Market Analysis for Reebok for Project and Portfolio II

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A Market Analysis for
Reebok
Ingrid Little
Full Sail University
Project & Portfolio II: Business and Marketing
November 16, 2017

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EXECUTIVE SUMMARY
This market analysis report examines the potential for growth in the current market for
Reebok sneakers as it relates to trends in fitness, technology, and reach to the target market.
Methods include an analysis of Reebok’s internal goals and products, competitors, company
position within the marketplace, and trends in the sneaker industry. Results of the data analyzed
show that despite unique internal goals and products there is much competition in the sneaker
industry and Reebok represents less than 2% of the market share. However, trends show that the
market for sneakers is increasing at an exponential rate, which is driven by millennial spending.
The report finds that if Reebok targets fitness-oriented millennials, with new technology-
driven products, they could see an increase in revenue, market share, and brand awareness.
Recommendations discussed include targeting millennials with sneakers that are relatable,
innovative, and eco-friendly and partnering with other fitness organizations that can increase
brand awareness and subsequently revenue and market share.

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OBJECTIVE
As it relates to the current market for sneakers, determine whether there is potential to
grow revenue and brand awareness for Reebok amongst the current target market and what steps
should be taken in order to achieve this growth.
RESEARCH METHODOLOGY
The information used in this report is primarily external, secondary sources from the
Internet and online databases. It contains both qualitative and quantitative data. The information
was gathered during the month of November 2017 and is current.
RESEARCH AND KEY FINDINGS
Reebok is an American based
company, owned by Adidas, who’s internal
goal is to become the best fitness brand in the
world. Reebok products focus on “functional
training, combat training, studio [dancing and yoga], running and walking.” (Adidas Group,
2017). Reebok focuses their target market on the fitness-oriented consumer. With “over 54
million American [paying] gym membership fees in 2014,” the fitness market is continually
growing. (FranchiseHelp, 2017). Through partnerships with CrossFit, Les Mills and the
Spartan race, Reebok hopes to solidify their mark on the fitness world. (Sports Business Journal,
2013). Reebok is also currently in a “six-year contract to provide Ultimate Fighting
Championship” (UFC) footwear and apparel to fighters. (DiChristopher, 2014).

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New product
releases by Reebok feature
new technology and
environmentally-friendly
style shoes.
Technologically, Reebok
launched the Liquid
Factory, where they have
developed a faster, more
economical way of producing responsive footwear: 3D printing. (Forester, 2017). Reebok is the
first company to use such technology. Also, the company is “participating in Adidas Group
initiative to use 100% sustainable cotton in all [their] products by the end of 2018.” (Reebok,
2015). Also, in the fall, Reebok released the 100% biodegradable sneaker. (Jones, 2017).
Reebok’s products compete with other footwear company’s releases. Some of the
companies include Nike, Under Armour, Puma, and NOBULL. Each of these companies release
similar products for fitness activities, like running, and target similar markets. Despite being in a
competitive industry, Reebok’s vision of being the best fitness brand in the world is unique from
the marketing strategies of these other companies.
Reebok’s current brand value is
estimated at $800 million, which is in the top
ten of sports businesses, according to Forbes.
However, the company represents under 2% of
the market share of the sneaker market. (Bonk,

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2017). Despite these numbers, ‘the international sneaker market has grown by more than 40%
since 2004 to an estimated $55 billion” (Weinswig, 2016). Millennial spending is fueling this
growth in the footwear industry accounting for $21 billion in spending in 2014.
CONCLUSIONS
Reebok is in the position of being in an industry that is growing exponentially. And their
millennial target market seems to be driving this growth. While Reebok doesn’t represent a large
part of the sneaker market, with new product releases and technology, Reebok could potentially
raise revenue and market share. Brand awareness will continue to increase with sponsorship
deals and endorsements.
RECOMMENDATIONS
Based on the research findings and conclusions, Reebok needs to focus on creating
sneakers that millennials can relate to, in order to target a greater percentage of the market share.
By creating sneakers that appeal to fitness-oriented millennials, Reebok could see an increase in
the sale of sneakers and subsequently, increase revenue for the company. Also by creating a
shoe that generates hype amongst millennials, Reebok could see a major increase in brand
awareness amongst its target market.
“Businesses that want to attract millennials need to emphasize their innovative ways and
positive societal impacts.” (Schwartz, 2014). Reebok must target this trend by releasing sneakers
that are innovative and eco-friendly. Releasing a sneaker each year that signifies an advance in
technology or promotes a positive impact on society will encourage millennials to buy Reebok
products. Also, new technological advances in the production and functionality of sneakers can
help Reebok stay ahead of the competition.

