Dakota Chin

Reebok Project

SPM 466

A. Recommended Decision

This Reebok campaign will be old legends reimagined headlining a 1980s classic shoe

the Reebok Workout. The purpose of this remodeling is for Reebok to regain a competitive

edge in the lifestyle shoe market by targeting active women ages 18-35 who want a versatile

shoe that is also fashionable. Reebok gained their popularity in the United States in the 1980s

when they released the Reebok Freestyle an athletic shoe specifically designed and marketed

for women. During this time Reebok was actually more popular than Nike in the sneaker

industry and it wasnt until 1989 that Nike even began to make get back into the race with

Reebok (Mcgill, 1989). This new innovative shoe will be the first step in getting back to

Reeboks roots of the womens athletic lifestyle shoe and regaining the women demographic thus

taking back some of the market share within the lifestyle shoe industry.

Through the use of a combination of designs from the Adidas Ultra-Boost, Reeboks

DMX foam technology, and of course the classic 1987 Reebok Workout. On top of a trendy

design from mimicking trending shoes in the market this remodeling will include features that

will make the shoe innovative through the use of technology from Boa Lacing Systems, as well

as Gore-Tex. This campaign coupled with the new Reebok logo design will help the company

regain their cool and innovative public image.

B. Decision Criteria

The decision to build a lifestyle versatyle show was based off of recent market trends.

Lifestyle shoes has grown more than 40 percent for the year so far (Powell, 2016). Most of the
 major brands in this sector have struggled, with Adidas being a standout exception (Powell,

2016). With that being said there is a huge opportunity for Reebok as a brand to step into this

space. The target market of this campaign will be woman ages 18 to 35, due to their ability to be

active and experience with social media. Another reason why we focused on designing and

marketing a shoe for women is because women are less brand loyal versus men according to a

survey of 4,300 individuals from the US, UK, Brazil, and China. The survey states that men are

30% more likely to be brand loyal compared to 16% of woman being brand loyal

(Marketingcharts staff, 2014). Lastly re-imagining the Reebok Workouts from 1987 was a logical

decision because they were ranked #8 on complex.coms 80 greatest shoes of the 80s

(Bengtson, Warnett, Schonberger, 2012).

We will have four famous instagram models (two of which are Reebok sponsored) to

promote the shoe at our event which will be discussed in a later part of this paper. Those models

include Gigi Hadid who has 33.4 million followers and is one of the two sponsored by Reebok,

Emily Skye who is also sponsored by Reebok and has a following of two million, Alexis Ren,

8.7 million followers, and Kayla Itsines, 6.8 million followers. That itself will then have a total

of 50.9 million Instagram users who will see the promotion of the Reebok Workout DMX+. After

the first event held in New York City we will launch a three month campaign on Instagram

building up to the release date. We will then have a raffle and in order to be entered into the raffle

you must be over the age of 21. There will be 150 raffle winners for each event and the winnings

will include a pair of our exclusive Reebok Workout DMX+ shoe and a ticket to our after party

of the event.

C. Proof of recommendation
 This campaign to market the Reebok Workout DMX+ will rebrand Reebok by

demonstrating value in style and innovation for the women market ages 18-35. The purpose of

marketing to this demographic is to recapture the market that made Reebok so successful in the

United States, and allowed them to compete with NIke in the 1980s. In 1982, Reebok produced

the first athletic sneaker for women (Ellis, 2013). This shoe was called the Reebok Freestyle.

This was a shoe that women can wear to and from the gym, while being practical for the actual

workout itself. It was a popular shoe at the time and gave Reebok a leading edge over Nike. The

Reebok Workout was released in 1987. This was a second shoe launched for women, which was

very successful to women who enjoyed being active and fashionable, allowing Reebok to

maintain a healthy market share over Nike between the years of 1987 and 1989 (Rohm, 1999).

Nike started creating shoes that were more trendy and more popular to women in the mid 1990s.

This was when Nike started to fully dominate the athletic footwear industry and the women

sneaker market. The DMX+ will be a reimagined and more innovative model of the vintage

Reebok Workout from 1987. This shoe will be the new trend in the lifestyle versatile shoe

industry, with the introduction of new technology for Reebok. Technology like Boa Lacing

Systems and Gore-Tex material will make the DMX+ stand out over other women lifestyle

sneakers. The shoe will also have stylish features for the modern market. Gore-Tex is a

comfortable, long lasting fabric that is used to protect fabric from the weather. This will make

sure that your shoe will stay dry during the worst rain or snow storm. BOA lacing technology is

usually found on hiking boots, snowboarding boots, or ice skates. BOA laces is a wire that is

connected to a knob close to the top-center of the shoe (Deeter, 2013). You use the knob to make

your shoe more tight or more lose, depending on your comfort level and particular activity. This
 will guarantee the perfect amount of comfort for any activity. This show will be a top seller to

women who want a shoe that they can wear for all activities, without losing a stylish look.

