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Reebok Launches

EasyTone1

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Current PerformanceReebok Total Performance,2007-2009 (In Millions)

EasyTone Performance 2009 (inMillions)

Performance(millions)

2009

Market Demand (units) 108

Global Market Share 5.3%

Sales Revenues $141

Gross Margin 37%

Gross Profit $52

Marketing, Sales, Admin $42

Net Marketing

Contribution

$64

Marketing ROS 7%

Marketing ROI 24%

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Current Performance

2009 Reebok launches EasyTone

Marketed as walking shoe for women

Reeboks most successful new product in 5years

Claims to tone gluteus muscles andhamstrings/calves 28% and 11% more,

respectively

Average Price: $100

Sold out and on backorder at most retailers

(Nordstrom, Lady Footlocker)

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Marketing Mix

Product

Fit shoe that works to enhance muscle tone in legsand butt

Price

$99.99-$129.99 dependent on various colors andstyles

Place Online: Reebok.com, Zappos.com, Amazon.com

Strategic Retail Partners: Footlocker, SportsAuthority, Nordstrom, etc.

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Market Demand

o Athletic ShoeMarket

o Sales fell 2.2% btw

2007-2009o Growth: 8.4% btw

2009-2012

o Fit Shoe Market

o New section of athleticshoe market

o Growth: 10% per year

btw 2009-2012

Fit Shoe & EasyTone MarketDemand Growth 2009-2012

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Industry Analysis

Fit Shoe Industry scores 59/100 Profitable Industry

Competitor entry, competitor exit, substitutes, buyer power,seller power, price rivalry

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Fit Shoe Industry Analysis

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Competitors7

Price

ShoeAesthetic

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Competition

Reebokss market share and relative share are largerthan Skechers

Competition Sales (B) Market Share Relative Shareof top 3 competitors sales

Reebok $2.7 (2008) 6% 11.2%

Nike $18.36 (2008) 31% 76.1%

Puma $3.07 (2008) 7% 12.8%

New Balance Not public 6% N/A

Asics $2.29 (2008) 5% 9.5%

Skechers $1.44 (2008) 5% 6%

Others 18%

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Share Performance

Potential MSI: 41%

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Customer Needs/Segmentation

The EasyTone Customer

Fitness oriented

Body conscious

Female, Ages 20-45

Looking to increase muscletone of the lower body

Style conscious Price concious

Well educated, middle class

Purchasing Behavior Interested in trendsWants to try better

productsWilling to take a financial

risk on a slightly moreexpensive product

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Competitive Position/ Customer Value

Customer Perception

Shoe that tones the butt and leg muscles with out theunattractive rocking sole, or high price of competitors.

Relative Performance Self-commissioned study found effectiveness of EasyTone,

although study was very small.

Customer Value Increased muscle tone and definition is of greater value than

the cost of the shoe.

Reebok brand equity

$100 is not too much more than a traditional walking shoe,

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SWOT ANALYSIS

Strength Balance Ball Technology Reebok Brand Equity Style preferred to other fit shoes Reeboks most successful product in 5 years Priced at mid-point of fit shoes Light-weight and less chunky thancompetitorsEarly entrant into fit shoe market

Weakness Product currently only available for women Product on backorder for major retailersShoe effectiveness not proven with largerstudy group

Opportunities Expand into a male market Develop an EasyTone shoe for running International market expansionCreate partnerships like Nike and iPod

Threats New entrants/competitors (Nike) Studies to prove effectiveness are self-commissioned, reducing credibility. Fit shoe trend could fail to catch on

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Marketing13

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Marketing

http://www.youtube.com/watch?v=qCHKXICefFw

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http://www.youtube.com/watch?v=qCHKXICefFwhttp://www.youtube.com/watch?v=qCHKXICefFw

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Marketing15

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Questions?

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