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In order to build brand awareness, Reebok must continue to partner with other fitness
organizations. It is recommended that by year-end 2018, Reebok develop a partnership with
Aerobics and Fitness Association of America (AFAA), in order to explore the needs and wants
of the fitness-oriented consumer and create products that fill that need. Through the partnership
with the AFAA, Reebok should become the official sponsor of the organization’s members and
those seeking fitness certification. Partnering with the AFAA and other organizations within the
fitness realm will help to achieve the company goal of being the best fitness brand in the world.

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REFERENCES
Adidas group. (2017). Reebok Profile. Retrieved October 26, 2017, from https://www.adidas-
group.com/en/group/profile/#/reebok-is-tough-fitness/
Bonk, S. (2017, May 04). Forbes Fab 40-The World's Most Valuable Sports Brands - pg.1.
Retrieved October 27, 2017, from
https://www.forbes.com/pictures/57ffcf244bbe6f19f2b51eee/forbes-fab-40-
2016/#39d3916d64e1
DiChristopher, T. (2014, December 02). Reebok looks to capture UFC fans—including women.
Retrieved October 27, 2017, from https://www.cnbc.com/2014/12/02/reebok-looks-to-
capture-ufc-fans-including-women.html
Forester, P. (2017, October 11). Reebok's 3D-Printed Sneaker Tech Is a Huge Step Forward.
Retrieved November 03, 2017, from http://www.esquire.com/style/news/a49863/reebok-
3d-printed-sneakers-liquid-factory/
FranchiseHelp. (2017). Fitness Industry Analysis 2017 - Cost & Trends. Retrieved November 03,
2017, from https://www.franchisehelp.com/industry-reports/fitness-industry-report/
Jones, Charisse, @charissejones, & USA, T. (2017). Talk trash on the court, but recycle these
Reeboks. USA Today. Retrieved from Academic Search Complete,
http://web.b.ebscohost.com.oclc.fullsail.edu:81/ehost/detail/detail?vid=3&sid=f7811bb7-
cf45-4f5c-8cb2-4132ee43b716%40pdc-v-
sessmgr01&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#AN=J0E054817229617&db
=a9h
Reebok. (2015, June). We Honor the Planet | Reebok. Retrieved November 04, 2017, from
https://fitness.reebok.com/About-Reebok/Stories/2015-06/We-Honor-the-Planet/

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Schwartz, A. (2014, February 07). Millennials Want Companies That Work On Innovative Ways
To Fix The World. Retrieved November 17, 2017, from
https://www.fastcompany.com/3025989/millennials-want-companies-that-work-on-
innovative-ways-to-fix-the-world
Sports Business Journal. (2013, October 02). Reebok's Partnerships With Fitness Groups Like
CrossFit Appear To Be Paying Off. Retrieved October 27, 2017, from
http://www.sportsbusinessdaily.com/Daily/Issues/2013/10/02/Marketing-and-
Sponsorship/Reebok
Weinswig, D. (2016, March 18). Sneaker Culture Fuels $1 Billion Secondary Market. Retrieved
November 04, 2017, from
https://www.forbes.com/sites/deborahweinswig/2016/03/18/sneaker-culture-fuels-1-
billion-secondary-market/#4ddeed7e7911
IMAGES
Bonk, S. (2017, May 04). Reebok - pg.11. Retrieved November 16, 2017, from
https://www.forbes.com/pictures/57ffcf244bbe6f19f2b51eee/9-reebok/#2b837d083a8a
Forester, P. (2017, October 11). Reebok's 3D-Printed Sneaker Tech Is a Huge Step Forward.
Retrieved November 17, 2017, from http://www.esquire.com/style/news/a49863/reebok-
3d-printed-sneakers-liquid-factory/
M. (2017, July 10). Reebok unveils its new ’Delta’ logo. Retrieved November 16, 2017, from
http://www.thebrandingjournal.com/2014/04/reebok-unveils-its-new-delta-logo/