Article info 
Keywords
Pestle analysis on marketing campaigns
adidas
Case study
Suleman qazi

Abstract

PESTLE Analysis of Adidas analyses the brand on its business tactics. Adidas PESTLE Analysis examines the various external factors like political, economic, social, technological (PEST) which impacts its business along with legal & environmental factors. The PESTLE Analysis highlights the different extrinsic scenarios which impact the business of the brand.

Pestle analysis on adidas market campaign

Suleman qazi

Pestle analysis is an important framework for companies like Adidas to understand market dynamics. Let us start the Adidas PESTLE Analysis:

Pest analysis also known as PEST analysis is a marketing theory term. The concept is also used as a tool to track environments where companies are launching or planning new projects/products/services etc.

The pastel analysis of Adidas. Adidas is a German global multinational sports equipment hardware and footwear company. Adolf Dassler is the founder of Girder Dassler and founded the brand in July 1924. Adidas was born on August 18 1949. Adidas is headquartered in Herzogenaurach in Germany. Adolf Dasslers two sons worked together. The father’s company They separated in 1947 and founded their own company; Adidas and Puma. Later they became fierce competitors in the sports industry. Some of the main products of adidas are eyewear hats headbands and bracelets running shoes hoodies basketball shoes yoga pants soccer shoes sportswear t-shirts sportswear and jackets. According to one estimate the company employs around 59533 people in its stores worldwide. Some of the major competitors of Adidas are Fila, Converse, Callaway Golf, New Balance, Under Armor, ASICS, Puma, Lululemon Athletica, VFC, 

, and Victoria’s Secretes. Today, we’ll discuss the pestle analysis of Adidas, how macro-environmental factors impact the world’s leading sportswear brand. If you want to learn about the internal factors of the company, check out the 

IMPORT/EXPORT TARIFF BY TRUMP ADMINISTRATION

If you doubt that Adidas is a German multinational it has nothing to do with the conflict between the US and China. As we all know USA is the biggest market for Adidas sporting goods. The Trump administration is a nationalist government pursuing protectionist policies. The Trump administration has imposed tariffs on all products made in China. Adidas products are made in China. When a company exports products to China Americans see them as made in China. This means that brands have to pay more taxes

Adidas is a global multinational brand whose products must be distributed across the borders of different countries. Every country has different supply chain policies and international trade laws. If companies do not address the complexities of their supply chain systems it will adversely affect their profitability

Government regulations vary from government to government. Factors such as terrorism nationalism patriotism low acceptance of rigid social systems and extremism played an important role. These factors explain the country’s stability and business environment. If it is harsh and nationalistic there is room for outsiders

The global COVID-19 pandemic and business closures have sent the global economy into recession. As 2020 ends and 2021 begins companies are not operating at full capacity. Adidas is a financially stable brand but its annual sales and net profits have declined sharply. According to a report by 

 the annual revenue of Adidas was 22.63 billion dollars in 2020. Out of which the 

 of the brand after minimizing all the expenses was 0.529 billion dollars. In 2020, the annual revenue and net profit of the brand decreased roundabout 12.83% and 75.31%

Below are the economic factors in the PESTLE Analysis of Adidas:

The entire sports industry’s revenue share is very concentrated with 50 largest companies contributing to around 70% of the total industry’s revenue.

Adidas is a German brand and trades with neighboring European countries in euros. Contracts are in USD when it comes to international trade and company manufacturers in Asia. This happens often. The company has to deal with different exchange rates every day Economic stress and other conditions such as epidemics cause the exchange rate to be unstable. Even a small difference between the USD and EUR exchange rates can make a big difference when you multiply it by millions.

