Puma
Puma
Puma SE, branded as Puma, is a German multinational corporation that designs and
sportswear manufacturer in the world. The company was founded in 1948 by Rudolf
Dassler. In 1924, Rudolf and his brother Adolf "Adi" Dassler had jointly formed the
relationship between the two brothers deteriorated until the two agreed to split in
1948, forming two separate entities, Adidas and Puma. Both companies are currently
based in Herzogenaurach, Germany. Puma has been a public company since 1986,
listed on the Frankfurt Stock Exchange. French luxury group Kering (formerly known
as PPR) holds 9,8%, Kering's largest shareholder Groupe Artemis owns 29% of the
share capital. Since 1 July 2013, the company has been led by former football
more than 13,000 people worldwide and distributes its products in more than 120
countries. Following the split from his brother, Rudolf originally registered the newly
established company as Ruda (derived from Rudolf Dassler, as Adidas was based on
Adi Dassler), but later changed the name to Puma. Puma's earliest logo consisted of a
square and beast jumping through a D, which was registered, along with the
company's name, in 1948. Puma's shoe and clothing designs feature the Puma logo
Puma offers products for Football, Basketball, Running, Training and Fitness, Golf,
including Pelé, Eusébio, Johan Cruyff, Diego Maradona, Lothar Matthaus, Clyde
Frazier, Jim Hines, Boris Becker, Martina Navratilova, Tommie Smith, Joe Namath,
Linford Christie, Colin Jackson, Heike Drechsler and Michael Schumacher among
Sergio Agüero, Antoine Griezmann, Marco Reus, Raphael Varane, Luis Suárez,
David Silva, Vincent Kompany, Christian Pulisic and many more are sporting Puma
Bengaluru FC, Mumbai City FC and many others. National football teams include
Italy, Iceland, Switzerland, Austria, Morocco, Egypt and Uruguay. In athletics (track
and field), Puma sponsors several athletic associations such as the Jamaica, Cuba,
and Norway. It also has the world's fastest man and Jamaican track athlete Usain Bolt
under contract along with other track and field athletes like Andre Degrasse, Karsten
Warholm and Gianmarco Tamberi. Over the past decades, several world records were
achieved by athletes wearing Puma shoes, such as Heinz Futterer (1954), Armin Hary
(1960), Jim Hines (1976), Tommie Smith (1968), Asafa Powell (2005), and Usain
Bolt (2009).
In 2018, Puma announced its entrance back into basketball after a break of almost 20
years. The brand appointed Jay-Z as creative director of Puma basketball. Marvin
Bagley, Deandre Ayton, Zhaire Smith, and Michael Porter Jr. are the first players to
join Puma's basketball roster and play in performance Puma basketball shoes. Also,
Puma made its partnership with Netball after 28 years by sponsoring the Melbourne
Vixens, the only netball team to be partnered with the global firm From 2018, Puma
became the official apparel sponsor of New Zealand's national netball team, the Silver
Ferns. The firm sponsors Indian cricketer Virat Kohli the captain of the India cricket
team. Golfers such as Rickie Fowler, Bryson DeChambeau and Lexi Thompson are
equipped by Puma's golf brand Cobra Puma Golf. In Formula 1, Puma equips the
teams of Mercedes AMG Petronas, Scuderia Ferrari and Red Bull Racing. In addition,
Puma also sponsors BMW and Porsche in all of their Motorsports activities. In
NASCAR Puma equips Team Penske with fire suits, gloves, and shoes. In order to
support its women's business, Puma endorses supermodel Cara Delevingne and
Adriana Lima as well as actress/singer Selena Gomez. Puma is also the main sponsor
of the Israel Football Association (IFA) and is currently a focus of the Palestinian
Boycott, Divestment and Sanctions movement. The IFA, with sponsorship from Puma
and other companies, operates from settlements, as does Puma itself via its past and
present licensees in Israel. In July 2021, there were anti-sweatshop protests outside
BACKGROUND
Christoph von Wilhelm Dassler was a worker in a shoe factory, while his wife Pauline
