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The Adidas Company was behind and helped such influential athletes as Jesse Owens and Muhammad Ali as they broke countless records. The heart of the Adidas product line is athletic shoes and this trend shows no signs of changing but the three-stripe logo appears on apparel and other jock accoutrements. Bankruptcy once had Adidas on the ropes, so to speak, but it made a comeback by shifting production to Asia and beefing up its marketing. Being the number two maker of sporting goods worldwide, just behind Nike, it has inked deals with football and basketball athletes, as well as the New York Yankees.
The firm won sponsorship rights to the 2008 Olympic Games in Beijing. It now seems that in every sports related segment Adidas has a new quality product that was created to address an athletes’ needs either on the playing field or getting ready for their leisure time. Currently, Adidas has expanded their market to capture athletes who not only want to perform well in their sport but who also want to look and smell like a celebrity. Therefore, in 2003 Adidas introduced a new line of fragrances and body wash products.
In this line Adidas offered eight different types of fragrances targeted towards both male and female consumers. These body care products ranged in price from $8. 25- $20. 45. We believe that Adidas has great potential and ability to launch a product that refreshes their athletes even when they do not have time to shower. Using the high performance image that Adidas has already established through its fragrance lines, we feel that it would be just another opportunity for Adidas to continue to address the needs of its athletic consumers.
Adidas Cleansing Cloths act as a towlette which has the Adidas patented secret sweat absorbing micro scrubbles that soak up sweat as soon as they come in contact with sweat molecules. These towlettes also contain the three signature scents that leave the user with a “just out of the shower” refreshed feeling and make them smell good even though they did not have a shower. These Cleansing Cloths are also very easy to use. To use you simply take out one Cleansing Cloth from the package and wipe it over the areas where the user feels are covered in sweat.
One Cleansing Cloth has the ability to cleanse the entire body of an individual. Internal Analysis Because Adidas is a name that is synonymous with quality and high performance by athletes across the planet, their image consistently has allowed for all of its new products, such as Adidas Cleansing Cloths, to be perceived as more dependable. With annual sales in the hundreds of millions, Adidas is not only Coty Beauty`s largest license brand, but also one of its fastest-growing.
Adidas, the second largest sports brand in the world, has evolved from a pure sports brand into a brand which appeals to consumers of all ages and interests. Coty Beauty`s product initiatives have been designed to capitalize on these diverse aspects of the Adidas image. In 2003, the United States and Europe saw the launch of Active Skincare for Men, an advanced-performance skin fitness line developed for athletes. The major fragrance launches were Adrenaline Man in the United States and Adidas 3 cool in Europe.
These are lifestyle fragrances for young, metropolitan urban men and women. The Adidas line of fragrances, toiletries and skin care products enjoy worldwide popularity. The brand spirit of Adidas is based on optimal performance, athleticism, energy and vitality. These values are supported in all of the Adidas personal care and fragrance product lines. Currently, there are only three other “cleansing cloths” on the market and Adidas will have the only product that is advertised towards athletes looking to feel refreshed without taking a shower after high intensity work outs.
These products contain a special combination of soap and micro scrubbles that allow an athlete to give themselves a quick rub down when there is just not enough time to shower. Adidas is perceived by many to be one of the most effective healthcare products for people to use after athletic events and this product just takes their line of hygiene products to a higher level. This product, like all Adidas products, is relatively inexpensive at only $7. 35 for a package of thirty Cleansing Cloths as compared to the other brands which range in prices from $4. 5- $9. 60. Adidas claims that this product allows its users to feel as refreshed as they would if they had a shower. The healthcare division of COTY, an Adidas affiliate, has experienced 7. 9% volume growth in the fiscal year of 2005. The Body Care division also grew by $7,858. 6 million in sales and shows no signs of slowing down. Although there were additional marketing investments to support product initiatives for all Adidas healthcare products, the overall net earnings for this healthcare division was $462. 4 million, which is an increase of 28%.
