...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...
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...Competitive Forces ITM 524 - Foundations of Information Technology Management Module 2 – Case 1 Trident University International January 4, 2016 Value Chain and Competitive Forces The value that an organization creates and acquires is referred to as the profit margin. This means that the more value the organization creates the more profitable the it has a chance of becoming. In order for an organization to remain profitable, they must develop a competitive strategy. Michael Porter developed the concept of the “value chain,” which is a “set of activities that an organization carries out to create value for its customers (Porter's Value Chain, 2015).” The Five Forces The five forces model was developed by Michael E. Porter to help organizations evaluate the quality of a particular industry’s competitiveness and develop business strategies accordingly. The five forces are supplier power, buyer power, competitive rivalry, threat of substitution, and threat of new entry (Porter, 2008). Supplier Power With supplier power an organization determines how easy it is for suppliers to drive up prices. This is determined by the number of suppliers of each key input, the exclusivity of their product or service, their strength and control over the business, the cost of transferring from one to another, and etc. The scarcer the supplier choices an organization has, and the more the need for suppliers' help, the more powerful the suppliers become (Porter’s Five Forces, 2015)...
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...Table of Contents Introduction 3 Nike, Inc. 3 Under Armour 4 Porter’s five forces analysis 5 Nike, Inc. and Under Armour innovation strategies comparison 7 Conclusion 9 References 10 Introduction Nowadays, more and more people become concerned about health; they develop special diet that include vitamins and advanced nutrition supplements, and of course they do sports. Any kind of sports demand at least basic sports outfit: a T-shirt, shorts or pants, and a pair of shoes. Industry of sports apparel and footwear is an important part of today’s global business, where big companies have to compete for a customer. It is rather hard to differentiate on this market, because all the goods have to fulfill only one goal: make a person feel comfortable during a workout. Thus, companies have to work harder to develop new innovative products to gain market share advantage. The market of sports apparel is now dominated by several big companies: Nike, Inc., Adidas group (which includes Adidas and Reebok), and Puma. But there is also a new fast-growing and very promising player - Under Armour that managed to enter this saturated market. The key success factor for Under Armour was their innovative approach in creating sports apparel. Observing Under Armour’s success Nike has reconsidered their strategy and made innovation the core part of their mission, and in 2013 Nike was announced a #1 innovative company by fastcompany.com. So now there are two key innovators on the market...
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...Review of What Is Strategy Introduction The article---‘What is strategy’ is mainly concerned with exploring the definition of the strategy by distinguishing ‘operational effectiveness’ from ‘strategy’. To explore the real meaning of strategy, the author defines this term from three different perspectives: strategic position, trade-offs and fit. Main part Understanding of the article Some concepts of this article are based on theoretical foundations. Firstly, operational effectiveness is based on the Five Forces Frame Work (Porter, 2008), as its definition ‘performing similar activities better than rivals perform them’ (Porter, 1996) links with external environment, especially for the competitors. Another concept ‘strategic position’, performing different activities from rivals’ or performing similar activities in different ways (Porter, 1996), is related to RBV (Barney, 1991), because both them emphasize on the distinctiveness and uniqueness. The other two concepts ‘trade-offs’ and ‘fit’ are based on VRIO criteria (Barney, 2007), which is the basis of the company to generate sustained competitive advantage. The V of VOIR, value, is consistent with ‘trade-offs’, as they indicate that company should decide what to do and not to do. The ‘fit’ is line with the ‘I-inimitability’, since both of them stress that interlinkages among corporate activities makes difficult for organization to imitate. Wider context of strategy theory Besides, this article could also be...
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...1) Porter 5 Force Model of Lululemon: Bargaining Power of Suppliers | Suppliers have low bargaining power since Lululemon gets their fabrics from many suppliers. | Bargaining Power of Buyers | Lululemon consumers have high bargaining power. Since alternative brands are deemed cheaper, consumers switching costs would be low. | Threat of New Entrants | Threat of new entrants are moderate, but growing as more companies are outsourcing their fabrics to manufacturers in other countries that allow them a lower price mark for consumers. Plus online retailing is growing making these company sport wears more easily accessible. | Competition Level | Competition level is very high since companies in the sports apparel industry are constantly repositioning their brand in order to obtain a greater share of the market. | Threat of Substitutes | The threat of substitute is low since not many of the alternatives match in quality. | Based on the Porter 5 force model, the competitive forces are moderate in the yoga and fitness apparel market. There are many businesses in the industry, high customer bargaining power and moderate threats of new entrants. However, there aren’t any comparable substitutes when it comes to their quality. 2) I believe Lululemon is well positioned based on their effective strategies. From training and educating all of their employees to on Lululemon products and Lululemon’s core values, to having Yoga instructors as brand ambassadors, to having design...
