The Sporting Goods And Equipment Industry Marketing Essay

The sporting goods and equipment industry is made up of an extremely diverse and large market which contains six types of activities. These activities are:

Competitive Team Sports: (baseball, softball, basketball, diving, soccer, football, etc.)

Extreme Sports: (skateboarding, snowboarding, surfing, etc.)

Fitness: (walking, distance running and all fitness activities).

Individual Sports: (Bowling, Boxing, wrestling, tennis, etc.)

Indoor Games: (billiards, darts and table tennis).

Outdoor Recreation Sports: (fishing, hunting, bicycling, etc.).

All these activities entice customers of all ages and all income groups. Thus, the sporting goods and equipment industry produces a massive range of specialized equipment, apparel, and footwear for all these activities.

Industry size and growth rate:

This section of the report will analyze the sporting goods and equipment in America, Asia-pacific and Europe, as well as analyzing the global market for the industry.

Sporting goods and equipment in America:

The industry in the United States has experienced low growth in the recent years and it is expected that the market slows up over the next five years. In 2009, the industry in the US had a total profit of $24,680.2 million and the annual growth rate was 1.6% between the years 2005-2009. Sales of fitness equipment were the most profitable in the US market in 2009 with total revenues of $5,792.5 million, equals to 23.5% of the market’s overall value. It is expected that the growth rate for the sporting goods and equipment on the way to be suppressed to 1.3% for the period spanning from 2009-2014 which will drive the market to a value of $26,291 million by the end of 2014.

Sporting goods and equipment in Asia-Pacific:

The market in Asia-Pacific captured the second place with total revenue of $23.9 in 2009. The growth rate for the period 2005-2009 was 2.7% at the same period. Sales of Ball Sport Equipment were the most profitable in Asia-Pacific market in 2009 with total profits of 5.4 (22.6% of the market’s total value). The growth rate of the market is expected to be suppressed to 2.5% between the years 2009-2014 and that could drive the market value to $26.9 billion by the end of 2014.

Europe:

The market in Europe captured the third place with total profits of $21.1 billion in 2009, representing a growth rate of 2.2% in 2005-2009. Golf equipment sales were the most profitable in the market with total profits of $3.9 billion which represents 18.5% from the market’s overall value. The growth rate is expected to be the same for the period 2009-2014.

Global:

The total revenue for the industry’s global market was $74.8% billion in 2009 with a growth rate of 2.3% for the period spanning 2005-2009, and the sales of Ball sport equipment were the biggest in the global market in 2009 with total revenues of $13.3 billion which equals to 17.8% of the market’s overall value. The market growth rate expected to be suppressed to 2% for the period 2009-2014 which will drive the market value to $82.7 billion by the end of 2014.

Significant key events in the history of sporting goods and equipment industry:

The Sporting Goods Manufacturers Association (SGMAI) and The National Collegiate Athletic Association (NCAA) were founded in 1905 to make football safer by modifying football equipment.

In the 1980s and 1990s many significant sporting goods companies like Nike and Rebook emerged by adding apparel and footwear as significant products to their categories.

Adidas which is one of the leading companies in the sporting goods and equipment industry started in 1949. After years of success, the company equipped 6000 Olympic athletes from 33 countries. Adidas athletes won 220 medals, including 70 gold which increased the apparel sales by approximately 50%.

In 2006, Adidas and Rebook combined together to make a wider range of products and to capture the first place in the market which led by Nike at the previous years.

In 2006, Nike and apple teamed up to combine the worlds of music and sports together with an innovative idea that allows the footwear to transfer information about time, distance, calories burned and pace to the IPod Nano.

In 2010, Adidas created kits for various World cup teams and also provided the official Jabulani match ball. Adidas sales were up 13% by selling World Cup shirts, boots and balls comparing with the sales in 2009.

Pest analysis:

This part of the report will take Nike which is considered one of the biggest sporting goods and equipment companies as a representative to the industry, and will analyze the PEST for the company products.

Political and legal factors:

Policies play a major rule in fostering the growth of businesses. For instance, US policies have helped Nike to advance their products with stable currency conditions, low taxes and interests rate and macroeconomic stability.

Economic factors:

Strength and weakness of the currency affects the power of purchasing for the customers. Thus, that affects every business. For an international company like Nike, not the local economy only will affect the sales of the company, but the international economy will affect the sales. For example, a weak Euro will suppress the power of purchasing for some customers and that will affect the sales of the company.

Social factors:

These days, people are more concern about their health and the number of athletes and gyms has increased. Thus, the demand for sporting goods and fitness equipment also increased. Responsibility and ethics are also significant because people are looking for responsible companies. For instance, Nike lost a lot of customers when people found out labor and factory conditions at production locations in Asia.

Technological factors:

Technology is a significant aspect for every business. Nowadays, sporting goods and equipment companies are trying to differentiate their products by using the modern technology in their products. For example, Nike used the technology to help the customers to know how much time they spend doing sports, how many calories they burned and the distance they ran or walked. Companies also are using the internet technology to inform their customers about their new products and to make online purchases.