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Theory

SWOT analysis

SWOT Analysis - theory

SWOT is an acronym used to describe the particular Strengths, Weaknesses, Opportunities,and Threats that are strategic factors for a specific company. A SWOT analysis should notonly result in the identification of a corporations core competencies, but also in theidentification of opportunities that the firm is not currently able to take advantage of due to alack of appropriate resources.

The SWOT analysis framework has gained widespread acceptance because it is both simpleand powerful for strategy development. However, like any planning tool, SWOT is only asgood as the information it contains. Thorough market research and accurate informationsystems are essential for the SWOT analysis to identify key issues in the environment.

Internal and external factor

The intention of any SWOT analysis is to separate the key environmental factors that aresignificant to the marketing plans of the business. SWOT clusters key portions of informationinto two main categories:

Internal aspects - The 'strengths' and 'weaknesses' internal to the business, i.e., itsstrategies and its position in relation to its competitors.

External factors - The 'opportunities' and 'threats' caused by the external environmentand the competition.

The internal aspects may be considered as strengths or weaknesses depending upon theireffect on the company's positions. This means, they may symbolize a strength for oneorganization but a weakness, in relative terms, for a different. The external factors maycomprise macroeconomic issues such as technological change, legislation, and socio-culturalchanges, in addition to changes in the marketplace or competitive position. The results areoften presented in the form of a matrix.It should be kept in mind that a SWOT analysis is justone technique of categorization and has its own weaknesses. It is worth pointing out thatSWOT analysis can be very subjective: Two people rarely come-up with the same version ofa SWOT analysis even when given the same information about the same business and itsenvironment.

Accordingly, SWOT analysis is best used as a guide and not a prescription. Adding andweighting criteria to each factor increases the validity of the analysis.The importance of individual SWOTs will be exposed by the value of the strategies it creates.A SWOT point that generates valuable strategies is central. A SWOT item that leads to nostrategy is not relevan.

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Internal Strenght and Weaknesses

Internal strengths and weaknesses are an organizations controllable activities that areperformed especially well or poorly. The internal strengths and weaknesses can arise in the:

Management, Marketing, Finance or accounting, Production or operations, Research and development, and Management information systems activities of a business.

To identify and evaluate organizational strengths and weaknesses in the functional

areas of a business is an essential strategic management activity. Organizations strive to

pursue strategic that capitalize on internal strength and eliminate internal weaknesses.

The strengths and weaknesses are determined relative to competitors. Relativedeficiency or superiority is important information. Other than that, strengths and weaknessescan determine by elements of being rather than performance. For example based on financial,Adidas is reducing operating expenses as a percentage of sales despite significant increasingin advertisement. Strengths and weaknesses may be determined relative to a firms own

objective. For example, Adidas want to produce the most durable and safety footwear forathletes in different sport. So, the strength that it has is product being sold around the world is200 countries.

Internal factors can be determined in a number of ways, including computing ratios,

measuring performance, and comparing to past periods and industry averages. Various typesof surveys also can be developed and administered to examine internal factors such asemployee morale, production efficiency, advertising effectiveness, and customer loyalty. Forexample, NIKE have their customer loyalty for a long time but the weakness is the newgeneration will be not be exclusively loyal to NIKE.

External Opportunities and Threat

External opportunities and external threats refer to economic, social, cultural,

demographic, environmental, political, legal, governmental, technological, and competitivetrend and events that could significantly benefit or harm an organization in the future.

Opportunities and threats are largely beyond the control of a single organization. In a global

economic recession, a few opportunities and threats that face many firms are listed here:

Availability of capital can no longer be taken by granted Consumers expect green operation and products Marketing has moving rapidly to the Internet Consumers must see value in all the consume Global markets offer the highest growth in revenue

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Other opportunities and threats may include the passage of a law, the introduction of the new

product by competitor, a national catastrophe, or the declining value of the dollar. A

competitors strength could be a threat.

