Mercury International Ltd.

Looking into marketing mix, mission statements, marketing strategies, and “stickiness” are all being compared and ranked between Nike, Adidas, New Balance, Puma, Sketchers, and Fila. The strategy of Mercury International Ltd. was not totally effective considering the overall performance for 3 years and 4 rounds. The operation was good but it only took a little share in the market. Mercury is only the fourth largest seller of athletic footwear and apparel in the world. The growth was only 3.11% while for Nike which is the big competitor took 8.80%, while its operation in Asia was declining the net profit margin was only 3.04% compared to Nike which is 9.31%. The operation of Mercury is only 59% it indicates a high cost of product it will result in high price which is not competitive. In totality the 3 years and fourth rounds was not satisfactory and below the performance level. Mercury International Ltd. Is a manufacturer of sports and fitness products, footwear, apparel, and accessories? Mercury’s personnel are responsible in the design, and sell to product lines. The shoes products are Boost, SnowStep, TrailStep, Mercury Clinics.. These products were a result based on the experienced of the founder Patrick and John O’Brien and the new technology in shoe making.  The strategies were on unique products and customers service and develop strong ties to each customer to differentiate it from other competitor in foot wear industry.

In the apparel the product are Sweetness Training Apparel, Boost Booths and the competitors were numerous and big manufacturer. The performance could have been improve if the  strategy was not confine to small segment the management should have taken into consideration operational excellence and product leadership. To achieve this strategy the company must have studied the demographics, financial status, and fad of the customers. The company must explore massive advertisement in all aspects including a web site.  The thrust of the management must be aiming the top as manufacturer of Sporty Goods world wide. The operation was that we place a strong emphasis on technology, and we have continued to incorporate various proprietary performance technologies into our products, focusing on cushioning, stability and lightweight features in our footwear products and on comfort and moisture management in our apparel products. As part of our commitment to offer leading footwear technologies, employees working in our state-of-the-art product development facility research, design and develop technologically advanced athletic and fitness footwear.

We also have product development centers in China, Taiwan and Indonesia to more closely integrate our development activities with production. Our most significant technologies are TrailStep, Boost and SnowStep. Our TrailStep technology provides superb support for off road runners and utilizes a heel-to-forefoot, active motion system that ensures smooth foot plants and good traction. Originally introduced in 1985, we have enhanced and expanded this technology by developing multiple versions of TrailStep to meet the performance demands of various activities, taking into account performance attributes, aesthetics and price among the various versions. SnowStep is the newest incarnation of TrailStep technology, utilizing a newly developed rubber compound to give excellent traction on snow and ice, while providing new, lightweight insulation for warmth during cold weather training.

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In 2003, we continued to redevelop our proprietary exchangeable sole technology, Boost, exploring broader and more varied applications for this technology in our footwear. We plan to continue our redevelopment of Boost in 2004.

Finally, we have incorporated advanced technologies into certain apparel products with our Sweatless moisture-management system. This moisture-wicking technologies help to keep wearers dry, which facilitates regulation of body temperature. We plan to expand our range of apparel products, incorporating moisture-management technologies.

Mercury could be better off if to diversify into marketer of athletic activewear, casualwear, and sportswear for men, women, and children.  Pricing on must complement the prices of their retail stores. Mercury Shoes Ltd. must enter the e-commerce store as a branding and marketing tool to enhance rather than compete with sales at retail stores (PR Newswire, 1999).  In the commercials, Mercury must  show that sport is not a war, but it has a humanistic side.  For instances, Yao Ming must endorse athletes of Mercury, are in a commercial where one is playing basketball and caring the environment. Besides other things, Mercury’s mission statement was  available on its web site.  Mercury must invest more money to increase advertising in both US and international markets.  They will increase spending by 50% in the US and internationally spend 70%  in advertising alone. Mercury must take steps in making their web site more interactive (Lefton, 1997).  Mercury must updates their web site about every quarter and adds new products to keep it fresh for the users.  They must have contests to meet with Mercury endorsed athletes, like Yao Ming, and provide information about him (PR Newswire, 1999). Mercury “new format aligns with the  athletes with the products and cross-merchandise footwear and apparel for an easier shopping experience” (PR Newswire, 1999).

Mercury begun must make major improvements on their web site to make it more “sticky”.  They must add more content areas including which will all help them practice relationship marketing.  Also, adding sessions to chat with Mercury’s endorser such as Yao Ming this is also part of their customer relationship management strategy.  They must start to provide fitness tips for their users as well (Warner, 1997).  One of the biggest draws to their site will be the promotion on "shoe give-a-ways" of their new shoe lines, many of which are not yet available in stores.

