Together, marketing and retail investments absorbed 20.0 percent of Puma's total turnover last year. The marketing spend was kept at between 11.0 and 11.5 percent of sales, and Puma has launched new initiatives on this front as sales have been accelerating. In commenting on the strategies behind its results last Thursday, the company's chief executive, Bjørn Gulden, pointed out that 75 percent of the marketing budget is being spent on sports, as the brand intends to regain its strength in performance, while the balance is allocated to entertainers and other types of promotion.
Much of the marketing budget has been used lately on major football club sponsorships and to support the launch of new products and the brand's re-entry into basketball. Gulden indicated that Puma now has the football players and the products it needs to send out a strong performance message, but hinted that it is about to receive the endorsement of yet another big football club in the next few weeks.
Gulden also said that Puma has decided to invest heavily in basketball to make a bigger mark for itself in the U.S., where younger people don't perceive it as a performance brand, and in China. It is also investing in golf because younger players are now attracted to the sport. As Gulden put it, American football is “dangerous,” baseball is “boring” and basketball is “cool.”
As reported in the News Briefs, Puma has become a sponsor of the NBA, among numerous other product and marketing initiatives, some of which revolve around the brand's heritage in this segment. Gulden said it has been holding back on new product deliveries to create demand in the category. Larger shipments will be made in the second half of this year.
Puma has also spotted new trends in running shoes, and it has more products in the pipeline in the lifestyle segment and others. In lifestyle, the new RS-X and Cali franchises have sold well. According to Gulden, Puma did a good job at releasing large volumes of sneakers to quickly adapt to new trends, and the bulky sneaker trend has not yet reached its peak.
