LAUNCH OF THE BRAND

Launch of Reebok in India

In October 1995, Reebok International Ltd. entered in an 80:20 joint venture with Delhi based Phoenix Overseas (Reebok India Co.). Phoneix is Asias largest footwear

manufacturer with a capacity of 1000 pair per day. Reebok started with 13 retail store in India. Reebok opened its first exclusive store in India in 1995, followed by Nike and Adidas. Companys first concept store was launched in Delhi in 1999, named Planet Reebok. In Aug 2001 Reebok entered into a retailing partnership with Bata-India for sale of Reebok and Rockport footwear in Bata outlet.

Positioning at the time of launch

When the company came to India, all that the consumers wanted was an international brand of footwear and Reebok gave them that at an affordable price. Reebok positioned itself as fitness and comfort providing sports goods manufactures. When it was launched in India, fitness was a very nascent industry and people bought Reeboks products more for the American brand image, fashion and comfort. Over the years while it has retained its position as a fashionable brand, a sizeable portion of its consumer base buys the products for indulging in some form of fitness activity. Brand Personality To celebrate individuality in sport and in life. Reebok people are unique. Celebrates the distinct qualities: Unique points of view Individual style Remarkable talents Authenticity Reebok calls them visionary and original.

Their main target was: A population of 10 million with annual income of 45000 (and above) for medium priced shoes. A population of 2 million people with an annual income of 75000 (and above) - for super premium shoes.

Vision and Mission

The parent company had issued a mandate that its Indian subsidiary should stick to the company's vision of instilling fitness consciousness among people and, at the same time stay focused on maintaining its leadership position in India. The company felt that its fitness platform would fit well in the Indian market as it was better understood than sports. However analysts felt that the fitness footwear and apparel market in India were at a nascent stage, and had limited scope. The Company's brand vision is fulfilling potential, its mission, Always challenge and lead through creativity. Reeboks brand values are authentic, individualistic, courageous, empowering, innovative and real. Reebok has introduced its internationally acclaimed fitness programs in India, conducted under the banner of Reebok Instructor Alliance, which is dedicated to fitness instructors, personal trainers and health club owners.

Product Portfolio
In the initial years when we launched Reebok, our product offering was dominantly for the male consumers. At the time, sports and fitness was predominantly a male activity. However, there was always the realization that there is a female consumer who lives an active lifestyle -- who walks regularly, or even works out -- and who we could attract with our product offerings. In the initial years when we launched Reebok, our product offering was dominantly for the male consumer. At the time, sports and fitness was predominantly a male activity. Initially, Reebok offered 65 varieties of sports shoes and sports clothing such as T-shirts, shorts and sweatshirts in 5 exclusive stores in Delhi and Mumbai, started from Rs. 1300. In 1995, their Product offering: 1. Lower End - Shoes Rs 1300 2. Mid Range - Shoes Rs 2500

In 1999, 40 Models of shoes priced Rs. 990- Rs. 1500 were introduced. After that cricket shoes PRO were introduced.

Promotions & Branding

Logo: The original Reebok logo shows the Union Jack, representing the brands beginnings in Bolton, England in 1895. The logo was modified to represent the Reebok Classic Collection, a collection of products characterized by the brands past. In the late 80s, Reebok introduced a second icon, known as the vector. This icon was introduced to represent a new era of "performance" product. The design comes from cues on the product known as the "side stripe cross check". There have been modifications and iterations of the Reebok Performance Logo over the years. The vector has been Reebok's iconic symbol of Sport Performance.

Communication: It had four components 1. Public Relations: Reebok Instructor Alliance, wherein it trained and certified health and gym instructors. This was instrumental in establishing the brands image as a fitness brand. 2. Sales Promotion: Free gifts and free passes to major sporting events, focusing on cricket and golf. 3. Events: Held events like aerobic clubs, fitness programs and marathons. 4. Ad Campaigns: In 2006, Reebok had a tagline Run easy. The Run Easy campaign took a 180 degree turn from traditional sport advertising. The hit the wall attitude that is portrayed in the sport applies only to a handful of participants and the rest are struggling to reach an ideal that isnt achievable. Print Ad: Reebok's Advertisement for the 1996 Atlanta Olympics with Dhanraj Pillai, then Indian Hockey team captain.

See the sweat on my face It's oil for rusty dreams. Look into my eyes They are seeing Dhyan Chand wield a stick that Hitler called a magic wand Hear my blood pounding It's my war cry Smell the air It's time for a harvest This is my planet

