Adidas 1996 Annual Report Download - page 27

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Product marketing will focus on innovative
high-performance footwear and apparel, with
particular emphasis on the landmark Feet
You Wear line of products. Although we pro-
duce products for many sports, the core cat -
egories will be soccer, running, basketball,
tennis and training, with additional develop-
ments aimed at the women’s and kids’
segments. Product marketing will benefit
from above-industry-average spending on
R&D, a level of 2.5% of footwear net sales.
Communications will be made more pro-
ductive. In an environment of an ever-
increasing spiral of inflation in the promo-
tional investment circuit, we will concentrate
on key symbols and messages. Promotional
activities will be centered around these sym-
bols and be leveraged by a combination of
creative advertising and public relations,
extensive merchandising, and large-scale
grass root programs. The Feet You Wear
concept will be the focal point of our overall
communication effort, with an additional
boost from the World Cup ‘98 sponsorship
which will gain importance as the event
approaches.
In sales and distribution, we aim to maintain
maximum control over our brand and to pro-
vide top-rank service to the trade. To this
end, we will continue to expand our network
of fully-owned subsidiaries or joint ventures:
Italy and South Korea were signed in ’95/’96,
and negotiations with Japan are currently
underway. Activities to increase our service
level include the development of partnership
programs with key trade partners. These
include ‘Shop-in-Shops’, Electronic Data
Interchange, or ‘Fit for Sales’, a unique
educa
tional training program for retail sales
person
nel which we have pioneered in
Germany.
Sourcing is at the heart of our business, and
an essential lever to reduce FOB prices and
optimize our service level to subsidiaries and
customers. Strategies in 1997 will include
consolidating and enhancing partnerships
with key suppliers in footwear and in apparel.
We will continue to reduce lead times by
securing a highly flexible and higher-technol-
ogy factory base in Asia for footwear and will
also source an increasing amount of apparel
close to our major markets.
We have specific strategic objectives in mind
for the different regions. In Europe, we want
to reinforce leadership in Germany and push
for share growth in all other major countries.
In North America, we will continue to drive
marketshare in some of our core categories,
especially running, and to revitalize basket-
ball to reflect its importance in America and
worldwide. In Asia/Pacific, we will capitalize
on market growth and pursue our joint-
venture efforts by concluding current busi-
ness partnership projects including those in
Japan, as well as by improving existing ven-
tures. Finally, in Latin America, we will
strengthen the regional organization by rein-
forcing management in key countries and
stabilize performance in countries which
have proven volatile, including Mexico, Brazil
and Argentina.
We all are committed to these clearly defined
strategies. In close cooperation with our
trade partners, we are all personally commit-
ted to being the best performer in the busi-
ness. Now is the time to make a statement:
we are one company, with one mission and
a single, unifying brand. And in time, if we
are true to our mission, we will be the best
sports brand in the world.