Brand management. Measuring the brand equity of Decathlon in Portugal
Seminar paper from the year 2016 in the subject Business economics - Business Management, Corporate Governance, grade: 1.5, Católica Lisbon School of Business & Economics, language: English, abstract: This report should analyse the current brand perceptions of Portuguese consumers about the brand Decathlon, find strengths and weaknesses in the current positioning and give recommendations for Decathlon on how to improve their current situation in the market by building a stronger brand.
The Sportswear industry in Portugal in the year 2015: The economic downturn is over; Portuguese economy is recovering. This positive economic trend also influenced the sportswear industry, which grew by 2% to a total market volume of 775 m. EUR.
The clear industry leader with a market share of 24% is Nike Retail BV. Nike managed to build up a really strong brand in Portugal over the past years. One of the key success factors for the brand image has been using Cristiano Ronaldo, the sports idol of Portuguese people, as a brand ambassador. In the shadow of Nike, also the second force in the industry, Adidas managed to grow by 6% in 2015.
The prospects for the sportswear industry are optimistic. Nike and Adidas are expected to stay the most popular brands with their technological innovations, heavy marketing campaigns and focus on outstanding designs.
This report is neither about Nike nor about Adidas. It is about a brand that is quite different but at the same time a direct competitor of those brands: Decathlon. Decathlon is acting in two major areas: Sportswear and Sports equipment. Regarding its strategy, the size of the stores and the range of the product offer, Decathlon differs a lot from Nike and Adidas. But surprisingly, Nike and Adidas are seen as the main direct competitors of Decathlon by Portuguese consumers. In Portugal the brand is mostly perceived as a sportswear brand. The second big section, the sports equipment product offer, seems not to be a strong enough differentiator to position Decathlon in another direction.
Clearly, for Decathlon, with its different focus, it is hard to compete with the leading brands in their strong area of sportswear. The key could be in differentiating from these brands and focusing on different areas with more promising potential (e.g. use the growing popularity of outdoor activities).