Reebok Using Two New Ad Campaigns To Raise Prices This Year
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Harrington Says Reebok Needs To
Raise Its Average Footwear Price |
Reebok plans to “refocus its strategies to raise average selling price, expand more aggressively overseas, bolster its sports credentials, and concentrate on marketing to runners and women” this year, according to Jenn Abelson of the BOSTON GLOBE. Reebok will introduce “two major marketing campaigns” in ’07. Reebok Head of Global Marketing Uli Becker said that the company is “looking to celebrate the camaraderie, joy and fun with its ‘Run Easy’ campaign,” set to debut this spring. Becker: “Unfortunately, our image is not one of being a true running brand.” The second campaign, “Best on/Best off,” will begin in the fall and “attempt to differentiate Reebok as a brand that shows its strength both in sports and in lifestyle footwear.” While adidas is promoted as “high-performance, high-end fashion, Reebok will market itself more as a fitness and lifestyle brand.” Reebok will also unveil the Hatana, which the company calls the “first running shoe created exclusively for women.” Reebok also wants to open “up to 90 stores in Russia this year and as many as 200 in China,” while continuing to expand in “key markets” like India and Latin America (BOSTON GLOBE, 2/2). Becker said, “Our job here is not to create a second Adidas. It’s to create Reebok.” In Boston, Donna Goodison reports Reebok raised its marketing budget from 5% of sales to 10% this year, with 80% of that earmarked for the two campaigns. It also “wants to raise its products in more sporting goods and specialty stores.” Reebok President & CEO Paul Harrington: “We need to raise our average price. We need to be less dependent on the $29.99” (BOSTON HERALD, 2/2).
GROWTH FORTHCOMING: adidas Chair & CEO Herbert Hainer said that he expects overseas growth, “particularly in Asia, to push sales at its Reebok division to $5[B] over the next three to five years.” The company also expects “to cut costs” by about $113.3M this year. Hainer said that the cuts would “more than offset” costs of integrating the Reebok brand and result in savings of $13-26M (REUTERS, 2/1). Harrington said that U.S. sales of Reebok “are expected to decline this year before turning positive next year” (BLOOMBERG NEWS, 2/1).
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