For the past years of operations of New Balance, the combination of a sound market strategy as well as remarkable leadership have brought the company closer towards the attainment of success in the sneakers industry through impressive growth. New Balance puts great effort in creating their own identity in the market as compared their competitors like Nike and Adidas.
New Balance is using a differentiation strategy in order to gain market competitiveness and increase the success of their market penetration.
Moreover, New Balance has been using this kind of strategy because their management believes that by differentiating their company from their top competitors such as Nike and Adidas, New Balance could easily establish brand loyalty to their target customers.
Furthermore, considering that footwear industry in the United States works under the oligopolistic type of market system, product differentiation would provide an identity to New Balance. In this regard, New Balance finds it easier to achieve their goals and increase their market influence which provides an avenue towards competing with established footwear producers like Nike and Adidas.
Another competitive advantage that New Balance has is their concentration in certain market segments which give them room for establishing good customer relationship in various retail outlets. New Balance concentrates more on catering to the needs of small retailers in order to tap small service type of customers. New Balance divides their retailers into two groups namely: key accounts and specialty dealers, in order to concentrate their efforts or to give ore focus to retailers that bring them more profit and sales.
The market segment concentration strategy of New Balance, compared to their top competitors like Nike and Adidas, allow them to easily tap and establish good customer relationship as well as improve the quality of their service to retailers by delivering their products in a timely manner. Given that their target customers want new and innovative product line, their strategy of intensifying their research and development team could also provide an advantage for the company against Nike and Adidas.
Moreover, extensive efforts of the company to develop their product line are impressive which support their claim of providing high quality products to their consumers. Research and development serves to be one of the important ingredients for New Balance to generate more sales through attracting more customers by providing them with a new and innovative product line. Due to this, it is vital for any company in the industry of footwear to provide at least enough focus for research and development in order to dominate the footwear industry.
Therefore, the more innovative the products of New Balance would be, the more they could have market competitiveness and the more customers they will be able to attract to purchase their products. The only aspect that weakens New Balance would be their concentration on only manufacturing their products and not focusing much on marketing their products. This idealism of New Balance serves as a barrier for further improvement in the footwear industry since successful marketing for their products to their target consumers would mean higher profits and sales.
This is because consumers nowadays are easily attracted to products that are well endorsed by a given company or a product that successfully penetrated a given market segment through various marketing strategies. If only New Balance could give their marketing strategies more attention there is a great possibility, together with their corporate strengths, that the company would attain better market status and influence as compared to maintaining the status quo.