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-External FactorEvaluation
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Opportunities
Expansion strategy
It can be associated to product diversity or entering into newmarkets. Expansion strategy play a big role for thedevelopment of the company. This is the opportunity for adidas toexpand its product lines to beat its competition. The nature ofthis strategy is very important because it would provideopportunity to adidas to enter into a new product line and become astrong brand in different product line. I have assigned it rating 4it responses superior with current strategy of the adidas. (“AdidasGroup,” 2013, p. 68)
Product innovation
Adidas deals in premium and design shoes. with innovation it canget opportunity making itself one the strongest brand. The ratingis 2 because research and development for innovation requires ahuge investment, that’s why I rated 2, its current products aredoing well so response is average. (“Adidas Group,” 2013, p.79)
New market development
Company's strategy to enter to untapped market is an opportunityto make itself a brand in those market. This opportunity would helpto cover the niche market so that it market share can grow. Therating is 3 because there are not many such market left that is whyresponse is above average. Adidas since have already covered manymarkets but still have to cover the other set of market which isnot yet covered by competitors. To do so, they may launch new setof products to hit the consumers of lower budget. Middle classconsumers range would not only create the market share, also brandloyalty and promotion would be enhanced. (“Adidas Group,” 2013, p.80)
Demand for premium products
As all we know adidas is known for its premium shoes which hasbeen a trend all over the world for decades. The rating is 3because it is still growing factor to which adidas response isabove average.
Since the consumer preferences and likes are keep changing, nowtowards more of branded items which ultimately boosted the sale ofpremium products of Adidas. To gain more market share and increasethis rating, the adidas must work on expansion strategy and enterinto new market to gain largest market share. (“Adidas Group,”2013, p. 79-80)
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Threats
Competition
Competitors in the shoe industry are not many but still being aglobal brand, adidas is on 2nd position. Nike tops at 1st positionwhich possess a threat to adidas. The rating is 4 because adidasmakes its strategy so that competition cannot become an issue soresponse is superior. Also, competition can be managed if itfollowed by the different strategy of distribution to theconsumers. Social media and online sites play a vital role as todaymost of the people prefer sitting at home and placing an order atdoorsteps. (“Adidas Group,” 2013, p.79 )
Political changes
Political power changes also affect the business because theycan alter the laws related to import-export and taxes which caninfluences the cost and prices of the product. But adidas adaptwith these threats because these changes occurs in years by thetime company prepare itself, so rating is 1 because response tothis threat occurs in years that is why response is poor. This canalso lead to enemy country if any changes take place. Politicalfactors affect the business widely and that also depends on thegovernment if change after elections. Those countries which arepart of Global initiative at WTO level, are still easy to deal withas they follow international guidelines for trading and business.(“Analysis of Adidas,”2017 )
Tech. advancement
Tech. advancement or technological changes also affect businessbecause it can affect the manufacturing operations of the shoeproduct. They pose threats to adidas that is why response should beabove average so rating is given 3.
Technological advancement has a great way to go. They are neverending and are quite effective these days. Organizations whodoesn’t keep their pace with the advancement and creativitycouldn't survive long. In this changing dynamic society, change isconstant and hence the organization has to spent a lot formaintaining the same. (“Adidas Group,” 2013, p.79-80 )
Government rules and regulation
Being a global brand, it enters and operates into differentcountries where laws and order are different to each other. Sostrategy are impacted because policies and rules of adidas madeaccording to law and order of that country. The rating is 3 becausethey response to these threats above average.
Government regulations are quite high in terms or import/exportregulations and custom tariffs, because of which the pricing of theproducts differs in those countries as compare to home country.This creates an issue in terms of competitive pricingavailable.
(“Govt Regulations (Adidas AG)”)