These figures show that despite the additional funds spent on marketing these new products, they proved to be an asset for the company and resulted in a significant increase in net earnings and volume growth for the healthcare division. Although this particular product is relatively inexpensive as compared to most of its competitors, Adidas cleansing cloths are more expensive than most competing brands which sell their products for approximately $4. 95. Adidas claims that its’ cleansing cloths are proven to be better than any of its competitors products.
While claiming a superior product, this price difference would cause Adidas to lower its original introduction price from $8. 95 to $7. 35 so that their lower price would match with a competitive entry. This resulted in a negative pricing impact of 1. 4%. External Analysis Since our society today has really pushed a healthy lifestyle, many professionals must find time in the hectic day for exercise. Adidas recognizes that many professionals are forced to exercise on their lunch break which creates great time restrictions.
The Adidas cleansing cloths allow for the athlete to take the time of a person having to shower after a workout with the use of these quick and easy Cleansing Cloths which leave them with that refreshed shower feel and smell in half the time. Many feel as though their workouts are being cut short because of the time it takes to shower and get back to work after the workout so Adidas wants to help those people by putting more time into the exercise and leaving the shower to them.
Within this market there is a considerable opportunity for increased advertising to reach more of these people who may not be aware of the effectiveness of this product and its reasonable price. Due to Adidas being such an innovative and consumer oriented company there is only a couple of brands that compete with a similar product but none of these competitors try to capture the time restricted weekend athlete who just cannot find the time to shower. The only real competitors in this market are Olay, Athletix Products and CK Antimicroals.
Olay produces what they call unisex cleansing cloths. Even though they are listed as unisex they are strictly marketed to the female market. Their advertisements all claim that these cleansing cloths have additional benefits such as make- up removal. Adidas primary competitors are Athletix Body Wipes and CK Antimicroals Body Wipes which are both direct competition for Adidas Cleansing cloths. Each of these companies markets their products for people on the go who do not have time to shower. However, each of these competitors is marketed towards a sports specific group.
The Athletix Body Wipes are marketed strictly to women who attend female only gyms and do not like to feel sweaty, so these wipes are seen as a preventative measure in wiping the consumer down as the exercise. The other product the CK Antimicroals Body Wipes are marketed specifically to people who wrestle and in between matches do not have time to shower, therefore, they use these wipes to clean themselves in between matches. Analysis of Competitors As previously identified, the primary competitors for the Adidas Cleansing Clothes are Athletix Body Wipes and CK Antimicroals Body Wipes.
Both companies advertise to a very niche oriented target market, as well as use a similar medium such as print ads. Neither of these two competitors have any television ads or a strong presence in the print advertisement channel. Each of these competitors has a very poor marketing campaign and neither has a high amount of brand awareness. Athletix Products Company does not sell to individuals but instead only market and sell their products to the Business to Business segment. This particular product is marketed only to woman who attend female only gyms.
This being said their target age group is woman between the ages of 40-65 and are trying to get back into getting fit by going to the gym. This product is geared towards women who do not necessarily enjoy the by-product of exercising, sweat, and therefore, this product is designed to wipe the sweat off of the consumer as they exercise. This product is also targeted towards women who feel that gyms are not the most clean of areas, so this product also acts as a machine wipe as well.
CK Antimicroals Body Wipes are advertised much like or product except they are advertised exclusively for the use of Wrestler who do not have time to shower in between matches. This product does use print ads but only in Wrestling magazines and currently we can find no other presence of Advertising. This product is advertised to a target market of 8-38 years olds who participate in the sport of Wrestling. We saw no sex distinction in the advertising and it is believed that they advertise to everyone who participates in the sport of wrestling and does not segment on the bases of gender.
Opportunities that Exist for Adidas Cleansing Cloths While the competition in the Body Wipe market appears to be only between 2 companies who seem to have found a real niche in the market the competition is not very intense at all. This is because this is a relatively new product that has not been marketed very well, therefore, many people are currently unaware of it. Each of the Competitors as well as our Adidas Cleansing Cloths seem to all make similar guarantees as to their effectiveness and ease of use of product. However, each of these companies have a very different target market and advertising campaign.
