History( three phases)

Phase I 1924 – early 1980s:

• 1924 – Two brother co-founded “Dassler Schuhfabrik”

• 1948 - split – Rudi set up “Puma Schuhfabrik Rudolf Dassler”

Strategies:
• First company used “Vulcansation” techniques and “Velcro” fastener
• 1952, Sponsored the German national football team
• Sponsored top-soccer players:
 Pele(Brazil)-1970 FIFA World Cup
 Diego Maradona (Argentina)
 Johan Cruyff (The Netherlands)
 Fellow Germans: Rudi Voller and Lothar Matthaus
• Sponsored German tennis player:
 Boris Becker who became the youngest player to win the Wimbledon
Championship

Result:
• Footwear: 1970s and early 1980s – Puma AG –one of the most promising footwear
company in the world
• Tennis Gear: Puma would overtake ‘Adidas’ to become the world’s leading tennis gear
producers

Brand Image:
• An exclusive brand that catered to the demand of the elite
• Synonymous with the best in contemporary sport

Phase II: 1980s to 1993 – on the endangered list

• 1974 – Rudi’s son: Armin took over as CEO

• 1986 –Went Public Dassler family sold its share in the company –resignation of Armin

Strategies:

• Make affordably priced met all classes needs

• Sold at discount shops and department stores at very cheap rates

Results:
• Undoing of Puma’s image
• The elite and affluent class started avoiding Puma products
 • Lack of proper leadership after Armin’s resignation
• Posted constant losses between 1986 -1993
• In later 1993, on the verge of bankruptcy: totaled lost was $32 million and was saddled
with $100 million in debt

Brand Image: Cheap and negative

Phase III: 1993-current

• 1993 – Zeitz took over as the CEO

Strategies (two stages)

Stage I: 1993- 1997 –Restructuring (streamlining Puma’s Production)

• Reducing the cost overheads of the company by streamlining the organization in to a
more cost-efficient one:
• Reduced employees from 719 to 367
• Closed down German factories
• Subcontracted the entire production to countries like China, Vietnam, Taiwan and Turkey
• Purchased the licensing rights for the U.S. –Enable Puma to regain control over the
distribution of its products in the U.S. market.

Stage I results:
• The restructuring phase reached completion in 1997
• Posted record revenue of 37 million euro
• Recorded positive cash flows
• Paid off all the debts

Stage II: Launched a campaign to make Puma the world’s greatest spot Lifestyle manufacturer

• Soul-searching: went to five target markets and just went did focus groups and talked
about what Puma was back then and what Puma could be
• Differentiation: design-driven approach – a very stylish and fashionable approach
 CO-OP - Collaborated with world famous fashion designers:
o Jil Sander
o Neil Barrett
o Yasuhiro Mihara : 02 Mihara collection (kickboxing)
 Created up-scale fashion ranges:
o Pumaville
o H Street
• Celebrity endorsements:
 Approached Monarchy Enterprise (purchased 40% until June 2003) –exposure
Puma’s in blockbuster movies like “JFK” and “Pretty Woman” and hit TV shows
like “Friends” and “Will & Grace.”
  Brad Pitt, Gwyneth Pallrow and Madonna began purchasing Puma products for
their personal used
• Sponsorships : various from athletes, teams, and events
 Sponsor promising athletes who is unconventional and mirrored Puma’s image of
being a rebel against established principles:
o Serena Willians (US tennis player)
o Wilson Kipketer (Danish Runner)
o Barry Zito (US Baseball Player)
o Italian, Bulganan, Cameroon Soccer team
o Lazio, an Italian Soccer club
 Sided with the “underdogs” of the sport world
o Jamaican Soccer team – great personality (fun)
 Signed contracted to equip world-class Formula 1 teams
 Supplied sportswear for the “FIA World Rally Championship” – the “Ford Rally
Division”
 Provided sport gear for Travis Pastrana – the freestyle “Motocross” world
Champion
 Took up a sponsorship deal with the boxing sensation Oscar De la Hoya – hold on
the boxing market
 Attained its first National Rugby Union asset in 2005
• Launching of exclusive product lines
New collection – the wearer is able to tackle any environment with confidence
Shudoh – is a fully integrated collection of footwear, apparel, and accessories. Using carbon
fiber materials into PTC ). The new PTC offering players two choices: greater cushioning or
more rigidity and stability.
Complete- high-performance running shoes was designed with the serious athlete in mind
(cell technology)
Nuala - created by supermodel Christy Tulington – designed to meet the work, travel and
exercise needs of the modern-day woman (incorporates the finest fabrics). Puma expanded
the collection to include a greater variety of footwear, appeal, and accessories.
Rudolf Dassler Schunfabrik – carry the identity of original sport-influenced products to
today’s casual sneaker market. For instance: 01 collection is brought the traditionally heavy
staid worker boot to leisure boot (fun to work)
Platinum - melding the words fashion and sport by developing cutting edge styles and looks.
• Set up its own chain of exclusive stores
 Owned 28 boutiques across the major fashion centres of the worlds (11 in USA)
in 2003
• Advertising
Advertised on “MTV” – enhanced its image of a rebel against social standards

Stage II results:
• Being featured in exclusive boutiques along with luxury lifestyle brand like “Prada” and
“Gucci”
• 1998, Puma’s image received a phenomenal boost when Jamaican pulled off an
unexpected victory in the 1998 Soccer World Cup.
 • Global brand sales grew by 22.6%, had a 4.5% share of the $17 billion global athletic
footwear market in 2003
• Strong order backlog increased in 2004

Image: Hi-fashion sport lifestyle brand

- Rebellious
- Dare-to-be different
- It is about Prestige, not size!

Current:
1. The majority of Puma’s stocks started to be owned by Pinault-Printemps-Redoute
(Gucci’s Owner) on 17 July 2007
2. Reported its profits had fallen by 26% due to higher costs linked to its expansion,
and sales actually rose by mote than a third