A basic tenet of strategic management is that firm need to formulate strategies to take

advantages of external opportunities and to avoid or reduce the impact of external threats. Forthis reason, identifying, monitoring and evaluating external opportunities and threats are

essential for success. This process of conducting research ad gathering and assimilating

external information is sometimes call environmental scanning or industry analysis.

Competitive Advantage

In strategic management, they are nine key terms that should consider in order to discuss on

strategic management. Strategic management is all about gaining and mantaining competitive

advantage. Competitive advantage refer to an advantage that a firm has over its competitors,

allowing it to generate greater sales or margins and /or retain more customers than its

competition. There can be many types of competitive advantages including the firms cost

structure, product offerings, distribution network and customer support.

Competitive advantages give a company an edge over its rivals and an ability to generate

greater value for the firm and its shareholders. The more sustainable the competitive

advantage, the more difficult it is for competitors to neutralize the advantage.

There are two main types of competitive advantages , which is comparative advantage and

differential advantage. Comparative advantage, or cost advantage, is a firms ability to

produce a good or service at a lower cost than its competitors, which gives the firm ability sell

its good or services at a lower price than its competition or to generate a larger margin on

sales. A differential advantage is created when a firms products or services differ from its

competitors and are seen a better than a competitors products by customers.

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ADIDAS CASE STUDY- THE NATURE OF STRATEGIC MANAGEMENT

As our first task, we need to make some comparison between Adidas and three of other its

competitors that identified as Nike, Puma and Callaway Golf. First of all, the comparison is

between the internal and external factors.

ADIDASSWOT ANALYSIS

Internal Factor

External factor

THEORY STRENGTH WEAKNESSES

1.Management - Proposing a dividend toshareholder more than twice theprior year level-Have team of employees with the

expertise of R&D

- Changing ownership gradually erodedthe companys fortunes

2.Marketing - Customer segmentation strategy- Largest market share in Europe-Product being sold around theworld is 200 countries.

-Lack of global advertisement campaign-Increased cost of advertisement-Too many product

3.Finance -Reducing operating expenses as apercentage of sales dispitesignificant increasing inadvertisemnet- Net income increase 131 % to

567 million and earning per sharewere 2.71

-Financial crisis and economic difficultiesof 2009- Decreasing of percentage total revenuefrom 2008 to 2009,(4.85% to 3.8%)

THEORY OPPORTUNITIES THREAT

1.Technology -Using new technologies areengineering using stateofthe

art CAD and Finite Element

Analysis (FEA) systems-Focus on the development ofinnovative technologies forperformance sport.

- Invest considerable resources intodeveloping and commercialising newtechnologies .

-As well as new design ideas.

2.Competitor - Improve their productivity-Going into global market brands

- Adidas larger competitor, Nike has agreater market share-Amount of competitor increasing day byday

3.Demographic -trendy, modern and cool-Product segmentation-performance,original and lifestyle

for each different gender.

- Less focus on aging factor.-The newly born several brands like NewBalance,Reebok,CAT,GAP.-has increase

their advertising budget.

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Adidassw

In management of Adidas Company, they have proposing a dividend to shareholder of

0.80, more than twice the prior year level. That can make shareholders more confident with

Adidas management in company. Other than that, management of Adidas Company had been

stronger because they have team of employees with the expertise of R&D. The team is for

coordination of compliance with and control of the Workplace Standard.

The strength of Adidas marketing is have involved customer segmentation strategy

that facilities the systematic allocation of differentiated product packaged to group of

comparable customers. The segmentation strategy is a initiative, which designed and

implemented in Europe. Furthermore, Adidas Company has largest market share in Europe

and has their product has being sold around the world in 200 countries.

Beside, the Adidas Company also has weaknesses in marketing. The company has

lack of global advertisement campaign and their cost of advertisement was increases. That is

because, the Adidas Company have new brand such as Reebok, CAT, and Gap has increase

their advertising budget in recent years. Adidas have much kind of products to producer make

their cost increases.

