Reebok 2007 Annual Report Download - page 58

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ANNUAL REPORT 2007 --- adidas Group GROUP MANAGEMENT REPORT – OUR GROUP -- Structure and Strategy - TaylorMade-adidas Golf Strategy
CAPITALIZING ON THE STRONG MARKET POSITIONS OF TWO
WELL-ESTABLISHED BRANDS TaylorMade-adidas Golf main-
tains two well-defi ned golf brands with strong market positions
under one roof. TaylorMade is the market leader in terms of
sales in the metalwoods category and is among the leading iron
brands. In addition, TaylorMade is also steadily evolving into a
leading golf ball manufacturer. adidas Golf has delivered out-
standing sales growth in both footwear and apparel during the
past fi ve years and has clearly become the fastest-growing golf
footwear and apparel brand in terms of sales and market
share in major golf markets. TaylorMade-adidas Golf is com-
mitted to further growing its business in a profi table way
and improving its market position by harnessing the R & D
strength  see Research and Development, p. 072 and brand equity of both
TaylorMade and adidas Golf.
INCREASED INNOVATION FOCUS TaylorMade-adidas Golf’s
core principle is to create the best performance golf products
in the marketplace, and that starts with a clear commitment
to innovation, technology and Tour leadership. The brand
strives to extend its leadership position with a continued focus
on innovation.
To remain at the forefront, TaylorMade-adidas Golf is intensi-
fying its R & D efforts. For example, TaylorMade created an
independent innovation team that is solely focused on identifying
potential new product concepts and designs, primarily in metal-
woods and irons, that may subsequently be transformed into
product development by the general R & D team. adidas Golf
continues to leverage adidas’ R & D capabilities, transforming
innovative adidas concepts and technologies into golf footwear
and apparel products. TaylorMade-adidas Golf strives to intro-
duce at least one major new product innovation or evolution
every 12 to 18 months.
EXTENDING LEADERSHIP IN METALWOODS Today, TaylorMade
is the clear market leader in metalwoods - particularly in the
USA, where the brand’s market share of approximately 28 %
has created a substantial gap between TaylorMade and its
strongest competitor. This success was driven by the brand’s
ability to continuously introduce and commercialize new and
innovative products. Therefore, the brand’s primary focus going
forward is to maintain its place in the market as the innovation
leader and to further expand its metalwoods business outside
the USA. By strengthening its promotion partnerships in other
regions (e. g. new partnerships with Korean golfer Ye Yang and
the China Golf Association in Asia), TaylorMade plans to sup-
port its international expansion in the metalwoods category. By
2010, the brand’s goal is to achieve a similarly strong market
position on a global scale as in the USA.
GROWING GOLF BALL BUSINESS BY FURTHER GAINING TOUR
CREDIBILITY Success in golf balls depends on the ability to
create high-performance golf balls, bring them to market and
build credibility among Tour professionals. Over the last three
years, TaylorMade-adidas Golf has restructured its golf ball
business to lay the groundwork for a prosperous future in this
product category. The brand purchased numerous patents
with the acquisition of Maxfl i in 2003 and created its own ball
division that is fully dedicated to developing high-quality,
technologically-advanced performance golf balls.
TaylorMade successfully introduced its TP Red and TP Black
golf balls in 2006, which together now comprise the second
most-played ball models on the European, Nationwide and
Japan Tours. In this way, TaylorMade has established itself as a
credible golf ball brand among professionals and highly skilled
players. In 2007, the number of marquee players using the TP
Red and TP Black golf balls further increased. Among new
additions to the portfolio of players were Retief Goosen, Fred
Funk, Sean O’Hair, Darren Clarke and Natalie Gulbis. The
brand intends to increase sales in the golf ball category by
extending the TaylorMade branded offering and further lever-
aging the successful NOODLE franchise.
TAYLORMADE-ADIDAS GOLF STRATEGY
TaylorMade-adidas Golf’s mission is to be the
l
eadin
g
performance
g
olf company in the
w
orld in terms o
f
sales and
p
ro
fi
tability.
It combines two o
f
gol
f
’s strongest brands:
TaylorMade
(
focused on clubs and balls
)
and
a
didas Golf
(
focused on footwear and apparel
)
.
Both brands are ded
i
cated to cont
i
nuously
d
evelop
i
ng and commerc
i
al
i
z
i
ng
i
nnovat
i
ve,
technologically advanced products. To
a
ccomplish its goal, TaylorMade-adidas Golf
has set its si
g
hts on fi ve strate
g
ic priorities:
extend
i
n
g
i
ts leadersh
i
p
i
n metalwoods,
s
igni
fi
cantly expanding its gol
f
ball business,
maximizing growth at adidas Golf, driving
marketin
g
excellence and further stren
g
thenin
g
i
t
s
dis
tr
ibu
t
io
n m
i
x
.