Adidas Looks Toward Future

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Herbert Hainer Chairman, CEO; Adidas Group
Photo By Courtesy Photo

BOSTON — Adidas AG last week focused on its potential bright spots for 2010, rather than the difficulties of the past year.

After reporting a 65 percent drop in fourth-quarter profits, the German footwear company said it sees a promising year ahead for its Reebok brand — particularly in the toning category — and that it expects the upcoming soccer FIFA World Cup to boost overall company sales this year. The firm guided currency-neutral annual sales to increase in the low-to-mid-single digits. Earnings per share are seen between 1.90 euros to 2.15 euros, though below estimates for 2.41.

Regarding Reebok, Herbert Hainer, Adidas Group CEO, said on a quarterly conference call that the brand “can now see the first truth of success demonstrating the validity of the strategic priorities we have set for the brand.” Among its recent achievements, the EasyTone product helped the brand’s fourth-quarter sales rise 4 percent currency neutral in North America for the first time since Adidas acquired Reebok. Hainer said Reebok will continue its focus on toning.

Specifically, the Reebok toning product will expand beyond women’s and walking to men’s and casual. TrainTone will launch for gym training, Hainer said, while RunTone will debut for running. He said the brand’s whole toning offering should sell more than 5 million pairs in 2010.

Another Reebok product launching in March is ZigTech for men’s running and training, which Hainer said is targeted at achieving “a unique energy and cushioning system [that] reduces stress on muscles by up to 20 percent.”

Hainer added that the World Cup and a new campaign for Adidas Sport Style should also boost sales in the lifestyle segment.

Christopher Svezia from Susquehanna Financial Group noted in a report that although Adidas has forecast sales growth for 2010, “significant investments in marketing and retail expansion will likely keep a return to historical margins at a more moderated, multiyear pace.”

In 2010, Adidas expects to bow 150 new stores and remodel around 200.

Last Wednesday, Adidas reported that net profit for the three months ended Dec. 31 fell to 19 million euros, or $28.1 million at average exchange, on sales that declined 5 percent to 2.46 billion euros, or $3.63 billion.

By brand, Adidas sales decreased 4 percent to 1.74 billion euros, or $2.57 billion, while total Reebok sales fell 8 percent to 412 million euros, or $608.5 million.

Retail sales rose 7 percent in the quarter to 497 million euros, or $734.1 million, with comparable-store sales up, the company said, though Adidas brand comps fell 2 percent. Reebok’s comp-store sales increased 12 percent, and it had a strong performance from its e-commerce division.

Adidas said full-year profits declined 62 percent to 245 million euros, or $341.7 million, on sales that slid 4 percent to 10.38 billion euros, or $14.48 billion. Sales in the Adidas brand were down 4 percent for the year at 7.52 billion euros, or $10.5 billion, while Reebok sales fell 7 percent to 1.6 billion euros, or $2.24 billion.

