Nike Was Originally Founded In 1964

Published Date: 02 Nov 2017

Adidas was formally registered on 18 August 1949 as Adidas AG, which idea from the founder’s name, Adolf ‘Adi’ Dassler, took it from its nick ‘Adi’ and his first pronounce of his surname ‘Das’. The business was started in a small kitchen then a laundry as their operation based. The name of Adidas become famous was initiated from a brave move by the founder Adolf, during the 1936 Olympics, AdiDassler drove to Munich and persuaded Olympic’s sprints and the long jump four gold medalist Jesse Owens to wear his shoes which established his reputation among the sporting world and gave him lots of contracts and financial success. The trademark three stripes and the slogan ‘impossible is nothing’ are Adidas’ identity and worth millions of dollars.

Adidas famous mainline of products are the running shoes named under adiStar and Supernova series. Followed is the football boot which named under Predator, Adidas’s premier football boot. Thereafter, in the American most famous sport, Basketball, its flagship products are Superstar and Pro Model series basketball shoes. Beside, Adidas also manufactures shoes or accessories for the sports, such as cricket, rugby, tennis and lacrosse in various line of its business.

The concepts of brand mantras, points of parity and points of difference between the two brands

Brand Mantras

Nike

It has established the most impressed brand mantra in the consumers’ mind set. The credit shall goes to Scott Bedbury that keeping the Nike brand on track through a series of phrase brand mantra for Nike. The mantra built by Nike is it emphasized on the authentic athletic performance. The most successful example is the Air Jordan series products that endorse by the Basket Ball star Michael Jordan; in this event, Nike has merely reinforced its corporate vision and values with winner instinct and sports elitism as a promotional way for the particular product series. Hence, Nike would potentially add depth that could extend and transform the meaning of its brand. Furthermore, Nike is developed various series of products and it also invited the talents as representative for particular area of sports’ activities to envoy the particular series of products.

Adidas

Similar to Nike, Adidas has constantly positioned itself as brand for Hard core Sports person for the years. Adidas founder, Mr. Dassler, is mission to offering the best quality products to sportsmen as its mantra, and also act as its company’s objectives. Thus, it has been using the successful sportsperson or aspiring sportsperson to endorse its products respectively. Beside, Adidas highlight another message that feature Healthy sporty men and women and majorly sportspersons in every of its campaign held and this has become a key feature and success mantra for Adidas. In order to keeping and continuous improving its brand mantra, Adidas has to constantly touch with sportspersons and identifying their needs. Then, it will become Adidas core competency in the market to the others.

Point of Parity (Nike and Adidas)

As compared between Nike and Adidas, we have identified that Nike and Adidas share the points of parity in term of their product quality and performance (Kevin, May 2006).

Basically, both brands are targeting to become the leader in the line of sporty products. From their marketing strategies and founder’s philosophy, it showed that they are strike to provide the best quality and durable products as equipment in enhancing the athletes’ performance.Moreover, the advertisement strategies are also the parity between Nike and Adidas. Both have the same scope of advertising and are engaged with the famous star in their expertise sport activities for endorsement. However, later on in the point of difference will discuss the detailed differences in this point. Then, there are series of products, even their flagship products are basically the same, for instant, the shoes and sport wear. Furthermore, their innovations are targeting each other as they are trying to adding more features attach to the products. Such as, when Nike was selling the Nike Ground technology embedded products, (a cushioning technology to absorb the forces); and Adidas was launch the adiPRENE technology embedded products.

As a result, the point of parity is significant in the circumstance that despite of the technology embedded in the shoes or even clothes, if take away the products’ logo or trademark, will a person really can differentiate where is actually the product manufactured?

Point of Difference

Nike

Nike’s associations are product specific while Adidas is not obtained the achievement as Nike has done. The core associations that made Nike outstanding from Adidas is innovative technology, high stylish products, joy and celebration of sports, maximum performance, self-empowerment and inspiring, locally and regionally involved, and globally responsible(Kevin, May 2006). Furthermore, Nike is making its products with additional attached features as a stylish, maximum performance and self-empowerment for the buyers. For instants, the Nike + is the sport kits that attached with the I-Pod and it function to recording the wearer exercise and physical data as a empowerment to the product. In order to attract the youngsters, Nike also allowed buyer to design for their purchases.

