Marketing strategy refers to the foundation of both short and long term activities in the realm of marketing and also focus on the analysis of the strategic initial position of the organization as well as the formulation, evaluation and choosing market oriented approach which help to meet the goals of the company. The approach equally focus on the scanning of the both business environment, that is, internal and external which help the company to understand the strategic constraints (Bradley 2012).
The PUMA Company was established the late 1940s by one Rudolf Dassler and Adolf Dassler. The company was authorized to function in mid-1986. Puma’s is situated in Germany. Since its establishment, the company has ever grown and occupied largest market in Germany as well as global pie. The company has more than ten thousands workers who are distributors and partners in across one-twenty countries. Puma as a brand name has greatly contributed to the sportswear by helping sustainability, peace, and innovativeness. Mission: To create the best technology sports equipment and services to the whole globe (Dominici 2009).
Vision: The company viewpoint has been to focus on satisfying the clients without compromising honor. The company ensures that its products and services as well reach to the market without delay and they are of finest quality (Correspondence 2013). The Puma Company provides that their consumers’ needs are their priority.
Management has selected the customers’ representatives to engender passion and respond with more determinations to address any needs of the clients. The company has technical staffs who are mandated to deal with customers. The company is always on the move to find the best methods and mechanism to enhance the sportswear business partnerships to enable achieve their vision.
Lastly, the company has a promotional approach which has put a mechanism to support national football team across the globe. Equally, Puma has sponsored and at the same time created the clothing for many known individuals in football career and teams. For instance, Puma sponsors cricket teams as well as distribute equipment to nearly five national rugby confederation teams (Stanley 2013).
For the company to maximize the profit as well as meeting the needs of customers, the firm must understand it microenvironments as well as macro environments situations. The two contexts may include customer, the two market environment, and the company abilities. Moreover, it requires predicting the current trends to fit the dynamics operation in which the company operates (Burke & Thurik 2010). The company has analyzed all the above by performing a 5Cs situational analysis which enables to a scan five primary areas particularly applicable to marketing decision making. The situation analysis covers the internal as well as external factors affecting the Puma Company. The below shows the five 5Cs tools of PUMA:
The Puma Company analysis refers to the assessment of the enterprise’s objectives, strategies, capabilities, opportunities as well as weaknesses. The indicators portray the strength of Puma business model, whether there are areas that require improvement and to what extent.
Puma has established its products to over one-hundred countries and have a capacity of workers ranging from nine-thousand employees across the globe. The company has expansively reached many markets with their quality and unique product (Roy 2011). The products have enabled to penetrated to various sports markets and outdo the substitutes as well. It is evident that nearly 30% of every homestead in developed countries have Puma products (Kotler 2013). The percentage translate that Puma have being a sports leader manufacturer. Equally, the company has done the undone by tapping into a crowd sports that involves soccer, cricket, rugby, and golf. Puma’s market approach slogan of profligate sports products in the whole world has enabled to meet many goals. Similarly, the company has signed many contracts of sponsorship with different teams as well as professional footballers in the various capacity of the sports industry (Burke & Thurik 2010). The company has best brand name across the world hence being unique in the industry. The company also involve creativity which emanates from rich R&D team. Puma manufacturer first and best football screw boots and the said Mexico 68 which was made by brush soles making it more comfortable for running boots.
Despite the profound success, the company has undergone problems either internal or external. Some of the significant drawbacks that Puma has faced stiff competition from other similar companies. The companies also produce similar sports products as Puma. The competitors include among them NIKE, ADIDAS, UNDER ARMOUR and REEBOK. The company also has a limited market share in comparison to other competitors like Nike Reebok. Puma has encountered challenges in that they have not able to have a top tier shoe and apparel products (Dobbs 2014). The big competitors outdo the market strategy of Puma making the company strain remaining relevant in the sports industry. The company has also beaten in social media marketing approach by others companies hence have few opportunities to gain and recruit new customers or buyers. For instance, on Facebook and Twitter pages the Nike have over seven million followers while Puma has five million followers (Grundy 2009). The difference translates that the sheer achievements that the competitors have acquired hence rank the Puma’s position as a far as market share are concerned. The position of Puma in social media market approaches do not reach an adequate number of individuals who can maintain the company to outdo their competitors in the sports industry.