Ambush marketing hurt Adidas brand

When Wayne Gretzky lit the Olympic torch at this year's Winter Games in Vancouver, organizers didn't take any fashion chances. Canada's hockey hero was adorned in gear from an Olympics official sponsor, the Hudson's Bay Company.
Organizers had reason to be diligent with the clothing showcased at the torch lighting -- arguably the most impactful and symbolic moment of the Games. Because less than two years earlier, a Summer Olympics sponsor -- Adidas -- was successfully ambushed by rival athletic footwear and clothing company Li Ning.
Indeed, the threat posed to sporting events sponsors by ambush marketing seems to grow every year -- and ambush marketers will no doubt be targeting the next major event on the global sporting calendar, the 2010 FIFA World Cup in South Africa.
When a firm invests hundreds of millions of dollars in a sponsorship, and many millions more on marketing efforts to exploit that sponsorship, it embarks on a promotional journey that may help establish it as the uncontested brand in its category: Consider Coca-Cola, Visa, and McDonald's as examples. At the same time, it exposes itself to an array of counter-attacks by competitors who have either chosen not to exploit the sponsorship opportunity, or who have simply not had the resources to do so.
Our recent study showed that the persistent effectiveness of ambush marketers leaves Olympic sponsors and those of other major sporting events particularly vulnerable -- costing them not only their financial investment, but also ultimately their customers.
We examined data from the 2008 Beijing Summer Games -- which saw Olympic sponsor Adidas ambushed by globally lesser-known Chinese company Li Ning. The Chinese company's namesake founder, Li Ning, was China's most decorated Olympian, and it was he who lit the Olympic flame at the 2008 opening ceremony.
Data collected after the closing of the Beijing Games isolated what we call the "Li Ning effect" -- being incorrectly identified as an official sponsor as a result of clever ambush marketing.
In the footwear category at least, Li Ning was the clear brand winner of the 2008 Olympics, in spite of the millions Adidas spent to secure a sponsorship.
Amidst the background noise of multiple sponsorships, this highly poignant event stuck in people's memory such that when they were asked to recall who the official sponsor of athletic footwear was for the Beijing Games, more of our respondents thought it was Li Ning than Adidas.
The return Li Ning received via its minimal investment in sponsorship -- lobbying, perhaps? -- was almost infinite. And while Adidas undoubtedly enjoyed some benefits from its sponsorship efforts, the company invested heavily to achieve these.
Given this, it needs to be reiterated to would-be sponsors: Don't naively put yourself in a position to be ambushed. Remember, large sporting events provide optimal venues and occasions for this to happen.
This does not mean that firms should abstain from sponsorship; large global events can provide superlative opportunities for marketing communication. However, walking into sponsorships and blithely ignoring the lessons from the Li Ning affair would be asking for trouble. If you do decide to sponsor a major event, anticipate and behave as though an ambush will happen.
While organizations such as the International Olympics Committee and various governments build protective walls around, and enact legislation for event sponsors in order to protect them from ambush marketing, ambush marketers have become increasingly cunning. Much like computer viruses that become smarter and more lethal as antivirus software becomes more sophisticated, today's ambush marketers don't merely resort to hanging banners outside a stadium or placing numerous ads in local newspapers. To this end, we offer seven lessons marketers should remember when sponsoring major events:
- Expect the unexpected -- ambush attacks won't come in a form you anticipate.
- Event organizers won't always keep their word.
- Don't rely on governments to protect you -- their own interests will always trump yours.
- Be constantly aware of the likelihood of an ambush.
- Remember that customers don't care -- they won't share your moral indignation regarding an ambush event.
- Don't overreact to an ambush -- it will only compound the problem.
- Sponsorship is only the first stage of marketing in an event setting -- a firm needs to be proactive in all marketing efforts and defensive in anticipating ambush.
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- Leyland Pitt is a professor of marketing at Simon Fraser University's Faculty of Business Administration. Michael Parent is an associate professor of management information systems at SFU Business. Their study, Event sponsorship and ambush marketing: Lessons from the Beijing Olympics, appears in the March issue of Business Horizons. The study was co-written with Pierre Berthon of Bentley University and Peter G. Steyn of Lulea University of Technology.

Adidas The dazzle hasn’t disappeared

 

Great things come from small beginnings and that is certainly the case for global sportswear apparel manufacturer Adidas (ADDYY). The company began life in the home of one Adi Dassler, who decided to make sports shoes in his family home. The operation soon outgrew its modest production facilities and with the help of his brother Rudi, Dassler Brothers Shoe Factory was born.

As with all successful sports related brands, the brothers recognised the value of promoting their product through association with top athletes. The brothers provided running shoes to a number of athletes in the 1928 Olympics, in addition to the running star of the time, Jesse Owens in the 1936 Olympics. 

World War II upset the apple cart somewhat, with the factory turned over to the manufacture of anti-tank weapons. The brothers subsequently went their separate ways after the war, deciding that they could no longer work together after a long running feud. Adi renamed the company Adidas in 1949, while Rudi established Puma. The brothers never again spoke to each other and the companies remain bitter rivals to this day. 