The strength of financial Adidas Company is they have reducing operating expenses as

a percentage of sales despite significant increasing in advertisement to support brand strength.As marketing working budget expenses are not distribution channel specific, they are not

allocated to the segment. Based on annual report Adidas 2009, net income was increase from

131 % to 567 million and earnings per share were 2.71

The weakness of financial Adidas Company is when the company has faced financial

crisis and economic difficulties of 2009. At the time, the percentage of total revenue was

decrease from 4.85% to 3.8 %.

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Adidas-ot

First, in term of opportunities of technology, Adidas are using new technologies using

engineering state-of-the art CAD and Finite Element Analysis (FEA) systems. For example,the sourcing team together with the material teams within product development work closely

with our suppliers to identify innovative materials as well as integrate cost and production

process aspects into the development phase. Adidas also focus on the development of

innovative technologies for performance sport. For example, Adidas was introduced the

Adidas JABULANI, which is the official match ball for the 2010 FIFA World Cup in South

Africa.

Second, in term of opportunities competitor, Adidas need to improve theirproductivity. The reason is the company is establish among international level.This have been

proven when their brands going into global market brands.

Third in term of opportunity in demographic areas, Adidas has more trendy, modernand cool type of product. The company also using product segmentation strategies in order toensure their product will successful segmented. The company make differentiation betweenperformance, original, lifestyle for each different gender, male and female. The adidas brandbreaks their products down into two primary divisions called as Sport Performance and SportStyle.

In term of threat that Adidas faced, their larger competitor, Nike has a greater marketshare in Europe. This will make Adidas need to rearrange their strategies again in order to winthe situation. Not only that, there were so many amount of competitors exist and increasingday by day. Third in term of opportunity in demographic areas, Adidas has more trendy,modern and cool type of product. The company also using product segmentation strategies inorder to ensure their product will successful segmented. The company make differentiationbetween performance, original, lifestyle for each different gender, male and female. Theadidas brand breaks their products down into two primary divisions called as SportPerformance and Sport Style.

Adidas have less focus on aging factor. This company just focusing on gendersegmentation only.This factor can give big matter of threat from the other company whichalso covered from aging factor. In addition, the newly born several brands like New Balance,Reebok,CAT,GAP. All of this new brands has increase their cost in term of advertisingbudget. This also give a big threat to Adidas company.

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Adidas versus Nike

Theory Strengths Weaknesses

Management -No factories. It uses contract factoriesto get the work done which makes itquite a lean organization.

-Unwilling to disclose anyinformation concerning its partneringcompanies

Marketing -Five structures within the appareldivision to focus-Global brand in the world-45 different countries

-Lack of strategic market-Sensitive price in retail sector.

Finance -We generated $19.2 billion inrevenueup 3 percent year over year.-The Nike brand generated $16.7billion in revenue, another record

performance, as footwear sales topped$10 billion and apparel sales topped$5 billion. Sales for the Jordan Brandexceeded $1 billion.

-Earnings per share declined 19percent for the year. Excluding non-comparable items earnings per sharewould have been up 10 percent.

There are some comparisons between ADIDAS and NIKE based on internal factorssuch as management, marketing and finance. Based on the management, ADIDAS have teamof employees with the expertise of RND. The team is for coordination of compliance with andcontrol of the Workplace Standard. ADIDAS also proposes a dividend to shareholder morethan twice the prior year level. That can make shareholders more confident with Adidas

management in company while NIKE has no factories. It uses contract factories to get thework done which makes it quite a lean organization. It has contracts with above 700 shopsglobally in about 45 different countries. ADIDAS weakness is detected when it changedownership gradually eroded the companys fortunes. When ownership changes, the planning

also have change and can give effect to the company while NIKE unwilling to disclose anyinformation concerning its partnering companies. It will cause the lack of trust between NIKEand its companys partnership.

