Nike and Adidas - Essay Example

Introduction

In order to understand how brands work, we will compare two sports brands (Adidas and Nike) and the difference that exists in marketing strategies, relationships as well as the brand that contribute to their success in the market. Nike and Adidas are among the renowned sportswear brands in the world. These two brands have successively managed to penetrate, target, segment as well as position their own brands in the life of customers (Umair, 2011). Although Nike is the leader in the global market in terms of sportswear, it is evident that Adidas is growing exponentially and soon it will give Nike competition. Umbro, Hurley as well as Cole Haan are owned by Nike whereas Reebok, Tylor, and Rockport are owned by Adidas.

The similarities between Nike and Adidas

As introduced above, Nike and Adidas are the most popular companies in the world that produce sportswear. Both of their popularity is so significant in the world that they are perceived as household names. Both companies have also the same targets; their target involves people who love sports. Just like Nike, Adidas has also international awareness because of its sponsorship of professional athletes as well as athletic teams. Adidas cuts its production cost by using low-wage labor. The strategies used by the two sports giants in order to win more customers are very similar. For instance, it is evident that both are working extensively towards reducing their costs of production. It is also evident that they both take part in sponsoring different professionals and sports. Additionally, it is also evident that they produced different designs of sportswear so as to capture the interest of their customers.

The differences between Nike and Adidas

Nike is widely known in the world not only for their sponsorship but also because of their expansion of their target market to individuals who participate in basketball as well as running. This is evidenced by the contract it signed with a famous basketball player, Michael Jordan so that he can be its spokesperson. Additionally, it also signed a seven-year contract with tennis player Serena Williams so that it can market it in the world. Unlike in the past in which their market was solely domestic (the U.S.), their market has expanded internationally. In addition to changing shoe designs frequently, Nike has also created the new appearance of shoes to capture the attention of bored customers so as to stay ahead of its competitors. In addition to Nike using oversees factories in producing its products; it also maintains a close relationship with its suppliers so as to minimize costs as much as possible. Adidas' key market on the other hand includes people who follow sports such as soccer and tennis. In addition to minimizing costs, Adidas also focuses more on the broad differentiation strategy in order to succeed in the market. In 2009, Adidas succeeded significantly in its sale of Reebok and Adidas brands because of its shift from the production of the vertically integrated brand to a functional multi-rand structure (Umair, 2011).

In conclusion, Adidas and Nike are the leading giants in terms of producing sportswear. Their success in the sportswear market is as a result of the strategies they employ. However, it is evident that branding contributes immensely towards Nike being the leading sportswear producer in the world; most people prefer sportswear produced by Nike to those produced by Adidas because of the name ‘Nike’.