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Adidas

Sport has the power to change lives

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Adidas, inspired by its heritage, seeks to push the boundaries of culture and human performance. Through sport, it believes it has the power to change lives. Headquartered in Herzogenaurach, Germany, the business employs more than 57,000 people across the globe.

Everything Adidas does is rooted in sport.

“The good news is that sport plays an increasingly important role in more and more people’s lives, on and off the field of play, so we operate in a highly attractive industry.

We push the boundaries of products, experiences and services to drive brand desire and capitalize on the growth opportunities in sport as well as in sports-inspired casual and activewear. However, the importance of sport goes far beyond that.

Sport is central to every culture and society and is core to an individual’s health and happiness. Therefore, we believe that, through sport, we have the power to change lives. And we work every day to inspire and enable people to harness the power of sport in their lives.”

Dreaming about sports

Although urban legend has it that the word “Adidas” is an anagram of the phrase “all day I dream about sports,” the athletic wear company gets its name from its founder, Adolph “Adi” Dassler. He and his brother founded the company that would become a worldwide brand, but their history as members of the Nazi Party isn’t as well known.

In 1920, at the age of 20, avid soccer player Adolph (Adi) Dassler, son of a cobbler, invented spiked shoes for track and field. Four years later Adi and his brother Rudolph (Rudi) founded the German sports shoe company Gebrüder Dassler OHG—later known as Adidas.  By 1925 the Dasslers were making leather shoes with nailed studs and track shoes with hand-forged spikes.

Beginning with the 1928 Olympics in Amsterdam, Adi’s uniquely designed shoes began to gain a worldwide reputation. Jesse Owens was wearing a pair of Dassler’s track shoes when he won four gold medals for the US at the 1936 Berlin Olympics.

At the time of his death in 1959, Dassler held over 700 patents related to sports shoes and other athletic equipment. In 1978, he was inducted into the American Sporting Goods Industry Hall of Fame as one of the founders of the modern sporting goods industry.

In the 1970s, Adidas was the top athletic shoe brand sold in the US. Muhammad Ali and Joe Frazier were both wearing Adidas boxing shoes in their “Fight of the Century” in 1971. Adidas was named the official supplier for the 1972 Munich Olympic Games.

Although still a strong, well-known brand today, Adidas’ share of the world sports shoe market dropped over the years, and what began as a German family business is now a corporation (Adidas-Salomon AG) combined with the French global concern Salomon.

In 2004 Adidas bought Valley Apparel Company, a U.S. company that held licenses for outfitting more than 140 U.S. college athletic teams. In 2005 Adidas announced that it was purchasing the American shoemaker Reebok, which allowed it to compete more directly with Nike in the U.S. But the Adidas world headquarters are still located in Adi Dassler’s hometown of Herzogenaurach. They also have an ownership stake in German soccer club 1. FC Bayern München.

Here is a extract from its published business strategy:

Mission

We want to be the best sports company in the world. What does that mean? Well, to us ‘best’ means that we design, build and sell the best sports products in the world, with the best service and experience, and that we do so in a sustainable way. But ‘best’ is also what our consumers, athletes, teams, partners, media and shareholders say about us.

Plan

‘Creating the New’ is not only the attitude that leads us into the future, it is also the name of our strategic business plan until the year 2020 to accomplish our mission. At the core of Creating the New stands our ambition to further drive top- and bottom-line growth by significantly increasing brand desirability. We therefore focus on our brands like Adidas and Reebok as they connect and engage with our consumers.

We know that, in order to be successful, we need to get closer to our consumers than ever before. To achieve that, our plan is based on three strategic choices: Speed, Cities and Open Source. For more information around these three choices, please scroll further down.

But ultimately, Creating the New has its powerful foundation in our unique corporate culture. We have great talents in our organization who work with passion for sports and our brands. It is our people that bring our strategy to life and make the difference in achieving our long-term goals.

Strategic choices

Our business plan is built around three strategic choices that will enable us to focus even more on our consumers:

  • Speed – How we deliver: Putting our consumers at the heart of everything we do and serving them in the best possible way means that we need to ensure that they always find fresh and desirable products where and when they want them. We will become the first true fast sports company.
  • Cities – Where we deliver: Urbanization continues to be a global megatrend. Most of the global population lives in cities. Cities are shaping global trends and consumers’ perception, perspectives and buying decisions. We have identified six key cities in which we want to over-proportionally grow share of mind, share of market and share of trend: London, Los Angeles, New York, Paris, Shanghai and Tokyo.
  • Open Source – How we create: This is all about collaboration and innovation. About learning and sharing. We are opening the doors of our brands inviting athletes, consumers and partners to co-create the future of sport and sports culture with us.

Acceleration Plan

To foster our brand momentum and accelerate sales and earnings growth, we introduced a number of initiatives that we will focus on in addition to the three strategic choices and our corporate culture – Portfolio, North America, Digital and ONE adidas.

  • Portfolio: This is all about more focus and less complexity. We are constantly revisiting and sharpening the focus of our brand portfolio, fully concentrating on adidas and Reebok and on our core competencies in footwear and apparel. This will allow us to reduce complexity and pursue our consumer in a more targeted and consequent way.
  • adidas North America: North America represents the biggest market in the sporting goods industry with a total share of approximately 40%. It is the single biggest growth opportunity for the adidas brand. That is why we have made North America a strategic priority and started to significantly increase our investments into our US business – people, infrastructure, marketing and point-of-sale – in order to be more relevant and always visible to the consumer.
  • Digital: The digital transformation is fundamentally changing the way our consumers behave and the way we work. Technology has enabled us to build more direct relationships with our consumers. With our relatively young workforce we are in the unique position to continuously improve our digital capabilities – not only to interact with the consumer, but also to become faster, better and more efficient in every part of the organization.
  • ONE adidas: We continuously strive for operational excellence. ONE adidas encompasses a set of initiatives that will enable us to work smarter, more efficiently and in a more aligned way. Because we know that when we act as one global company instead of 20 smaller ones, we can only get better.

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