Strategic Thought Transformation - The IIPM Think Tank

of the consumers was the primary task for
the company, and they did that with much
panache, comprehensively educating not
only the consumers, but also its own staff.
Reebok set up seventeen exclusive showrooms,
called Sports Infinity, in the major
cities of the country. The stores were designed
in a manner where each of the walls
was devoted to a particular sport – tennis,
golf, cricket, soccer and cross-training. The
staff members were imparted extensive
training where they were taught the finer
nuances of different sports and what was
the effect of those activities on the feet. For
example, basketball players land on their
feet repetitively; squash and tennis shoes
should have non-slip soles and so on and
so forth. The stores also had treadmills and
consumers were persuaded to use them.
Their running activity was recorded on a
camera and they were then shown their
own videos on how different people landed
on their feet in two different ways for the
same activity. This helped them convey the
message that sports shoes purchase decision
is very important and it had a direct
effect on the health of the runner.
Reebok also followed the commonly
tread path of advertisement to entice the
consumers to their stores. The focus of the
advertising though remained the same. The
advertisements focused on the features and
benefits of the shoes. The campaigns were
more or less centered on the concept of
what are the basic requirements of a good
running shoe. It further had celebrity endorsed
campaigns with sports icons like
Mohammad Azharuddin, Navjot Sidhu &
Anil Kumble. Reebok clearly understood
that India is a cricket frenzy country and
anything related to cricket is always well
received by Indian minds. It ensured that
the brand had high recall and high visibility
too. Reebok did not stop at that; it went on
to sponsor local cricket tournaments.
Reebok had seemingly understood the
Indian mindset very well, barring the fact
that Indians are also very price sensitive
people. Reebok products were priced double
the normal products available in the
market that time. And this hit back the
company badly. An incident that allegedly
happened in one of the Reebok stores
became part of management folk ‘jokes’.
This farmer hailing from a village near
Chandigarh walked into a Reebok store
When Reebok
entered India,
customers used to
consider the
Reebok range of
shoes as being
only illogically high
priced & imported
and asked for a sports shoe. When he was
informed about the four digit price, the
wife retaliated by saying that they could as
well buy a buffalo with that much amount
of money. Not necessarily to dissuade the
farmer from buying that buffalo, in early
1996, Reebok introduced the first ever below-Rs.1,000
segment shoe range, offering
a jogging shoe made specifically with the
Indian consumers in mind.
Even at the cost of bearing losses, the
company decided to get their shoes into the
Indian households. The end of the year saw
a discount sale, which was an initiative to
shed out the excess fat. As soon as prices
were lowered, Reebok experienced a significant
sales increase. As walk-ins increased,
a whole new market segment opened up
for the company. January next year, when
the company unveiled its new collection at
earlier prices, the sales figures went further
up. They further tied up with distribution
agencies like Planet Sports for increasing
their reach overnight. The gazelle strategy
of first alluring the target customer through
a rapid market penetration approach, and
then making them addicted to the product,
worked wonders for the company.
Reebok was adapting itself to Indian
tastes and preferences. Though this led to
quite a few successes, it also had its extremities.
Unbelievably so, targeting the
Indian woman, Reebok launched a line of
sports salwar kameez range for women,
which were accepted by Indian women in
the same way as the farmer had accepted
their shoes... basically, it was a disaster!
Reebok learned fast, and adapted. Now,
Reebok has already opened up its first exclusive
women’s store in Gurgaon. To attract
the fairer sex, the company has given
extra attention to the interiors of the shop.
They have deliberately given a softer touch
to the colour and visual tones in the store
and have made a significant effort to reduce
the testosterone level.
Customisation of products, pricing, rebranding
of products, all can be mentioned
as factors leading to Reebok’s success in India.
But what remains to be seen is whether
this success in market share actually translates
into money for Reebok, or would they
keep ruing why they didn’t heed the first
salesman’s report!
An IIPM Intelligence Unit Publication STRATEGIC INNOVATORS 81