Based on the marketing factor, the ADIDAS strength is it the largest market shares inEurope. It has their product has being sold around the world in 200 countries. Product beingsold around the world is 200 countries. Customer segmentation strategy that facilities the

systematic allocation of differentiated product packaged to group of comparable customers.The segmentation strategy is a initiative, which designed and implemented in Europe.Compare to the NIKE, it has five structures within the apparel division to focus which arewomen, men, kids, sports graphics and caps, and strategic response independently. NIKE isthe global brand in the world, recognized for being the number one sportswear brand in theWorld. It has contracts with above 700 shops globally in about 45 different countries.ADIDASs weakness is it has a lack of global advertisement campaign. It cost of

advertisement was increases and have too many product. Compare to the NIKE, it have a lackof strategic market and sensitive price in retail sector. It is because retailers usually tend tooffer a very similar experience to the consumers with another cheaper product.

Based on the finance factor, ADIDAS operating expenses on ADIDAS annual reportin 2009, it was reduced as a percentage of sales despite significant increasing in

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advertisement. This is important to support brand strength. As marketing working budgetexpenses are not distribution channel specific, they are not allocated to the segment. Netincome increase 131 % to 567 million and earnings per share were 2.71. Compare to theNIKE, we generated $19.2 billion in revenue up 3 percent year over year. The Nike brandgenerated $16.7 billion in revenue. Another record performance, as footwear sales topped $10

billion and apparel sales topped $5 billion. Sales for the Jordan Brand exceeded $1 billion. Italso based on the NIKE annual report in 2009. Percentage of ADIDASs total revenue

decreasing from 2008 to 2009 (4.85% to 3.8%). It has a financial crisis and economicdifficulties in year 2009. NIKE weaknesss shown when its earnings per share declined 19percent for the year. Excluding non-comparable items earnings per share would have been up10 percent.

Adidas versus Callaway Golf

THEORY STRENGTH WEAKNESSES

1.Management -Mantains employee benefit plansand programs.-Top engineers in the field-Successfully managing of newproduct.-Have a separate team of clubfitting specialistcustom clubSales-the able to sustain leadershipinternationally ( page 9)

-Pressure to design, develop source andsupply new product that perform betterthan their predecessory.

2.Marketing - Strong core branding (Odyssey& Callaway)-Value added by brand name-Product being sold around theworld is 100 countries

-Short windows of opportunity for launchand selling new product.-Require great precision in forecasting

demand.-presence of counterfeiters (page9)

3.Finance -Higher revenues at the first yearof introduction of product lifecyles.

-Two or less years of sales.-Decreasing the revenue.

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There are three internal factor which are management, marketing and financial to

compare between Adidas and Callaway Golf company. In management of Adidas Company,

they have proposing a dividend to shareholder of 0.80, more than twice the prior year level.

That can make shareholders more confident with Adidas management in company. Other than

that, management of Adidas Company had been stronger because they have team of

employees with the expertise of R&D. The team is for coordination of compliance with and

control of the Workplace Standard. Than there a few strength of management Callaway Golf

Company are the company was maintain employee benefit plans and programs for

participation of executive officers in Callaway Golf Company. That strategies make them feel

appreciate and satisfy. Another, the Callaway Golf has top engineers in the field to create idea

to improve high quality golf club products. They also are expertise in field creation product

especially using in technology. Therefore, they were successful in managed and launch new

products to market. Today, the Company, together with its subsidiaries, designs,

manufactures and sells high quality golf clubs are drivers, fairway woods, hybrids, irons,wedges and putters),golf balls, and also sells golf accessories such as GPS range finders, golf

bags, gloves, footwear, apparel, headwear, eyewear, towels and umbrellas) under the

Callaway, Odyssey, Top-Flite, Ben Hogan, and UPro brand names. The company also has a

separate team of club fitting specialists who focus on the Companys custom club sales and

able to sustain leadership internationally.

Nevertheless, the Adidas Company also has weaknesses in management process. The

company has changing ownership gradually eroded the companys fortunes. When ownership

changes, the planning also have change and can give effect to the company. Even do compare

the Adidas Company, the Callaway also have weaknesses in management. The company has

pressure to design, develop source and supply new product that perform better than their

predecessor because their product still new and the Adidas Brand was sustain long in market.

Therefore, the Callaway Company need create idea to produce the products.

