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    Adidas's Bold Leap: Over-Investing in Marketing for a Brighter Future

    There is a lot of new and interesting marketing strategies all around the world, but one I found specifically interesting was Adidas marketing strategy, found in the article Adidas pledges to ‘over-invest’ in marketing as CEO admits ‘we are not as good as we should be’. I was drawn to this article due to my regular consumption of Adidas products, even as I am writing this, I am wearing Adidas shoes and socks! When I read the title of this article surprisingly enough, I was not very suppressed at all. Due to the backlash of Kanye West saying and doing wild things on social medias, Adidas dropped his clothing brand from their catalog, however this caused a lot of backlash against Adidas. Because of this reason, as well as my interest in rap music, I could not let the chance to read this article pass me by. Here is the link to the article:  Adidas pledges to ‘over-invest’ in marketing as CEO admits ‘we are not as good as we should be’

Article Summary and Context:

    The article, Adidas pledges to ‘over-invest’ in marketing as CEO admits ‘we are not as good as we should be’, discuses Adidas' new marketing strategy due to their major loss in buisness, and how they have already increased their marketing by 9% this year. The article talks about how the Adidas said that the would "over invest" in marketing this year, after its first financial loss in three decades as stated by CEO, Bjørn Gulden. Luckily, their new marketing strategy is successful so far. The article talks about how it has increased their revenues by 8% after the first three months of 2024, after spending around 12% of their budget on marketing efforts. The article then dives into the topic of Adidas starting to focus on driving growth over the long term, and they will try to focus on less short term profit. Another thing that they are focusing on for the future, is making less and less sales discounts on items, and increasing the numbers of full price of items in the market. The article talks about Adidas remaining inventory count, and how it was reduced by 22% this last year, which the article said helps their growth. Finally the article talks about the Kanye West and Yeezy scandal that I mentioned earlier in this blog post. Even with dropping Yeezy as well as the controversies of Kanye West, the article said that Adidas managed to sell some of the remaining inventory for a revenue of $150 million during the first quarter this year.

Value Proposition:

 Adidas's value proposition emphasizes and focuses on blending cutting-edge design with technological innovation to offer superior athletic apparel and lifestyle products. It aims not only to meet the functional demands of athletes but also to resonate with the lifestyle choices of a broader consumer base.

Marketing Relevance and Strategic Actions:

    Adidas is creating 'brand heat' that appeals globally and emphasizes quality over price-led campaigns. Although the discontinuation of the Yeezy line was a major setback, Adidas has managed to navigate this challenge by strategically marketing the remaining inventory and focusing on full-price sales, which have vastly improved their market share and sales metrics.

Challenges and Competitive Analysis:

    The end of the Yeezy collaboration presented a great challenge. Adidas met the challenge by enhancing marketing efforts and reducing inventory by 22% in comparison to the previous year. The sportswear market is very competitive, and brands like Nike and Under Armour are relentlessly innovating their marketing efforts.

Critique and Personal Insight:

While an increase in marketing investment for Adidas does seem promising, it raises questions of the sustainability of such heavy spending. The balance between spending and return on investment is very delicate. For myself, I would suggest Adidas continue with digital marketing and innovation of new methods of consumer engagement, probably using new technologies like augmented reality or personalized online shopping experiences in order to boost consumer interaction and product exposure.

Conclusion:

The strategic marketing efforts by Adidas offer valuable lessons on how heritage brands can remain dynamic in the market amidst challenges through innovative marketing strategies. This case study not only contributes to our learning of strategic marketing principles but also emphasizes that in today's dynamic business environment, it requires modern ways and a forward-thinking approach. Through this blog posting and discussions that it will generate, we can achieve a deeper understanding of how brands might effectively use marketing as a basis for their market presence and consumer perception transformation.

You can read further in the article here: Article