Adidas and Adidas Pops Competitive Advantage

Adidas and Adidas Pops Competitive favourThree strategies that will Increase Adidas and Adidas Pops Competitive AdvantageA competitive advantage is modelled around the question of why a consumer should purchase a product from a given company when there atomic number 18 other numerous alternatives (Gebauer, Gustafsson Witell, 2011). According to Kumar et al. (2011), competitive advantage is the force behind a companys sustainability and long-term survival, and as a result, scholars have devised numerous frameworks such as the 5Cs of marketplaceing and Porters five-force model to evaluate the organisational competitive advantage. In this section I have identified 3 strategies that a high number of firms employ to recognise a competitive advantage and which could be employed to increase the competitive advantage of Adidas and its new product Adidas Pop.1. DifferentiationOver the years it has become discernible that markets have become most turbulent and competitive for manufactu ring firms and pricing strategies are no longer sufficient to keep an organisation competitive (Gebauer, Gustafsson Witell, 2011 Valipour, Birjandi Honarbakhsh, 2012). In round industries thus far, businesses still use price wars to undermine their competitors (Zhang Round, 2011). However, lowering prices for competitiveness is unsustainable in the long run and, as a result, many companies have resorted to other strategies to serving differentiate themselves from competitors (Valipour, Birjandi Honarbakhsh, 2012). According to Valipour, Birjandi Honarbakhsh (2012), traditionally, manufacturing organisations focused on products to the neglect of customer needs. However, this approach has changed and now, customer needs largely inform the product process (Kumar et al., 2011). The Adidas differentiation outline is built around establishing the company as a premium quality and highly innovative brand that not only sells sports apparel but nooky positively impact consumer life styles (Kohli Jaworski, 1990). To achieve this scheme, Adidas has developed a number of highly innovative products and has also collaborated with high profile fashion designers to create sportswear that is two functional and fashionable (Adidas, 2016). The move has led many consumers around the world to use Adidas products as a fashion statement instead of for sportswear (Gebauer, Gustafsson Witell, 2011), which has seen the Adidas market share grow in line with its business strategy. As part of the Adidas product range, Adidas Pop will utilise a similar customer-centric differentiation strategy to adjust itself apart in the emerging markets of Asia. Despite retailing at a comparatively premium price, Adidas Pop will appeal to the targeted markets 19 to 29 year-olds who want to live the Adidas lifestyle. This differentiation strategy will require the input of the marketing and production departments, as well as the RD unit to collect consumer wants and get under ones skin them in a product that accurately addresses their needs. To measure the success of the differentiation strategy, the organisation will evaluate the development and products personifys with actual sales.2. AlliancesStrategic partnerships are vital to businesses, as evidenced by Adidas decision to form an alliance with Reebok to penetrate the North American market and outsource its manufacturing functions to third parties in chinaware to cut on production approachs (Evans Richardson, 2007). Furthermore, Adidas has also formed alliances with distributors such as wholesalers and franchisees, to penetrate markets that are otherwise too costly for the company to set their shops in (Adidas, 2016a). Without these strategic alliances with both manufacturers and distributors in China, the vision for Adidas Pop would be impossible or extremely costly to establish. However, because of Adidas strategic partnerships, the Adidas Pop can be operationalised and could possibly break even within the f irst year. However, while strategic alliances are increasingly becoming a popular practice in the collective world, they are not always beneficial to all involved parties (Hamel Pralahad, 1985 Tax Brown, 1998). For example, critics observe that after 11 years of an alliance, Reebok lags in sales, in which while the three other brands profits have been growing at 16 percent annually, for the same period, those of Reebok grow by approximately five percent (Adidas, 2016). In such cases, Buhalis Crotts (2013) suggest the use of partnership performance measurement systems such as the Balanced Scorecard to determine the financial and non-financial position of Adidas Pops potential allies.3. Cost leadersDeveloped by Michael Porter, cost leadership is a way of establishing a competitive advantage by keeping costs at the lowest take (Kaliappen Hilman, 2013) If the cost for Adidas products can be kept lower than those of Nike or its other competitors then it is possible to create a comp etitive advantage. It is important to note however that keeping costs at the lowest level possible is not such an easy task. Costs need to be managed across the entire fibril from the very beginning to the very end. According to Kaliappen Hilman (2013), a balanced mix of a cost leadership strategy enhances organisational performance. Cost leadership is mainly internal-oriented as opposed to other competitive strategies such as the differentiation strategy that focus on the external environment (D. Banker, Mashruwala Tripathy, 2014). According to D. Banker, Mashruwala Tripathy (2014), cost leadership involves check costs control, in which, the production budget is solely focused on the most necessary processes. Adidas main competitive strategies are differentiation and strategic alliances. However, cost leadership will also be a useful strategy for Adidas Pop, in which the central focus will be total cost minimisation. Moreover, cost leadership is beneficial in keeping debts lev els down and monitoring operations costs (Valipour, Birjandi Honarbakhsh, 2012).