Adidas Strategic Evaluation: Business and Global Strategies

Introduction

Adidas is a multinational corporation specializing in sportswear. The company is engaged in the production, design, and creation of sports clothing and accessories. Over time, it has grown to become one of the leading companies in the world, with its products sold across the globe (Mahdi, Abbas, Mazar, & George, 2015). The company faces significant competition from major players such as Puma and Nike. However, Adidas maintains a competitive advantage, as the brand is respected for its commitment to ensuring that athletes wear what they want. In addition, Adidas holds a large market share in Europe, which enhances its prospects for profitability in the competitive sport apparel industry.

Business-Level Strategies

Business-level strategies for Adidas center on implementing technology across various company activities, as other large corporations have done. Improving its technological capabilities will help Adidas keep pace with competitors like Nike, which has been capitalizing heavily in this area. For example, Nike has embedded sensors inside its shoes to measure an athlete's heartbeat and distance covered. Adidas should invest in comparable technology to compete more effectively.

Nike is one of Adidas' primary competitors in the sports shoe market (Deac & Stanescu, 2014). To address pricing concerns, Adidas should ensure that its product range is sufficiently diversified to allow consumers across different income levels to find and afford suitable options. This approach would enable the company to produce customer-specific products tailored to high-income, middle-income, and lower-income consumers alike (Mahdi, Abbas, Mazar, & George, 2015).

Corporate-Level Strategies

At the corporate level, Adidas can advertise through available channels to highlight the company's history and strengths. This will help expand the brand's presence in the United States and in major growth markets such as China and India. The company's core values — authenticity, inspiration, honesty, and commitment — guide how it measures its own performance and that of its partners. Adidas' corporate mission is to be a global leader in the sporting industry by producing goods built on passion and designed to promote a healthy sporting lifestyle. Achieving this leadership position in the global market requires a strong emphasis on brand strengthening and development. Brand strengthening can be realized through advertising and promotion campaigns that first build brand awareness (Rudolph, 2016).

Adidas also focuses on maximizing consumer impact and increasing profitability through five strategic approaches. The first is aligning the company's structure with consumer needs. By anticipating and fulfilling consumer desires, Adidas can attract new customers while retaining existing ones (Mahdi, Abbas, Mazar, & George, 2015). As outlined in the business-level strategies, the company should invest in extending product design and fostering innovation, enabling it to develop offerings that compete effectively and capture consumer imagination.

Another corporate-level strategy is developing leading positions in all major markets and categories in which the company operates (Deac & Stanescu, 2014). Adidas also aims to excel in execution by improving product quality and delivery. Given the increasingly competitive global market, it is equally important for Adidas to maintain strong financial health — managing working capital tightly and monitoring key financial indicators. Sound financial health will ensure the company maintains a healthy operating margin, adequate working capital, and reduced debt levels while continuing to expand its market presence (Mahdi, Abbas, Mazar, & George, 2015).

Conclusion

Adidas has a great deal of untapped potential that could yield immense benefits if addressed strategically. One of the key strategies the company should implement is the diversification of its products to allow consumers a wider selection. This diversification should be accompanied by greater investment in technology, following the example set by competing companies such as Nike. Adidas must also give serious attention to emerging markets where it has significant growth opportunities. Forming strategic partnerships with local companies in markets where entry barriers exist should be pursued, as this will enable Adidas to grow its market share considerably and work toward becoming the leading sportswear company in the world.

References

Deac, V., & Stanescu, A. (2014). Strategic segmentation — the preamble of developing a company strategy. Revista de Management Comparat International, 15(4), 461.

Mahdi, H. A. A., Abbas, M., Mazar, T. I., & George, S. (2015). A comparative analysis of strategies and business models of Nike, Inc. and Adidas Group with special reference to competitive advantage in the context of a dynamic and competitive environment. International Journal of Business Management and Economic Research, 6(3), 167–177.

Rudolph, M. (2016). A financial analysis of the sportswear company Adidas AG.