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Case Study: Salomon

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  1. Market and positioning
    1. Ski market
    2. Overview
    3. Strengths of the Y generation
    4. Importance for a brand such as Salomon to target the Y generation
  2. Communication mix
    1. Push or pull strategy
    2. Push or pull strategy
    3. B2B - Falling and intermittent

In 1997, the Adidas-Salomon group was formed as a result of the fusion of three brands: Salomon, Adidas and TaylorMade. This group represents 14,000 employees worldwide. The strength behind this association is the global presence of Adidas-Salomon in more than 60 sports, and its distribution of products in 160 countries.

Salomon is an international firm which is implanted in several countries.
However, we can see that this brand is mostly established in Europe. Salomon's sales represent 64% of its turnover in this geographical area.
The second main market for Salomon is North America with only 25% of its sales. This market represents the biggest blackhead of this company. For example, at the end of 2003, the order book of Adidas-Salomon showed a 31 % recession in nominal value with regard to the same period in 2002, and only 18 % was free from the effects of exchange. Indeed, the competitors were more implanted in the US, and were very profitable and mature. Hence, the lone way for Salomon to increase its market share was to stay focused on this market via Adidas. Finally, Asia and South America represent only 11% of Salomon's sales in the world market.

From 1985 to 2002, the turnover of the ski market had witnessed a huge increase from 75 billion euros to 160 billion euros. However in 2002, sales began to be directed downwards.

In this market, there are three different actors who share themselves as a primary component of this market:
Salomon was the primary one, with 492 million euros in 2002 in Winter (684 millions of euros at the end of the year), Rossignol is the second one with 468 million euros (in Winter) and Atomic was the last one and was placed in the third position in the market of the equipment of the winter sports. It recorded a turnover of some 200 million euros , and expects a stagnation of the world market in 5 million units .
The sales of snowboards are not expected to increase (1.7 million units approximately), as it faces some difficulties in the Japanese market, especially after the effects of September 11 attacks that slowed down the American economy.

Salomon and Rossignol aim at being a reference brand in each segment of practice (from Racing to Freestyle. This strategy has been quite successful, thanks to its innovative products. However, as they are not specialized, their image is very broad in the middle segment. We can see that Armada is very small and is highly specialized in Freestyle/Freeride. This is the typical example of a ?core brand?. Therefore, when a young customer will look for freestyle skis, he will be more confident in buying Armada skis.

[...] The strength of their team rests on legends like Candide Thovex, as well as revelations from last season like Simon Dumont The weakness is the fact that Salomon is financially limited as the following example demonstrates. Candide Thovex received an interesting offer from Rossignol and Salomon did not want to outbid an offer made by one of its competitors. If Salomon had acted otherwise, it would have endangered its entire team and more particularly young talents, by mobilizing an unreasonable sum for the only one of their icons. [...]


[...] Growing European brand Salomon is an international firm which is implanted in several countries. However, we can see that this brand is mostly established in Europe. Salomon's sales represent 64% of its turnover in this geographical area. The second main market for Salomon is North America with only 25% of its sales. This market represents the biggest blackhead of this company. For example, at the end of 2003, the order book of Adidas-Salomon showed a recession in nominal value with regard to the same period in 2002, and only was free from the effects of exchange. [...]


[...] Face to Face: Commercial negotiation Salomon Group is mainly dealing with big retailers such as Decathlon, Intersport and with small retailers located in the French Alps and Pyrenees, where one can buy winter and summer sports items. The relations with the big retailers are quite difficult. As seen in the Porter 5 forces models, the retailers have a high bargaining power because there are only a few chains that are solely dedicated to sports, and they are in a dominant position on the market. [...]

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