Adidas Cohesion Case EFE, IFE, and CPM

Competitive Profile Matrix (CPM)

Nike
Critical Success
Factors

Product Quality
Branding and
Reputation
Global
Expansion
Market Share
Portfolio
Diversification
Advertising
Financial
Position
Price
Competitiveness
Customer
Loyalty
TOTAL

Under Armour

Callaway Golf

Weight

Rating

Weighted
Score

Rating

Weighted
Score

Rating

Weighted
Score

0.15

0.60

0.60

0.6

0.15

0.60

0.45

0.45

0.1
0.09

4
4

0.40
0.36

3
3

0.30
0.27

1
2

0.1
0.18

0.12
0.12

4
4

0.48
0.48

3
3

0.36
0.36

1
2

0.12
0.24

0.09

0.36

0.27

0.27

0.09

0.27

0.27

0.27

0.09
1.0

0.36
3.91

0.27
3.15

0.27
2.5

Page 1 of 8

Adidas Cohesion Case EFE, IFE, and CPM

Product Quality
Product Quality was given a weight of .15 considering that its importance is manifested
in the effects on the other critical success factors. A firms success is greatly rested on its
products, while its products are significantly comparative in terms of quality.
Nike
Rating: 4
The effectiveness of its strategies targeting this area has greatly resulted to a majority of
the market share and great financial returns. One notable strategy is extensive emphasis on
research and development. The company has established the Nike Explore Team Research Lab
in Beaverton. The state-of-the-art research facility employs more than 40 employees who have
accomplished numerous masters and doctorate degrees in biomechanics, physiology, physics,
to name a few. Innovation and product improvement are the prime objectives of the laboratory,
where new products that aim to aid and improve performance are continuously being
developed. Research partnerships have also been established with various universities and
educational institutions in North America. Furthermore, Nike practices worker empowerment by
providing employees with the proper skills to immediately address issues regarding quality in
production.
Under Armour
Rating: 4
Using advanced textile technology to produce specialty fabrics, the company is
dedicated to introducing products that aids in body temperature regulation, aiding in
performance regardless of any weather condition. The brand also provides products that aim to
improve users performance. They do so by forming quality assurance teams that constantly
monitor the items that arrive from suppliers and manufacturers. These teams also monitor
quality systems in production and remain in constant lookout for better options in terms of
quality and production. Lastly, a Universal Armor of Performance was made to assure
customers of superior product quality.
Callaway Golf
Rating: 4
Aside from having a research and development department, Callaway employs Sr.
Quality Engineers. These employees work hand-in-hand with production, R & D, and suppliers
to ensure that quality levels are met. In addition, they monitor smooth returns of defective
products, and generate reports that document complaints and negative reviews in order for
specific improvements may be made. Lastly, they identify product and process issues, so as to
ensure consistent and high-level quality when it comes to the firms products. The company has
produced over 1,100 US patents. Lastly, the line involving Childrens Products are tested and
certified in accordance to the Consumer Product Safety Act of 2008.

Adidas Cohesion Case EFE, IFE, and CPM

Branding and Reputation

Branding and Reputation was given equal weight with Product Quality, since it holds
great influence in consumers buying decisions, especially relative to competitors. Reputation
has been lumped together with branding, since according to Siraf, et al. (2012), Corporate
Social Responsibility strategies are essential in building up a companys brand.
Nike
Rating: 4
Nike has designed its brand to be distinguished as everyday active-wear that extends
beyond professional use. It affirms the brands image of improving a persons potential. Aside
from cementing its position as the current market leader, the firm has also chosen to be involved
in numerous activities dealing with its social responsibilities. One of these is the Nike
Foundation, which currently have programs that aid poverty in women and adolescent girls.
Nike also offers scholarship grants to deserving students and aid in community welfare through
various programs that aid in promoting physical activity for kids.
Under Armour
Rating: 3
Although it hasnt reached market leadership, Under Armour has firmly established itself
in the market catering to young athletes. In strengthening its branding, it has become a leading
provider of sports products to various American universities and products. Involvement in
various environmental conservation, cancer research, and educational foundations are also to
be taken note of.
Callaway Golf
Rating: 3
Callaway exercises their Corporate Social Responsibility by remaining dedicated to
ensuring safety in their employees work environments and standing firm to its stated ethical
standards. It has also brought forth the Callaway Golf Foundation, which has currently donated
more than $8 Million dollars to various charities, involving sports, health, and education.
Global Expansion
This factor was given a weight of .10, since superior products need to be aided by
excellent distribution in order to achieve market leadership in the given industry.
Nike
Rating: 4

Adidas Cohesion Case EFE, IFE, and CPM

Since 1980, Nike has constantly grown to be what it is now today, with operations in over
160 countries. The firm has 330 retail stores in the United States alone, along with more than
330 around the world. In addition, Nike now targets to significantly increase its sales in China
and put greater focus on European markets.
Under Armour
Rating: 3
Although its expansion is not as vast as Nike, Under Armour has stores in Canada,
China, and 39 states in North America.
Callaway Golf
Rating: 3
Despite its limited product line, which mainly focuses on golf related items, Callaway has
managed to establish itself in over 110 countries around the globe.
Market Share
Market share was given a weight of 0.09, since this not only brings prestige and higher
brand equity; it also rewards a firm financially.
Nike
Rating: 4
Nike is clearly the market leader with a chunk of 54% of the entire market according to
Forbes (Riper, 2013). This clearly puts the organization at a clear advantage.
Under Armour
Rating: 3
According to Mirabella (2014), of the Baltimore Sun, Under Armour has recently
overtaken Adidas in terms of sales and is now currently No. 2 when it comes to the market
share of sportswear.
Callaway Golf
Rating: 2
The company falls behind the previous two when it comes to market share. This could
also be attributed to a limited line of products that are currently being offered by the firm, relative
to its existing competitors.