Next internal factor is about marketing of Adidas and Callaway Golf Company. The

strength of Adidas marketing is have involved customer segmentation strategy that facilities

the systematic allocation of differentiated product packaged to group of comparablecustomers. The segmentation strategy is a initiative, which designed and implemented in

Europe. Furthermore, Adidas Company has largest market share in Europe and has their

product has being sold around the world in 200 countries. Compare the strengths of Adidas

marketing, the strength of Callaway Golf Company is has strong core brand (Odyssey &

Callaway) The participation of core golfers and rounds of golf played yearly drive the golf

equipment sales. Core golfers are adult golfers who play eight or more rounds of golf per year

and account for 87% of total domestic participation and 87% of total golf expenditures. So,

value Callaway Company added by brand name. Adidas was successful sold their product to

200 countries in the world, while Callaway Company has sold their products to 100 countries.

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Beside, the Adidas Company also has weaknesses in marketing. The company has

lack of global advertisement campaign and their cost of advertisement was increases. That is

because, the Adidas Company have new brand such as Reebok, CAT, and Gap has increase

their advertising budget in recent years. Adidas have much kind of products to producer make

their cost increases. The weakness of Callaway Golf marketing compare the Adidas Company

is the Callaway Golf company has relatively short window of opportunity for launching and

selling new products requires great precision in forecasting demand and assuring that supplies

are ready and delivered during the critical selling periods. Therefore, the company requires

great precision in forecasting demand. Another, the market is the presence of counterfeiters,

who compete for customers that care more about the price as opposed to the quality and

performance of the equipment.

The third internal factor is about financial between Adidas and Callaway Golf

Company . There are several contrasts between Adidas financial and Callaway financial. The

strength of financial Adidas Company is they have reducing operating expenses as apercentage of sales despite significant increasing in advertisement to support brand strength.

As marketing working budget expenses are not distribution channel specific, they are not

allocated to the segment. Based on annual report Adidas 2009, net income was increase from

131 % to 567 million and earnings per share were 2.71. while Based on annual report 2009 of

Callaway Company, they have higher revenues at the first year of introduction of product life

cycles. Factors driving these short product life cycles include the rapid introduction of

competitive products and quickly changing consumer preferences.

The weakness of financial Adidas Company is when the company has faced financial

crisis and economic difficulties of 2009. At the time, the percentage of total revenue wasdecrease from 4.85% to 3.8 %. Same with Adidas company, Callaway Company also have

weakness in financial. In first year, the company gain higher revenues but after that, total

revenue was decrease because amount of product sold decreases.

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Adidas versus Puma

Theory Strengths Weaknesses

Management - Opened new company headquartersin Herzogenaurach, Germany.

- worked on time-to-market.

- difficult and a painful process

Marketing - The most innovative marketingCampaign (Everest of Sailing)- sponsored ten African national teams(Africa Cup of Nations in Angola)- distribution through 80 countries

- Lack of infrastructure and lowwater resources.

Finance - measures pro-actively in the previousyear- The price of the PUMA share stoodincreased by 65.2% year-on-year

- global brand sales decreased by6.4% to over 2.6 billion- Currency-adjusted consolidatedsales dropped by 3.7% to approx.

2.5 billion.

There are some comparisons between ADIDAS and PUMA based on internal factorssuch as management, marketing and finance. Based on the management, ADIDAS have teamof employees with the expertise of RND. The team is for coordination of compliance with andcontrol of the Workplace Standard. ADIDAS also propose a dividend to shareholder morethan twice the prior year level. That can make shareholders more confident with Adidasmanagement in company while PUMA had opened new company headquarters inHerzogenaurach, Germany. The complex includes a modern administration centre, a BrandCentre and the worlds largest PUMA Store. The new headquarters also embodies our

longstanding commitment to climate protection, as it incorporated numerous innovativeenergy and electricity saving concepts in the new building that limit its effect on theenvironment. It also worked on time-to-market to make operational processes and itsorganization more efficient. ADIDAS weakness is detected when it changed ownershipgradually eroded the companys fortunes. When ownership changes, the planning also have

change and can give effect to the company while PUMA made executed a tight cost savingsprogram to adjust our cost structure to market reality although it was difficult and a painfulprocess.

