Strategic Vision

Strategic Vision

The strategic vision of our company was to be a company that offered high quality athletic shoes at a low price. Our goal was to compete in a low cost strategy and become one of the industry's leading low price corporations. We wanted to expand to have the most capacity in the industry. The vision was that having the most capacity would help to secure a significant portion of market share in all of the market segments: wholesale, internet, and private-label.

Internet Market

For the internet market, we wanted to offer a high number of models and we reduced the prices each year to stay competitive in this market. Each year we would look at the industry average and either go with that price or a price just below the average. In the last few years we would use the competitive intelligence reports to look at the prices the other companies were offering for the internet and we would try to be one of the lowest pricing companies.

Wholesale Market

In the wholesale market, our company's competitive strategy consists of several factors. First and foremost we wanted to keep the model availability high. Generally throughout the game the number of models offered was 200. Towards the end of the game we figured out that we could actually make 208 models without having to spend extra money manufacturing 250 models. This slightly increased the demand for the wholesale market. Another factor would be price. In the beginning of the game we kept our prices as they were set. In the years following we would decrease our prices slightly. Toward the end of the game we looked at the competitive intelligence reports to see what prices the competing companies were offering and adjusted our prices accordingly. We were not aiming to be the industry low cost leader because we incurred some extra operating expenses offering a variety of models. However, our strategy was to offer low prices. Another key factor was our advertising expenditures. We strived to keep our advertising at or above the industry average. Keeping our advertising expenditures high allowed us to have a significant share of the wholesale market. As the game progressed we noticed that the number of retail outlets available fluctuated from year to year. We believed that the retailer support and the number of available outlets to use were related; therefore, we strived to keep our retailer support around the industry average or slightly above the average. We tried to always use the maximum number of retail outlets that were available to our company. Initially we did not offer rebates. Later on we offered a low rebate and in the last few years we would try to keep our rebates around the industry average. We also increased the rebate if the competitive intelligence reports said that it was a weakness. For celebrity appeal we offered some bidding and won a couple of contracts in the first year. The spending cap was reasonably set usually no more than 10 million. After that we did not bid on