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... of external adaptations and internal integrations that has worked well enough to be considered valid and, therefore to be taught to new members as the correct way to perceive, think, and feel in relation to those problems” (as cited in Guzman, Stam, & Stanton, 2008, p. 34). Therefore, IT managers must consider that organizational culture is an important factor to be taken into consideration within the value chain. As stated by Schein, culture is relevant and it matters because it is a powerful, latent, and often unconscious set of forces that determine both our individual and collective behavior, ways of perceiving, thought patterns, and values (Guzman et al., 2008). In order to take a look deep inside an organization’s social and technical dynamics, via value chain we turn our attention to “The Mini-cases: 5 companies, 5 strategies, 5 transformations”. This unique interaction case study was conducted by Balu Bagopal, Maurice Berns, Zayna Khajat, Martin Reeves and Andrew Townsend a MIT Sloan Management Review and knowledge partner. The Boston Consulting Group, with sponsorship support from business analytics provider SAS, are collaborating on a project called the Sustainability Initiative. This case study is a survey of five corporate executives and managers about their perspectives on the intersection of sustainability and business strategy (Berns, M., Townsend, A., Khajat, Z., Bagopal, B., Reeves, M., et al. (2009)...
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...Technology and Management in Singapore. Nike Inc. was founded in 1962 by Bill Bower man and Philip H. Knight as a partnership under the name, Blue Ribbon Sports. Since Germany conquered the domestic market in America, Nike came with low-cost and high quality products for the American people. Today, Nike manufactures and distributes athletic shoes in the global market and 40% of its sales come from athletic apparel, sports equipment,and subsidiary ventures and they have traditional as well as nontraditional distribution channels in more than 100countries globally. Nike has attained a premier position in the market but in 1998, the company has to face the issue of exploiting overseas workers and the altering consumer needs negatively pretentious the sales of Nike. In this report, I have discussed the case history of Nike that majorly covers the child labor problem and the problem of change in consumer’s preferences after which I have done the SWOT analysis and have come up with strategic objectives, market driven strategy Objectives. Furthermore, the marketing strategy is discussed that covers the segmentation strategy, targeting, positioning and channel distribution of Nike and the product, price and promotional strategy it must approve. In the end, I have given some recommendations to Nike’s management to force it towards success. Contents INTRODUCTION: The company Nike has establish its brand with lot of efforts today almost all knows about Nike it is a world famous brand with a...
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...face declining productivity and stagnant margins from 1999 to 2003, which drove the debt to increase, however in 2004 ECCO showed signs of improvements in its financial capabilities and, is looking to strengthen its integrated value chain from ‘cow to shoe’, by making it more efficient and cost effective. ECCO realized that it needs to focus on long term sustainability and also they understood the importance of moving towards a marketing oriented path, which would help ECCO leverage on its innovation, research capabilities and tis high quality products. Porters five forces Every industry’s attractiveness can be gauged from the competitive forces in the industry. To assess the industry attractiveness and long term sustainability we can use Porters Five Forces to analyze their competiveness using 5 factors, rivalry, entry barrier, threat of substitute, supplier power and buyer powers. Situational Analysis – Porter five forces Every industry’s attractiveness can be gauged...