Apparently, Puma market is far much behind in that it require different market strategy to enable impeach the competitors such as Nike and Adidas. However, the company has an excellent chance to shift from every drawback encountering them. Although in social media have not reached the capacity of other similar companies, they have a great opportunity to advertise their brands or products using the same media channel and broaden their product lines as well (Ibeh 2012). Since the company is known everywhere in the corners of the world, they have to generate a significant amount of development from this. The company should use the largest acceptable products such as soccer apparels to expand opportunities to steer the sports market and focus on the globe’s population sport currently present (C Gabriela 2011). Despite sponsoring big soccer club such as Arsenal FC, the company should add the number of sponsoring many different football clubs across the world to attract the customer to buy the products.
Threats may range from market to competitors. Puma is an international recognizable sports company hence sometimes the Company’s business is influenced by the recession, boom as well as an economic stoppage. The company has not accepted any actual threats such cheap products from competing company to them and their brand line (Kampanje 2014). The open stiff competition from companies such as Nike, Puma, and Adidas has been the largest threats. The competitors’ only poses risks because they have an extensive range of products compared to what Puma provide. Puma has included various sports product lines which other companies produce (Dobbs 2014). The company has not adequately accessed in all sports which popular hence, many clients shift to other enterprises that produce similar products such as Fila or Converse. Substitute’s apparel companies enable the customer to have a variety of product lines across all sports.
The main clients of Puma are athletes and sportsmen/women as well those are fanatics of sportswear. The wide range of customers is across the world. Puma has large number of customers across the world corners. The firm does not waste any chance given to meet with their clients either one-on-one or via social media. Puma management ensures that every niches raised by the clients have got sufficient feedback as well as instantly. The company use comments insights to understand their clients’ motivations, challenges and requirements. The company has enhanced both their consumer experience and the internet performance to enable accommodate the customers inclusively (C Gabriela 2011). The company has cut across all market size and the enabled it to reach almost every fanatic of sportswear. The company has also maintained their customer via regular introduction of promotions which involves the customers as a mean of motivation to buy their items. To the customer most of them are youngsters and their buying behavior is more regularly hence making it vast profit for the company (Joshi 2014). Some of the items are affordable by common customers hence make repeat buying now and then.
Collaborators are useful tools for every large and small company since they facilitate the supply chain network. They also contribute to the increase of building more ideas and improving likelihood of accessing to more business opportunities. Puma Company have got agencies, suppliers, distributors and partnership. Some of the agencies include brokers who break the bulk to other partners in the chain of supply network. Furthermore, suppliers on the hand, have played a significant role in providing raw materials to complete the manufacturing process of sportswear. Puma have got various suppliers ranging from wholesalers, merchants, franchisors, as well as drop shippers (C Gabriela 2011). They supply Puma products to all parts of the world via transporting them in to the regional warehouses then distributing to the market. The variety of suppliers enhance cultivating different skill as well as experience to the Puma. The role of distributors cannot be ignored. The distributors hold every niche for inventory. They function as the controller of Puma (manufacturer) and also manages vendor relationship. The company have partnership with BMW and Ferrari companies (Joshi 2014). The partnership enhances company’s profit by equally sharing assets and liabilities which translate a new spring of capital and skills.
Puma have very stiff competition in the sports industry. The competitors among them include the Nike, Adidas, Fila, Reebok, Converse, and Under Armor among others like Bata, and Liberty shoes. Each of the competitors struggle to take large market pie hence creating ever competition. On the other hand, the company fears a lot of any new entrants which has high probability to happen (Dobbs 2014). The threat of new companies joining the sports industry is therefore due to reason that the industry has grown hence attracting many players ranging from fashion, apparel, and foothold industries in to the entire sports realm.
Puma has utilized technology to reach market. For instance, the use of social media and innovation of cell technology has boosted the company in terms of marketing and production respectively. New design sportswear have attracted many customers from many market segment. The one called UniQT which the company sponsored the Cameroon national football team (Kampanje 2014). The strong information structure laid by Puma has enabled to connect the world. For instance, especially the regional managers use it for communication and to an extent of holding meeting online. Tech has Puma management share fast executive information for company decision making (Sloman 2005). Qualified Puma Online Retailer has boosted the correlation between company and customer.