Based on the marketing factor, ADIDAS strength is it the largest market shares inEurope. It has their product has being sold around the world in 200 countries. Product being

sold around the world is 200 countries. Customer segmentation strategy that facilities thesystematic allocation of differentiated product packaged to group of comparable customers.The segmentation strategy is a initiative, which designed and implemented in Europe.Compare to the PUMA, it is the most innovative marketing Campaign known as the Everest

of Sailing. It was launched and provided an extremely successful entry into the sailing

category. PUMA also sponsored ten African national teams (Africa Cup of Nations inAngola). It was the first time PUMA were the Official Supplier of the tournament. Other thanthat, PUMA is distribution through 80 countries. From the weakness, Adidas has large ofamount of competitor increasing day by day. Adidas weakness has a lack of globaladvertisement campaign. It cost of advertisement was increases and have too many productwhile PUMA has a lack of infrastructure and low water resources.

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Based on the finance factor, ADIDAS operating expenses on ADIDAS annual reportin 2009, it was reduced as a percentage of sales despite significant increasing inadvertisement. This is important to support brand strength. As marketing working budgetexpenses are not distribution channel specific, they are not allocated to the segment. Netincome increase 131 % to 567 million and earnings per share were 2.71. Compare to PUMA,

it measures pro-actively in the previous year to ensure the companys high profitability also inthe future. The price of the PUMA share stood at 231.84 at the end of the year and increasedby 65.2% year-on-year, which resulted in a market capitalization of approx. 3.5 billion.Percentage of ADIDASs total revenue decreasing from 2008 to 2009 (4.85% to 3.8%). It has

a financial crisis and economic difficulties in year 2009. Compare to the PUMA, its globalbrand sales decreased by 6.4% to over 2.6 billion. It based on the PUMA annual report in

2009. Its currency-adjusted consolidated sales dropped by 3.7% to approx. 2.5 billion.

External Factor

Adidas versus Nike

There are some comparisons between Adidas and Nike based on external factors suchas technology, competitor and demographic. Based on technology, Adidas take an opportunityby using new technologies. The new technologies that it used are engineering using state ofthe art CAD and Finite Element Analysis (FEA) systems. Adidas focus on the development ofinnovative technologies for performance sport. For example, Adidas was introduced theAdidas JABULANI, which is the official match ball for the 2010 FIFA World Cup in SouthAfrica. Compare to the Nike, it created new technologies to drive product innovation which

are Flywire and LunarFoam. For three years Nike worked with athletes all over the world todesign new products for nearly every competitive event. Adidas has some threats which areinvest considerable resources into developing and commercialising new technologies. Otherthan that, the new designs make some customer hard to adapt the products while Nike designsnew products for nearly every competitive event.

Based on competitor, the opportunity that Adidas take is going into global marketbrands. Adidas can market its brand of products to the global. It also improves theirproductivity to make more durability product such as JABULANI. It will establish thecompany among international level. This has been proven when their brands going into globalmarket brands. Other than that, Nike always improves their design to fulfil and give the

satisfaction to their customer. It is the company who is sponsored the world event such asAtlanta Olympics. Nike sponsored the top athletes and due to this step, it gained valuable


1.Technology - Created new technologies todrive product innovation (Flywire and LunarFoam)

- Design new products for nearly everycompetitive event.

2.Competitor -Improve their design-Sponsorship world event (Atlanta Olympics)

-Nike has a greater market share butAdidas larger competitor.

3.Demographic - Nike's once loyal market iscurrently aging - The new generation will not beexclusively loyal to Nike

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coverage. From the threats, Adidas has large of amount of competitor increasing day by day.Adidas has a larger competitor. It makes Adidas need to rearrange their strategies again inorder to win the situation while Nike has a greater market share. NIKEs market has higherdemands in the world.

