Organization buying behavior

                                       What is Organization Buying Behavior 

 

 Organization buying is the decision-making process by which formal organizations establish the need for purchased products and services and identify, evaluate, and choose among alternative brands and suppliers There are three buying situation :-

·                     New Task

·                     Modified Rebuy

·                     Straight Rebuy

Buying Decision Approaches -

·                     Casual Approaches- It involves no information search or analysis. Adidas did not apply this approach as it had done research regarding what the people demand and what are there needs. On basis of that they launched there product which had one of most distinguishing factor and that was flat shoe.

·                     Routine Low Priority - Decsions are more important and involve a moderate amount of analysis. Adidas had done research regarding its product and had involved a much amount of analysis.

 

 

There are many forces that influences the organizational buying behavior. Adidas had to take into consideration many factors because they were going to launch a new product which was somewhat a brand extension for there company. Thus all such factors which were important were taken into consideration while launching there new product.

Sustainable/Holistic Marketing

HOLISTIC MARKETING

A marketing strategy that is developed by thinking about the business as a whole, its place in the broader economy and society, and in the lives of its customers. It attempts to develop and maintain multiple perspectives on the company’s commercial activities.

In 2007, Adidas say that all Group athletic footwear factories became part of the reporting program. Factories new to the indicators recorded data with less accuracy than those that have already been working with the indicators for a few years. In 2007 Adidas saw an increase in the average consumption of key resources per pair of shoes since Reebok footwear factories joined the system and they have yet to improve environmental efficiencies, according to the company.

Adidas has been making waves, recently. Last week, the German sportswear manufacturer announced the biggest ad campaign in its history, featuring David Beckham, Katy Perry and Lionel Messi. Today came a big move in a different area: sustainability. According to CEO Herbert Hainer, the multi-year sustainability strategy will focus on “implementing environmental performance across our value chain is an important step to deliver sustainable operations over the long term.”

Sales Management

Sales Management
What is Sales management?

Sales management is about leading the people and process your company uses to sell prospects and service customers. Responsibilities include:
• Building the right sales strategy
• Hiring the right team
• Creating the right compensation plans, territories and quotas
• Setting the right projections
• Motivating your team
• Tracking revenue against goals
• Resolving conflicts
• Training and coaching sales reps
• Managing processes
• Getting the sale!

                                                         SWOT STRATEGY

Strengths:

The main strength of Adidas is his Product Quality. The quality and the material uses in Adidas  is very good.

The company has a good brand image in the market, the publicity and the advertisement is also very good and lastly company  hold a healthy market share in the market.

Another  strength of the company is its well efficient and effective management, which works as a team.

Weakness:

The major weakness in the Adidas is that the manufacturing of the products of Adidas is not done in India itself it is being import hence the cost become high and the margin of profit becomes low that’s why company must give a deep thought on manufacturing their products in India.

Another major weakness in the company is that it is not catering to all the segments which I have already discuss above, If these two weakness in the company can be eradicated then the company may earn high profit and better market status.

Opportunities:

Adidas does have many products for the urban segment or poor people, but there is hardly any product or we can say that there are no products for this segment. India is more a rural country, in the total population of India major part of population lives in rural area and these people cannot afford the costly products of the company like Adidas hence company must target this particular segment they must introduce the shoes and other product according to their demands.

Also price is one of the major factor which may influence this type of segment hence company should make their policy accordingly.

Company must also consider the range and the variety of the products as compare to Nike and Reebok. In my opinion the company must introduce more rage or more variety in the market to compete with their competitors and also the customer have more choices to choice the product from.

Threats                                                                                                                                                                            Adidas does not have strong distribution network as compare to Nike and Reebok in India. Nike has more number of retail outlet then Adidas and Reebok has a unique distribution network, the company Reebok not only uses its outlet for the sale of their product but also use some other shoes company outlet like “Bata”. In a Bata showroom u can find Reebok shoes and other products. But this is not a case with Adidas hence Reebok has an extra advantage over Adidas.

Adidas do not have any competitive advantage as compared to Nike and Reebok

Distribution

Adidas entered into a distribution tie-up with Woodland Shoes earlier in 2003 and before that it had tied up with national multi-brand retailers like Planet Sports, Lifestyle and Metro Shoes.
The main distribution strategy of Adidas is to gain visibility through a network of exclusive brand stores and multi-brand stores and distributors apart from their franchisees.
Currently Adidas has 750 exclusive stores in 220 cities and is planning to add 125 more stores by the end of the year 2012.

Branding

Adidas is a German sports apparel manufacturer, part of the Adidas-Salomon Corporation. Adidas had a heritage for using athletes to represent their brand by sponsoring some sport teams.