The official Adidas website does not have any of its heath care product in it, therefore, there is a huge opportunity for Adidas to incorporate this healthcare line into their website. Here, Adidas can show commercials of their Cleansing Clothes at work with science behind their effectiveness while the whole time using celebrity endorsement that they already have available. Adidas Cleansing Cloths will be the only Cleansing Cloths that are geared toward acting as a temporary shower for that busy person who would rather work out longer then end their work in order to feel refreshed and get to where ever they have to go.
Adidas Cleansing Cloths also provide a soap fresh smell that not only leaves the user feeling refreshed but also great smelling. No other cleansing cloths on the market has a built in soap smell that leaves the user with the scent of just getting out of a shower. The Adidas Cleansing Cloths will also be the only product on the market who will capitalize on the time constraints that society feels it is under. We also feel that if they go forward with these cleansing cloths that it will as a stepping stone in really bring prestige to their current healthcare product line.
Analysis of Current and Potential Target Markets Based on the current print and television advertisements that feature young males and females between the ages of 15-26, the target market for their current HealthCare products seems to fall within the same range. For the Adidas Cleansing Cloths we feel that the target market for such a product would be more male oriented between 27-55 years of age. Although, currently most products of this nature are geared towards women, we feel that this market can be segmented further and can also include a very profitable male market.
It should also be noted that males between the age of 14-24 could also be included after the initial market of time restricted professional males is effectively reached. As a whole with the Adidas Cleansing cloths can be furthered to expand into the female market at a later date after it has already established its product as the high level of sports performance and quality that Adidas has been known to have. The first target market that we would like to gear our sales towards is Professional males between the age of 27-50 who go to the gym at lunch or have other time restrictions and just do not have the time to jump in the shower.
For this segment the wants and needs will be different from those of a younger generation. For the younger male market which is 14-25, the student who does not feel comfortable at the gyms in public shower but wants to feel and smell refreshed. For many people primarily males within this age group, public shower such as the ones that are in most gyms are an area of great concern. Many males in the age group feel uncomfortable in situations such as these; therefore, Adidas has created a product so that everyone can feel refreshed leaving the gym.
At present no company targets Cleansing Cloths towards are segment of the male market, and if this segment is targeted correctly with effective communication by Adidas, the opportunity to increase sales will be significant. The primary male market would be comprised of males between the age of 27-50 who are professional who what to maximize their restricted time working out instead of cutting back their exercise in order to get a shower. Males today are much more health and appearance conscious than ever before. In today’s society time is a luxury that many in the working class do not have.
Most people have little time to go to the gym as there is only a scheduled amount of time in each day. With Adidas Cleansing Cloths these people can focus more on their work-out than stopping early so that they can shower. These Cleansing Cloths can allow the athlete to feel refreshed in much less time than it would for them to shower. Adidas has an opportunity to really take advantage of the enormous potential that society’s busy lifestyle has created. Currently in society time is of most importance to people and everyone is looking for that product that gives the consumer that extra 5 minutes of leisure time.
Although, showers are important, sometimes people just do not have the time to have one, now because of Adidas Cleansing Cloths a person can have that shower feeling even if you do not have time to have one. Current and Potential Customers It is extremely difficult to talk about current customer because at the moment this product has not been released. However, Adidas does have a very loyal customer base who purchase most Adidas products because of their reputation as elite sports performance products.
We feel that our primary potential customers that well be targeted is males between the age of 27-55 who are professionals having a career and have limited time to exercise in a busy work week. We feel that many males within this age group have serious time restraints and we would like these men not to have to cut back on their exercise in order to meet them. Instead we propose that these men can work out as close till when they have to leave and then wipe themselves down feeling refreshed with these Cleansing Cloths.
Potential customers can be targeted through advertising through such mediums such as; television, print and internet advertising. A huge benefit for Adidas is that they already have professional athletes at their use for endorsements. We feel that because of Adidas tremendous success of their healthcare products it is only a logical link for them now to introduce a product that not only capture their scientific expertise in the healthcare industry while combining with their expertise in athletics.