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...波特五⼒力分析模型 - MBA智库百科 13-1-17 下午2:34 (Michael Porter's Five Forces Model) [ ] · (Michael Porter) 80 [ ] , [ ] 1 Power of Suppliers) Bargaining - http://wiki.mbalib.com/wiki/波特五⼒力分析模型 第 1 ⻚页（共 19 ⻚页） 波特五⼒力分析模型 - MBA智库百科 13-1-17 下午2:34 - - [ ] 2 (Bargaining Power of Buyers) - - [ ] 3 Threat of New Entrants ( ) http://wiki.mbalib.com/wiki/波特五⼒力分析模型 第 2 ⻚页（共 19 ⻚页） 波特五⼒力分析模型 - MBA智库百科 13-1-17 下午2:34 [ ] 4 (Substitutes) [ ] 5 (Rivalry) http://wiki.mbalib.com/wiki/波特五⼒力分析模型 第 3 ⻚页（共 19 ⻚页） 波特五⼒力分析模型 - MBA智库百科 13-1-17 下午2:34 ( SWOT ) [ ] [ ] 1 2 3 http://wiki.mbalib.com/wiki/波特五⼒力分析模型 第 4 ⻚页（共 19 ⻚页） 波特五⼒力分析模型 - MBA智库百科 13-1-17 下午2:34 [ ] Porter 5 force analysis industry chain 1. ShinEtsu 2. 3. Polymatech Sunarrow Nokia FIH Motorola 4. 5. OA 1-4 Dynamic Monitoring System http://wiki.mbalib.com/wiki/波特五⼒力分析模型 第 5 ⻚页（共 19 ⻚页） 波特五⼒力分析模型 - MBA智库百科 13-1-17 下午2:34 [ ] , 575 8.7% 2001 4.3% 25% 2004 8.1% 2005 · (Michael Porter) 80 M E Porter http://wiki.mbalib.com/wiki/波特五⼒力分析模型 第 6 ⻚页（共 19 ⻚页） 波特五⼒力分析模型 - MBA智库百科 13-1-17 下午2:34 1 10% 40 ( 2010 10% 5 ) 2012 10% 27 2006 53 ( ) ( ) 2010 , 2010 200 100 2010 , 2 http://wiki.mbalib.com/wiki/波特五⼒力分析模型 第 7 ⻚页（共 19 ⻚页） 波特五⼒力分析模型 - MBA智库百科 13-1-17 下午2:34 ...
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...International Marketing | PM 305 | | | OLANREWAJU OLABODE | I.D NUMBER 33344 | 3/19/2016 | | TABLE OF CONTENTS 1.0 Introduction............................................................................................................. ......3 2.0 Situational Analysis................................................................................................. ..4-7 3.0 Swot and Tow matrix................................................................................................ 7-10 4.0 Market Selection......................................................................................................... .11 5.0 Recommended Markets and Market entre Strategies............................................11-12 6.0 Marketing Strategies........................................................
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...Introduction 3 PART A: Promotion and Branding in Global World 3 Standardized and Localized Strategies 4 Case Study: Nike 5 Case Study: PizzaHut 5 Discussion 6 PART B: Future Environmental issue 6 Changing Social Trends 7 Case Study: Nike 7 Case Study: PizzaHut 8 Conclusion 8 Reference List 9 Introduction With the growing pace of globalization, companies’ marketing departments are faced with a substantial challenge of designing successful marketing strategies promoting their products and services (Keller, 2010). The ongoing academic debate has pointed out the tension between standardization and localization practices (e.g. Whatley, 2012). While the benefits frequently associated with the standardization practice revolve around the promotion of a single consistent message to the global market (Aaker, 1991), the localization paradigm emphasises the particular differences between individual markets and thereby the need to adapt marketing strategies to suit the needs of the local population (Gillespie, Jeanner & Hennessey, 2010). The aim of the presented paper is to critically investigate the promotion and branding strategies pursued by global organisations. The key focus is put on the examination of their relative effectiveness and two case studies are used to demonstrate the validity of the theoretical underpinning. Nike Inc., a sportswear and footwear retailer, and PizzaHut, a chain of fast-food restaurants, are therefore used as examples...
