A case study on the partnership of Polar Heart Rate Systems and Adidas from 2005 until 2007

1. Polar Adidas Brian Smith · Jo Anne Lotfallah · James McCartneyJosh Dafoe · Nastania Mullin · Jason TaylorTrevor Dufresne

2. http://www.youtube.com/watch?v=196Y90fl1uA

3. Agenda Introduction Problem Identification Situational Analysis Organizational Objectives Alternatives Recommendations Implementation Plan Q&A Period

4. Introduction Established in 1977, Polar is a tech driven leader in sports medical science Employs over 1 200 people worldwide, has 26 subsidiaries globally, and manages a distribution network supplying over 35 000 retail outlets. First heart rate monitor developed in 1982

5. Problem Identification Contradicting sizes of both companies result in a strain on the relationship Lack of adequate resources on Polar’s end Very tight schedule and deadlines for releasing the finished product

6. Problem Identification Engineering is shared between the two Asks the question: Who owns what? The rights for Project Fusion in the air as a result

7. Situation Analysis - Strengths Influx of R&D capital for product diversification Access to market data once unobtainable Exposure to new markets

8. Situation Analysis - Strengths Increased cash balance of foreign currency Ease of movement within Europe

9. Situation Analysis – Weaknesses Size differences of companies could create difficulties and strains Production capabilities to match the demand

10. Situation Analysis - Weaknesses Risk of downgrading quality of current product Lack of resources to deal with set-backs and failures

11. Situation Analysis - Opportunities Influx of R&D capital for product diversification Access to a market once beyond Polar’s reach Exposure to new markets that will only benefit Polar

12. Situation Analysis - Opportunities Entry point into Europe Backdoor into foreign markets through German trade agreements “Top-Grade Seal of Approval”

13. Situation Analysis - Opportunities High brand equity of adidas can increase Polar’s brand equity Increase in exposure “Big Brother Effect”

14. Situation Analysis - Threats Ownership and rights to the product “Predators” trying to steal/sabotage Polar’s technology

15. Situation Analysis - Threats The difference in sizes of both companies Marketing strategy decisions: Where does Polar fit?

16. Organizational Objectives PE aims to improve the quality of life for its consumers Wants to establish itself with the already successful adidas brand with its heart monitors Increase brand loyalty and company equity

17. Organizational Objectives A means of gaining brand awareness The technology can be used for other applications Learn from adidas Gain assistance in development

18. Alternatives Do nothing Joint Venture  Establish a third company Acquistion by adidas

19. Recommendations Take a more controlled approach to future textile alliances Continue to be a technological trend-setter

20. Recommendations Staff training at the retail level Finland expansion on Research and Development Assembled products

21. Recommendations The Michael Porter Value Chain

22. Implementation Plan Address the issues of exclusivity Address the joint marketing efforts Media, Joint Websites, Etc. Areas regarding management must be determined

23. Question Period Do you agree with our assessments? What do you think this alliance became? What are the market positions of these two companies today? Why?

24. Thank You