With this product we feel that the introduction of this product will bridge the gap between Adidas’ healthcare division and the sports division by further solidifying their reputation as the most elite sports performance company in the world. Market Positioning of Adidas Body Wipes Adidas has been creating high quality, high performance sporting goods as well as clothing apparel for many years. With this in mind, it allows Adidas to easily expand their product line and have consumers believe similar characteristics about our body care products.
Adidas has been a well known and trusted brand name for almost seventy years; therefore, it is easy to market Adidas Cleansing Cloths as a dependable and effective product that can be easily to use. The Cleansing Cloths will cost approximately $7. 35 CAN, which is slightly higher than competitors mirror product but we are able to price the cloths in such a manner because of the reputation that the Adidas brand name carries with it. As a result of our positioning as a high quality product at a reasonable price, there is potential for us to expand into new markets in the future if this campaign is a success.
Objectives of the Communications Campaign The first communication objective for Adidas will be to introduce a new product into its Adidas Body product line. This will be the main objective of the campaign because we want to inform our target audience of the new Cleansing Cloths as well as draw interest toward our product. The more aware people are about our product, the more apt they are to purchase it. The second objective will be to provide information to our target audience about our new Cleansing Cloths. We want to inform our target audience of our new product and communicate the benefits of using the Cleansing Cloths.
The third, and final, objective of our advertising campaign will be to increase brand awareness. Many consumers know about our high quality sporting products and clothes, but we want to expand that thinking onto our body care products. We want consumers to be able to trust our products and know that they are made with the utmost quality as well as made for performance. Adidas is a “top of the mind” producer of athletic gear and clothes and we want consumers to have the same rational of thinking when choosing our body care products.
Marketing Communications Budget Adidas Body Care products make up a small portion of a much larger company; therefore, we decided that a percentage-of-sales method would be best in determining the marketing communications budget. In 2005, net sales for Adidas Body Care products were approximately $285 million . The body care product industry is a highly competitive market with many competitors and because of this we chose to have a Marketing Communications Budget of $70 million which is approximately 25% of our 2006 net sales.
This may seem like a large portion of sales dollars to use on advertising, but when a market is as highly competitive as the one we are in, you need to spend a lot to differentiate yourself from the rest of the crowd. The $70 million will be divided amongst the various endeavors in the Marketing Communications Budget, and these endeavors will receive their allocation based on which media we believe will get our message across the best and which media Adidas has focused on using the most in past campaigns. The allocation for all of the areas included in the Marketing Communications Budget can be found in Exhibit #1.
Ever since the introduction of the Adidas Body Care product line in 2002, television advertisements have rarely been used to promote the many body care products that they offer. This year, we have decided to spend a large portion of our Marketing Communications Budget on TV ads. We feel TV ads will effectively and efficiently reach a large portion of our target audience which is why we deemed it necessary to spend approximately $40 million to create numerous advertisements depicting the effects of using our all new Cleansing Cloths.
Since the cost of creating a single, thirty second television ad can be in the upwards of $250,000 , and we plan on creating approximately eight TV ads, we felt that the $40 million to be spent on TV ads is a reasonable amount to spend. We plan on advertising on channels such as ESPN, The Golf Channel, and The Score because these channels are geared towards members of our target audience. Running television ads on these channels vary in cost, but the average cost is approximately $400,000 per month. We plan on advertising heavily during the introduction of the Cleansing Cloths, and during the beginning of each major sport season.
The section of the budget dedicated to the promotion of the Cleansing Cloths in print media is based on the accessibility and usage of print media by our targets. We plan on advertising in magazines like Men’s Health, Runner’s World, Golf Magazine, and Sports Illustrated, which all have a reading audience that is similar to our target audience. Our communications budget for print media will be about $16 million. Placing an inside back cover advertisement in Sports Illustrated will cost approximately $8 million , while placing an ad in Men’s Health will cost about $4 million a year.