Based on the opportunities of demographic, the product segmentation of ADIDASperformance is variety, original and lifestyle for each different gender, trendy, modern andcool. It used product segmentation strategies in order to ensure their product will successfulsegmented while Nike's once loyal market is currently aging which are women, men, kids,sports graphics and caps, and strategic response independently. As the threats, ADIDAS has aless focus on aging factor. It is only focus on gender which is for female and male. The newlyborn several brands like New Balance, Reebok, CAT and GAP has increase ADIDASadvertising budget. Its brands have increased their cost in term of advertising budget. Thisalso gives a big threat to Adidas Company compare to the NIKE, the new generation will notbe exclusively loyal to them. It is because the customers can choose other brands with thesame quality but have the lower prices.

Adidas versus Callaway Golf

In term of external opportunities and threat, there are three factors that used in order todo the comparison between Adidas and Callaway Golf. The factor include technology,competitor and demographic.

First, in term of opportunities of technology, Adidas are using new technologies usingengineering state-of-the art CAD and Finite Element Analysis (FEA) systems. For example,the sourcing team together with the material teams within product development work closelywith our suppliers to identify innovative materials as well as integrate cost and production


1.Technology -Using Computer Aided Design(CAD) software, Computer AidedManufacturing (CAM), andComputer Numerical Control

milling equipment- to create andmodified product design.-Using Ethernet-based I/Onewgolf ball

-All competitor are using RND tocompete each other by using newtehnology

2.Competitor -A large fraction of the coregolfer group-strong customer base

- The opposite between prices and qualityof the equipment ( 9)

3.Demographic -target for those who like to playgolf

-Focus on segmentation of golfball, glove and equipment to play

-Have no segmentation of gender likeAdidas

-Not have variety type of segmentation

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process aspects into the development phase. Adidas also focus on the development ofinnovative technologies for performance sport. For example, Adidas was introduced theAdidas JABULANI, which is the official match ball for the 2010 FIFA World Cup in SouthAfrica.While Callaway Golf are using Computer Aided Design (CAD) software AidedManufacturing (CAM), and Computer Numerical Control milling equipment in order to create

and modified product design. Not only that, Callaway also using Ethernet-based I/O in orderto create new golf ball.This technology in order to help automate its new 225,000 square-footmanufacturing facility, which was built to produce Callaways revolutionary new golf ball,the Rule 35.

Second, in term of opportunities competitor, Adidas need to improve theirproductivity. The reason is the company is establish among international level.This have beenproven when their brands going into global market brands.While, Callaway Golf has a largefraction of the core golfer group. This is because as the generation get older, they will form alarge fraction of the core golfer group and provide a strong customer base for Callaway andits competitors. The company also have a strong customer base. This is also the opportunities

to them because they do not need to worry about the new competitors. The customer alwaysknow what are the best product to them.

Third in term of opportunity in demographic areas, Adidas has more trendy, modernand cool type of product. The company also using product segmentation strategies in order toensure their product will successful segmented. The company make differentiation betweenperformance, original, lifestyle for each different gender, male and female. The adidas brandbreaks their products down into two primary divisions called as Sport Performance and SportStyle.On the other hand, Callaway Golf have using product segmentation in term of differentway which is by targetting for those who like to play gol. That is why, the company producemany type of product of golf base, such as golf bags, gloves, shoes and other apparel.Then,

the comparison between both of company is in term of threat of technology. Adidas need toinvest considerable resources into developing and commercialising new technologies.Thereason is new technologies will come up with high risk in term of cost to using or bring newtechnologies. For example , when this company want to produce new design of company.