As mentioned previous, the different in their endorsement strategies is that Nike are contracted some sport stars in their centre of attention in specific sport. Such as, Michael Jordan in Basketball and Tiger Woods in Golf. Nonetheless, the endorsement patterns are also different as Nike promote a more provocative aggressive winner attitude that as "you don’t win silver, you lose gold". Hence, most of the athletes are running with Nike but medal with Adidas.

In term of pricing, Nike is slightly expensive than Adidas whereas all other elements is the same.

Adidas

When Nike is success in its innovation technologies and so on, Adidas is focusing to achieve its objective to another direction of technologies development, durability. Adidas not only focusing to the outlook, it claimed it is the most durable equipment for athletes in the market and assist to achieve the optimal performance. It is because Adidas still inheritance the older innovations and technology from the Equipment line. However, according to user and their testimonials and also analyzing the communication of co.Feelings associated with brand Adidas isequipped with best quality needed while have stronger durability and reliability. Also the pricing tend to be more favorable to the consumer with the same class of products from Nike (Aggarwal&Partani, 2010).

The similarities and differences between them, as well as the pros and cons of each.

Similarities

Both Nike and Adidas have used the same theoretical systems to create their brand building programs. They actually are benchmarking each other by analysis each other’s success. For instant, when Nike was launching their Alpha line products, it was benchmarked on Adidas launched sub brand of the equipment product line for the elite of sports men. Moreover, in term of promotion method, the similarity happened again as both companies are chosen the famous athletes to endorse their products.

Differences

Mentionable, Nike expansion strategy is from its internal, or means it developing new product line itself under its own brand name. However, Adidas deviate from Nike, as it is same targeting to leading market positions in all markets where it competes with almost 180 subsidiaries worldwide. However, it has prioritized our investments based on those markets which offer the best medium- to long-term growth and profitability opportunities. The method in achieving Adidas expansion is through acquisition and merger. However, after absorbing the Reebok and TaylorMade, Adidas still not to put it under it roof but remain as separate entity in the market. It just treats the absorbed company as additional line to the groups. Hence, their marketing and managing direction is different.

Pros

Both Nike and Adidas are well known and accepted brands. Their main customers are athletes and sports enthusiasts. Men and women and even children are well versed with the brands and use them. Nike and Adidas sneakers are somewhat of a status symbol and image, especially those of college age or younger.both Nike and Adidas have placed a great importance in developing their branding and marketing strategies on the net through web appearance and user friendly functionalities.

Nike shoes are considered to be attractive and durable. They are also highly advertised and promoted, and are much higher price than shoes of comparable quality. Nike shoes are also innovative, introducing a number of new features designed to increase the comfort and enhance an athlete’s performance. Nike has been on the cutting edge of sporting goods technology. For example, For example, Nike+ FuelBand is a bracelet that tracks a person’s activities and helps him or her to achieve goals. Nike recently team up with Apple Company to produce the Nike+ products which can monitor a runner’s performance through a radio in the shoes that can link to the iPods and iPhone. Nike also continues to create new technologies for its shoes, such as with Flyknit, which helps create ultralight performance and an adaptive fit.

Adidas also makes high end, high quality products for all sports, so this will interest audience at affordable price.Adidas focus on performance development and technology development so that ,Adidas incorporates Predator and SprintSkin technology into its shoes aim to continuously progress their quality and image of their product in order to exceed consumer expectations and to provide them with the highest value of satisfaction. Adidas also involves the sponsorship to various sports and events like Olympics, street ball, soccer, and tennis to achieve the brand reputation of the sport performance products.