The company have adjusted with the political forces that affect its operation. Environmental issues has been one major factor that has caused the company and individual to have different overview on this matter. The company outsource from many countries hence face different environmental regulations depending on the country. The regulations may differ as well in terms of international and local and must be adhered to maintain the standard process of development of the company (Luck 2008). The trade restriction as well as tariffs are another major barrier of the company operations.
The company is affected by currency fluctuation which have impacted the Germany (or other countries where Puma operates) foreign exchange rate and monetary issues (Luck 2010). The labor laws in various countries also has challenged the company. Ultimately the culture of different places and the beliefs has influenced the company’s human resource.
The Puma have heavily invested in R&D. Puma have researched and identified that half of the online clients are multichannel shoppers, that is, they shop online as well as visiting stores and make purchase decisions (C?adez? 2009). The company have adjusted customer relation and realized to have better approach on wining them.
The company have an opportunity to forecast the future models to use to control the competitors. It also has to have early approach into potential activities that help the company adjust mechanism against competition.
PUMA has analyzed the changes of business context in all countries they operate in. PUMA also have therefore put in place mechanisms to ensure all challenges be it political such regulations have been assessed to avoid barriers such as in distribution process and employment regulations in the operation. Similarly, the company have adopted mechanism that will accommodate all political/legal requirements (C?adez? 2009) hence making it easier to operate in many countries.
The company have recruited agencies who works on their behalf. Ultimately, Puma have identified effective collaborators who have abilities which matches with theirs (Panayides 2015). The capabilities will support running the company’s operation as well as analyzing the level of assurance required for a collaborator to company correlation.
A marketing strategy refers to the set goals that describes the way forward of a company on its mission to satisfy the customers’ needs in the market. Puma has a set of strategies which will enhance business growth as well as take a large pie in the competitive markets (C Gabriela 2011). However, the company has focused on various basic priorities which have to ensure the progress of the company. Puma has ensured to improve the product or brand heat for PUMA, in additional, improving the product machines which will double the production and strengthen the innovativeness and business product (Bradley 2012). Further, the company has have objected on optimization of distribution quality via integration and partnership (Burke & Thurik 2010).
Puma choice of target market regards to geography, demographic, psychographic, behavioral influences. Puma has a distinguished market segmentation. The primary purpose of market segment enables Puma to adjust the marketing tactics or mixes such as price, promotion, and product. By doing so, the company meets the most of the customers’ needs as well as segments. Besides, Puma uses market segmentation processes to distribute large markets into smaller manageable segments as per the individual features, various groups as well as geographical locations. Since the company has significant large market share in the Europe and the world at large, it considers the buying attitude and customer’s buying practices concerning to different people (Correspondence 2013). Puma’s partner’s design has segment of a market program for every buyer. The company should target Africa market as many of the competitors have not explored the continent. The Puma should produce the cheap products as the people from the Africa have low purchasing power (C Gabriela 2011).
Demographic segmentation refers to the division of the marketplaces into desirable groups regarding the demographic variables like sex and age. The company has borrowed this tool from the clothing industry since it is widely used. Puma products range from those of men, women, and children about their respective ages and lifestyle segmentation as well as gender division. Puma has produced many brands of men and women (of between 18-35 years) that include shoes, sports clothes, and other wears (Dominici 2009).
Psychographic segmentation refers to the division of market in the groupings based on social clout, lifestyle cycle, and personality viewpoint. The company has segmented the social groups due to the individual in the societies who many have same purchasing traits. The company equally applies the tool to assess the income gender, ethnic and family lifestyle division’s to differentiate their market across the globe (Rahmani & R 2015).
Puma is committed to work and participate in enhancing the world’s innovativeness (Ibeh 2012). Creativeness is part of the market strategy. For instance, the Puma has the primary target age of 17-30 which mostly enticed by footwear and apparel (Correspondence 2013). Other competitors such as Reebok initially were not producing football products, but they have shifted to join Puma. The company, the PUMA, was known to produce a very attracting product which appealed their customers, for instance, they designing and new functionality in the assortments and hurled old looks in the 1980s. The cost switching from one product to another is low for the clients because customers are not restricted to buy or get substitutes form other companies like Adidas (Correspondence 2013).