ran a small laundry in the Franconian town of Herzogenaurach, 20 km (12.4 mi) from
the city of Nuremberg. After leaving school, their son, Rudolf Dassler, joined his
father at the shoe factory. When he returned from fighting in World War I, Rudolf
was trained as a salesman at a porcelain factory, and later in a leather trading business
in Nuremberg. In 1924, Rudolf and his younger brother, Adolf, nicknamed "Adi",
founded a shoe factory. They named the new business "Gebrüder Dassler
Schuhfabrik" (Dassler Brothers Shoe Factory) which was the only business at the time
that manufactured sports shoes. The pair started their venture in their mother's
laundry. At the time, electricity supplies in the town were unreliable, and the brothers
sometimes had to use pedal power from a stationary bicycle to run their equipment. In
1927, they moved into a separate building. The brothers drove from Bavaria to the
1936 Summer Olympics in Berlin with a suitcase full of spikes and persuaded United
States sprinter Jesse Owens to use them, the first sponsorship for an African
American. Owens won four gold medals. Business boomed; the Dasslers were selling
200,000 pairs of shoes annually before World War II. Both brothers joined the Nazi
Party, but Rudolf was slightly closer to the party. A growing rift between the brothers
reached a breaking point during a 1943 Allied bomb attack. Adi and his wife climbed
into a bomb shelter that Rudolf and his family were already in. "Here are the bloody
bastards again," Adi remarked, apparently referring to the Allied war planes, but
Rudolf, due to his apparent insecurity, was convinced his brother meant him and his
family. When Rudolf was later picked up by American soldiers and accused of being
a member of the Waffen SS, he was convinced that his brother had turned him in.
After increasingly different views of how to run the business, the brothers split the
business in 1948. Rudolf moved to the other side of the Aurach River to start his own
company. Adolf started his own company using a name he formed using his nickname
—Adi—and the first three letters of his last name—Das—to establish Adidas. Rudolf
created a new firm that he called "Ruda", from "Ru" in Rudolf and "Da" in Dassler. A
few months later, Rudolf's company changed its name to Puma Schuhfabrik Rudolf
Dassler in 1948. Puma and Adidas entered a fierce and bitter rivalry after the split.
The town of Herzogenaurach was divided on the issue, leading to the nickname "the
town of bent necks"—people looked down to see which shoes strangers wore. In
1948, the first football match after World War II, several members of the West
German national football team wore Puma boots, including the scorer of West
Germany's first post-war goal, Herbert Burdenski. At the 1960 Summer Olympics
Puma paid German sprinter Armin Hary to wear Pumas in the 100-metre sprint final.
Hary had worn Adidas before and asked Adolf for payment, but Adidas rejected this
request. The German won gold in Pumas but then laced up Adidas for the medals
ceremony, to the shock of the two Dassler brothers. Hary hoped to cash in from both,
but Adi was so enraged he banned the Olympic champion. During the 1968 Olympics
Black Power Salute, Puma sponsored African-American athletes Tommie Smith and
John Carlos, after having won gold and bronze in the 200 meters respectively, took to
the podium with their Puma Suedes in hand and bowed their heads and raised their
black-gloved fists in silent protest during the playing of the national anthem, an act
meant to stand up for human rights and to stand up for black Americans. In February
2007, Puma reported that its profits had fallen by 26% to €32.8 million ($43 million;
£22 million) during the final three months of 2006. Most of the decline in profits was
due to higher costs linked to its expansion; sales rose by more than a third to €480.6
million. In early April 2007, Puma's shares rose €29.25 per share, or about 10.2%, to
€315.24 per share. On 10 April 2007, the French conglomerate PPR (which became