Cons

Nike and Adidas have implemented several marketing strategies. It had incurred high costs in producing and promoting it products. The costs are increase among handling inventory, designing, advertising and production. Beyond that, the inflation had raised the cost of raw materials and transportation. To solve these problems, Nike has increased the products price and reduces it marketing budget. According to Boggan (2001), Nike had also employed child labor in Cambodia to reduce its production and labour costs. Therefore, this could affect the brand image and reputation in the long-term growth of the Nike, and it might have many people boycott Nike and stop to buy anything from Nike. Besides that Nike and Adidas limited budget allocation to advertisement is the risk will have a negative influence about Nike’s future development, for example, the market share in the world, reputation, and brand image and customer loyalty.

Nike and Adidas have lots of pressure from rivals, competing with Puma, New Balance, Converse, Liberty, Reebok, Red tape and so forth. The product line is slightly different between Nike and Adidas. Nike is mainly focus on footwear for men and women who between 15 to 35 years old, while Adidas is specialize in footwear for men, women and children between the ages of 10 to 30. This had shown that there is less diversification of Nike and Adidas marketing strategy. They could also provide footwear for children to attract more parents to become their potential customers, because the changing in fashion and customers’ preference had brought negative effect. So Nike and Adidas should introduce new products and performance apparel to maintain customer loyalty as well as attract new customer markets

NIKE footwear

The term "packaging "encompasses a variety of characteristics, Characteristics that influence packaging design such as package shape, product type, size, whether or not it is environmentally friendly, legal requirements, color , among many other. Boxes have been used as a form of product packaging. They protect the product and also serve well in advertising, in truth, well designed boxes help sell the products and increase the sales. Packaging design is paramount for any product. The function of packaging in the modern world is mainly to encourage customer to purchase and use the product. The package aesthetics of a product are the first things that a customer sees therefore packaging influence and attractive on consumer. The package job is to self itself to the customer. A product which features a beautifully designed piece of packaging can stand apart from competitor products and promote sales.

C:\Users\Jih Yi\Desktop\nike-lebron-10-gr-black-white-red-4-02-box.jpgC:\Users\Jih Yi\Desktop\541100-303-jw-250x250.jpg

Nike design special edition packaging to target the market in order to increase the financial gain and an increase in brand recognition. Example: Limited Edition of Nike LeBron X+ and Nike Lebron 10 ‘Cutting Jade use the color and brand design of packaging to effectively communicate across multiple cultures.The packaging of Nike Lebron 10 ‘Cutting Jade will include a white overlay but the box itself will be done in black with green lettering in accordance with the colorway itself. Limited Edition of Nike LeBron X is also offering the shoes in a special red wooden box. The packaging design aesthetics is perceived through the eyes of the customer, this is an influence on whether that customer purchase or not. Using the color would be best to use simplicity to convey a message effectively to any audience so that minimizing the amount of text on the product design aesthetics in order to maximize the package’s effectiveness. According (Gofman et. al, 2012), packaging design plays a critical role in purchase decisions and influences the consumer decision are made at the point of sale where more attractive packaging frequently. When a consumer is relatively indecisive about a product and it comes time to make decision, the package plays a critical role in purchase choice (Silayoi, Speece, 2012). I was found that " a brightly colored packaged is likely to draw more attention than a dull package and adapting a package design to a local culture is useful," (Aslam, 2012)

Nike considered design creates performance innovation products that minimize environmental impact by reducing waste throughout the design and development process, using environmental preferred materials and eliminating toxics. Corrugated cardboard is Nike’s single-largest material purchase. The shoebox and its shipping carton account for half of Nike packaging. So to reduce packaging waste Nike standardized the production of its shoe boxes to ensure printed with water-based inks and contain no glues, coating or staples. The design for recycling and consumer bring their products back to us to be recycled into new products. Nike modifies the traditional shoe box in order to reduce weight and materials used. Thereby reduce cost in shipping and reuse in eliminating solid waste

C:\Users\Jih Yi\Desktop\db43f96f376a3836eb78e8e6359c3e50.jpgC:\Users\Jih Yi\Desktop\213517__W95cwLUWwPIOobUiPRLDnmAd.jpgADIDAS footwear

