Things are now definitely on track and, if the current marketing slogan, “Impossible is Nothing", is anything to go by, the company is brimming with confidence. This is not surprising when you consider that Adidas now consistently out-performs the rest of the sector and has enjoyed eight years of consecutive double digit net income growth. It is now the world's number two sports apparel manufacturer with total sales for 2007 of €10.3bn and profit growth of 9%.
Walk along any high street and it is clear that wearing sports clothing is definitely a fashion statement, and possibly an indication of athletic prowess. Adidas recognised this trend early on and has developed high-performance sports lines in collaboration with the likes of Stella McCartney, Yohji Yamamoto, Porsche Design and Rolland Berry. That said, the company does not sacrifice its commitment to improving sporting performance and aims to launch at least one major new technology or technological evolution per year. Even more than its peers, Adidas has put performance at the heart of its product portfolio and invests specifically to support this. R&D projects involve collaborations with professional and amateur athletes including Zinedine Zidane, Michael Ballack and Allyson Felix. In addition, Adidas works with clubs such as AC Milan and Bayern Munich to test and optimise products. Over recent years this has led to development of technologies such as ForMotion, which supports the core adistar and Supernova families, as well as the next generation of the Response and BOUNCE running shoes.
Alongside providing performance products, Adidas recognises that consumers make purchase decisions based not only on brand but also on availability, convenience and breadth of product offering. As a result the company has been refining its distribution proposition, concentrating on expanding its own outlets or ‘controlled’ space and improving retail relationships. There are now over 1000 Adidas stores around the world and, in the run up to the Beijing Olympics the company opened an average of two stores a month in China. By 2010, the aim is to generate at least 30% of the group’s revenues through controlled space.
To keep its brand in the public focus Adidas has also sponsored sportsmen and women for many years. In 2008, 295 footballers, 64 rugby players, 71 tennis players, 24 basketball players and 8 golfers all benefited from its three stripe logo. One of the first prominent endorsers of Adidas equipment was American running legend Jesse Owens, the gold medalist at the 1936 Summer Olympics. As well as sponsoring the Beijing Olympics Adidas is also supporting the 2012 Olympic Games in London in a deal worth around $200 million: in this sector such brand awareness is critical. Going forward, Adidas is also embracing a number of niche sports and lifestyle activities fuelled by the current trends in individualism, health and wellbeing with, for example, a new woman's Yoga range. As it aims to take over world number 1 position in the sector from Nike, Adidas will be innovating incessantly both within existing sports and outside the core.
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