Reebok 2007 Annual Report Download - page 54

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ANNUAL REPORT 2007 --- adidas Group GROUP MANAGEMENT REPORT – OUR GROUP -- Structure and Strategy - Reebok Strategy
SIGNIFICANT ORGANIZATIONAL AND OPERATIONAL PROG-
RESS In 2007, the main focus at Reebok was on laying the
groundwork for a sustainable revitalization of the Reebok
brand going forward. While fi nancial results were mixed,
 see Reebok Business Performance, p. 099 signifi cant organizational
progress was made. During the year, new regional heads
were put in charge in North America, Europe and Asia with
the appointment of Matt O’Toole (North America), Nigel
Griffi ths (Europe) and David Mischler (Asia). Michael Rupp
was also appointed President and CEO of the Rockport brand
effective January 1, 2008.
In North America, Reebok took important steps in improving
its distribution mix by cleaning inventories and strengthening
relationships with retailers in the sporting goods channel.
A strong presence in this distribution channel is critical to
strengthen credibility as a sports brand. Reebok also pro-
actively started to limit distribution in the mall-based athletic
specialty retail channel by solely accepting at-once orders
from one major account.  see Risk and Opportunity Report, p. 104 The
Sports Licensed Division, an adidas Group unit which focuses
on licensed apparel for both adidas and Reebok, acquired the
assets of Mitchell & Ness Nostalgia Company, a wholesaler,
marketer and distributor of authentic vintage athletic product
effective October 31, 2007 (transaction value: low-single-digit
million euro amount). The acquisition offers Reebok further
sales potential and helps the brand strengthen its position in
the sports licensed business.
In addition, Reebok made signifi cant organizational headway
outside of North America. The brand’s European Headquarters
relocated from Bolton (UK) to Amsterdam (Netherlands). This
move was initiated to sharpen the brand’s focus on the region’s
traditional and emerging markets and to improve range mer-
chandising. During the year, Reebok also bought back distribu-
tion rights in Turkey and Greece, effective April 1, 2007 and
January 1, 2008, respectively.
Reebok also made progress with several brand marketing
initiatives. With the addition of tennis star Jelena Jankovic and
the global sponsorship agreement for the 2008 Avon Walk
Around the World for Breast Cancer,  see Reebok Products and
Campaigns, p. 138 the brand further strengthened its partnership
portfolio in the women’s business. Regarding brand communi-
cation, Reebok ran its largest fully-integrated global running
campaign: “Run Easy”. This campaign highlighted the camara-
derie, joy and fun of running. And in China, the brand launched
its “Fuel Yao’s Unlimited Power” campaign for the Beijing
Olympics featuring basketball star Yao Ming.
BECOMING “THE BRAND THAT FITS ME” As a consumer-
driven brand, Reebok commits to offer the “perfect fi t” for
consumers. On the one hand, this implies designing and devel-
oping products with materials, styles and technologies that
enhance fi t and comfort for consumers. In 2007, for example,
Reebok developed 893 fi t initiatives to be included in products
for the spring / summer collection 2008. Highlight products are
footwear and apparel featuring KineticFit technology.  see
Research and Development, p. 072 On the other hand, it means
addressing consumers in a personal, engaging way so that
they can better identify with the brand. Reebok’s 2008 global
brand campaign – “Your Move” – stresses the fact that con-
sumers have a choice and that Reebok is the brand that best
understands and meets their needs.  see Reebok Products and
Campaigns, p. 138
However, the concept of fi t is not only a product and marketing
philosophy. Instead it should guide all facets of the brand’s
business. Reebok’s intent is to be “the brand that fi ts me”. That
means meeting the needs of consumers, promotional part-
ners, retailers and employees. With a “perfect fi t” distribution
strategy, Reebok intends to offer the right product for the right
accounts at the right margins. Moreover, Reebok is committed
to building a work environment that matches the need of its
employees and to hiring people who fi t the brand’s values.
REEBOK STRATEGY
Y
“
always challen
g
e and lead throu
g
h creativity”.
Th
e
i
dea
o
f fi t
a
n
d
co
mf
o
rt i
s
a
t th
e
co
r
e
o
f
a
ll
p
roduct develo
p
ment. Reebok
i
s a consumer-
d
riven brand with a balanced sales s
p
lit
between sport and lifestyle. Women’s and
runnin
g
are the brand’s two
g
lobal cate
g
ory
pr
i
or
i
t
i
es alon
g
s
i
de several re
gi
onal
i
n
i
t
i
at
i
ves
to dr
i
ve growth worldw
i
de. Bu
i
ld
i
ng the
branded apparel business and recalibrating its
l
ifestyle offering are other strategic priorities
fo
r th
e
b
r
a
n
d.