1. alter that pattern. Traditional brands are
1. 1. Industry Analysis 1. 1.
1. Market Characteristics: – Market Potential: During the past few years major footwear and clothing brands like Reebok and Puma, and more recently, adidas and Nike, have been moving into the cricket market. Reebok was the official technical sponsor of the 2011 ICC World Cup and adidas clothes the Proteas, English and Australian teams. Nike featured prominently on the sleeves of the Indian team shirts. Some of the top players who had been in action at the World Cup use bats from brands more associated with athletic tracks or soccer fields than cricket pitches.
These include the likes of Sachin Tendulkar using an adidas bat, and World Cup Man of the Series Yuvraj Singh using Reebok. Many other top players were sponsored by brands such as Puma and Nike. The sports brands have been supplying cricket clothing and footwear for many years, but the recent movement into hardware is a new innovation.
Puma has been selling bats for a few years and adidas have been testing the market, but SA will only now be seen as a serious target for these brands. These big brands have the benefit that they need no introduction and are immediately recognised by consumers.Youngsters think they are cool. A company like New Balance is already well recognised and well respected in the sports apparel market, mainly with shoes. Brand recognition will be high amongst consumers and with the growing number of clothing and footwear brands entering the market; it seems the logical decision for New Balance to seek the potential this market can provide. – History of Market: Australia, England, India, New Zealand, Pakistan, South Africa, Sri Lanka, and West Indies are the main centers of the cricket sales industry.
Kenya, Canada, Netherlands, Bangladesh, and Zimbabwe are the emerging markets. In these main markets, the traditional cricket brands have been the trendsetters for many years in the cricket equipment market which is highly specialized and technical. Mike Hermanson, owner of Sports Horizons, who claims to have 70% share of the cricket specialist retail market says that there has been little change of the past four years to alter that pattern. Traditional brands are outperforming the global brand names in the local retail market.Although there are no figures to support this, retailers claim that the traditional brands own arguably more than 80% of the top-end, top quality market. Traditional brands have the edge because they are generally very good marketers, they understand the complexity of the game and that each player has different requirements from their equipment.
Gunn & Moore for example, has introduced computerised cutting machines for all of their bats. Gunn & Moore is the best performer in terms of sales at Sport Horizons and is comfortably ahead of the rest of the pack, says owner Hermanson.Interestingly though, Puma recently became his second best selling brand. Pierre Bester of Brian’s Sports in P. E agrees that the traditional cricket brands like Gunn & Moore and Kookaburra outperform the general sports brands in terms of his sales. The Eastern Cape manufactures the B&S brand of equipment which also sells well. But again, adidas, Nike, and Puma have begun to sell bats because of their strong brand-names and selling power.
The traditional brands, it is predicted, will be preferred by customers for a while still as they are thought of as the specialists.But fashion, high cost endorsements and good marketing should attract more consumers for the other sports brands to establish themselves in the market. Cricket is a specialist sport like golf and it would take some time before the big sport brands would really penetrate the market. But as with golf, market predictors see that the sport could be dominated by the general sports brands in the future. For the specialist cricket brands to survive will require all their industry knowledge, experience and passion. – Level of Competition:So far, the entry of the general sports brands has not yet affected the sales of the traditional cricket brands in South Africa.
Peter Wright who is the managing director of Gunn & Moore says that feedback from the Australian and English markets suggest that the share of the traditional cricket companies such as Gunn & Moore, Gray-Nicolls and Kookaburra have actually increased. While there are many brands entering the market, any significant competition with the already established specialist brands will take time to do.New Balance cricket equipment will be competing with brands entering such as adidas and Reebok initially as they all fight for their share of the market. In general sporting equipment, Adidas trails Nike in international sales.
Adidas however, has resorted to cricket, and has tackled it in the largest cricket market in the world, India. The company’s target market for its adverts is 14-19 year olds and they are leading the cricketing equipment market in India. Reebok is also a front runner in the Indian market.
Manufacturer | |Adidas | |Bradbury | |CJI Cricket | |Gray Nicolls | |Gunn & Moore | |Hunts County | |Kookaburra | |Mongoose | |MRF | |Puma | |Salix | |SG | |Shark | |Slazenger | |Woodworm | 1. 1. 2. Trends and Drivers One of the biggest and most noteworthy trends in cricket in the last 10 or so years has been the emergence of the sport on a much more commercial scale. With the globalization of the 20 (20Twenty) over format, the exciting, action packed game has gained exponentially in popularity. With this increased commercialization, the game has become a billion dollar industry worldwide.Puma, Slazenger, Gunn & Moore, Duncan Fearnley, Gray Nicolls, Kookaburra, and Surridge are the major equipment manufacturers.