In order to help stimulate awareness about this product, there will be a launch party with

famous social media celebrities who will wear the limited edition shoes in pictures. This will

spread the image of Reeboks new shoe and market it to their followers. Our Instagram models

will be Gigi Hadid (33.4 Million followers and Reebok sponsored), Emily Skye (2 Million

Followers), Kayla Itsines (6.8 Million Followers), Anna Victoria (1.9 Million Followers), and

Alexis Ren (8.7 Million Followers). The exposure on their instagram accounts will be a great

asset to advertise directly to consumers and increase hype about the brand. The launch party will

be explained more depth in the action plan.

D. Critique of options

The footwear market is very saturated which makes it difficult to create and innovate new

shoes. Reeboks current market focuses on training and CrossFit shoes, especially for women.

Since they already control the market for CrossFit, the best direction would be to create a

lifestyle shoe designed for women. Then figuring out how to market our new product.

The decision to create a new lifestyle shoe for women is due to the fact that there are few

womens specific products, brands or retailers. Most of Reeboks sneakers are dedicated towards

CrossFit. CrossFit shoes are solely used for working out rather than for style and comfort. This is

what drove our decision to branch out. Womens sneaker sales at retail in the US have not grown

in the last three years. While the womens running business has been solid, losses in other key

categories held the total number back (Powell, 2014). Mens shoes represent 59% of all

sneakers sold in dollars, Womens 22% and kids 20%. This makes the womens sport footwear

market about $4.8 billion in the US at retail (Powell, 2014 paragraph 2). Clearly there is a need
 for womens lifestyle sneakers. By creating these sneakers, Reebok can expect to dramatically

increase its revenue, while at the same time creating loyal customers.

Reebok understands that they cannot compete financially with their competitors such as

Nike or Adidas when it comes to promoting new inventions. These companies have the ability to

outbid any potential celebrity that would endorse our product. That is why our decision to stay

away from celebrity endorsements will prove beneficial. Our marketing campaign will focus on

developing a social media presence. To do this, Reebok will target popular social media users

(mostly Instagram) to promote our sneakers. By doing this, Reebok will be able to gain the same

amount of publicity as competitors while saving millions.

E. Major disadvantages of decision

Any plan can have potential disadvantages. Even though this campaign is whats best for

Reebok moving forward, there will be possible drawbacks. These include fierce competition as

well as Reeboks currently limited brand loyalty.

The footwear market is one of the most competitive in the world, which makes it difficult

to enter and gain customer loyalty. Increasing participation in sport and fitness activities are

some of the factors that are driving the global athletic footwear demand. Even though The

global athletic footwear market valued at around USD 80 billion in 2015 and this market is

anticipated to grow at a CAGR of around 2%, from 2016 to 2024 (Athletic, 2017), there is

limited entry. The leading market players in the athletic footwear market are Nike, VF

Corporation, Adidas, New Balance, and Asics. These five companies account for around 80% of

the overall market share. Nike and Adidas accounted for around 45% and 35% of the overall

revenue generated in the athletic footwear market (Athletic, 2017). Our plan to market directly to

women will be our foot in the door of the athletic footwear market.
 Reebok has been blown away by its competitors in terms of loyalty among its customs.

Establishing differentiation is important in a crowded field like fitness brands. Theyre all trying

to not only promote their products, but also be associated with the fitness lifestyle and culture.

Finding new and unique ways to not only sell product but to also be a place where consumers

can turn to for fitness lifestyle choices will continue to be the goal for many fitness brands. As

more people become health conscious and aware that exercise and good health should be a way

of life, brands will continue to find ways to cater to their wants and needs (Forte, 2016). Creating

a new line of womens footwear will be the first step towards a loyal group of customers.

F. Action plan

Due to the fact that Nike has the ability to out bid Reebok for any major celebrity

sponsors, this campaign will be focused on people with a strong social media presence.

