Is Ditching TV Ads a Good Idea?

So, recently I read this article about Adidas and adidas-black_1.pnghow they ditch TV ads to reach generation Z on mobile. This is part of their strategy called “Creating the New” that was launched in 2015. They emphasize in mobile-based marketing as they believe this generation are always engaged with their mobile devices and no longer watch TV with the development of various online streaming services. So they shift their advertising schemes and no longer advertise their products on TV.

Looking at their revenue, I say they made an excellent decision since they earned a revenue of $21.5 billion USD, increased by 18% from the prmaxresdefault.jpgevious year. However, I was curious about how their competitor was doing and did a little research for Nike, their largest competitor. I found that Nike last year made $32.4 billion USD. That is almost 50% more than what Adidas is earning. I look into their advertising schemes and found that Nike is advertising both on TV and mobile-based marketing. And looking also from their market share below, we could see how Nike still dominates the market.

Screen Shot 2017-03-27 at 10.58.34 PM

I find this very interesting and see how different advertising strategy may lead to a different outcome. I personally think that Adidas is on the right track by advertising fully on mobile, however, I think that they do it too soon when a numerous amount of people still watch TV and still watch the ads on the TV.

So what do you guys think? Is this the right strategy for Adidas to implement now? And is Adidas losing potential customers for not doing TV ads? Feel free to leave your opinion below! 🙂

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11 thoughts on “Is Ditching TV Ads a Good Idea?

  1. With such a big brand like Nike, I think they can afford to dabble in a couple of different areas of marketing, why not, right? However I feel specialising in one area of advertising has many benefits and can really pay off in the long run. It will be interesting to see what Adidas does in the future!!

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    • Yes, I completely agree. But I think Adidas will stay on their strategy for now since it is working very well for them. and with the huge publicity of their NMD and Yeezy shoes, I think word of mouth is working in their favor.

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  2. I do agree with you that Adidas is currently on track by doing mobile advertising, as it is what most advertisings are switching to these days. However, in my personal opinion, the reason why Adidas is not making as much revenue as Nike does is not because it has removed its TV ads. Probably, the major reason why it is so is because Nike has done a better job at branding earlier than Adidas, which has created a powerful brand now, and also built brand loyalty from its customers. Which is very crucial and can be one of the major influence to the revenue earned. As can be seen, Nike is dominating the sportswear market in the US, which means it covers most of the sales of sportswear globally. To conclude, even though advertising is important in reaching more sales, branding should also be taken in mind. Therefore, I personally think that Adidas will not lose potential customers just because it cut off its TV ads.

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    • What an interesting opinion you have there. Yes, I did not take into account that Nike has been building their brand longer than Adidas. and yes I agree that Adidas won’t lose potential customers because if you have an Instagram, you can see how their products are advertised unintentionally by people from all over the world. and with their current success in products, i think Adidas is just getting started.

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  3. As consumer the usage of digital devices increases, it will lead to increases in digital advertising.I think, we are becoming increasingly more reliant on digital technologies in our daily activities, whether it is personal or professional activities, and I think what Adidas did is already on right track as they want to maximize this opportunity. However, I do believe that traditional advertising on tv will not completely obsolete.

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    • Yes, I can see how technology have been a huge part of our lives and how we are getting more and more connected to our devices. Yes, I also believe that traditional tv advertising will not be obsolete, maybe there’s just a different market in the TV ads than in mobile ads and with the right product then the marketers can utilize even both channels.

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  4. I personally agree on your opinion that Adidas’ shift to focus more on mobile-based advertising rather than TV-based advertising is the right thing to do, considering the fact that youths nowadays use TV less often than previous generations. However, I do believe that for the present time it is still a good idea to advertise on the TV. I believe Adidas shouldn’t change their marketing strategy that dramatically in that short period of time, rather they should slowly decrease TV advertising rather than completely removing it for now.

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    • I agree with your opinion. I too believe that by completely removing TV ads for their products, they miss out on a lot of potential customers that still rely on TV. It would be a nice strategy for the company just like you said if they would slowly decreasing their ads on TV rather than removing all at once.

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