Reebok 2015 Annual Report Download - page 60

GROUP MANAGEMENT REPORT – OUR GROUP
Group Strategy
56
2
FINANCIAL AMBITION UNTIL 2020
Our three strategic choices will be step-changers with regard to brand desirability and brand advocacy
which, in turn, will enable us:
•To accelerate our top-line growth: We aim to increase currency-neutral Group revenues annually by a
high-single-digit rate on average. This performance will be driven by high-single-digit currency-neutral
growth rates per year on average at both the adidas and Reebok brand.
•To win significant market share across key categories and markets: We have defined key categories
within our core brands that will spur our growth. From a market perspective, we have defined clear
roles for each of our markets, depending on macroeconomic trends, the competitive environment and
our brand strength in the respective markets.
•
To improve our profitability sustainably: We plan to substantially improve the profitability of the Group,
growing the bottom line by an average of around 15% per year, significantly faster than our targeted
top-line growth.
•To deliver on our commitment to increase shareholder returns: Creating the New includes a strong
commitment to generating increasing returns for our shareholders. Given our firm confidence in the
strength of the Group’s financial position and future growth ambitions, we increased our targeted
dividend payout ratio to a range between 30% and 50%. We will also increase the returns to our share-
holders through our shareholder return programme. In total, we plan to return up to € 1.5 billion by
the end of 2017.
INTRODUCING OUR STRATEGIC CHOICESTO DRIVE BRAND DESIRE
Speed
Driving brand desirability begins with putting our consumers at the heart of everything we do and serving
them in the best possible way. This involves ensuring that consumers always find fresh and new products
where and when they want them. This, in turn, means to us being able to anticipate what consumers want
and react accordingly in a timely manner. Speed is therefore a very critical and powerful lever for our Group
and we have set ourselves the goal to become the first true fast sports company by 2020.
Being fast will give us decisive competitive advantages. These include:
•Faster delivery of products, based on shorter lead times.
•Increased opportunities to react to short-term and in-season trends.
•Increased full-price share of sales, while at the same time reducing markdowns.
•Eliminating the risk of over-/under-stock building by supplying products in short periods of time.
We have built the foundation for our Speed ambitions with adidas neo, in which a big proportion of the
product range to date already runs on so-called ‘Speed programmes’. In four categories – Running, Football,
Training and Originals – we have started to adapt the learnings from neo and to build Speed capabilities
for a defined share of their business.
We will use our industry-leading experience to re-shape our entire business model end-to-end, from range
planning to product creation, sourcing, supply chain, go-to-market and sales. We base our Speed ambitions
on three global and centralised initiatives that are deployed consistently across our markets and channels:
•
Planned responsiveness: Based on sell-through data, which we receive and analyse at the beginning of
the season, we re-order products and deliver them within the season to fulfil higher consumer demand
than initially forecasted.
•Never out of stock: We standardise and strengthen our existing ‘never-out-of-stock’ business propo-
sition by setting a global, permanent offer with longer life cycles and continuous reproduction and
replenishment. This will ensure our most iconic and desired products are permanently available to
our consumers.
•In-season creation: We plan ranges to be created later in the season in order to create or capture the
latest trends of the industry driving brand desire to new heights.
see Our Share, p. 46
see Glossary, p. 260
see Global Operations, p. 74