The factors of channel conflict between Adidas Malaysia, The Gardens and Adidas franchise, Mid Valley / Nur Syafiqah Rosli

Conflict is a common phenomenon when exercising power. Therefore, channel conflict are defined as the situation in which the channel members competing against each other for a common sale and common brand. A world known sporting apparel, Adidas has been operating in Malaysia since 1994. Little do realize that channel conflict exists between its different channel member - different retail (principal store - Adidas The Gardens, Kuala Lumpur and franchise store - Adidas Mid Valley, Kuala Lumpur). The principal store is owned and operated by Adidas Malaysia and the franchise stores operated from Adidas Germany. This research attempts to achieve two objectives, which are: (1) to identify the factors of channel conflict between Adidas Malaysia, The Gardens and Adidas franchise, Mid Valley; and (2) to identify the approaches that Adidas Malaysia, The Gardens can take to manage the channel conflict effectively. In this research study, researcher found two issues. The first issue is difficulty to attract the customer and the second issue is customer have choices because there are two Adidas outlets located near with each other. Qualitative method has been used in this research study and researcher conducted personal interview to get the in-depth information on the factors of channel conflict between these two Adidas outlets and also the approaches that Adidas Malaysia, The Gardens can take to reduce the channel conflict effectively. The respondents consist of four persons which are two persons (assistant manager and supervisor) from Adidas Malaysia, The Gardens and two persons (store manager and supervisor) from Adidas franchise, Mid Valley. Data collected were analyzed from the interview transcript. The findings from the interview session show that there are five factors of channel conflict between these two Adidas outlets which are difference in goals, price, promotion, service and stock level. The finding also show that there are five approaches that Adidas Mid Valley can take to manage the channel conflict effectively which are price strategy, product strategy, promotion strategy, channel communication and collaboration. As the conclusion, there are two gap found in this research study which are price conflict and price strategy. The recommendations for this research study are introduction of Adidas membership card, implementation of 'click and collect', training on customer service and do monthly meeting.