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...marketing strategies applied by Nike Air Force 4.1 Challenges Forcing Nike to Focus More on Marketing Sportswear is defined primarily as apparel and footwear made for sports participation, though is now also includes casual clothes worn by people for daily activities (E. Ko, C. R. Taylor, et al., 2012). The sportswear market is one of the most price-competitive markets throughout the globe. Within the UK, items of sportswear are purchased by almost 90% of people under 35 years of age, and by 76% of the population as a whole (Mintel forecasts, 2006). The international sportswear market is worth nearly 41.5 billion US dollars at the wholesale level, with Nike, Adidas, as well Reebok comprising some 14% of this market (Jeroen, 2004) and more details are shown in Figure 1. International Athletic sportswear market: Share by brand in Millions of US dollars (Source: Sporting good intelligence, 2003) 4.1.1 Overview of sportswear industry through Porter’s Five Forces analysis Before the study regarding the marketing strategy of Nike Air Force, it is important to have a clear view of sportswear industry as a whole. Based on Porter's Five Forces model, the general characteristics of the industry can be described in the figure as follow. Based on the analysis, it can be concluded that the sportswear industry as a whole can be characterized as competitive and easy for new entrants. Such truth has raised challenges for existed companies, such as Nike. In addition to that, customers...
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...Case Study: Under Armour 1. How strong are the competitive forces confronting Under Armour, Nike, and The adidas Group? Do a five- forces analysis to support your answer. The analysis of the Porters five forces are very important to business entities. Based on the analysis a business can evaluate their current position and positions that they plan to progress towards as it relates to the industry they are operating in. The following is my five forces analysis of the competitive forces confronting the companies that operate in the industry that Under Amour, Nike and Adidas operate in. Competitive Rivalry: There are many companies in the sports apparel, footwear and accessories industry, such as Nike, Adidas, Puma, Champion, New Balance etc. just to name a few. Many of the company’s competing in the industry offer a wide variety of similar products and each is trying to establish its brand as the brand for customers to commit their money and loyalty towards. What is obvious right away is that Nike and Adidas are Under Amour’s two biggest competitors and they have the highest percentage of market share. All three companies are established, have good resources, strong finances, sound marketing plans and popular celebrities that they can use to endorse their products. Therefore I think it’s safe to say that competitive rivalry in the industry is pretty strong. Supplier Power: The supplier power in the industry is low because there are many manufacturers...
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...The Wharton School of the University of Pennsylvania Management 223 - Business Policy & STRATEGY Spring Semester, 1999 Course Description and Syllabus Instructors: Phanish Puranam (PP) & Michael G. Jacobides (MGJ) Office: 2061(PP) /2055(MGJ) SH-DH (Management Dept. Suite) Tel: 898-1231 (PP) / 898-1224 (MGJ) Email: puranam@management.wharton.upenn.edu jacobides@management.wharton.upenn.edu Class Hours: Tuesdays and Thursdays 12:00 to 1:30pm Office Hours: By appointment (PP) Course Overview This course focuses on strategic management and strategic decision making and examines issues central to the long-term and short-term competitive position of the company or division / business unit. Students are placed in the role of key decision-makers or their advisors and asked to solve problems related to the development or maintenance of the competitive advantage of the firm. We start the course by looking at strategy at the level of the business unit, which is the fundamental level for competitive analysis. The perspective taken is of a manager in a given unit with particular assets, capabilities and competitive challenges. We look at industry analysis, examine the sources of competitive advantage, and explore generic strategies: How can we analyze the competitive environment, and what are the basic options for business-unit level strategy? What are the bases of competitive advantage? What is the nature of the value chain? Following...
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... Table of Content Executive Summary ………………………… 1. Introduction ………………………………………………………………… 2. Situation Analysis 2.1. Macro Environment Analysis 2.2. South African Sports footwear /casual Industry Competitive Analysis ………… 2.2.1. Industry Analysis 2.2.1.1 Market Size 2.2.1.2. Market Growth 2.2.2. Industry Competitive Analysis 2.2.2.1. Competitive Forces Analysis …………………………… 2.2.2.2. Driving forces Analysis ……………………………… 2.2.3. Market Position 2.2.4. Industry Key Success Factors 2.3. New Balance South Africa company analysis 2.3.1. Performance Evaluation… 2.3.2. Resource Strength and Weakness. 2.4. Market Opportunities and Threats 3. SWOT analysis ………………………………… 3.1. Discussion and Conclusion-…………………………………………… 3.2. Strategic Actions…………………………………………… 4. Price and Cost Competitiveness of New Balance South Africa 5. Strategic Issues 6. Conclusion and Recommendation …………………………………………… 7. Implementation Plan References Annex Executive Summary Introduction 2. Situation Analysis...
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