Advertising and media in the marketing environment Lab Report

Advertising and media in the marketing environment - Lab Report ExampleThe confederation is headquartered at Herzogenaurach, Germany. The company was founded by Adolf Dassler in the year 1924. Market capitalization of the company is $13.30 billion as of 2011 (Yahoo Finance, 2012). Porter Five Force Purchasing Power of vendee Buyer power in the industry has weakened due to individuality of customers. Individual consumers lack in financial strength to affect business strategy of monumental manufacturers such(prenominal)(prenominal) as Nike, Puma, Adidas and others. Buyer power is low due to following factors (Source Marketline, 2012) Power of Supplier Sportswear industry is complemented by three inter machine-accessible themes such as innovation, research & development and adoption of style trend. In many cases it has been observed that Nike and Adidas design their sportswear in counties like USA, UK and other demonstrable countries but subcontract manufacturing process to develop ing countries such as China, India and South Korea. Partial control over forward and backward integration of value string decreases power of retailer but increases power of supplier whence it can be said that supplier power is strong crude entrants need to form a bare-assed company and diversify their business in order enter sportswear industry. New entrants need to establish strong distribution channel and sustainable logistics framework. New entrants need to invest huge amount of money on setting up logistic division while revenue growth is not very exciting. Risky condition of business and high start up cost have created high entry barrier for new entrants. (Source Marketline, 2012) Threat of Substitute Online retailers such as eBay, Amazon has emerged as major competitor for brick and mortar sportswear retail channels. In many cases it has been observed as e-business companies are selling mark sportswear to customers without mentioning mark-up difference and technical knowh ow. This situation creates negative image about the brand such as Adidas, Nike or Puma in the mind of consumer hence it can be said that threat of substitute is high. (Source Marketline, 2012) Competitive Rivalry Companies like Nike, Puma and Adidas are trying to compete with each other at every aspect of sportswear products. Presence of online and offline retailer has intensified the completion while switching cost is low for customers because branded companies do not succeed incentives to them. Based on the situation it can be inferred that competitive rivalry is high in the industry. (Source Marketline, 2012) PESTLE Political Environment Adidas need to work in coordination with Political Action Committee (PAC) in order to handle government issues of particular country (Curtis, 2010, p. 43). Economic The world is going through economic crisis such as Eurozone sovereign debt problem and recession. These two events have dampened the growth of economy (Lynn, 2010, pp. 94-104). Adida s need to