Competitive environment
Its major competitors in India are: Adidas, Nike, Puma, Action, Lakhani and other Indian companies. After, failing for 3 consecutive years and posting dismal financial results, it was one of the first MNCs that came in post liberalization to have posted a profit and that was in 1999. And it has been making profits ever since. Reebok differentiates itself from Nike and Adidas on the basis of Features. It puts more emphasis on comfort and fitness instead of designing and style. Eg.-Reebok produces ultra light shoes which posses air compressed pad in its sole to make it much lighter than other foam based soles. India is the only market where Reebok has sprinted ahead of Nike and Adidas. "Reebok has sustained a good number of exclusive stores for the past few years and that's a good indicator of healthy retail revenues. Also, in contrast to what happens globally, in India Nike tries to catch up with Reebok in terms of strategy," says a retail consultant. The biggest hurdles for Nike in India were its entry model and its lack of aggression. When the global sports majors entered the Indian market in 1995-96, government policy dictated that they had to have a local partner. Nike agreed to an exclusive distribution agreement with a Delhi-based trading firm Sierra, in early 1996; Adidas signed up a licensing agreement with Bata for retailing at its huge network of stores; only Reebok entered India as a subsidiary with a 20 per cent equity stake by Phoenix, a distribution and trading firm and Reebok's distribution partner. Reebok was the first to understand the ground realities in the Indian market. It was the first to build its promotions around cricket, not only through endorsements but also through sponsorships of regional and local cricket associations. Reebok also Indianized its ad campaigns right from the start, signing on highprofile sportsmen like Mohammad Azharuddin , Bhaichung Bhutia and Dhanraj Pillai. Even Adidas changed its advertising tack by signing on cricket icon Sachin Tendulkar and tennis star Leander Paes in 2000. But even as Reebok became more aggressive (by 1998 it had invested in as many as 100 stores), Nike was going slow. "It's up to the global players to use the local partnership to grow in the market," says a competitor. Nike clearly didn't think the same way. Right from the start it has used international ads and sports icons for promotions in India as well -- and that hasn't changed still. "Sports in India largely means cricket and football. A Michael Jordan is irrelevant to the masses," says Shrikhande of Shoppers' Stop. And where globally, Nike's marketing budget is over $ 5 billion, spends in India are significantly lower.

"The biggest splash in Nike's advertising was when it launched the Presto range (flexi-shoes) in 2001," says an ex-company official. According to retail consultancy KSA Technopak, while Reebok has a 45 per cent share, Adidas has 30 per cent and Nike accounts for just 25 per cent of the Rs 375-400 Crore branded sportswear market. The biggest problem, say market watchers, is Nike leaving decisions on advertising and store expansion to the distributor. "It's a risk for global players to leave strategic and branding initiatives to the local partners. They have to take the reins in their hands," says a distributor.

Socio-Cultural and Economic environment

Reebok came to India in the mid-90s mainly to develop the middle segment of the footwear market in Africa, the Middle East, and Central and South Asia, and as a fallback in the event of an interruption in Chinese supplies. The annual threats of adverse action against Chinese imports into the United States, prior to the admission of China to the World Trade Organization in 2001, were noted in each Reebok annual report as having a potentially negative financial impact. Positive climate for business growth: GDP growing @ 7%, this was the time when Reebok entered into Indian market. And liberalization of Indian economy led to increase in buying capacity of middle class. Being 1st of its kind to enter India it had an edge over its competitors. And its business grew by 18 % in 2001. In the past, Reebok had an association with outsourcing through sweatshops, but today it claims it is committed to human rights. In April 2004, Reebok's footwear division became the first company to be accredited by the Fair Labor Association. In 2004, Reebok also became a founding member of the Fair Factories Clearinghouse, a non-profit organization dedicated to improving worker conditions across the apparel industry. They launched sports kameez for health conscious Indian women. They introduced classical line of union polos and yoga pants. They also launched a range of personal fitness equipment such as heart rate monitors, yoga mats, ankle weights, dumbbells, tubings and trampolines which contributed to 45% of their sales.

Winning Strategies An Analysis:

Tie up with Bata for retailing footwear and apparel, as was mandated by the government at that time. Played according to the rules of the game. However, the strategic control and production held by Reebok. This was instrumental in its success, beginning from 1999.

One aspect to Reebok's success has been its ubiquitous retail chain. By the end of 2005, the company was retailing from 182 franchised stores. It also retails from two thousand multi-brand outlets. While Reebok has been adding a store a week in 2004, for the next year the company has lined up even more ambitious plans to open a store every 72 hours.

Understood the psyche and the needs of the Indian consumer well. o o Keeping in view the love of cricket in India they introduced range of cricket shoes called PRO. A functional issue that was arguably instrumental in aiding the company establish itself early in the country was the fact that its shoes have a broader forefoot, which suits the Indian consumer. In contrast, the shoes of international rivals have narrower forefeet.

Whenever a style would do well, the company would ensure that stores were always well stocked with that style whereas competitors would try and push the entire range of products at the consumer. At Reebok, we believed that, although small, here was a business to be taken. And they started to play the percentage game.

It adapted the format of all its stores and introduced a women's collection -- it created a small corner with 20-30 SKUs in apparel and shoes. It worked out well and soon its women's business was 15 per cent of their main business.

Its marketing to women took the grass-root path and touched a chord with the fitness conscious Indian customer. They trained fitness instructors -- from 20 in 1996, they now have 700 Reebokcertified instructors in India -- that started a small fitness revolution in India under our RIA program.

Bibliography:
1. http://www.ibef.org/download/running_jan19.pdf 2. http://www.scribd.com/doc/40052613/reebok 3. http://www.icmrindia.org/casestudies/catalogue/Marketing/Reebok-Marketing%20Case.htm 4. http://www.indiaretailing.com/editorial-analysis-shoe1.asp 5. http://www.rediff.com/money/2005/feb/15spec1.htm 6. http://www.bharatiyahockey.org/1996Olympics/reebok.htm

Group Suggestions:
Had the group been managing the brand: Low and medium Priced Range. As can be seen from the table below the great potential is there in this price range in the Indian market. Tier II and Tier III towns can be potential targets. Would have focused on tapping this segment particularly.

Plethora of opportunities in untapped Ladies & Kids Segment. Lion share around 80% of unorganized players in Ladies and Kids segment. Also, willingness to pay is higher in this segment. Reebok has already started focusing on the kids segment, would have strengthened this further, with campaigns, TVCs and print ads dedicated and targeted exclusively at the segment.

Estimated growth in the Industry is 12%. Would have focused more on Reebok Fitness Online workout for higher customer engagement and brand loyalty, as majority of the Reeboks current customers are first time users.