§  Sportswear brand Adidas operates worldwide. Interest rates inflation rates unemployment rates and many other factors vary from country to country. These economic issues play an important role in affecting the purchasing power of consumers. When people have less purchasing power they spend less. Declining sales meant the company was making less profit. This is what has happened in the past few months during the pandemic

There are two types of products. Necessities and leisure. Exercise and exercise aren’t for everyone. Only the rich and wealthy can afford luxury training and sportswear. Not necessarily lower middle class or working class. It is a casual product but people’s attitude towards it is also casual. This is why sales of activewear products have declined during the pandemic because people have not considered its necessity.

Adidas CEO Rosette said in an interview that the 10% market for Adidas products in Asia is fake and fake. There are many third-party sellers in Asia who produce low-quality products and sell them at high prices using the Adidas logo. Customers are willing to pay more when they see the adidas logo.

In the last few years people have started realizing the importance of health and fitness activities. Today people participate in various types of health and fitness clubs such as golf gym runs and other exercises. When they do this, they need training shoes and clothing and this is where adidas products come into play and their profits for the company. Due to the epidemic and lockdown people are confined at home. When things return to normal, they go outside and start outdoor activities.

The culture of yoga and finding inner peace has grown in recent years. A materialistic lifestyle has made people feel that something is missing in their lives. That is why many people join yoga clubs. You have to buy yoga pants for that. Adidas already offers yoga pants.

Lockdown and bandh have confined people to their homes. Many people have lost their jobs due to this epidemic. They only reduce the prices of necessities. This means a reduction in their sports budget and sportswear.

The adidas brand cares about our communities and the people we do business with. The company has initiated several social assistance programs to improve the health and well-being of its communities

Adidas sponsors international sports events to attract the attention of fans. The brand is estimated to have spent around £100m on the 2012 Olympics. It turned out to be a very profitable investment for the company. Thus, the brand was able to increase its sales.

In times of rapid research and development when new products need to be launched every three months or every year. Otherwise, your competitors will gain a competitive advantage over you. And little by little they will drag the whole market under your nose. You need to keep up with new technology trends in the market. It is good that Adidas is always up to date with the latest technology and it is one of the main reasons the company is growing.

Many researchers are working on developing technological raw materials. This reduces waste and sportswear companies can reuse the same materials over and over again by melting them down. If Adidas could somehow develop a new synthetic material, it would be a huge advantage for the company.

Pandemics and business closures have brought awareness to the importance of e-commerce sites and online retail stores. Adidas already has an e-commerce platform. It’s not at the level of brands like Nike Amazon or Walmart. Companies should use this opportunity to their advantage.

Adidas is known for being a quality-conscious brand. Before launching sportswear products into the market companies thoroughly check their products with sports professionals and trainers. The company’s products are designed to enhance the performance of athletes.

With the logo of the three parallel stripes and the Adidas brand the company lost a classic battle in the Supreme Court of the European Union. The company was unable to satisfy the court that customers would identify with the 3-line logo. For that very pain. After losing the trademark the trademark may be more vulnerable to counterfeiting in the international market.

§  Adidas owns the IP system and intellectual property rights. This allows companies to reduce the risk of counterfeit designs and infringements. Product fraud is very common in the sports industry. Patents and legal protections help businesses reduce risk.

Adidas has a history of hiring celebrities and athletes as a brand ambassador for the promotion of its products. When certain celebrities and fans join any organization, they bring millions of their fans along with it

Adidas claims that not all of the company’s manufacturing units produce limited and environmentally friendly products. The company has launched several low-loss projects such as the Future Craft Loop Parlay for the Ocean Adidas Bio-Steel Fiber and Sports Infinity Formation Technology Dyeing Process. All of these schemes aim to use petroleum-based plastics that reduce carbon emissions and produce leaner more efficient products.

ADDIDAS IS A GLOBAL ORGANIZATION Let more people know that Adidas is adidas at it uses the localization concept of global brands to meet the needs of consumers and implement strategies in a highly competitive market. Sports market. Adidas is also well aware that its customer centric structure is unique in the industry which gives adidas Group a competitive advantage.

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