The one name that comes readily to mind for most people worldwide when it comes to sports apparel is Adidas. Officially founded as Adidas by the German Adolf Dassler back in 1949, this multinational corporation has continued to lead the way in designing and producing clothing, shoes, and other sports accessories.
Adidas is currently ranked as Europe's largest manufacturer of sportswear. They are also ranked just behind Nike as the second-biggest producer of sportswear in the whole world. Apart from sportswear, Adidas also specializes in producing footwear, apparel, toiletries, and sports equipment. Adidas is also widely known for its impact on sports like football and basketball. They are the official kitting company for many countries and popular football clubs like Bayern München and Manchester Utd.
As of 2018, this company posted a revenue figure of €21.915 billion. This outstanding revenue can be attributed to its well-thought-out marketing plan of Adidas. This report highlights the Adidas segmentation, targeting, and positioning strategies responsible for the brand's success.
Market Segmentation of Adidas
Adidas market segmentation consists of Behavioral, Demographic, and Psychographic segmentation. The brand has different segments formed based on the preferences of customers. All Adidas products fall into four categories: Neo, Originals, Performance, or Style.
- Neo: This is a relatively new segment with products designed for teenage customers between the ages of 14 and 19 years.
- Originals: The line of products under this segment mainly includes street-style casual wear. Originals consist of footwear and clothing that are not necessarily sporty in appearance.
- Performance: This segment is made up of products that are sporty in nature. They include sportswear designed to meet the needs of athletics. These needs include sportswear, including sports clothing and footwear that can improve the overall performance of users in their respective sporting activities.
- Style: The Adidas products available under Style consist of footwear and clothing that are trendy and sporty. The customers that fit this segment are mostly young people.
Behavioral segmentation: The Neo, Originals, Performance, and Style segments of Adidas offer different customers a choice based on their preferences. Athletes would be drawn to product underperformance, while customers looking for streetwise clothing would prefer Originals. Trendy and sporty youth can stick with Style, while young teenagers can choose clothing and shoes from the Neo segment.
Demographic segmentation: Adidas designs and produces clothes, shoes, and accessories for different age groups and gender. For example, as earlier stated, Neo products are designed for teens aged 14 to 19 years old.
Psychographic segmentation: Adidas is able to strike a delicate balance in providing apparel and sportswear for both the upper and middle social class. They offer high-end products as well as items produced to meet the needs of upper-middle-income earners.
Targeting of Adidas
Adidas's target market is quite broad-based. Target customers consist of sports and fitness fanatics, fashionable youth, and brand loyalists. The brand targets athletic young adults aged between 20 to 30 years old. These customers are passionate about sports and associate themselves with top sportswear brands like Adidas.
The Neo segment was designed to meet the needs of Gen Z for sporty, trendy clothing, shoes, and accessories. The marketing plan of Adidas is to introduce a new generation of athletes to the Adidas brand with the hope that they remain loyal to the brand throughout their lifetime. Adidas widely views this generation of customers as greatly influential in promoting the brand and providing inspiration for innovative product design.
Adidas's target market also includes middle-aged (40 to 65 years old) customer groups, many of whom have been loyal to the brand since their youth. Adidas targets customers belonging to the upper class and upper-middle class. Ultimately, Adidas designs and produces products for customers in the Neo, Originals, Performance, and Style target segments.
Positioning of Adidas
Adidas positioning strategy centers around being the best sports apparel, footwear, and accessories brand globally. The marketing mix elements of Product, Place, Price, and Promotion all play a crucial role in ensuring that Adidas positions itself as a leader in the global sportswear and accessories market. To achieve this, Adidas operates a very efficient production, marketing, distribution, and sales plan to meet the needs of a global target audience.
Adidas has a well-structured marketing system that incorporates collaboration with sports clubs, conventional media, and social media influencers intending to promote the Adidas brand in the consciousness of sports fans. To further bring the brand closer to the final consumer, Adidas has many stores spread worldwide.
These retail outlets are often located in large popular shopping malls in major cities around the globe. Adidas products are also made available through market mediators and distributing firms like Aw Lab or JD Sports. While Adidas products are most affordable, particularly to middle-income earners, the brand still offers high-priced products that are often reserved for the high-income earning upper class.
Social media plays a very important role in helping Adidas promote new or existing products. Adidas solicits the help of social influencers in this regard, and celebrity endorsements are also encouraged by the brand. In addition to this, Adidas relies on sponsorship and kiting deals to help push out the brand to the full glare of the public. Their proactive and vibrant promotional drive is one of the main reasons the brand can churn out impressive sales and revenue figures yearly despite global economic upheavals.
Adidas's marketing plan is central to the achievements and success of the brand. And this plan is efficiently driven by the Adidas market segmentation, targeting, and positioning strategies in place. Adidas segmentation includes Behavioral, Demographic, and Psychographic segmentation.
The brand has different customer groups with specific preferences and demands. Adidas designs products that fit each of Neo, Performance, Originals, and Style customer segments. The target audience of this brand is very broad, but there is a greater emphasis on youth. With Adidas, impossible is nothing. This slogan drives their thought process daily to produce innovative sportswear that improves the performance of athletes around the world.
Adidas is the best sportswear company in Europe and one of the top two in the world. This is a position of strength that they have earned and continue to earn with revolutionary marketing strategies that define a generation.
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Adidas segmentation targeting and positioning
Positioning of Adidas | STP Analysis of Adidas, October 7, 2018