The late 1980s and early 1990s were a chequered period for Adidas. The company was bought by one Bernard Tapie. Although Mr Tapie had a record of rescuing bankrupt companies, he eventually went bankrupt himself, having borrowed too heavily for the Adidas acquisition. Control passed in 1993 to his friend Robert Louis-Dreyfus. 

Adidas’s fortunes improved under the new ownership. The company made a major acquisition in 1997, bringing the ski wear manufacturer Salomon into the fold. The deal also brought with it golf company heavyweights Taylormade and Maxfli. The addition of these strong golfing brands allowed management to open up another front against major competitor Nike, who has a significant presence in golf.

Although management sold Solomon and Maxfli in 2005 and 2008 respectively, the company retains their golf division through Taylormade-Adidas golf.

Adidas’s campaign against Nike strengthened in 2006 through the acquisition of their UK rival Reebok. The acquisition lifted Adidas to the number two position in the ranks of the world’s athletic shoe brands, which is of course the heart of the company.

Financials

The table below shows Adidas’s ROE, in conjunction with other key ratios, for the financial years to 31 December 2000 through to 2008.



As the data shows, although the company’s ROE has weakened from the 2000 high of 24.3%, it has remained reasonably consistent around an average of 20.7%. We would also note that the company’s ROE figures received a boost in the earlier years from a considerably higher level of debt, as shown by the net debt to equity ratio well in excess of 100% through to 2002.

Return on Capital (ROC) accounts for variable levels of debt, providing a truer picture of profitability. On this metric, the picture is more positive with considerably less volatility.  

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Adidas banks on World Cup marketing to rally global sales

 
The Associated PressInSouth Africa, above left, actress Charlize Theron holds the officialmatch ball “Jabulani” during the 2010 World Cup draw on Friday.
Struggling with slow sales this year, German sporting goods maker Adidas Group is betting on its sponsorship of the 2010 World Cup soccer tournament and related new products to give its business a high-flying kick against Nike and other rivals.


The 60-year-old corporation, with 39,000 employees and $16.2 billion in net sales last year, is rolling out a mammoth marketing campaign to capitalize on the soccer championship that will be watched by more than a billion people around the globe.


That global strategy is showing up this weekend in the Portland area, home to Adidas' U.S. headquarters, where retailers set up new Adidas displays.


Based on past marketing battles, expect to see some big guns.


Adidas, Nike and, to a lesser extent, Puma compete fiercely to sponsor major international soccer tournaments and teams and secure endorsements of superstar players.


Last year, Nike paid a reported $64 million a year to grab sponsorship of the French national team from Adidas, for 2011 to 2018. That's four times what Adidas was paying.


In 2007, Adidas went to arbitration to retain sponsorship of the German national team, for which Nike had offered $67 million a year over eight years - five times what Adidas was paying. That same year, Adidas unsuccessfully tried to snatch Brazil's team, reportedly offering $40 million, more than triple what Nike was paying.

New styles adidas shoes for the New Year

Considering the functionality and how the foot works dictates how we fabricate our shoes. Adidas has been one of the major elements of sports and fashion world since 1920, delivering high-tech athletic footwear. The main aim is to design shoes that work with the foot, not against it, to facilitate you reach your maximum level of performance and ease.
Adidas will release their 2010 Star Wars footwear and apparel collection. The collection is made up of Star Wars footwear and clothing that pays proper respect to the key characters from the first Star Wars film. This collection is jam packed with goodies that any Star Wars fan will appreciate. Look for this collection to hit adidas Originals accounts early 2010.
Global street wear icon adidas Originals is proud to announce a unique collaboration with one of the world’s best known and loved brand marks: STAR WARS. This stellar Spring/Summer 2010 collection fuses iconic STAR WARS characters and scenes with classic adidas Originals footwear and apparel silhouettes.
For this new styles adidas shoes, people love to own one pair. “To work with Lucas film in bringing a timeless story to life on our products is great. Like adidas Originals, the STAR WARS brand has a long and rich history of being a leader, leaving an indelible mark on pop culture. For fans of the films, sneaker heads or those that love fun and fresh designs, the collection gives you the chance to find the force or join the dark side.” Inspired by the galactic saga, the STAR WARS collection consists of limited edition as well as mass distribution footwear, apparel and accessories for men, women and kids. Classic adidas Originals track tops and several legendary sneaker styles are represented with characters and scenes from the epic saga in reinterpreted versions.
Popular shoes have its reason to be popular. Adidas has continued to add momentum through the years. Many attribute this to adidas’ excellence, stylishness and repute. Currently Adidas is the largest provider of athletic shoes in Europe. It is the factory for the whole world. Majority of sports enthusiasts like wear adidas sports shoes.