Kering in 2013) announced that it had bought a 27% stake in Puma, clearing the way
for a full takeover. The deal valued Puma at €5.3 billion. PPR said that it would
launch a friendly takeover for Puma, worth €330 a share, once the acquisition of the
smaller stake was completed. The board of Puma welcomed the move, saying it was
fair and in the firm's best interests. As of July 2007, PPR owned over 60% of Puma
stock. Puma holds a 5% stake at German sports club Borussia Dortmund, whose
supplier has been the company since 2012. The company has been led by former
football professional Bjørn Gulden (chief executive officer) since 1 July 2013. Puma
is the main producer of enthusiast driving shoes and race suits. They are the primary
producer for Formula One and NASCAR clothing. They won the rights to sponsor the
2006 FIFA World Cup champions, the Italian national football team, making and
sponsoring the clothing worn by the team. They entered a partnership with BMW,
womenswear line in December 2014. In 2014, Puma and Arsenal Football Club
the biggest deal in Puma and Arsenal's history. The partnership ended in 2019. In
March 2018, Puma launched its venture with its ambassador Selena Gomez called
"Phenom Lux''. In 2018, Puma re-entered the basketball sneaker market for the first
time in 20 years and announced Jay-Z will be the creative director for Puma
Basketball. Puma last sponsored Vince Carter in 1998. They signed young basketball
players Marvin Bagley III and Deandre Ayton, both of whom became the Top 2 picks
of the 2018 NBA Draft. In December 2018, Puma reintroduced the RS Computer,
with "RS" standing for "running system." The shoe contains technologies such as an
accelerometer and Bluetooth. In September 2020, Puma signed with Brazilian football
superstar Neymar. In July 2021, Puma signed with 18 athletes in India to represent the
country in national and international events across sports such as hockey, shooting
etc. In December, the brand launched High Court, its first-ever women's basketball
In 2000, Puma began auditing all of its suppliers on a yearly basis, and makes the
results available in its sustainability reports. Since 2005, it has publicly provided a list
of its suppliers. In August 2004, a joint report from the National Labor Committee
and China Labor Watch stated that workers at some of Puma's Chinese factories were
enduring sweatshop conditions, working up to 16.5 hours per day for about US$0.31
an hour. Puma said they would investigate the claims. In February 2012, a woman
who worked for one of Puma's suppliers in Cambodia was shot during a protest over
factory working conditions. Puma acknowledged the poor working conditions and
said they would work to improve the situation. According to a joint report from
Labour Behind the Label and Community Legal Education Centre, 30 workers fainted
in November 2012 while producing clothing for Puma in China. The faintings were
caused by excessive heat and alleged forced overtime. In 2014, almost 120 workers
fainted in two Cambodian clothing factories where sportswear was being produced for
Puma and Adidas, due to temperatures above 100 degrees. In March 2017, 150
workers assembling Puma products in Cambodia fainted due to thick smoke. Puma
has obtained the Ethical Clothing Australia accreditation for its Australian-made
products. This labour-friendly accreditation applies to only a small percentage of
Puma's total production. In May 2011, English newspaper The Guardian released an
article saying that Puma was the "world's first major company to put a value on its
commitment that within four years, half its international collections will be
develop more sustainable materials and products." Puma is also known for boosting
positive environmental practices in its supply chain through financial incentives. The
performance of key suppliers to the costs at which they can access finance. Such
scheme won the company an "Innovation Award" in Supply Chain Finance in 2016.
