Michael porter 5 forces analysis As said by Porter (1980), “The collective strength of the forces determines the ultimate profit potential” Therefore, using Michael Porter 5 forces would be more appropriate to evaluate Adidas’s competitions as well as implications in the footwear industry.
Threats of new entrants
In the footwear industry, Adidas is considered as one of the leading competitors. Thus competitors who want to enter the market would need to think twice before entering, as there might be a loss or a crease in operations as there would be more resources needed to promoting advertisement and increasing brand recognition in order to compete with existing rivals. Especially when Adidas is gaining on Nike by sponsoring the Europeans soccer tournament where there were eventual winners Spain (Torry 2012).

Therefore, when it is harder for new competitors to enter the market, the more unfavourable the industry attractiveness is, as the cost of entering to complete might incur greater loss.

Threats of substitutes
There are little product substitutes to the footwear industry that Adidas is competing in. One example of a substitute could be simply just normal casual footwear; such as Cros, which are covered slip-on shoes that have been very popular in water sports as well as a fashion items. It could be substitutes to customers who do not indulge themselves in sports or light exercise. (Lussier, Kimball) Thus, we believe that the availability of product substitutes to the industry that Adidas is competing in is very low which means that the industry attractiveness would be high.

However, as sporty footwear products are known to be expensive as compared to other casual footwear such as converse or Tommy Hilfiger, thus the costs of switching to such substitutes would be high. (Lussier, Kimball) This is due to having more research and