Using Third Bridge
The client downloaded over 15 Forum Interviews, conducted across three continents, discussing supply chain delays, the competitive landscape and cost challenges.
Third Bridge’s Connections team also identified hundreds of industry experts for private consultations to understand operating margin expansion opportunities and pricing dynamics.
Developing a new investment thesis
Interviews with former executives of major footwear brands discussing latest channel trends provided the foundation for a new investment thesis on Puma and Adidas. The client discovered that channel mix is crucial and that third-party sales were driving Puma’s growth. This was particularly true regarding its partnership with Amazon, which benefited from COVID-19 tailwinds.
In contrast, Nike and Adidas had been increasing their D2C sales since 2019 and as a consequence of becoming over-distributed started to withdraw from some third-party wholesalers. Puma had in turn gained a competitive advantage, as the company was able to claim the wholesale shelf space left by its rivals.
Key outcome for the client
This was the first time that Puma’s supplier-first approach vs Nike and Adidas’ retail-focus strategy had surfaced, resulting in the client taking a long Puma/short Adidas position.
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