Adidas also used this approach to position themselves as a brand for people who want success and they used great athletes, shown wearing Adidas products. They try to convince average people that they will be successful if they wear the right clothes. For example, Adidas formed relationship with some of the world's best players such as FIFA World Player of the Year Zinédine Zidane, David Beckham, Raúl, Michael Ballack, Kaká and Rui Costa. Besides, for Adidas, the UEFA EURO 2004 also proves to be a commercial success since five out of the six most recent European champions were wearing the Adidas Three Stripes. Using athletic to promote the brand seems to be an effective ways to acknowledge the public and increase its popularity. This promotional approach is really successful at the European market.

Adidas has successfully gain market share at USA with its heritage promotional strategy by positioning themselves in the mind of the customer. Customer will think that, if they wear the same brand or shoes like David Beckham, Kobe Bryant or Yankees, they will perform well as those athletic does. Moreover, Adidas also have their own tagline like what Nike does. Nike's tagline - "Just Do It!" is a significant success and Adidas also wish to achieve such success by having their own tagline, "Nothing Is Impossible". Adidas tagline had also gain clear success as it had influence the market like Nike. Both of this strong branding had created a positive prejudice in the mind of the customer and had gain clear success by doing so.

As a conclusion, Adidas had successfully gain back market share by its heritage of building their brand name through effective sponsorship and promotional strategy. Besides, its tagline of "Nothing Is Impossible" also gain potential success like Nike does and it had created a positive prejudice inside the mind of the customer as customer felt great when using their products.

Customer Behavior

Consumer behavior is the study of individuals, groups, or organizations and the processes they use to select products, services or ideas to satisfy needs and the impacts that these processes have on the consumer and society. It blends elements from psychology, sociology, socio psychology, anthropology and economics. It attempts to understand the buyer decision making process, both individually and in groups. It also studies characteristics of individual consumer’s s in an attempt to understand people's wants. It also tries to assess influences on the consumer from society in general.
For Adidas a consumer shall mean and include any person or individual who has purchased a Adidas product from any authorized Adidas store in India.

Adidas providing shoe range in almost all type of sports, helps its consumer to link themselves to the sports of there choice and but product according to their preference. Being an International brand, Adidas create value in the minds of its customer by providing product with guaranty of durability and better performance. Moreover with the brand endorsed by sports personalities which are aces in their particular field, consumer relies on the product more and purchases more.

Services and Services Marketing

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Services marketing typically refers to both business to consumer (B2C) and business to business (B2B) services, and includes marketing of services like telecommunications services, financial services, all types of hospitality services, car rental services, air travel, health care services and professional services.

 The range of approaches and expressions of a marketing idea developed with the hope that it be effective in conveying the ideas to the diverse population of people who receive it.

Services are economic activities offered by one party to another. Often time-based, performances bring about desired results to recipients, objects, or other assets for which purchasers have responsibility. In exchange for money, time, and effort, service customers expect value from access to goods, labor, professional skills, facilities, networks, and systems; but they do not normally take ownership of any of the physical elements involved.

Services of Adidas:-
1.Pre purchase services:- This include accepting telephone and mail order,advertising, shopping hours and fashion shows.

2.Post purchase services:- This includes shipping and delivery, gift vouchers, adjustments and returns.

3.Ancillary services:- This includes general information of the product, repairing if the product is faulted.

They also provide services as follows:

Intangible services :-This are the services which are not physically seen for example mailing and giving feedback, and complaining about a particular product.

Inseparable:- This is services which are provided but Adidas employees directly through a door to door bases or on a telephonic call, where a customer can directly contact to the technical team and can solve their problem in seconds, which gives a better customer satisfaction.

Variability:-Adidas in particular have a training professionals which take care of the customers complain and revert back in seconds with a solution and also note complains which always helps in improving the upcoming products.

In short, Adidas provides a customer satisfied services which has helped them to cover such a huge market worldwide.

Marketing Strategy

MARKETING STRATEGY

Adidas, the brand with three stripes, seems to use the elements of high-tension in its ads. Remember the Sachin Tendulkar commercial? How everything is near-frozen, and the shattering glass signifies release. Release of tension. Adidas gives you a chance to but the boundaries – in every sphere. Only now, the setting is not the playground or the track or the court, it is the urban landscape – with its omnipresent traffic jams, crowded streets and so forth. This way, Adidas becomes a part of life. Anyone’s life. You don’t have to be the high-voltage performer to be a part of the Adidas family. And it goes beyond that – Adidas becomes something that makes you better. Not just as an athlete, but as a sports person, and better human being.