Puma is one of the most well-known manufacturers of sports shoes but they also have
marketed their diversified product line using Ambassadors, CSR Strategies. They
have an Innovative Research and Development team that helps them in getting new
and advanced products for them in the market Let’s discuss their marketing strategy
in detail. First, let us see the product diversification of puma which has made it
1. Product Diversification
Puma has come a long way, from producing only footwear products to diversifying
custom-made shoes, racer suits, and shoes for Formula One, Puma has been providing
football shoes for football players and various equipment for various sports. Let us
Puma has signed deals with various sports personalities like Virat Kohli, KL Rahul,
Sushma Verma, Sunil Chhetri to promote their brand. Puma also endorses its
products with different celebrities for example Saina Nehwal endorsed Badminton
racket and cork. Puma has made its brand image by making famous sports players
who most Indians follow in their fields. their brand ambassadors influence people in
buying their products. Making a person feel proud of the brand they are purchasing is
also an important marketing tactic. Let us now see some of Puma’s CSR strategies
3. CSR strategies
Puma had been providing Sports Scholarships to promote sports culture and also Anti
Child Labour Campaign. Puma has 10 sustainable goals to fulfill by 2050 ie Human
Instead of a Shoe Box and cover for the box, Puma started replacing them with Clever
Little boxes to reduce the use of cardboard, paper, plastic, and less emission of
Puma did some great work in creating campaigns that hit people differently and subtly
promote their brand. Here, we have discussed the best campaign by Puma. Propah
Lady Campaign The campaign celebrates the shift from women being told what to do
and not do. The campaign celebrates breaking the stereotypes. The ambassadors of
this campaign are Boxer Mary Kom, Actress Sara Ali Khan, International Athlete
Dutee Chand, and Transgender model Anjali Lama. This campaign focuses on how
women are always told to be feminine, wear decent clothes, be soft and not be
opinionated. From a very young age, women are always told to be proper but this
campaign focuses on how women can be a Propah Lady which means women can be
however she wants to be and not how society wants her to be. During the past years,
people have started using social media on a large scale and every company should
have a social media campaign. Let us now look at Puma’s social media campaigns.
Every different social media account has its unique use. Puma has managed all of its
accounts properly and is posting all relevant content on its social media. Let us start
by looking at Puma’s Instagram strategy. On their various social media handles, they
Puma SE’s generic strategy for competitive advantage emphasizes making the
company and its products different from the competition, based on Michael E.
Porter’s model for generic competitive strategies. On the other hand, the company’s
intensive growth strategies focus on gaining a larger share of the international sports
shoes, apparel, and equipment market, based on Igor Ansoff’s Matrix for growth
strategies. In this case, Puma uses its generic strategy and growth strategies in directly
competing against such companies as Nike, Adidas, ASICS, Under Armour, and VF
Corporation. Given the global market’s dynamics, these firms need competitive
advantages that strengthen the attractiveness of their sporting goods among target
makes the sporting goods business competitive, continuing in its growth and
players in the industry. The combination of Puma’s generic strategy and intensive
generic strategy and corresponding intensive growth strategies, and the strategic
business operations in the global market. Based on Porter’s model, this generic
strategy creates competitive advantage by developing the uniqueness of the business
and its products, such as through innovation in the design of athletic footwear. This
generic strategy moves the business toward attaining Puma’s corporate mission and
empowers the multinational company to successfully reach and satisfy its target
customers, despite rivalry against competitors, especially large and aggressive firms
that offer comparable sporting goods. The success of this generic strategy for
strategies for growth. The company also uses focus strategies for some of its product
lines, such as athletic shoes for certain market segments involving specific types of
sports activities. The cost leadership (best cost provider) generic strategy is not used
maintaining Puma’s high investments in product design and innovation. This strategic
objective supports the generic strategy’s requirement of making the business and its
social responsibility strategy helps build the uniqueness of the company’s corporate
global market for athletic shoes and accessories. For example, Puma’s marketing mix
tactics for marketing communications. The company’s intensive growth strategies are
used to achieve such strategic objectives pertinent to the global sports shoes and
equipment industry.
Market Penetration (Primary). Puma’s main intensive growth strategy is market
penetration. In the Ansoff Matrix, this intensive strategy for growth focuses on selling
more of the company’s current sports shoes, apparel, and equipment to current
markets. The SWOT analysis of Puma SE outlines the business strengths used to
the use of competitive advantages based on the company’s generic strategy, which
products.
intensive strategy for growing the business. For example, the company integrates
computing technology in its athletic shoes, leading to better products that satisfy
athletes and non-athletes alike. In this regard, this intensive growth strategy pushes for
resources used for innovating sporting goods. For instance, Puma’s corporate
structure includes human resources that are dedicated to innovation in the design of
products. Also, the success of this intensive growth strategy and the corporation’s
Puma’s corporate culture provides support for human resource development necessary
continue increasing investment in research for new and improved designs of athletic
development as an intensive growth strategy. In this case, the Igor Ansoff Matrix
definition of market development entails selling the company’s current sporting goods
in new markets, or offering current sporting goods for new purposes or uses.
the competitive advantage to ensure this intensive growth strategy’s success. In using
Puma’s existing products, in order to create new revenue streams for the business.
products in new industries or markets other than the company’s current ones, which in
this case is the market for athletic footwear, apparel, accessories, and equipment.
