You may make any reasonable assumption about the firm and situation. You may add facts, provided that the information does not contradict the facts provided below or in Assignment #1. All of the information provided here is appropriate to include in the backgrounder to be used for copywriting purposes. However, you probably would not include everything in a backgrounder or fact sheet distributed to the public or the press.
Zoomer is looking for advice from you about what he should say about the importance of the name change, future of the company. (Contribute quotes, as needed.)
Name change becomes effective two months from today. (Calculate the actual date for your backgrounder; date your release for the kickoff date.)
Zoomer founded the firm in 1984, and has shepherded the company through phenomenal growth. Zoom represents the merger of 12 different firms acquired from 1995 to present. Some acquired firms have been merged to create the firm's current eight subsidies.
Business revenues come from the following sources: 68% shoes, 12% athletic equipment (tennis and racquetball racquets, football pads and helmets); 11% from athletic wear (mostly team uniforms, including uniforms for professional football and soccer teams); 7% from book, CD and magazine publishing; and 2% miscellaneous products (most notable example: whistles). Three subsidiaries manufacture shoes, two make equipment, one publishes books, one publishes magazines, and one makes miscellaneous equipment (most noteworthy product: whistles).
Firm is publicly traded on NYSE. Trading Symbol: ZM. Wants to change symbol to: ATH. Currently 24,000 stockholders, with 75% in U.S., 25% abroad, mostly in Europe. Headquarters: Paramus, N.J., outside New York City (7,000 employees at headquarters.)
Zoom has not been involved in any labor disputes in Third-World Nations, such as its major competitors, Nike and Reebok. Its 20 foreign plants are in Thailand, Myanmar, Singapore, Hong Kong, People's Republic of China (new, small facility just opened).
All of the subsidiaries, except the publishing operations, will change names to establish a consistent brand. In all, 32 brands will be switched to Athlete's Choice. (Important to maintain separate identity for publishing operations--so appears to be independent.)
Top ten brand names: Zoom Shoes, Zoomers, Buffboy Shoes (hiking), TopTen (tennis shoes), StreetCars (men's walking shoes), Athletic Uniforms Unlimited, Women's SportsWear Ltd., Runner's Way (magazines and books), Sports Week (magazine), Why Whistles.
Company sells its shoe, equipment and apparel products through athletic retailers, better shoe stores, department stores, and some specialty sports shops. Not currently distributed through discounters, such as Wal-Mart, KMart or Target--although the firm is considering distribution through these outlets to sustain future growth. Zoom Shoes has an active catalog division, which also carries products from other divisions with different brand names. About 8% of sales are online; the company's web address is: http://www.zoomshoes.com. It's assumed that a new URL will be obtained: www.athleteschoice.com.
Firm hired the Bass Associates firm in Los Angeles to design new logo. Firm has extensive experience in corporate identity with major firms such as United Airlines and ATT. Design expected to be approved in two weeks. Specifications require red, white and blue design with stylized flag reminiscent of the U.S. flag (but not actual U.S. flag).
Firms expects to spend $12-15 million on name change activities in first three months, $60 million in the next nine months, primarily on advertising. Will change signage, stationery, point-of-sale materials, packaging. Some items will be changed on date of implementation; expect to take one year to complete entire conversion.
Zoomer, who was born in 1957 in South Carolina, once played second-string quarterback for the New York Jets. Spent 6 years in NFL before he retired. Attended school at University of Georgia. Native of Macon, Ga. Zoomer and his wife, Audrey, have twin grown daughters, Debbie and Diane, who attend the University of Georgia now. Both majored in exercise science and are excellent tennis players. One is a college tennis coach, the other oversees customer service at the company. His personal net worth: $150 million.
Purpose of name change is primarily to consolidate brands, allow better cross promotion. Hopes to increase sales by 4% each year for next five years. Name change is expected to contribute to the increase, but growth will largely be driven by the greater demand in the market for athletic footwear and equipment, a more aggressive sales force, improved year-long advertising, and promotional tie-ins with athletes. Women are an important market for sales growth, Zoomer believes.
Only four executives at the headquarters now know about plans for the name change.