Marketing Strategy: Case Study of New Balance

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The English born William J. Riley formed New Balance in 1906. At first, the focus of New Balance was on orthopedic items and specialized in arch supports. William Riley joined Arthur Hall in 1934, who sold services to individuals, for example police officers, who had work on their feet all day long. There was a high demand for New Balance items when the 1950s rolled around, so much so that the athletes were calling for the customized shoes. In 1954 Arthur Hall sold his daughter and her husband Paul Kidd to New Balance. The market and products produced skyrocketed when Paul Kidd took control along with his father. The New Balance Trackster released the second year in the new decade 1961 which was the first high performance running shoe. The Trackster has a ripple sole for traction and has been available in various widths. New Balance was sold again in 1972 but this time to an outsider of the Jim S. Davis family (‘New Balance History’, 2020). By 1976 New Balance was still low, but with their 320 model and winning first place in the Runner’s World Magazine competition, they made a global break through. New Balance has expanded its running shoe business to include a full athletic shoe empire, including basketball, tennis and hiking sneakers.

Description

The OMN1S, the first shoe in the new line of Kawhi Leonard, was officially released to the public on October 23, 2019, marking the return of New Balance to the market of basketball shoes. The pair, retailing for $140, is made of an upper mesh and features a leather or suede frame wrapping around the foot (Gallinger, 2019). It also features a New Balance-branded brace across the forefoot and midsole FuelCell cushioning technology. New Balance revealed the shoe’s name on February 15, 2019 and showed off the first six PEs that will be a part of Kawhi’s signature shoe contract. During All-Star weekend, the shoes debuted on court. Since the 2010-11 season, New Balance had not produced a basketball shoe since unceremoniously leaving the market when Matt Bonner’s prototype shoe collapsed on the floor.

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Situation Analysis

• Products/services or product/service lines:

Our task at New Balance is to help athletes seek success, whether it’s helping professional athletes set records and win medals, or propelling ordinary people to achieve a new Pb, completing their first 5 K, or just live a safer and more active lifestyle. The items are the perfect combination of feature and design, supplying you with the value technologies you need and the style you desire (‘Inside NB Overview’). With their high-level skills and ingenuity, our colleagues around the world carry these goals to reality. While we are offering the best product on the market, we are also committed to returning. So, while we’re looking to be successful, we believe in ensuring others have the same chance.

• Size of market opportunity:

Market opportunities are enormously open market. Nike is the market leader in the global sports footwear industry, with sales of over USD 22.2 billion in 2018. This figure is larger than the combined footwear revenues of its two closest rivals, Adidas and Puma, which in 2018 made global sales of US$ 12.8 billion and US$ 2.5 billion, respectively.

• Sales and distribution setup:

There are five plants in the United States, and a sixth in the UK. New equilibrium products are marketed by ecommerce, retail stores, and new balance markets (Eatbigfish., 2018).

• Geographic areas sold to:

The products are available in countries such as South Africa, China, Japan, Canada, the UK, New Zealand, Australia and, of course, the USA (Bhasin, 2018).

• Target audience (population, demographics, income levels and so on):

The business has selected upper middle-class young men, women and children as its target customers who are sports fans. It is described as a sportive brand that sells premium products.

• Existing competitors in the marketplace:

New Balance’s principal rivals include Nike, Adidas, and Puma.

• Historically, how well products are sold:

Through revenue through 2018, New Balance has risen from $1.5bn in 2008 to $4.5bn (Eatbigfish., 2018).

SWOT Analysis

• Strengths:

The versatility, distinction, good affiliation with top players, brand positioning are new balance power (Bhasin, 2019).

• Advantages:

It has produced some great ad campaigns shown through tv, sports magazines and channels for social media. The organization has its own website to manage the promotional activities, along with Instagram, Twitter and YouTube.

• Available tools used for marketing goals:

New Balance has social media marketing tool available, ads supported, mailings, advertising, and social influencers.

• Unique differentiators:

New Balance sneakers is a highly differentiated brand, and certain main variations are due to the extra cost that the buyer must pay for the pair. We can choose the color of the shoes and choose the styles we choose. Many models also offer the possibility to print the customer’s name on the foot. The user can visit newbalance.com, as well as custom design sneakers.

• Resources (people + time) that will help:

New Balance has added two allstars in Basketball to their respective brands Darius Bazley and Kawhi Leonard to help relaunch their line of basketball shoes (Newcomb, 2019).

• How to leverage our existing audience to reach the goal:

We would expand our existing market with more ads, more advertisements, more brand influencers, more exposure in the business.

• Weaknesses:

The drawbacks are Exorbitant Price, Expensive Settings and Preferences for Teens.

• Improvements that could be made:

The new balance changes will render are more affordable shoes that cater to 13-25 age range buyers.

