UNIVERSITI TEKNOLOGI MARA STRATEGIC MANAGEMENT ADS 552 The Rationale Behind The Adidas and Reebok Merger

Prepared For : Miss Norhayati Yaacob Prepared By : Adzmil Ainudddin bin Ahmad Farah Nabillah binti Zulkifli Nor Farah Shila binti Mazlan 2008599649 2008504133 2008404464

1.0 Introduction 1.1 History 2.0 Vision, mission and objective 3.0 Analysis and evaluation 3.1 SWOT Analysis 3.2 Strategies 4.0 Conclusion and recommendation 5.0 References

1.1 HISTORY
ADIDAS
Founded in 1926, in Europe by Adi Dassler World leader in soccer shoes(sponsored FIFA world cup 2006) Number 2, behind Nike in worldwide, number 4 in the US Three acquisition before Reebok Company Sports Salomon in 1997 ArcTeryxin in 2002 Culture of control, engineering, and production

REEBOK
Founded in 1895 First athletic shoe for woman Number 2 in US, number 4 in Europe Strong sales growth from 2002-2004 Unique portfolio of long term league licenses (NBA and American baseball)

ADIDAS

Vision
To be the leading sports brand in the world.

Mission
We will never equate quantity with quality. Our founder Adi Dassler was passionate about sports. For Adi, the athlete came first. He gave those on the field the court and the track the unexpected and the little differences that made them more comfortable and improved performance. This is our legacy. This is what the brand stands for. This will never change

REEBOK Vision
Fulfilling potential. Reebok is dedicated to providing each and every athlete from professional athletes to recreational runners to kids on the playground with the opportunity, the products, and the inspiration to achieve what they are capable of. We all have the potential to do great things. As a brand, Reebok has the unique opportunity to help consumers, athletes and artists, partners and employees fulfill their true potential and reach heights they may have thought un-reachable.

Mission
At Reebok, we see the world a little differently and throughout our history have made our mark when weve had the courage to challenge convention. Reebok creates products and marketing programs that reflect the brands unlimited creative potential.

3.1 SWOT Analysis

STRENGHT
More product for different customer Complementary brand identities and market segments New both upper and middle priced market are covered Shared R&D, patents, technology innovations

WEAKNESESS
Differing values among management Complexity of joining two corporate cultures Both companies belong to different countries

OPPORTUNITY
Reduction in costs Decreased competition Cross-over promotion by sponsored athletes Enter to new market or segments

THREAT
Nike Nike's possible acquisition of Puma

3.2 Strategies
3.2.1 3.2.2 3.2.3 Endorsement and product co-identity Concentrate on innovation-driven shoes Establishing the group's output as premium products in the industry Selling at wholesale rates to large retailers

3.2.4

Statistics on Adidas & Reebok merger

Net Sales by region

Net Sales by segment

The merger between Adidas and Reebok is a once-in-alifetime opportunity to combine two of the most respected and well-known companies in the worldwide sporting goods industry. Together, they will expand their geographic reach, particularly in North America, and create a footwear, apparel and hardware offering that addresses a broader spectrum of consumers and demographics. Both companies had focused on their strategies as they continuing to compete their most competitor, Nike and also to be the clear No. 2 in the sporting goods market worldwide.

Adidas and Reebok should have the specific tagline that can convince their customer loyalty Adidas and Reebok should focus improving their quality of products compared to their market share Adidas and Reebok should have one headquarters for both companies as they can align their management

http://www.adidas.com http://www.adidas-group.com http://www.articlesbase.com/marketing-articles/ adidasreebok-merger-1983240.html http://www.businessweek.com http://www.reebok.com/US