Adidas WatchesThe Classic Sports Fashion brand

As popular as Adidas is as a sports and fashion brand, Adidas watches are perhaps not quite the obvious brand to go for as you mainly associate the label with clothing and sports orientated footwear. In recent years however, Adidas watches have grown in popularity, particularly in the sports industry and have become renowned for being durable, functional and of course highly reliable. Indeed in the past year Adidas watches have proven to be a highly regarded brand with budget friendly price and the style adaptable to all ages.


Adidas Watches – Enhance Your Sports Performance


If you are a sports enthusiast, then you need a timepiece that will go the distance and support your active lifestyle. Adidas watches are the perfect choice as they serve these very purposes as well as looking super cool and stylish and are fantastic if you are a keen runner or generally very active. There are many different models in the range, some of which incorporate features such as an alarm, 10 ATM, an interval timer, a 200 lap measurer, shadow, timer, vent strap, referee mode, and even a training timer. There are also Adidas watches designed specifically for women and these include functions such as an alarm, 10 ATM, an interval timer, timer, vent strap, and 10 lap measurer. As well as styles for specifically men and women, Adidas watches also have some unisex models within the collection which are very much of a classic style and incorporate the same key features.
Adidas Watches – Something for All the Family


Of course, style is a huge selling point and as well as being designed primarily to serve a purpose, Adidas is highly regarded as a fashion brand which allows people to look great whilst on the go. Adidas watches can be worn by adults and children and the brand is becoming increasingly popular among teenagers who like the vivid colours that the range has to offer. The Oddity Candy Adidas watches are a prime example of this. Some of the timepieces also feature a Velcro strap which is perfect for ensuring that the watch isn’t going to break within a month and great for kids! Adidas watches also look very adult and so children also like this appeal. At between £30 and £60, Adidas watches aren’t going to leave a huge dent in your bank account and therefore make the perfect choice for children and of course, if you yourself are on a budget yet desire a great quality and stylish looking timepiece.


Adidas watches offer a wide choice of models and you can be sure to find something for every age. Simplicity is the key and Adidas tend to focus on styling their watches with bright and cool colours and offering plenty in the way of features. Overall they are watches that will ensure durability whilst playing sports and will endure physical activity as well as enhancing your sports performance with some of the key features.

Adidas Trainers 2009

Germany had a massive impact on the story of the training shoe. In the year of 1920, adidas was launched on the world. For the first time adidas trainers appeared in the Olympics games, Amsterdam in 1928. The Adidas brand was being promoted in 1956, at the Melbourne Olympics.

This was the first sports sponsorship. Adidas then split out from trainers into footballs and clothing in the year 1961. Adidas added the three stripes to its trainers to reinforce the shoe and add extra stability to the foot; the trademark that is now recognized around the world was launched. At the 1964 Tokyo Olympics, 83% of all athletes sported footwear with the familiar Adidas 3 stripes.

Currently adidas manufactures a huge variety of trainers, covering all forms of marketplaces and sports under two small logos. The adidas originals collection bears the classic trefoil logo, and the adidas equipment range under the three-stripe logo.

Substance generally carries one of the widest ranges of Adidas trainers online, which includes adidas retro trainers and reissues of dead stock classic adidas trainers. In our exclusive range of adidas trainers, you can find toby black canvas shoe, adidas originals adi 14 trainers black, adidas originals superstar vintage white, adidas originals touring brown, adidas originals adi 14 trainers white, adidas originals tennis vintage black and many more.