• What’s not going so well right now:

Although new balance is a standalone market brand as far as running and walking shoes are concerned. There’s still to be a concrete foundation in the market for basketball shoes.

• Factors that may suck time away from the work done to make the goal a reality:

The factors that would take away the work that we are doing are lack of organization, unclear communication, team infrastructure, workload distribution.

• Tech limitations:

The tech limitations that could prevent New Balance from achieving the goal are packaging quality, cost-effective production and inefficient methods to cope with other shoe rivals.

• Opportunities:

The preferences of customers across the world are changing and with a growing propensity to spend, the customer is willing to invest more in custom-designed shoes. New Balance is one of the first companies to make custom shoes and this makes it one of the forerunners in capturing this trend.

• Content the competition is not advertising:

Our contest isn’t about telling health awareness stories. Financial awareness and wellbeing.

• Stories the competition is not sharing:

Many businesses still must think about deprivation stories. To talk about the minority struggles. Such as inequalities in education, and gaps in social class.

• Trends to capitalize on:

New balance of industrial and hip-hop industry loses significance. A collaboration with popular pop stars like Liuzzo, Drake, and Beyoncé has yet to reach a new level. As previously mentioned, new balance will concentrate on acquiring brand influencers. Many rivals in the market have noticed the gap and capitalized on it.

• How to get better results with less than half of the work?

Developed is a model called 50/30/20, we use 50% of our budget to focus on what we know works, 30% to be a minor progression, and 20% to be on high-risk, uncharted and creative territories (Eatbigfish., 2018).

• Threats:

  • Competition: New Balance’s main rivals are Nike, Adidas, and Puma.
  • Losing to piracy: Most cheap fake imitations of leading footwear brand s are marketed at a very low price. Some buyers want only the look and not the consistency, so they buy the fakes that lead the company to lose out.

• Market conditions (or audience sentiment) that cause a threat when achieving marketing goals:

Our competitors Nike, Adidas and Reebok are overshadowing the market conditions that may keep us from achieving our goal.

Description of Market Segmentation

New Balance’s approach to market segmentation approach to New Balance is that of a concentrated market strategy. The segmentation approach of New Balance is functionality over fashion. Stressing the shoe’s versatility and approaching the professional sportsman is therefore how New Balance segmented the business (‘Differentiates New Balance product’, 2019). The strategy has been selected for three reasons: The selection / volatility of the drug. For elite sportsmen they market mainly specialized expert running shoes. Economic variability, the economic has different sectors but they have opted for follow the same running industry. Finally, marketing strategies to rivals.

Marketing Strategy

Brand range / volatility. They sell primarily advanced specialist running shoes for professional sportsmen. Business variability, the business has different sectors, but they have opted to follow the same operating industry (‘Differentiates New Balance product’, 2019).

New Balance could use the best trail runner in the world as the face of its trail category as they are the leading brand in that category. Price New Balances ‘ aims to achieve 38 percent to 40 percent margins and will therefore keep the brand inexpensive for a new balance entry level shoe at the RARE-RARE price.

Given that entry-level shoes form the bulk of New Balance’s sales may need another strategy. A new high-end line can be made with the entry level shoes starting at a much higher price which is for the more exclusive target market. The clients would be the kind of consumers who mix price with cost, flexibility and reputation.

In South Africa, the middle-income market is growing and so people can afford more high-end products with rising incomes. Place New Balance’s market plan included attacking small sports retailers that were overlooked by their big competitors, these shops ended up contributing 36 per cent of the company’s revenue while the larger stores e. Total, Edger’s, etc. Did the remainder of the share. You may argue that even their methodology of delivery was that of a niche tactic type, because they pursued what their major competitors had bypassed.

It’s not a great move to open braded shops in weak areas like Iambi to keep a low profile. I would also consider opening branded shops in the cities with a new balance. That’s where most operation and population density are, and where the brand itself can show all facets of its business and items that stores can’t buy. We may be afraid to deal for their tillers, but I think there’s plenty of space for retailers and New Balance design stores to both thrive on the market without canceling out. New Balance can also set up an online distribution network where customers can directly buy products online.

Publicity Marketing New Balance has a good form of a public relations campaign to get consumers out there with the word New Balance. As they would organize activities, this baby became a large part of their policy, and that made up a large portion of their expenses. This has given them a lot of exposure via print media and television e. Total sports challenge, sports events for the school.

Conclusion

It is important for all businesses to discover the significance of a marketing strategy. It’s just so helpful to have a marketing strategy that you can think of it as getting a road map (or a cheat sheet). It will lead you in just about every decision you make on the market. In short, the marketing strategy should illustrate the direction you follow toward meeting your goals and objectives. New Balance should take the road that focuses on functionality over fashion. Stressing the shoe’s versatility and approaching the professional sportsman.

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