Millennials18 to 34-year-oldsspend the most time on social media6 hours and 19

minutes weekly or 24% of their total time spent on media. The share is up 21%.(Lafayette,

2017) Social Media has become a new market of direct to consumer advertising because even

though people are watching cable television Nielsen found that 30% of smartphone users said

they use their devices several times a day while watching TV. Also 21% of the owners of tablets

use them while tuned into TV. (Lafayette, 2017) There will be an event located in Central Park,

New York and another event hosted in Los Angeles, California at Palisades Park. These two

events will take place during New York Fashion Week on September 9th and the next event will

be held on September 30th during Los Angeless fashion week. The event will be correlated into

Crossfit and or Casual running such as 5K, followed by a private concert by DJ Calvin Harris

and there will be Reebok banners and photo areas at the exclusive private concert to build hype
and a cool factor for the Reebok brand. Since both events are held in a high rate time of people

being in either city due to the fashion week, the after party will take place in two high end

nightclubs. In New York City it will be held at Marquee nightclub and in Los Angeles it will be

held at Exchange which is also a high end nightclub. Calvin Harris will be performing at both

events and tickets will still be open to the public. For people who buy tickets publicly they will

not receive a pair of the Reebok Workout DMX+. The after party will be sponsored by Reebok

so it will increase brand awareness tremendously especially for the target market of 18 to 35 year

old woman.

These are big promotional events that may end up costing Reebok a lot but to put into

perspective the amount of money necessary to gain demand within the sneaker industry, Nike

spent $3.031 Billion in 2014 on Demand Creation. This is much cheaper alternative that if

executed successfully should have a substantial impact. (Leach, 2015)

In order to build hype around this product Reebok will not be making the product

available to the public for three months allowing social media campaign to increase talk about

the product. The combination of social media celebrities and Reeboks social media pages

displaying the style and features of the innovative product will build hype over the three month

span as well as reminding the public how many days are left in the countdown for the limited

release of the high end product priced at $160 just under similar products within the industry

who have seen success such as the Adidas Ultra Boost and Nike Air Max Thea (both $180). The

cost to produce this shoe based off of the industry average of similar products is between $21-

$33 which allows Reebok to maintain healthy margins (Lopez, 2016). Two weeks before the

release Reebok will announce the exact time and place where the shoes will be released to

influence the formation of a line outside the store and surround the Reebok brand with hype and
 a cool factor. After the limited release there will be a new countdown with a specific date as to

when the remodeled shoe will be released for retail allowing another three month span for the

limited release shoes to be sold privately at an increased price on online shopping centers. This

concept is model after the Yeezy boots which were originally sold at $350 a pair and were then

seen being sold on Ebay for up to $7,000. (Roberts, 2015)

The product that will be sold for retail will feature a variety of colors and sizes to again

increase hype and talk about the product by showing a never before seen style of the shoe and

also allowing customers to express themselves in a variety a ways similar to market trends.

Along with the release of these shoes at the $160 price mark there will be a cheaper version

released with a similar design but cheaper material at a $100 price mark based on industry

averages of the Adidas Alpha bounce and Nike Air Zoom.

G. Major risks and responses

Major risks include marking a shoe that resembles the vintage Reebok Workout from 1987.

The Reebok Workout was a popular shoe with a great reputation to athletic women in the late

1980s and the relaunch of the shoe would be an ideal product to trigger nostalgia from

customers. In order to do this successfully new technology has been introduced to the redesigned

shoe. Another concern is whether or not our customers want BOS Laces on their sneaker. The

knob on the shoe is pretty big, which may look unattractive to certain customers. Were using

attractive Instagram models during our relaunch campaign to show consumers that the knob is

trendy and attractive. If they have no problem with taking pictures and wearing the shoe in

public, then potential customers will feel that the shoe is appropriate to wear in public. Adidas

recently release a shoe with BOS laces technology. The knob doesn't appear to be losing Adidas

revenue and is actually selling online. The wait between the launch party and the actual release to
 the public may cause a loss of interest in the Reebok Workout DMX+. A heavy social media

campaign will help to ensure the Reebok Workout DMX+ is still on customers and fashion

enthusiast minds. This will make sure that they're ready for the official day that the Reebok

Workout DMX+ will come out for the public to purchase.

H. Appendix

In Order:
1.) Classic Reebok Workout 1987
2.) Updated Reebok Workout 2017
3.) Adidas Ultra Boost
4.) DMX Technology
5.) Boa Lacing System
6.) Gore-Tex waterproof material

Work Cited

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