While Callaway Golf has faced threat in term of when all the other competitors areusing to compete each other by using new technology. This company need to compete andwin the situation. Not only that, but the company also faced threat from Ebay in order to givethreat to Callawaypreowned.com.Then, the comparison among the Adidas and Callaway Golfin term of threat that have been given by their competitors. First, Adidas has largercompetitor, Nike has a greater market share in Europe. This will make Adidas need to

rearrange their strategies again in order to win the situation. Not only that, there were so manyamount of competitors exist and increasing day by day.While, Callaway Golf also faced withthreat in term of competitor. One threat in this market is the presence of counterfeiters, whocompete for customers that care more about the price as opposed to the quality andperformance of the equipment.The reason is the opposite between prices and quality of theequipment. In contrast, Adidas have less focus on aging factor. This company just focusing ongender segmentation only.This factor can give big matter of threat from the other companywhich also covered from aging factor. In addition, the newly born several brands like NewBalance, Reebok,CAT,GAP. All of this new brands has increase their cost in term ofadvertising budget. This also give a big threat to Adidas company.While, Callaway golf haveno segmentation of gender like Adidas. This is because the company just focus on people for

those who want to play golf without countying their aging,gender, or what place they comesfrom.The demography factor just focus on people who want becoming richers mans game

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againt. Not only that, compare with Adidas, Callaway Golf have threat on lifestyle changestowards spending weekends with family.

Adidas versus Puma

There are some comparisons between Adidas and Nike based on external factors suchas technology, competitor and demographic. Based on technology, Adidas take an opportunityby using new technologies. The new technologies that it used are engineering using state ofthe art CAD and Finite Element Analysis (FEA) systems. Adidas focus on the development ofinnovative technologies for performance sport. For example, Adidas was introduced theAdidas JABULANI, which is the official match ball for the 2010 FIFA World Cup in SouthAfrica. Compare to the PUMA, restructuring and re-engineering program designed to give thefoundation for its next phase of growth. PUMA made strategy of combining top sportsperformance and innovative technologies with lifestyle in an inimitably unique manner. .

Adidas has some threats which are invest considerable resources into developing andcommercialising new technologies. Other than that, the new designs make some customerhard to adapt the products while PUMA do not use innovative ways yet. If it will be use, itcan reduce the carbon emissions, curtail wasteful transportation, recycle and reuse availablematerials, use water sparingly, become paperless to save nature and stand ready to adapt tonew challenges that will present themselves as it work towards the goal of becoming anexemplary leader in sustainability.

Based on competitor, the opportunity that Adidas take is going into global marketbrands. Adidas can market its brand of products to the global. It also improves theirproductivity to make more durability product such as JABULANI. It will establish the

company among international level. This has been proven when their brands going into globalmarket brands. Compare to PUMA, it is the large retailer industry. It has very high levels of


1.Technology - Restructuring and re-engineeringprogram designed- innovative technologies withlifestyle

-do not use innovative ways yet

2.Competitor - capitalized on the few competitions( Volvo Ocean Race and theAthletics World Championships)- The large retailer industry

-Competition mainly comes in the form ofpremium positioned stores in the high-classcategory.-new entrants into the market

3.Demographic -sport lifestyle - limited aging

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competition. It is extremely competitive and growing at a fast pace in Australia, it is still notas large as the department store industry elsewhere in the world, such as the USA. Other thanthat, it also capitalized on the few competitions which are by Volvo Ocean Race and theAthletics World Championships. Adidas has a larger competitor. It makes Adidas need torearrange their strategies again in order to win the situation while PUMA has a greater market

share. PUMAs new entrant into the market lies in the form of competing department storesfrom overseas. The main competitors of Puma stores are middle- upper class departmentstores that stock a wide variety of products. Competition mainly comes in the form ofpremium positioned stores in the high-class category.

Based on the opportunities of demographic, the product segmentation of ADIDASperformance is variety, original and lifestyle for each different gender, trendy, modern andcool It used product segmentation strategies in order to ensure their product will successfulsegmented while PUMA is already known as the sport lifestyle branded. It is most popularamong the teenagers and adult. As the threats, ADIDAS has a less focus on aging factor. It isonly focus on gender which is for female and male. The newly born several brands like New

Balance, Reebok, CAT and GAP has increase ADIDAS advertising budget. This also gives abig threat to Adidas Company Compare to the PUMA, there is a limited aging who is famousamong customers. It is not too famous among older people.

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