Adidas Cohesion Case EFE, IFE, and CPM

Product Diversification
The level of diversification was given weight of 0.12, since various product lines when
strategically decided upon, will be able to easily facilitate increase in market share and market
domination.
Nike
Rating: 4
Products of Nike are greatly diversified with various lines catering to different needs. The
firm offers numerous brands, such as Chuck Taylor, Cole Haan, Nike Golf, Hurley International,
Bragano, All Star, Hurley International, and Converse. Through this,
Under Armour
Rating: 3
What started as a compression t-shirt company has now successfully diversified into
offering various sports-products that are now globally distributed with successful financial
returns.
Callaway Golf
Rating: 1
Although it produces high-quality golf products, Callaway has not developed other
product lines that cater to different sports and various athletic lifestyles.
Advertising
Advertising has been given a weight of .12, since proper promotion is essential to
sustaining an edge in the market.
Nike
Rating: 4
Nikes advertising techniques include endorsements by world famous champions. These
endorsements also cover a diverse number of product lines, with endorsers like Michael Jordan,

Adidas Cohesion Case EFE, IFE, and CPM

Tiger Woods, and Serena Williams. They clearly establish the superiority of their products
through the choice of its representatives to the public.
Under Armour
Rating: 3
Under Armour solidifies its grasp on the younger generation, by providing sponsorships
to varsity teams of universities and colleges across America. Although its promotions are not as
strong relative to Nike, the firm has properly focused its advertising efforts to be geared towards
the market they wish to capture the youth.

Callaway Golf
Rating: 2
Although Callaway Golf may have high ethical standards when it comes to advertising its
products, making sure that products promoted truly have improvements over those that have
previously been released to the market, its advertising efforts are less visible as compared to
Nike and Under Armour.
Financial Position
Financial position has been given the weight of 0.09 since it can only achieved with the
help of the previously-mentioned critical success factors. In this case, strategy becomes more
important than financial performance as the industry focuses more on growth rather than on
solvency. However, it is important to note that achieving high financial performance is the result
of effective strategy implementation.
Nike
Rating: 4
Nikes superior financial performance has clearly shown how much the company intends
to maintain its market leadership. Its Inventory Turnover is higher by 16% when compared to
Adidas. Its revenues are higher than Adidas by 31.94%. Furthermore, its profits have greatly
exceeded Adidas 333.5%, showing how much the market leader has managed to maintain its
low costs of production and distribution.
Under Armour
Rating: 3
As compared to Nike, Under Armour is relatively new to the industry. This implies lower
net income relative to Nike and Adidas, which are more established brands in the industry.
However, its sales continue to grow as they create products that are innovative and promote
good corporate citizenship.

Adidas Cohesion Case EFE, IFE, and CPM

Callaway Golf
Rating: 3
Since Callaway only caters to a smaller market, those that engage in golfing, it can imply
relatively lower profits when compared to bigger and more diversified brands such as Nike and
Adidas. Despite such, it reported profits of $66 million USD in year-end 2008, which is more or
less two times bigger than Under Armours. This may be accounted to the acquisition of patents
in US as well as the production of top quality products.Price Competitiveness
As mentioned in the case, more and more customers are turning away from luxury
items. This implies the importance of providing not cheap but inexpensive products that
provide consumers with superior advantages.
Nike
Rating: 3
Due to its established branding coupled with durable and innovative sporting products, it
is expected for consumers to pay premium when it comes to buying Nike products. While Nike
products are not exactly luxury items, it also does not belong to the low-cost items.
Under Armour
Rating: 3
More popular among the youth, Under Armour prides itself with unique, innovative, and
performance-enhancing products that are made from synthetic fibers. Their highly differentiated
products are considered to be among the high-end brand option for consumers that engage in
athletic lifestyles. Although this may imply higher prices, its products establish a worthy reason
for its consumers to pay premium in exchange of high quality and performance-enhancing
products.
Callaway Golf
Rating: 3
Known for its top quality products that clearly provide significant advantages to
consumers, Callaway Golf likewise provides prices that are not exactly low but high enough to
pay off the costs incurred for statistical testing and innovative efforts..
Customer Loyalty
Although customer loyalty is important to gaining more sales, consumer can be loyal to
one brand for a moment only. It is easily gained but easily lost at the same time. Consumer
buying patterns are, therefore, hard to determine especially with the highly diverse and
competitive market.
Nike

Adidas Cohesion Case EFE, IFE, and CPM

Rating: 4
Looking at Nikes exemplary financial performance and clearly established brand, it can
be implied that the company is able to gain repeat buyers. This loyalty coming from the
customers may be due to its superior products and outstanding global presence.
Under Armour
Rating: 3
As compared to Nike, Under Armour may be achieving lower customer retention rate.
Although there might be an obvious disparity between the two, the fact that Under Armour has
captured the younger market may bring more customer loyalty from them. If the trend toward
producing highly innovative products continues, Under Armour is expected to experience
significant advantages.
Callaway Golf
Rating: 3
While Nike captures a more diverse market, Callaway Golf captures those that engage
in golfing. With their top quality products, the company is able to satisfy and retain customers
from its target market.