MARKETING: ADIDAS

In 1997, Adidas became Adidas-Salomon with its US $1.4 billion purchase of Salomon, a French manufacturer of skis and other sporting goods. The deal put Adidas one step closer to competitor and world market leader Nike, and one step ahead of Reebok. Salomon, aside from its winter sport equipment, also owns golf club brand Taylor Made and cycle brand Mavic. The merger makes Adidas/Salomon the second largest sport marketer in the world, and number one in Europe. Salomon is currently very strong in North America and Japan, and Adidas has the largest market share in Europe. Adidas is, like Nike, very active insuring sponsorships advertising deals with celebrities. Some of the most famous are Martina Hingis(tennis), Kobe Bryant (basketball), Peyton Manning, Paul Palmer (swimmer), jan Ullrich (racing cyclist) and the New York Yankees. David Beckham, Patrick Kluivert and Zidane all wear Adidas boots, the Predator Accelerator.

LEVERAGING ON SACHIN: ONE MAJOR PART OFMARKETING STRATEGY IN INDIA

Continuing its association with trump card Sachin, the local four-ad print campaign tries to connect Adidas’ product attributes with Sachin’s magic. “Instead of presenting just one dimensions: The first ad connects Sachin’s choice of a heavy bat with Adidas’Falcon Dorf light weight shoes. Says the headline: ‘Sachin likes his bat heavy, not his shoe.


Segmenting Targeting and Positioning:

Customers between the age group of 14- 30, having interest in sports, or players of different sports are targeted. Also the geographic, demographic, psycho-graphic and behavioral factors come into play. As products (shoes) are diversified to cater to the needs of different types of audience.
For example in city like Kolkata and other eastern regions where football is very common, more availability of football shoes (spikes) would be there, with diversity in size, type, quality and color to meet the needs of the target customers. Option of specialized shoe is also provided.

Pricing

Adidas is clear; it wants to become the no. one sports brand in India, a choice brand for all brands. So far so good, but how will it tackles a price conscious market like India? Adidas feels that being high energy business Adidasintroduces 600-700 articles every six months – enables the brand to remain fresh and bring on an international and Indians the brand from the price stand point. Price, that’s the most critical factor in the Indian context. Adidas believes it has to deliver a functional at an affordable price. It’s a tough job – to maintain the integrity of the performance and still come out with a product a right price point. Globally shoes start at $50. But in India as the perceived need is lower, you have to make the product more affordable. To tackle this, Adidas came out with speed 2000, a product priced at Rs.995 with the help of local and Hong Kong source people. Adidas however feels that it’s just the matter of time before India coverage’s the world on this front. It is very difficult to operate on a lower price point and maintain integrity of product, but it’s been barely 3 years since the sports market has taken off. The original sector is just 20% of the total market and 80% of the volumes comes from sporty shoes. But our market is producing products at a price that is relevant to the consumers. Adidas feels that as the volume go up, Adidas will try and work out price points as people graduate with better understanding of quality and price perception. Volumes are bound to go up. Adidas started at the time when India had no strength out in the sports products market in 1989 – 90. It’s then licensing partner Bata, and it had limitations of what it could have put behind the brand. So company took the next best step when the licensing agreement ended to take a bigger share in business. To conclude we can say that Adidas is putting all efforts to bring down the price consciousness in the Indian market. Company is trying to make products, which are easy to afford and still maintain the integrity of their performance. Growth has been phenomenal for Adidas even given the base is small. In 2002 Adidas grew by 25%, 2003 by over 50% and this year Adidas is expecting more than 50% in terms of value in both shoes and apparel, while the industry growth as a best-case estimate has been 20-25%

Promotion

Above the line: advertising through various modes like –

v  Television: impossible is nothing campaign featuring famous sports figures, telling their stories and promoting the brand.

v  Hoardings: Amazing hoardings on the highways or crowded roads,  most of the times featuring one specific product or the entire brand mostly endorsed by famous sports figures or just products.

v  Internet: Promotion and advertising on internet- mostly through their own website, through social networks and through gaming.

Own website: Through exclusive digital content featuring making of commercials, by impossible contests for audience, downloadable content in the form of IIN wallpapers, videos.

In Game advertising: With massive, the in game advertising agency, Adidas took advertising to a new level by featuring it’s ‘Impossible Is Nothing’ campaign in advanced sports games such as MLB 2K7  and NFL 2K7.

 

Below the line:

v  Through catalogues and brochures meant for individual customers:

                    

COMPETITION

                                 Main competitors of Adidas: Nike and Puma..

Porter’s model of Forces Determinants: (Nike as its major competitor)