These figures, as well as the figures for placing ads in the other magazines can be seen in Exhibit #3. Placing ads on the inside back cover of magazines will allow us to include a free sample cloth during the first month of our advertising campaign. The inside back cover of magazines usually catch the attention of readers. Internet advertising will not cost us a great deal of money, since we plan on only using our website to advertise. To create the ads and keep them up to date, we budgeted $2 million for up keeping and maintenance. The remaining portion of our marketing communications budget will be spent on coupons and displays.
We will spend approximately $12 million on these. Coupons will play an integral part of our campaign because they will allow us to penetrate the market better by offering our new Cleansing Cloths at a temporarily low price. This will draw potential consumers in and will encourage consumers to take immediate action and purchase our cloths. These coupons will cost about $6 million to implement. The displays will cost about another $6 million to produce. These displays will be placed in stores nationwide and will attract consumers because of their life size cut outs of athletes. They will also contain information on how to use the cloths.
The breakdown of the Marketing Communications Budget can be found in Exhibit #1. Exhibit #1: Communications Budget Breakdown Category% of Communications Budget$ Amount Television Ads57%$40,000,000 Print Ads22%$16,000,000 Website3%$2,000,000 Coupons9%$6,000,000 Displays9%$6,000,000 Totals100%$70,000,000 Marketing Communications Schedule Since Adidas Cleansing Cloths are not a seasonal product, we will use a pulsating schedule of advertisements to advertise our product. This means that we will advertise in continuous amounts and have bursts during the beginning of each sporting season.
We plan on advertising more during the introduction of our product and then continue to advertise during the rest of the year. The Marketing Communications Schedule can be seen in Exhibit #2. Adidas Cleansing Cloths are being marketed towards athletic males; therefore, we will change our advertisements depending upon which major sport is being played at the time. For example, during the soccer season, our advertisements will have David Beckham in them as seen in Exhibit #3. The theme of the advertisements will also change, but the main message behind them will not.
We will advertise not only to inform our target audience, but also to maintain market share and increase brand awareness and loyalty. We feel that this Marketing Communications Schedule is appropriate for this type of product and will lead to a successful marketing campaign. Proposed Means of Communication Television Advertising: Television advertising is one of the most efficient ways to reach our target audience; therefore, it will be our main source of communication. Television advertising will allow us to reach a very large portion of our target audience.
We plan on using television ads continuously throughout the year and change the themes based on the different major sporting seasons such as Football and Soccer. Print Media: We plan on using several types of print media for our advertising campaign. We will place advertisements within magazines geared towards our target audience and we will also place posters at sporting events like Soccer and Football games which Adidas will sponsor. The print advertisement themes will change along with the major sporting seasons. This will allow us maintain a consistency with our television advertisements.
Displays: We will set up product displays in various stores to promote our new product. These displays will be placed close to or right next to our other body care products and will communicate the benefits of using the Cleansing Cloths. Consumers who already use our products will be attracted to the displays and will be tempted to try the Cleansing Cloths. Internet: The internet has been an increasingly popular way of advertising over the past few years because it reaches billions of people daily and it allows companies to place advertisements on websites that their target audiences can view.
The internet will be used as a means of providing information as well as to draw interest towards the Adidas Cleansing Cloths. All of our television ads, print ads, and product displays will provide a website address for which current consumers as well as potential consumers can visit to learn more about the product. Samples: We will use media sampling to distribute free sample wipes in magazines that are geared towards our target audience. The samples will be attached to our magazine advertisements. Using samples will encourage potential consumers to try our product and hopefully develop a like towards them.
Coupons: We will attach instant redemption coupons to our in store displays that are promoting the new product. These coupons will be used to encourage the immediate action of purchasing the product. How the Campaign will be Implemented As one of our main objectives is to provide information to our target audience about our new product, we will heavily rely on television ads to communicate our message that if you are stretched for time, using our Cleansing Cloths after playing sports or working out will eliminate the need of having to shower but will still give you the same effect as if you did take a shower.
Television ads will allow us to efficiently and effectively reach a very large portion of our target audience. Since our target audience consists of young athletic males aged 18-35, we will focus on playing our advertisements during sporting events like Baseball and Soccer games as well as on television channels that are geared entirely towards sports fans like ESPN and The Score. The TV ads will be played primarily in the mid to late evening time block from six to twelve AM when our target audience generally watches television.