Puma maintains its operations within this current market. This market focus means
that the diversification intensive growth strategy has insignificant contribution to the
sporting goods corporation’s growth. Considering that Puma uses the differentiation
generic strategy, the use of diversification would likely involve the same generic
implementing this intensive growth strategy, the company needs to obtain adequate
the technological and social trends relevant to business design and product
development.
PUMA BRAND AND DRIVERS OF GROWTH IN THE INDIAN
SPORTSWEAR INDUSTRY
Several things made Puma a successful product. As a brand, Puma focused more on
its consumers than on the profit margins. The company provided footwear that fit
their clientele. For example, while entering the Indian market, the company realized
that more clients preferred flip-flops and sandals as compared to closed shoes. The
company included the said type of shoes for the Indian market to their portfolio. In
turn, the company recorded massive profits compared to their competitors. In the
same breath, it is crucial to acknowledge that the company’s strategy takes a country
approach as opposed to a global approach. By doing so, the company customized its
different countries. The company’s retail strategy also led to its success. For example,
franchising helped the company become very successful. Taking the case of Puma
India, in 2016, the company had 340 stores in the country. 320 of the 340 stores were
franchises (Puri & Krishna, 2016). According to Puri and Krishna (2016) franchising
connections to develop trust amongst its target clients. In the same breath, Puma did
not pick out partners for the franchises. The company used a strategic approach,
where they made deals with local footwear stakeholders to sell their products. For
example, the company made a partnership deal with Rishabh Sports Station, which
was Reebok’s largest vendor (Puri & Krishna, 2016) when Reebok closed some of
their shops. Thirdly, the promotional strategy used moved the company ahead of
many of its competitors. The company invested in other ventures, such as a posh
social club in the Indian suburbs, to attract its clients. The Forever Faster campaign
was also enhanced to capture the new markets. Initially, the said campaign focused on
athletes, but with the new markets, it focused more on the client, creating the idea that
Puma’s shoes were not only fit for athletes, but for everyone who wears them. The
Many of the locals began to prefer lighter sportswear with high-performance rates.
Puma took advantage of the new trend to create lighter footwear for the Indian
market. Additionally, it changed its marketing strategy also to involve the ordinary
people. Another growth factor of the Indian sportswear as the disposable income level
increased. Additionally, the consumers became more aware in regards to fitness and
health. Thus, exercising became an excellent way for Puma to make profits.
Additionally, the public became more invested in good health. More people joined
gyms and started exercising. The trend increased consumer demand of sports gear and
companies such as Puma took advantage of the situation. The company also provided
SPORTSWEAR MARKET
Even though Puma leads its rivals in the Indian market, the company still has much to
do regarding maintaining the leadership position it enjoys. To begin with, Puma has to
change its strategy. The company has used the same marketing approach for
approximately eight years. It is the said plan that has allowed Puma to become the
number one brand in India. Indeed, one can argue that even though the strategy
ensured the company recorded the highest profits compared to its competitors, it has
to be adjusted to fit the company well enough to maintain its current position. In the
new strategy, Puma has to consider the growing E-Commerce model and the evolving
Indian market as well. Whereas the market is still pushed by fitness and healthy
living, the cost of living in India has gone up (Nakassis, 2016). Even though Puma
tapped into the E-Commerce model, much still has to be done in the same regard.
Additionally, new online marketing strategies have come up. The company would
have to revise their online marketing strategies to incorporate the said new policies.
