Issue No. 199: They’re heating up.

A last word: Adidas’ North American Onslaught

In a tweet today (here), I pointed out a slide from a deck that reveals Adidas’ hope for competing with a reinvigorated Nike. Here is some good data:
Annual North American sales:
Nike: $14.7 billion
Adidas: $3.6 billion
Non-North American sales:
Nike: $15.7 billion
Adidas: $15.3 billion
Adidas’ 2020 North American goal is $5.3B, a 47% increase. On Twitter, NPD Group industry analyst Matt Powell called the $5.3 billion sales goal a “layup.”
Read this by Mathew Kish: 
Adidas struggled in North America as recently as 2014, but it’s been on an upswing, fueled by a consumer shift to casual, white sneakers and denim. Adidas Group North America President Mark King said the brand’s resurgence is no longer simply attributable to Stan Smiths and Superstars, two such sneakers.
“A year ago the momentum was primarily in Originals and today the momentum is across the board in performance product and Originals,” King said. “The most exciting for us is the momentum in running and training apparel. Those are the two biggest categories, period.”

“It’s no longer just a couple of products. It’s now the brand is hot. We feel confident we can sustain growth.”

A few additional changes that should provide clarity for Adidas’ most recent strategy? They will be losing the NBA this year, as Nike takes over the apparel contract. While this may seem like a blow to Adidas’ mindshare, Jeremy Darlow (U.S. Director of Marketing) has been masterful at aligning Adidas’ revenue and brand equity growth missions with a metaphorical insurgency against the institution.

It’s worked well on the NFL stage (against Nike) and the NBA will present a new opportunity to do the same (against Nike). As for Under Armour, their strategy is scattered at best and presents no immediate challenge to Adidas’ lofty North American revenue targets. But Nike as always a course correction away from regaining their North American momentum.

See more of the issue here.

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