Product style and design also attract consumers. Adidas product is delivered in cardboard outer cartons which are re-used and recycle/ footwear packaging consists of recyclable cardboard shoeboxes lined with silk paper and paper support with the shoes.In addition, packaging could also affect consumer behavior. Adidas recently reengineered their approach to the environmental management. In the marketing campaign Adidas asking consumer to "grow the grass you play on" mean that all packaging uses recycled content and seed-infused cardboard allowing the customer to plant their packaging after being purchased. Besides that, the shoe boxes overall recycle content is 95% based on weight and made from 100% recycled fibre + clay coating/varnish, the ink used is soy-origin and water-based. Furthermore, Adidas "Team Signature" shoebox,Packaging for Adidas premium basketball brand, raw cardboard, embossed pattern, gold foil stripes, and 1 to 2 hits of white ink. It is the combination of features such as log, colors, pattern, test, brand mark and values that make up an effective way to communicate a product to catch attention of consumer in this competitive market and increase the brand recognition (Philip Kotler et al. 2005p. 550). According (Meyers, Lubliner, 2012) packaging is the link between advertisement, personal experience or referral of a product, and a consumer buying decision. If establish a good product image with the consumer and package a good way of communicates it product, will influences the consumer choice in order to success of marketing (Gofman et al, 2012)

Characteristics of Nike

There are a few of Nike shoes that are fairly popular to fit any man’s needs recently. Normally Nike designed to help to improve articulation and offer more flexibility of the shoes. For example, there is a kind of great looking shoe for playing basketball, Nike Zoom Kobe for men. Besides providing flexibility, it also provides extra support in its solid rubber features and herring bone. Due to its no marking traction that made according to EKG pattern, it also make less marks on the floor. Others features like shock absorption, comfort lightweight support are also the important function for Nike shoes. With high quality and stable characteristics of Nike shoes, one of the basketball stars, Kobe Bryant is also using Nike shoes as his main sports shoes like Nike Zoom Kobe (MARTINEZ, 2012).

Nike offers colorful designs with transparent Nike symbol on the side of them as well as premium leather on the top sides of the design. Nike Air Force that has great deep set colors like blue, solid blue or black red which is stylish and special design for men. One of the spokesperson of Nike Air Force, Michael Cooper is an American basketball coach and retired professional player (luzhiling, 2013) agrees that the outersole is durable and made of rubber which will provide grip and plenty of cushion and shock absorption because of an air sole unit.

Characteristics of Adidas

Adidas have been known for providing a plenty of quality products for most of the popular sports in US or even go overseas as of the early 1960s. The few features of adidas shoes are drainage system, shock absorbing, comfort, lightweight and so on. There are a lot of famous of their quality shoes and Adidas Bounce tennis shoes are one of them which are also some of the most advanced running shoes on the market. Tim Duncan,  an American professional basketball player who currently plays for the San Antonio Spurs of the National Basketball Association (NBA), Adidas Bounce are one of the sports shoes which were custom made for him according to his foot size (BWalter, 2010).

Adidas's clothing and shoe designs typically feature three parallel bars and it is incorporated into Adidas's current official logo. Normally, Adidas focus on running shoes and football kit. The design of Adidas shoes characterized a ribbed rubber structure for the upper leather of the shoes. It is used to accent ball movement when struck. Few of highly skilled players claimed they were able to curve the flight of the ball easily when wearing this new design, Mats Hummels is one of the players by wearing adidas Predator LZ (BS, 2013). The colors of Adidas shoes are more on black, white, gold, yellow and so on.

Pricing of Nike

Nowadays due to the costs of labor and materials as well as shipping costs are increasing continuously, Nike raises 10% for their shoes prices, when Nike will launch the most expensive sneaker—an expected $315 LeBron James basketball shoe right after a test of the approach comes. When Nike unveiled the LeBron X, analysts expect that this 10th LeBron shoe will retail for around $315. In 2003 the first edition retailed for around $110 and the ninth edition retailed for around $250 (BANJO, 2012).