Stan Smiths are regarded as the best selling trainers by Adidas ever; with over 32 million sold, but as a substitute there are also Adidas Ilie Nastase and Adidas Rod Laver styles. Adidas tennis trainers are also been highly accepted. Adidas have labelled their tennis trainers with the names of tennis legends from the 70's, which today offers them that retro essence.

Our adidas trainers further consists of adidas originals tobacco trainers musbro, adidas originals superstar 1 chalk, adidas originals universal black, adidas originals adicolor low mahoga/tecbl, adidas originals adi 14 trainers khaki, adidas originals century lo y3 trainers sun, pointer seeker 111 canvas chocolate, adidas originals porsche design cl black trainer, adidas originals cup 68 leather ld, adidas originals universal lux and more.

If you need more information on Adidas Trainers, feel free to get in touch with Substance Designer Clothing. With Substances rare and exclusive mix of brands we hope to provide our clients with a sense of individuality and class!

David Beckham promotes Adidas 'Brand Beckham' in Dubai

David Beckham, with AC Milan players, Kaka and Clarence Seedorf, meet winners of "Adidas Sign for AC Milan" at an Adidas store in Dubai Festival City.

All three AC Milan players, David Beckham, Kaka and Clarence Seedorf, appeared at Adidas store in Dubai Festival City yesterday to meet with competition winners. The ‘Adidas Sign for AC Milan’ competition ran across the UAE from 10 to 27 December 2008. Five winners from 1050 participants were chosen to meet the adidas football legends, experiencing a 30 minute session which saw the players answer questions, sign photos, jerseys, boots and other sportswear. A runner up to the competition received an AC Milan jersey signed by the team members. David Beckham no doubt enjoys getting the limelight. Justifying his move from the Los Angeles Galaxy to AC Milan on loan until March, Beckham said his former pop star wife Victoria will visit him once or twice a week. He admitted that it will be difficult for him to be away from his family but his sons, Brooklyn and Romeo need to stay in the US to continue with their education. Kaka, officially the best player in the world in 2007, feels Beckham still has the right stuff to help Milan during his stay. Clarence Seedorf, who has won the European Cup four times, said Beckham was the "new kid on the block" and the other players are not jealous of the attention he gets. Beckham is set to make his debut in the Dubai Football Challenge game against Hamburg tomorrow at the Sevens - kick off 7pm, before the more serious stuff starts in Serie A as the league resumes after its break.

adidas largest brand centre opened

adidas opened its largest brand centre worldwide last week. located in beijing, china the building is
approximately 3200sqm and consist of four floors. the building designed by shop architects new york,
features protruding glass and mirrors intended to reflect movement of oncoming pedestrians and traffic.
each level offers consumers interactive experiences. whilst visiting the brand centre consumers can

test their level of fitness, how they balance on their feet, their speed and jumping ability. the instore
and website design, designed by start creative allows user to obtain this information, normally only available
to professional athletes. consumers can also compare their results to famous athletes and how they can
enhance their skills. new products and technologies designed by adidas especially for the beijing olympics
will be displayed in the olympic brand launch centre space. the adidas brand centre is part of a new
entertainment and shopping district in chaoyang, beijing.

read more:
http://www.shoparc.com
http://www.startcreative.co.uk

ADIDAS OBYO KAZUKI PREVIEW

Kazuki returns to adidas with his Spring/Summer range for ObyO, this time stepping outside the tech wear we've come to love from past collections and bringing mad heat with some dope vintage-inspired looks. Keeping in line with his strong streamlined designs, Kazuki has created a range that encompasses not only the streets but also 'After-Five' wear with tailored 'Team Manager' suits and shirts. Again, the highlight will be the sneaker drops this time using the Mentos, AG, Gipfel and of course the MT80 boot. Look for the range to drop at all good adidas Originals stores in the next month.

