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Different business models are implemented to enhance the productivity of a working process. Two famous companies, Nike, Inc. and Adidas Group, serve as examples of successful performance. Nike is an American multinational corporation that designs and produces sports clothes, athletic footwear and accessories. Adidas is Nike’s main competitor from Germany. These global giants are widely available on the Saudi Arabian market and make a profit over $50 billion a year (Mahdi, Abbas, Mazar, & George, 2015). Their management methods have certain similarities and differences. The purpose of this paper is to discuss business models of Nike, Inc. and Adidas Group in order to make a comparison analysis.
Both Nike and Adidas produce athletic shoes. These companies shifted production to other countries like China, Indonesia and Thailand. These countries are distinct due to the low wage level. Hence, Nike and Adidas are able to relocate their manufactures really fast. For example, Nike sneakers are produced in Vietnam, and one of the main suppliers of Adidas is Cambodia. However, these companies have other competitive advantages.
A vast endorsement campaign that involved many famous sportsman and artists made Nike more popular than Adidas. Due to the engaging different basketball stars, its products are widely distributed in the North America. Also, Nike has recently become highly popular throughout the rest of the world. On the other hand, Adidas cornered the European market as it produces an excellent outfit for soccer and tennis players. In addition, Adidas is expanded worldwide like Nike.
Another advantage of Adidas is price. Overall Adidas’s prices are lower than the competitor’s. However, Nike employs another pricing strategy. This company targets high-income people. Hence, that well-designed scheme makes Nike very competitive.
Nike’s sales have risen for the last several years. The profit of Nike in 2015 has increased to 31.34B, comparing to previous years 27,8B and 25,3B in 2014 and 2013 respectively (Brohi, Prithiani, Abbas, Bhutto, & Chawla, 2016). The thorough analysis of these figures forecasts the expansion of the business in new countries as it may have 10-11% increment in sales. However, Adidas was successful as well.
The stock got higher more than 65% in the past 12 months and sales have increased by 20% in the most important regions, such as North America, Western Europe and China (“Outlook,” 2017). The company expects an increase in sales at a rate between 11% and 13%. The gross margin should increase up to 49,1% (“Outlook,” 2017). However, US dollar hedging rates will hinder the gross margin from the development.
The Sales Management Process
All sales in these companies are supervised and controlled by sales-management. Sales-managers establish an effective system and control the stability of a working process. It involves comprehensive analysis and a person-selling strategy. This type of management requires the implementation of organizational techniques that ensure sales operations. Generally speaking, sales-managers plan, guide and control work of their subordinates. Hence, a sales-management process is made up of several activities.
Planning is necessary to predict negative and positive outcomes. A successful plan is based on the market monitoring. It is always focused on a specific product. It is highly important to discuss all issues with other executives that involved in the plan implementation. Coordination ensures the productivity of a working process. A sales-manager always controls the work of every department and enhances the interaction among them. Motivating is a prominent component of sales-management. Cultivating the team spirit and inspiring subordinates increase the productivity of an entire organization as stimulated sales-persons accomplish better results.
The Salesforce Organizational Structure
These companies have complicated and well-designed salesforce organizational structures that enhance abilities of departments and their interaction (Mahdi et al., 2015). Such organization helps to deal with dysfunctions among regional markets. Divisions are based on geographic locations. However, corporate managers implement leadership programs. It assists in passing on key messages to semi-autonomous departments. These departments aim to monitor and meet demands of regional markets. Optimization of companies’ strategies is their main purpose (Kumar, 2017). A strict hierarchical structure serves to keep a dynamic and fast-changing working process in order and properly distribute roles.
The Process of Customer Service
Customer service is a prominent component of a successfully performing business. Customer service is organized in a similar way in both Nike and Adidas companies and “it aims to maximize the sales by analyzing, planning, implementing and controlling Salesforce activities” (Mahdi et al., 2015). It is necessary to highlight the main principles of an efficient customer service. These are collaboration and community management.
These principles create a system that supports and collaborates with different communities. It requires constructive discussion ensured via call centers, the comprehensive evaluation of a situation and feedback management (Jahanshani, Hajizadeh, Mirdhamadi, Nawaser, & Khaksar, 2014). These processes are integral to a customer service framework and work in an interdependent manner.
In conclusion, these two companies employ similar techniques but target a different audience. It is the main factor that determines their unique ways. The described above processes establish comprehensive and interrelate concepts. However, they require constant control and supervision. Figures illustrate the effectiveness of collaboration of departments that perform in different regions. Therefore, by creating competitive challenges to each other, these corporations contribute to the development and prosperity of sportswear industry.
Brohi, H., Prithiani, J., Abbas, Z., Bhutto, A. H., & Chawla, S. K. (2016). Strategic marketing plan of Nike. Web.
Jahanshani, A. A., Hajizadeh, G. M. A., Mirdhamadi, S. A., Nawaser, K., & Khaksar, S. M. S. (2014). Study the effects of customer service and product quality on customer satisfaction and loyalty. International Journal of Humanities and Social Science, 1(7), 253-260.
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Kumar, A. (2017). Suggesting measurable outcomes via studying sale trends & range of season SS16, FW16 & SS17 for brand originals. Web.
Mahdi, A., Abbas, M., Mazar, T. I., & George, S. A. (2015). A comparative analysis of strategies and business models of Nike, Inc. and Adidas Group with special reference to competitive advantage in the context of a dynamic and competitive environment. International Journal of Business Management and Economic Research, 6(3), 167-177.
Outlook. (2017). Web.