Tuesday, April 21, 2009
When the going gets tough: Reebok gets the boot!
According to market-research firm, SportsOneSource since adidas bought over Reebok in 2006 both brands have lost U.S. market share of athletic shoes. The U.S. market share of retail dollars for 2006 to 2008 indicates a fall of 4.76% for adidas and 2.02% for Reebok. The original intention of the parent company was to take over Reebok and combined, compete with rivals Nike. The market share lost since the merger was picked up by Nike and new footwear competitor Under Armour. Nike grew from a $1.2 billion company to an $18.6 billion empire and remains the leading retailer of sport shoes in the world. adidas were keen to maintain their challenge for supremacy and bought Reebok for $3.8 billion in 2006. Subsequently both mega giants have lost market share in the US. Down turn of economy aside experts are pondering why these events have come to pass. Some believe retailers want to carry less stock and are generally trimming their inventory so there is no longer room for both Reebok and adidas on their shelves. Others believe the niche market for female athletic shoes (which Reebok have catered for) is small by comparison and no longer as profitable and hence have dropped it.