These ads will contain popular male athletes like David Beckham, Reggie Bush, and Gilbert Arenas using our new product. The ads will change based on what sporting season is taking place at that current time. For example, an advertisement using Reggie Bush will be aired during the football season as seen in Exhibit #4. In terms of print media, posters will be placed at different sporting events that Adidas sponsors like the Major League Soccer matches and at the Boston Marathon.
The poster ads at the Boston Marathon will contain runners, while the poster ads at the Major League Soccer matches will contain soccer players from around the league like David Beckham. These ads will be simple in design, but will convey the same message as our TV ads. The posters will be large in size so it catches the attention of consumers and they will contain web addresses so consumers can go online and gather more information about our product. Future advertisements will include promotions dealing with the 2008 Olympics which Adidas sponsors, as well as the FIFA World Cup of Soccer.
We also plan on placing printed advertisements in magazines. Since there is not any one magazine that is specialized towards our target audience, we will choose several different magazines to advertise the Adidas Cleansing Cloths. Ads targeted towards athletic males aged 27-50 will be placed in magazines such as Sports Illustrated and Men’s Health. These ads will show some of today’s most popular male athletes using the Cleansing Cloths. The ads will change along with sporting seasons, just like our TV ads and other print ads.
The ads will also contain a sample pack that contains two free wipes which will encourage readers to try our product. Ads targeted towards male runners aged 27-50 will be placed in the Runner’s World Magazine. These ads will feature typical male runners breaking a sweat and will also contain free sample wipes for readers to try. The internet will be used primarily as an information provider during our ad campaign. All of our advertisements will contain a web address that consumers can access to gather more information about our new product.
The website will give information on how the cloths work, how to use them and how our patented Cool Tech??? system works. In store displays will be set-up during the introduction of the Cleansing Cloths and will be placed in locations that already carry our body care products like Wal-Mart, Shoppers Drug Mart, and Target. Small displays will be placed right next to our other body care products to encourage Adidas body care product users to try our new product, while larger displays will be placed near the entrance of each store to try to attract new consumers.
The large displays will portray life size cut outs of Reggie Bush, David Beckham, and Gilbert Arenas. The displays will be used for approximately one month after the introduction of the Cleansing Cloths to spread the word of our new product. Coupons will be attached to our in-store Cleansing Cloth displays for a limited time only. The instant redemption coupons will only be available for a couple of weeks after the product is released and will allow consumers to save two dollars if they purchase the Cleansing Cloths within the two week period that the coupons are available. Advertising Appeals
Our new product is geared towards athletic, professional males aged 27-50; therefore, we plan on using fantasy, sex and emotional appeals in our advertisements as these appeals are deemed popular to our male audience. These can be seen in proposed print ads found in Exhibits # 4, 5, 6 and 7, which shows before and after shots aimed at men who don’t have enough time to shower after a game or a workout, but want to smell and feel clean. Evaluation and Control of Implemented Plan We plan on using Theatre Tests on our TV ads and Portfolio Tests on our print ads to make sure that our ads are sending the right message and are consistent.
We will use multiple focus groups that consist of approximately twenty members of our target audience to test the overall effectiveness of our ads and determine whether we should release them to the public. We will also use Behavioral Measures to test the effectiveness of the ads. After the release of our ads we will analyze sales levels and determine whether we should continue with the same ads or change the ads depending on if the sales are where they should be. Using these methods will allow us fine tune our marketing campaign and will hopefully prevent a disaster from occurring by finding mistakes in the ads.
Conclusion Based on our analysis, we feel that there is an opportunity to increase sales by introducing our new Cleansing Cloths. With Adidas sponsoring so many sporting events, there is always going to be opportunities to adjust ads for upcoming events like the 2008 Olympics and the FIFA World Cup of Soccer. By introducing the new product, our goal is to increase our target audience’s usage of our products. The increased sales will cause an increase in our market share, further placing a stamp on the dominance of the Adidas brand name.