For example, the current prevailing trend in digital marketing is the use of online
focus groups. For instance, sports fanatics have online groups, which offer a great
opportunity for organizations such as Puma to advertise their products. One can argue
that Puma already has experience in this type of marketing, albeit using the strategy
offline. As stated, the company has already set up a high-end social club in the Indian
suburbs. The same concept applies to the use of online focus groups. It can also be
argued that Puma has to revise its prices or make better shoes at a more affordable
rate. With the cost of living going up, access to disposable income is limited. Thus, to
the target market, the purchase of shoes and other sportswear is preferential. The
revision of prices will ensure that clients can still purchase Puma products at all times.
It is vital that the company does not stop manufacturing their top brands in the
country. The reason behind this is that some consumers are loyal to brand and product
(Sengupta, 2013). Thus, replacing or removing the product from the market would
mean losing profits. Puma also has to ensure that they manufacture high-quality
According to the 2016 census, India has approximately 1.3 billion people (NPCS,
2014). The large population has attracted numerous companies in the country.
Suffices to mention, more sportswear companies have also entered the Indian market.
To fight the competitors, Puma has to become the ultimate household name in the
region. There are several things that the company should consider in an attempt to
become the biggest domestic name in India. First, the company has to produce
footwear for all people regardless of their socio-economic status. According to NPCS
(2014), 22% of the population in India is living below the country’s poverty line. 267
million people in the country are in the middle-class economic bracket. The change in
the structure of the Indian society has allowed more people to amass wealth and live
well. It is important to note that whereas Puma offers low-priced products compared
to its competitors, a large percentage of people in the country cannot afford their
products. Thus, the company has to make sure it has products for each type of
Secondly, to fight the response from the other international brands and become the
number one footwear brand, the company has to create a monopoly in the market.
Since it is not the first footwear company in the region, Puma has to make sure its
products are in every store all across the country. Baisya (2013) argues that the
marketing strategy ensures that a potential consumer will always have a Puma product
to consider regardless of the type of footwear he/she is looking for, or the store he or
she loves to shop. It is important to mention that this strategy will require massive
production. Thus, the company has to consider its capacity to produce that many
shoes to cover all major stores in India. It is advisable that the company start with one
city at a time. The process of choosing which cities to start with should be based on
the company’s current profitability margin, where the most profitable regions get the
One theory of international business that can be found in the Puma case is the
Monopolistic Advantage Theory. Buckley and Ghauri (2015) explain that the
theory applies to the Puma case as the company seeks to achieve monopoly through
franchising. As stated, in 2016, Puma had 340 stores in India out of which 320 were
franchised. Buckley and Ghauri (2015) confirm that many franchises are a partnership
between local stores and international brands. By partnering with the local stores,
Puma creates a form of trust with its target audience. Additionally, the monopoly is
achieved as Puma shoes can be found in almost all stores. Since it is much cheaper for
the company to use franchises, it is easier for them to also supply products all through
the country. Another theory that can be applied in the Puma case is the product life
cycle theory. Buckley and Ghauri (2015) explain that the product lifecycle notes that
international products usually have their first successful venture in the US. Other
companies in developing countries then import the said merchandise attracting the
developing countries. In the case of Puma, whereas the brand is German, it is very
successful in the US. Before Puma moved into the market, some local shops imported
the brand. Due to the large market size, and the popularity of the brand, the company
decided to open its stores in the country. The New Trade Theory can also be used to
analyze Puma’s experience in the Indian market. According to the New Trade Theory,
international trade increases the choices available to consumers and at the same time,
reduces the costs of the products (Buckley & Ghauri, 2015). When Puma entered the
Indian market, it found Nike and Reeboks among other competitors. Due to the
availability of various brands, the company had to lower its costs considerably to gain
an advantage over the rest. The other companies were also forced to revise their prices
making footwear more affordable to the target market. It is important to note that
while New Trade Theory pushes for reduction of cost based on the availability of
different brands, it also stresses the need for quality. Many international companies
achieving the ultimate monopoly, Puma has to ensure all its merchandise, even the