Cricket has adapted to the changing needs of viewers, and that’s why the sport has seen so many changes regarding rules, regulations, mode of playing and other issues. The game has become popular day by day and today it has reached a phase where it can give a complete thrilling experience to spectators. Cricket equipment is also ever-evolving, and in recent years, the industry has become so specialized that consumers can customize their equipment to suit their needs specifically. With technology constantly improving, helmets, gloves and pads are becoming safer.
With the growing popularity for the shortened, thrilling version of the game, cricket bats have been designed for maximum power and are much larger than they have ever been. India is being targeted by most cricket equipment producers as it is by far the largest cricketing consumer market in the world. The newer equipment producers to enter the market (adidas, Reebok, Nike) have all focused much attention and marketing resources on the Indian market. Also a more recent development is the sponsorship of players at virtually all skill levels. Players are now playing in more inter-continental competitions with much more airtime than ever before, and sponsors are capitalizing on this by sponsoring all gear.Gaining a cricketing celebrity endorsement is much more cut-throat than ever with players chopping and changing sponsors in between tournaments.
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Legal, Political & Economical Factors With the venture of importing bats and equipment made in India, a brief analysis on the trading relations between the two countries was conducted. – History of Relations: India declared on 23 October 1992 that they would enter into cultural relations with South Africa. This was the first step in toward a normal relationship between the countries.
On 22 November 1993, South Africa and India signed an agreement establishing full diplomatic relations. – Diplomatic Representation:South African Representation in India NEW DELHI – H E Mr H M Majeke – High Commissioner Extraordinary and Plenipotentiary Indian Representation in South Africa H E Mr V Gupta – High Commissioner Extraordinary and Plenipotentiary – Basic Economic information: The Indian unit of currency is the rupee (abbreviated Rs) which is divided into 100 paise. There are coins of 25 and 50 paise and of 1, 2 and 5 rupees.
Banknotes exist in denominations of 1, 2, 5, 10, 20, 50, 100 and 500 rupees. The exchange rate between South Africa and India as of 16 October 2011 is 1 South African rand = 6. 22468868 Indian rupees making importation costs from the country relatively low.India has become the 6th largest trading partner to the South Africa in Asia region. South Africa’s imports from India are dominated by cotton yarn, finished leather goods, machinery and instruments, handmade yarn fabrics, chemicals, spices, rice, handicrafts and handmade carpets. 1.
1. 4. Political Factors The political climate in India currently is stable. The specific manufacturer from which the New Balance equipment will come from is a well known producer in the country and has a very good name and reputation. 1.
1. 5. Sociocultural Factors – Availability of disposable income among South Africans: South Africa’s middle class is currently low on disposable income, and is looking to cut back on luxuries dramatically.South Africans have always traditionally loved sports, but the prolonged recession has halted spending on sporting equipment and goods. As the global economic recovery gets off to a slow, uneven start, 45% of South African consumers say they will be restricting their purchases on ‘essential’ expenses, and in the process cutting down on luxury goods in the next six months, Once the country pulls out of this recession, spending will once again increase.
Cricket equipment or at least the constant upgrading of equipment is somewhat of a luxury for those less serious about the sport, and will likely be something that will be cut from expenditure when families can’t afford too many luxuries. – Growing black middle class:A key point to note about the South African economy is the healthy and ever growing black middle class. As of 2007, the black middle class had a collective spending power of R180 billion. Statistics show that these “Black Diamonds” are best placed in South Africa to be spending on luxury items. Since South Africa’s re-emergence on the international cricket playing scene in 1992, the popularity of the sport has grown amongst the black population with icons such as Makhaya Ntini and Lonwabo Tsotsobe rising to fame. This growing interest in the sport amongst the black population means that these people will make up a large part of New Balance’s target market. 1.
1. 5.Technological Factors Due to cricket’s complexity and the vast array of equipment available, there are many areas where technology is improving the capabilities of the equipment. Recently it was ruled that the then Australian captain Ricky Ponting would not be able to use a cricket bat with not wood substances in it as it would give him too great an advantage. The cricket bat is the main focus of technological development in shape, size, weight, thickness and power. Recently the bat producers Mongoose provided opening batsman Mathew Hayden with different shaped bat with a longer handle and thicker meat, designed for hitting the ball over the boundary.Without changing technique in any way, the bat allows you to hit the ball harder and further.
Modern bats are heavier than in days gone by, with thicker handles and bigger sweet spots. But because the wood is less compressed in the making than before, they are lighter to pick up. They are also less durable as some players go through nearly 50 per season. As mentioned previously, the constant growth in popularity of the sport has seen many larger sport equipment suppliers in the world try get into the cricket market.
Nike’s Air Zoom shoes have revolutionized the cricket footwear market recently. The Air Zoom Yorker for fast bowers and the Air Zoom Opener for batsmen are now available in India.