Polar Adidas Case Study

Polar Adidas

Brian Smith · Jo Anne Lotfallah · James McCartneyJosh Dafoe · Nastania Mullin · Jason TaylorTrevor Dufresne

http://www.youtube.com/watch?v=196Y90fl1uA

Agenda

• Introduction• Problem Identification• Situational Analysis• Organizational Objectives• Alternatives• Recommendations• Implementation Plan• Q&A Period

Introduction

• Established in 1977, Polar is a tech driven leader in sports medical science

• Employs over 1 200 people worldwide, has 26 subsidiaries globally, and manages a distribution

network supplying over 35 000 retail outlets.

• First heart rate monitor developed in 1982

Problem Identification

• Contradicting sizes of both companies result in a strain on the relationship

• Lack of adequate resources on Polar’s end

• Very tight schedule and deadlines for releasing the finished product

Problem Identification

• Engineering is shared between the two

• Asks the question: Who owns what?

• The rights for Project Fusion in the air as a result

Situation Analysis - Strengths

• Influx of R&D capital for product diversification

• Access to market data once unobtainable

• Exposure to new markets

Situation Analysis - Strengths

• Increased cash balance of foreign currency

• Ease of movement within Europe

Situation Analysis – Weaknesses

• Size differences of companies could create difficulties and strains

• Production capabilities to match the demand

Situation Analysis - Weaknesses

• Risk of downgrading quality of current product

• Lack of resources to deal with set-backs and failures

Situation Analysis - Opportunities

• Influx of R&D capital for product diversification

• Access to a market once beyond Polar’s reach

• Exposure to new markets that will only benefit Polar

Situation Analysis - Opportunities

• Entry point into Europe

• Backdoor into foreign markets through German trade agreements

• “Top-Grade Seal of Approval”

Situation Analysis - Opportunities

• High brand equity of adidas can increase Polar’s brand equity

• Increase in exposure

• “Big Brother Effect”

Situation Analysis - Threats

• Ownership and rights to the product

• “Predators” trying to steal/sabotage Polar’s technology

Situation Analysis - Threats

• The difference in sizes of both companies

• Marketing strategy decisions: Where does Polar fit?

Organizational Objectives

• PE aims to improve the quality of life for its consumers

• Wants to establish itself with the already successful adidas brand with its heart monitors

• Increase brand loyalty and company equity

Organizational Objectives

• A means of gaining brand awareness– The technology can be used for other

applications

• Learn from adidas

• Gain assistance in development

Alternatives

• Do nothing

• Joint Venture Establish a third company

• Acquistion by adidas

Recommendations

• Take a more controlled approach to future textile alliances

• Continue to be a technological trend-setter

Recommendations

• Staff training at the retail level

• Finland expansion on Research and Development– Assembled products

Recommendations

• The Michael Porter Value Chain

Implementation Plan

• Address the issues of exclusivity

• Address the joint marketing efforts– Media, Joint Websites, Etc.

• Areas regarding management must be determined

Question Period

• Do you agree with our assessments?

• What do you think this alliance became?

• What are the market positions of these two companies today? Why?

Thank You