SMD’s Dilemma

Marketing Case Study

Guidelines

 All first year MBA students are eligible to participate in the case study.
 Each team should have 3 members each.
 The solutions have to be shared in PPT format. Please do not exceed the maximum permitted
slides for each question
 PPIs for summer internship to be awarded for the shortlisted solutions
 The first slide of the presentation should contain the following
 Name of the team
 Name and college ID of team members
 Email ID of team members
Sportsmed (SMD) is an Indian speciality footwear, apparel & accessories company with annual sales
of approximately 2000 crores. They have relied on the Speciality footwear market for 50% of their
revenues and in this market they compete with three other major companies. Together, these four
players represent approximately 70% of the organised Indian speciality footwear market, with
unorganised players forming 30% of the market. SMD has 60% share in the organised speciality
footwear market. The shoes within speciality include four main sub-categories: Work, casual, hunting
and winter. Work shoes are the largest subcategory and are geared to blue collar workers who
purchase these boots primarily for on-the-job purposes. Casual shoes are the fastest growing sub-
category, and are geared more towards white collar workers, youngsters and students who purchase
these boots for week-end / casual wear and light work purposes. The four key competitors in the
market are Vadgergum, Sportsmed, Schuller, and Cheebok.

(a) Vadgergum and Schuller are both well established as footwear companies, having a long
history and strong brand recognition and credibility among blue collar workers. At the other
extreme is Cheebok, a strong player in the casual shoes market but a very weak player in
work boots. Sportsmed, however, is a cross between the other competitors, having a
significant share in both work and casual. Historically Sportsmed had an even stronger
position in the work sector. However, since 2010 when the company began selling casual
shoes and focusing on the growth opportunity in casual, sales of the Sportsmed work shoe
line have steadily declined. The company decided to capitalise on retail boom & growing
urbanisation by opening stores in metros. It also started retailing its apparel products in these
stores. Also, around the same time SMD shifted its emphasis, Vadgergum became a much
more assertive competitor in the work boot market, increasing its market share to 43% in just
three years.

In 2016, Vadgergum launched a new line of aggressively priced work boots. The strong
success of this line has caused Sportsmed’s management to re-evaluate their position in work
boots. With limited additional resources, management must now decide if they should focus
their efforts on competing with Vadgergum in the work boot sector, or focus their resources
on further strengthening their position with casual boots. In January of 2017 SMD hired a
leading consulting firm to conduct research to help management in its decision making. To
make an informed recommendation, the consultants realized they needed to collect
information that would enable them to size the market and better understand SMD’s
competitive position. In addition, the consultants completed some internal cost and pricing
 analysis for SMD’s work and casual boot lines. The market pricing analysis showed SMD
competing at the premium end of the market for both its casual and work boot lines.

(b) Since 2015, Cheebok has made quiet inroads into online space. The younger millennial
consumers of casual shoes prefer online mode for shopping and Cheebok is becoming popular
amongst them, thereby eating into SMD’s market share. Cheebok has also launched bespoke
services for shoes in its website. However the older millennials still prefer offline or Omni
channel route.

Questions

1) What is market size of speciality footwear market ? (1 slide Max)

2) Should SMD enter online space? Your recommendation backed by analysis( 3 slides max)
3) If you were the consultant , what would you recommend as SMD’s strategy for casual & work
shoes going forward ?(4 slides max)