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Puma PESTLE Analysis: 10 Important Factors for the Sportswear Company

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Puma as you all know is a very popular brand with a global reach. The history behind its creation is very interesting, to say the least. Would you believe that Puma was once a part of a parent brand that was started by two German brothers who then had a conflict that resulted in them separating their businesses, one brother started Puma and the other one started Adidas! What a fruitful conflict we must say!

Started by Rudolf Dassler in 1948, Puma is based in Herzogenaurach, Germany. It is a company well known for producing some of the most widely recognized sportswear globally. They design footwear, apparel, and other sports accessories. Puma is the third largest sportswear manufacturer these days. In this article we’ll analyze this brand through a PESTLE analysis which essentially means to study it in terms of Political, Economic, Social, Technological, Legal, and Environmental factors; to see exactly where Puma is currently standing.

Political Factors

Following is the political factor in regard to Puma’s branding efforts:

puma-pestle-analysis-political

Lobbying

It is vital for a company to be on good terms with the governing parties of the countries it chooses to operate in especially for Global brands.

As of recent, Puma has been trying to gain access to the huge Indian market with a whopping population of more than a billion.

Online shopping has quickly caught up with Indian people over the years, so Puma has decided to take a leap of faith by lobbying the Indian government for access to their nation via online channels so that they can sell directly to Indian consumers.

Economic Factors

Following are the economic factors which affect Puma.

Cost

Puma has a global presence which is enough information to tell us that they must produce an insane amount of merchandise to be distributed adequately across all of their channels. Naturally, their costs would be sky high so to save on their expenses Puma has kept its manufacturing in China where the labor, as well as raw material, is substantially cheaper.

Buying Power

Puma has a very specific brand image which generally appeals more to people with high incomes. It is a status symbol of sorts and some of their products are often pricier than an average sportswear item.

Now a lot of people belonging to countries that Puma sells to are unable to afford their products, so this gap is filled with the creation of knockoffs. This causes a lot of opportunity loss to Puma because people satisfy their needs for sportswear by buying cheaper copies.

puma-pestle-analysis-economic-factors

Social Factors

Following are the social factors which affect Puma.

Health Consciousness

If 2020 has taught us anything, it’s that your health is more important of an asset than any other entity combined. Even before we were subjected to a deadly pandemic, people have become more and more cautious of their health and well-being whilst pondering on their lifestyles.

As more and more people caught up with the concept of maintaining a fit body, sportswear is more popular than ever. This gives Puma an excellent opportunity to grab a huge chunk of the market.

Information

We are breathing in the day and age of the internet and social media. All a brand has to do these days is to upload a single post of its latest offerings and millions around the globe are aware at the same instant. Everyone is up to date with Puma’s online presence.

Brand Ambassadors

A big reason for a brand becoming a sensation is the celebrity endorsements which they have. With stellar brand ambassadors like Usain Bolt and Sergio Aguero who sport Puma like the champs they are, people are bound to appreciate the brand for its charisma.

Technological Factors

Following are the two factors in regards to technology that support Puma:

Research and Development

Puma is a huge brand with amazing revenues each year. It had a revenue of 5.5 billion EUR (2019). It can easily afford to invest a lot in R&D which allows them to be on top of all important trends thereby allowing their company to manufacture the latest products.

Innovation

All thanks to R&D, Puma has been serving some amazing products. Recently they created IGNITE shoes, which have a revolutionary foam design which enables the one wearing this shoe to run with ease for longer durations because it is extremely comfortable.

They also launched “smart shoes” which literally adjust their fit according to your foot size and shape ensuring maximum benefit and comfort. Sign us up for a pair, please!

puma-pestle-analysis-shoes

Legal Factors

Following is the Legal issue that presented a problem for Puma:

Nike’s patent Infringement

When a brand is multinational, it is bound to find itself in sticky unwanted situations, often with legal implications. In 2018 Nike decided to file a patent infringement against Puma, accusing the latter of using their technology without formal permission. Yeah, we wouldn’t want to be Puma in this situation either.

Environmental Factors

Following is the environmental factor which affects Puma:

Climate Change

People are becoming more educated on the dire effects of climate change, which is becoming a serious threat to all life forms on earth. Puma has done wonders with its decision of using sustainable raw materials.

Puma has reached and crossed its target of 95% in 2020 with the amount of recycled paper and cardboard which is Forest Security Council (FSC) Certified. Puma makes noteworthy efforts in their use of less harmful materials such as BCI cotton, cardboard, and blue sign polyester.

Puma PESTLE Analysis: Final Thoughts

Puma is no doubt one of the most recognized brands on the face of this planet. Many people give them a healthy business.

With respect to the current macro-environment, all of the factors we discussed in this article apply either directly or indirectly to Puma. Some of these factors have positive implications on Puma and some of them have a window of future improvements and opportunities. Hopefully, Puma will retain its title as one of the top three brands of sportswear around the world, to say the least for its future potential.