The Company has reviewed it to enable penetrating to the new market that will represent PUMA. In additional the company has new way to approach the market since they have introduced the Green Product Line. Brand value positioning refers to the market strategy that enhances the company to achieve a different advantage over the others in the market competition. Puma, mostly, has positioned itself in the market to reflect the place that their product takes in the segments (Sloman 2005). The company ensures that every gap has to be filled and approach the opportunities for the wide range of the products that reflects in the market. Puma has distinguished itself from competitors since they apply specialties sports retailer. The company serves major three division that includes the discount/value, mid-price, and high-end. The Puma has used this tool and has been effective towards the growth of the company. The strategy has bleached the many recession and hence improve the quality of the brand names. The management has even stated that both brand name as and advertising help to signals out the quality and reliability of the Puma’s products (Luck 2008). The company has realized even the new entrant have borrowed their strategy to penetrate the sports industry. In the value or discount category, the primary competitor is Nike, Adidas, and Reebok, who are taking a big market pie in the sports industry.
Its excellent marketing strategy has been the best and enables it to lead worldwide in athletic shoe making. Away from making sportswear, the company has engaged in manufacturing watches and many other accessories. Some of the products that Puma make include, sports shoes, custom made shoes, apparels, fancy shoes, T-shirts, tracks, boxers accessories, gloves, helmets and water bottles. Apart from these products, the company also have an extensive range of footwear and other sports goods. The company also become the major producer of enthusiast driving apparels and shoes as well as race suits. Puma has a broad range of items it produces such as sportswear, fashion accessories (Dominici 2009). The company is the owner of PUMA, Tretorn, and Hussein Chalayan.
The most important products are the sportswear with 66%. The company also increased the apparel production up-to 50 % in 2010
The product is affordable to all and across all socio-economic divide hence enable to outdo the competitors in the market. The pricing approach has been designed to offer stiff competition to the alternatives companies. For instance, some of the apparel has rated from $40-$120. Furthermore, the company has used premiums pricing approach since they consider their products as premium. The most selling premium ranges from $70-$140. The competitors like Fila, Nike, and Adidas, have higher prices than Puma (Yun-sheng 2010). The products of Puma appear to be convincing due to the brand name it has. The company has surprising price tags designed to be competitive with other alternative companies and still friendly to the clients. The price tag is set about market segmentation (Bradley 2012).
The company has tried to supply their products in all over the world. Puma brands have occupied the most sports segments by ensuring the enough distribution of the multi-brands ware-fronts and stores across all cities and regions in the world. The strategy brings the needs of large demand and selection of their brands to customers than their competitors (Kotler 2013). Puma’s effective supply chain process have gained experience on distribution network hence harnessing resources everywhere. The company focuses on expanding the retail and opening new warehouses in different parts of the world. The new approach will enhance the smooth supply of the products from the manufacturer (Puma) to the respective partners. They have also enabled to work the customer base effectively and fully incorporate the online retails store. Puma does make the distribution of their item into the warehouses across the globe (Rahmani & R 2015). The second step involves transporting them to the various marketplaces.
The company uses various advertising methods such as an advertisement. Puma invests in an advertisement in different media forums like a newspaper, social media, and web. They always involve athlete and sports individuals to brand their companies as ambassadors. In a different segment, the company focuses more on revenue income from the football, cricket, rugby, and golf. Puma has spent much money on print media as well as making and designing innovative billboards. The promotion methods include television ads whereby it uses some of the high profile players such as soccer players, online/social media customization using different media channel, excellent apparel packaging, participating in CSR such as environmental pollution management. Other ways that Puma tried to win customers include sales promotion which involves short-term incentives that motivate more buyers and make trial of the brands. The company has applied PR in some situations to attract more customers (Goi 2009). For example, Puma sponsors sports events for promotion advantages as well as protecting brand name.
|
Expenses use ($) |
Football |
Rugby |
cricket |
Golf |
|
Internet |
$52300 |
$9000 |
$5430 |
$1300 |
|
Print Media |
$21350 |
$4000 |
$7000 |
$890 |
|
CSR |
$1000 |
$2400 |
$1830 |
$870 |
|
Television |
$30000 |
$6000 |
$6700 |
$1200 |
Table 1 (Goi 2009).
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