There is few studies show that using the same production techniques, the average cost at retail for a pair of Nike shoes would go up to $100. The average retail price for a pair of Nike shoes is between $70 and $75, so therefore it would go up to $170 or $175. "Prices are getting crazy excessive and as long as we continue to buy sneakers, Nike is going to keep increasing the prices," said Donell Brown, 30, who owns a cleaning services company in Dearborn, Mich. Nike is known for some pricey shoes, for a new version of Air Jordan is expected in December 2012 at $185 has increased from its original price of $64.99(or $138.38 in today's dollars) since 1985. There is a 33% increase when adjusted for inflation. Nike is "not arbitrarily taking up prices," said spokeswoman Mary Remuzzi. "We are constantly looking at ways to enhance the product line with new innovation and product attributes."

Pricing of Adidas

Raw materials, labor and transportation costs have all gone up in this few years. The overall prices of Adidas shoes are almost doubled up and still increasing continuously around 20% already in 2011. Most of Adidas shoes are about $50 to $60 according to the feet size. Adidas have a wide variety of affordable and reasonable shoes for consumers. Last season’s Derrick Rose signature shoes, the Adidas AdiZero Rose 2 and AdiZero Rose 2.5, both are retailed for $110. The upcoming Adidas Rose 3 gets a higher price of $50 point raise, settling on shelves at $160. Besides, Adidas Puremotion Heel is available in White/Metallic Silver/Satellite and Black/Black/Red for a suggested retail price of $120.00; Satellite/White/Metallic Silver for only a retail price of $100.00 (Brown, 2010).

Communications

Strong principle like selling a feeling, an emotion had been built by the overall communication of Nike brand value.They convey a feeling to the audience to experience what it would be like to use their products although without seeing or directly experiencing the product. This is promoted through famous spokespersons, top sportsman like Jeremy Lin, who is an appealing Asian players as well as a famous new star in the NBA.(King, 2012). Besides that, Nike also promote by depicting inspirational stories. Example like Oscar Pistorius, Paralympic World Record Holder, about how he wages his war although his was born without bones below the knee. (Matthew, 2012). They also go through the emotional connections between the viewer and the depicted person. For instance, the Just Do It strategy was first expanded over to women with "a mix of empathy, inspiration and empowerment. It spoke to women in a voice that was intimate yet strong, philosophical yet honest" (Bedbury, 2002)

Lastly is by motivating the viewer directlythat makes Nike so successful is the fact that it persistently promotes motivation in its campaigns. For example, a television commercial named Tell Me, in 1996, shows Michael Jordan in the court after returning from his short retirement from basketball. He challenges the viewer by saying "Disrespect me. Tell me I am older. Tell me I am slower. Tell me I can no longer fly. I want you to" (Youtube.com, 2010).

Conditions and the same strength as Nike did to capture the consumer interest. For Adidas, they are going through its brand communication through Advertising. (Berntson, 2006)Advertising often involve both images and words, and most of the time it is a combination of the two. Advertising slogans are often quite straightforward whilst the images presented in advertisements are much more complex. (Nordstrom, 1986)

Target audience of the Adidas is mostlyfor male and female between the ages of 10to 30 who are active in sports like football, basketball, running and swimming.(Mindmeister, 2012) Adidas use some advertising media to promote their product in the marketplace. For example like celebrities’ advertisement, online advertisement and public transport advertisement. (Rahman, 2009) For brand ambassador, Adidas using some popular international sports players like David Beckham, Tim Duncan and Messi(Phoenix Market City). Besides that, TV commercial can considered the most effective mass-market advertising format. Its reflected the high prices TV networks charge for the commercial airtime during popular TV programmes. Adidas has a large amount of TV commercial advertisement in worldwide like BBC and CNN.(Manus, 2011)

Distribution policies (availability of product)

Nike distribution system can be denominated as multi-channel system. The Nike specific distribution strategy combines both vertical sales channel structure together. Therefore, they can use direct distribution as well as various forms of indirect distribution.Nike focuses its direct distribution on two sales forms. On one hand products distributed through Factory Outlet Stores and other is through internet as ecommerce form. Nike also have B2B platform with reserved access for listed client and B2C business in their official website, where the product can be self-designed and personalized. (Baiker, 2007)They also have some Nike promotional items like key chains, note, and posters that are not available to sale, just for promotional purpose onlyand do not stock these items at their distribution warehouses, headquarters, or retail stores.(Nike) In Malaysia, Zalora.com is the online business for Nike product and mostly Nike retail shop is available in shopping mall like AEON, TESCO, and CARREFOUR. (ZALORA)

