in 2016, the fiscal second quarter sales in North America market increased 23% from 2015

Its growth has been fueled by the 60% increase in sales for originals and running footwear, the appeal of ongoing partnership with Kanye West, and the successful designs of on-trend silhouettes, new apparel fabrics, and innovative technology.

From this graph, we can see that the stock price of Adidas has grown 67% over the past year, showing their dominance over Nike and Under Armour.

For the threats of new entrants, over the last decade, many new entrants enter the market, many of them produce fashionable sportswear that Nike currently does not focus on.

In terms of strategic group analysis, our company do have a wide product range, however, from the financial statements, we discovered that most of our revenues come from footwear sales.