Adidas Contender

	When adidas entered the marketplace some 50 years ago, its focus was to produce shoes crafted specifically for soccer and running. Establishing the brand as the choice for professional athletes eventually parlayed into preference in the mainstream. In the 80's, Run DMC furthered adidas’s street cred with the rap “My adidas,” paying homage to their favorite shell-toe. But by the early 90's, Nike

and Reebok were out-marketing adidas – even in Germany, its own turf. Kids weren’t interested in the sneakers their parents wore, and adidas found itself forgotten in the back of the closet, heading for the Goodwill The new millennium has since brought about an adidas renaissance; the brand has steadily regained market share over the past five years to become the world's number two athletic shoe company (behind Nike). How did it go about repositioning to once again be among the coolest of kicks? Adidas claims that, "the brand values of the company – authenticity, inspiration, honesty and commitment – are derived from sport." Historically, this sensibility was demonstrated through early and continued involvement with Olympic athletes, as well as active sponsorship of major global sporting events – like the World Cup. Today these events provide an ample playing field for sportswear companies to duke it out for representation and thus market share. Adidas’s rapid growth in Asia, where revenue rose by 15 percent to US$ 878M last year, may be further propelled in Japan and Korea when those two nations host the World Cup this year – an event which is expected to garner 2.5M spectators and one billion TV viewers worldwide. However, the key to revitalized success seems to lie in the considerable endorsement deals adidas has developed with world class athletes. Recent sports figures representing adidas don’t only score high marks in their game – they also score high in their celebrity quotient. British football star David Beckham’s relationship with adidas has no doubt lent itself well to the brand’s visibility in the UK. Recently dubbed "Captain of England," Beckham led his team to victory in the 2000 FIFA World Cup. It doesn’t hurt that he’s married to a highly visible, ex-Spice girl and is often seen in the tabloids sporting the adidas logo. With Europe as adidas’s largest market, exposure like this reflects in the numbers; sales grew seven percent to US$ 2.7 billion, last year. Stateside, Kobe Bryant is another example of a winning adidas endorsee. The LA Laker and youngest NBA all-star player is an athlete with substantial celebrity leverage. This translates directly into sales, young men who idolize Bryant want to play basketball like he does, and thus will want to wear what he wears. The equally compelling Russian born, American-bred tennis star Anna Kournikova also meets these criteria. She’s a young, brilliant professional athlete whose celebrity extends well beyond the world of tennis – like Bryant and Beckham she’s captured the public’s interest in mainstream newspapers, magazines and tabloids. Reinvention was key, not only for the adidas’s marketing strategy, but also for its product line. On its website, adidas acknowledges that "The markets and industry in which we compete are transforming rapidly, paced by the evolution – or revolution – in how 'sports' are defined. Team sports such as soccer and basketball will always be a fundamental part of sporting competition. Today, however, eclectic, individual, 'no-rules' sports such as snowboarding, inline skating and surfing have grown into significant categories. Activities such as golf, hiking and mountain biking, which used to be seen as lifestyle and leisure activities, are now part of mainstream sports." Increased product offerings in these categories have undoubtedly contributed to a better score for the brand. To keep up with the competition, adidas generates close to 60 new foot-friendly designs each year. The adidas credo is to regard shoes as feet, resulting in a product with superior fit and performance capabilities. Tactics have been revised in getting these products out for consumption. As a result, products have been repositioned in higher-end and sports specialty stores. As their main competitor has sprinkled flagship NikeTown stores throughout the US, Europe and Australia, adidas has also embarked on a foray into retail. The first adidas-Solomon megastore launched in Paris last year to capitalize on the brand awareness in that market; France scored victories in both the 1998 World Cup and 2000 European Cup football championships. Word on the street is the brand hopes to eventually roll out this concept to more cities in Europe and North America. Adidas continues to prove itself as a brand built to last through a game plan of reinvention. With the recent acquisition of a lifetime partnership with Orlando Magic's Tracy McGrady (basketball) and its heavy involvement with 2002 World Cup, it continues to strike savvy deals that capitalize on the star power of young athletes and increase its visibility in the marketplace. It appears that team adidas has honed its strategy to become a revitalized contender in today’s competitive sporting goods market and is now duly recognized as the sneaker of yesterday and today.

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