Puma's marketing strategy is a whole new ball game
After years of pitching its shoes and clothing to hipsters in bars, bowling alleys and billiard halls, Puma SE is shifting its marketing focus to athletes.
For a new ad campaign the company calls Forever Faster, Puma lined up athletes such as sprinter Usain Bolt, golfer Lexi Thompson and soccer star Mario Balotelli, featuring each in situations that emphasise their athletic prowess and lives off the field.
Puma "wanted to reposition itself as a sports-performance brand rather than the casual thing it was", said Julian Easthope, a Barclays Capital analyst who recommends selling the shares.
"They definitely needed to do something to revitalise themselves around the sporting side of things because they'd lost their edge."
Chief executive officer Bjoern Gulden is seeking to inject some new spark into Puma, based in Herzogenaurach, Germany, where profit this year is expected to be about a third of what it was a decade ago. Gulden, a former German soccer pro, spent about 14 months at the helm of Danish jeweller Pandora A/S, where he is credited with turning the business around and restoring investor confidence.
"Without the solid grounding in sports, we weren't really resonating with our customers," said Adam Petrick, Puma's marketing director.
Kering SA, which owns 86pc of Puma as well as luxury brands such as Gucci and Bottega Veneta, needs to turn Puma around to maintain its lofty stock price. Puma trades at 25 times next year's expected earnings, higher than Nike and Adidas, even though it has a profit margin of 4pc versus 15pc at Nike and 11pc at Adidas. (Bloomberg)