Having a strong marketing mix (4 P's) is extremely important for an organization to be successful.  Corporations should and must have a mission statement that will keep them focused and guided in the right direction.  Nike, Fila, and Adidas each had mission statements that gave the customer some idea of what the company is all about. Mercury did not even provide a mission statement.  By definition, a mission statement is a clear and concise statement that explains the organization’s reason for being (Ferrell et al., 1998).  There are five questions that help clarify what a good mission statement contains:

• Who are we?
• Who are our customers and what do they value?
• What does our organization stand for?
• What makes our organization unique?
• What impressions does this organization want key publics to have of us?

Unfortunately, Mercury still does not clearly reflect that they are customer-oriented. They went the historical route, which is good, but anyone could easily get lost in it.  Although it is customer-oriented with the most comfort and performance improvement always being their top priority shoes that they are focused on improving their products, which, in turn, improves their customers.  This shows a direct reflection of the management. The decisions of the management always integrate its values like the care of its personnel; they received decent working condition and wages. In their operation world wide they respect the nations laws and policy concerning business. The company must state its missions and visions clearly and honestly in a statement.

In terms of performance the team did manage the company to at least within the stable operating condition. Although the profits is less than what the company should be gaining.  There was lacking in the overall strategy to penetrate the market by considering all the demographics and advertising aspects. The team did achieve just a little of what is expected. Basing on the company’s capability, production can be increased and the customer segment is only limited. Competition in the sports and fitness footwear and apparel business is intense, both in the United States and worldwide, with new entrants and established companies providing challenges in every category. Competitors of our Mercury-branded footwear include Nike, adidas, New Balance, Puma, Converse, Fila and Skechers. There are also numerous competitors of our Mercury-branded apparel including Nike, Reebok, adidas, Puma, Rocawear, Ecko, Brand Jordan, FUBU, Mecca and ENYCE. We are the fourth largest seller of athletic footwear and apparel in the world, measured by market share. The principal methods of competition in our industry include product design, product performance, quality, price, brand image, marketing and promotion, customer support and service, and our ability to meet delivery commitments to retailers. We believe we are competitive in each of these areas.

The success was measured by the team according to a good reputation and good service even though the revenue is somewhat sluggish. The process of decision is good. There was a decentralized in decision making among the dealers. The international economic issues are the differences in economic status of every country. While Mercury Shoes manufactures all of our own products in factories located in Latin America, Asia and Europe. We source component parts used in our footwear and apparel from independent manufacturers located in various parts of the world. In addition, we operate facilities in Indianapolis, Indiana, and Ft. Collins, Colorado that provide apparel and accessory finishing for our sports licensing business. Mexico, Puerto Rico, Indonesia, and Eastern Europe were our primary sources for footwear manufacturing throughout 2002. All manufacturing is performed in accordance with detailed specifications furnished by the operating unit and is subject to strict quality control standards, resulting in product rejects or factory seconds distribution when units do not meet specifications. To date, we have not encountered any significant problems with product rejection or customer returns due to quality problems. We generally consider relationships with our retail distribution channel partners to be good. Mercury Shoes operates under a supply chain model based on the principle that merchandise manufactured in one region (Asia, The Americas or Europe) is sold in that region. Mercury has made this model work economically because proprietary robotic technology has eliminated 98% of the human labor involved in the actual production of shoes and apparel. Mercury believes that this model remains viable even as its competitors outsource manufacturing, largely to cheaper labor markets in Asia, because Mercury has reduced labor costs to a far lower percentage of apparel cost than its competitors. In addition, Mercury avoids shipping, shrinkage, and tariff costs by not shipping products from one region to another. Further, Mercury’s customers and retail outlets appreciate the quick response to orders and Mercury’s ability to adapt quickly to changing market demands for various colors and styles of products. As part of our commitment to human rights, we require agents and our own manufacturing operations to apply the Mercury Human Rights Standards, which set forth acceptable factory policies and procedures regarding workplace conditions. We use a global program to implement these standards that includes internal and independent monitoring, technical assistance to improve air quality in factories producing our footwear, a worker communication system to resolve conflicts in such factories, and other initiatives to improve workplace conditions consistent with our Human Rights Production Standards.

Conclusion

E-commerce is an opportunity for every company, if they do it correctly.  Consumers are using the Internet more and more to purchase their goods and service.  The marketing mix, mission statements, marketing strategies, and “stickiness” are extremely important is having a successful Internet marketing strategy.  Mark Millman, president of Millman Search Group Inc. a national retailing consulting recently said, “Everyone is doing it.  If you don’t do it, you’re dead in the water.”   There is a difference in  overall ranking of the four athletic shoe companies.  This large difference in the ranking between the four companies clearly demonstrates Nike's online dominance as the leader in its industry. The mission and visions statement must be state clearly in order to guide the company’s management.

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