As for branded sportswear, Adidas channels most of its distribution through a network of approximately 3,000 small retail stores. Nationwide, the main retail stores are department stores and sporting good shops.(kmikalacki, 2005)Furthermore, Adidas also have distributed its product through ecommerce form. They are distributed in their main official website. (Adidas)Adidas is rolling out a global policy that will ban its retail partners from listing the company’s products on major e-commerce sites. They have product ban two of largest ecommerce sites, Amazon.com and eBay.(Siemer, 2012)The distribution channel of Adidas is done by 3 ways. First is Manufacturer to Adidas showroom to Customers. Second is Manufacturer to Retail Agents to Customers. Third is Manufacturer to online purchase to Customers.(Muzan, 2012)

Recommendation

Since Nike is suffering the image as well as reputation problem of their products being boycott by consumers due to the child labor cases, there is a few of suggestions for Nike to improve their brand image and regain recognition from public.

First of all, Nike may conduct more activities that are relevant to green environment like "create green". For example, Nike North Star is a representative product of green environment and to show that Nike is not only concern about substantial profit but also concern about issues and actions of environment. Nike can focus on providing other environmentally friendly product and not only on footwear such as container, bicycle as to Adidas as well. It can solve the problems of less diversification for both companies.

Besides that, Nike and Adidas may also replace plastic bags to recycle bags for their packaging. This can reduce the resources of making plastic bag and getting more environmentally friendly. Furthermore, both Nike and Adidas can also organize green campaigns and events to provide more knowledge and information about the benefit of green environmental activities towards public.

Nike and Adidas products focus more on footwear and age range between 10 to 35 years old, they can also co-operate make a partnership with other industries. For example, they can release a sports drink with collaborating 100 Plus so that they can break through the limited diversification and toward variety choice for public.In addition, partnership can also reduceoverall production costs like labor, materials and so on. On the other hand of reducing costs, Nike and Adidas can get a cheaper price of their main materials such as cotton and wool from other nations like India.

For both Nike and Adidas, they may do some design investigations for elder category and release some relevant products for the category. Moreover, both companies also can do the online survey in website like Facebook and Twitter to get the feedback from user and their feeling when using their product. They can also generate the ideas and creativities that given by respondent and create the product to satisfy their need.

Conclusion

After the completion of the assignment, we discovered that Nike and Adidas are mainly in the production of sportswear. In terms of Nike product packaging,boxes have been used as a form of product packaging. They protect the product and also serve well in advertising. In fact, well designed boxes help in selling the products and increasing the sales. For Adidas, product styles and designs also attract consumers. Adidas product is delivered in cardboard outer cartons which are re-used and recycle footwear packaging consists of recyclable cardboard shoeboxes lined with silk paper and paper support with the shoes. The brand mantras built by Nike is it emphasized on the authentic athletic performance.Adidas founder, Mr.Dassler, is mission to offering the best quality products to sportsmen as its mantra.

Nike provides high quality products and flexibility. The main features of Nike products are to improve articulation, shock absorption, comfort and lightweight support. Besides that, Nike offers a plenty of attractive colours such as blue, solid blue or black red and so forth. Adidas provides stable products for consumers. Their main features are drainage system, shock absorption comfort and lightweight support as similar as Nike. Adidas also offers a colourful design for their products such as gold, yellow black, white and so on. Although prices of both companies are increasing continuously due to the increasing of production costs, the prices of Nike products are increasing higher than Adidas products. For the communication of Nike, they are using celebrities, motivation, inspirational stories, and emotional connections to promote their brand value and product. Adidas is using the advertisement, brand ambassador, and media to promote its value to customer. Nike and Adidas distribution system can be denominated as multi-channel system. Both are using direct and indirect method to distribute its product.

Lastly, Nike can go through the green environmental activities to improve its image and reputation. Moreover, both companies also can apply partnership as the strategy to reduce their production costs. They also can do the online feedback to increase quality of their product.