The “love of football” reigns supreme above all else. Adidas has placed two enlarged versions of the so-called European Championship match ball at the entrance to its campus in Herzogenaurach, which can be easily overlooked from afar. The opening game between Germany and Scotland will kick off in Munich in less than 100 days, but there is little sign of European Championship euphoria. “That will change,” predicts Björn Gulden, CEO of Adidas. “The European Championships will be a mega party and people are looking forward to it.”
At least the dream of the summer fairy tale reloaded is alive. A new version of 2006, when the World Cup drove out the German hosts’ chronic discontent, the AfD was still far away and the country appeared cosmopolitan, carefree and happy. If the repetition works, it will not only trigger positive feelings, but also boost the business of sporting goods manufacturers. This Thursday, Adidas presents the European Championship jerseys of the German and all other teams that will wear the brand’s characteristic three stripes. As of today, eight teams at the European Championships will be equipped by US industry leader Nike, six by Adidas and four will wear Puma. At least ten out of 24 teams have German suppliers; three starting places at the European Championships are still being awarded.
For Adidas, Europe’s number one and world number two, the worldwide broadcast tournament comes at just the right time. Just like the American continental soccer championship Copa and the Olympic Games in Paris shortly afterwards. After difficult years with a change at the top, the comeback should be successful in 2024. After sales fell by five percent to 21.4 billion euros in 2023 compared to the previous year, they are expected to increase by seven to nine percent in the current year; Adjusted for negative currency influences, the increase is expected to be five percent.
Adidas had initially forecast a loss of 700 million for 2023, mainly due to the turbulence surrounding rapper Kanye West’s collection. After West’s racist and sexist comments, Adidas ended the collaboration at the end of 2022 and sold off the remaining products in 2023. Instead of a loss, Adidas ended 2023 with an operating profit of 268 million. Gulden and his management are forecasting half a billion for 2024. If one only takes continuing operations as a basis, Adidas had to absorb a net loss of 58 million euros in 2023.
In 2023 Adidas stagnated at best, in 2024 things should start to look up, slowly but at least. By 2026 at the latest, the brand, which turns 75 on August 18th, will be back to its former glory and strength, says Björn Gulden. He happily refers to the pop star Taylor Swift, who repeatedly wears Adidas without being paid for it. He proudly presents new products that will not hit stores until fall at the earliest. “We have a lot of great stuff in the pipeline,” he enthuses. The first collections developed entirely under his aegis will come onto the market in 2024.
CEO Björn Gulden is setting the pace at Adidas.
(Photo: Daniel Karmann/dpa)
The Norwegian, who moved from Puma to the three times larger Herzogenaurach local rival at the turn of the year 2022/2023, has revived Adidas. The 59,000 employees are grateful that a sports nut is leading them again. Gulden floods social networks with photos that show him with prominent Adidas athletes. No, no, the successes had nothing to do with him, flirted Gulden when he presented the balance sheet figures for 2023 at the company headquarters on Wednesday, the first year under his leadership. There are many good people at Adidas who had carried around a lot of innovations and ideas even before, i.e. during the time of his sacked predecessor Kasper Rorsted. But unfortunately just as many concerns and overcaution. He just untied the knot himself, says Gulden. His message to his own people: “Just do it, dare, take risks, try it out. And do it as quickly as possible.”
Using this method and some tough management changes, Gulden has eased tensions that had formed under his numbers-driven predecessor, Rorsted. Example “Samba”. A purely indoor football shoe 50 years ago, it has been successful as a sneaker for some time in cooperation with the luxury brand Gucci. Sales numbers rose quickly as early as 2022. The Adidas plan was not to start a Samba campaign until 2024. Gulden, however, pushed on: Do it now, the trend is there. In 2023, the Samba was named Shoe of the Year in the USA and sales figures are developing brilliantly.
The Swiss-born Norwegian Gulden cures Adidas using similar methods as before at Puma. More freedom for your own people, more speed in the development and market launch of new products, in marketing and also in sales. Adidas is once again relying on specialist retailers, who have seen themselves neglected and badly treated for years. In addition, Adidas is once again supplying training and competition shoes for almost every sport and not just the largest ones worldwide. And the brand is becoming more regional. For example, because the Japanese don’t like chunky running shoe soles, they offer flatter running shoes in the same designs. Or India. As soon as he took office, Gulden signed the national cricket team. During the World Cup in this sport, Adidas sold more than 600,000 replica Indian national jerseys. “That’s more than we sell from some successful football teams,” says Gulden.
The sporting goods giant wants to become faster, broader in its range and more regional. The latter is particularly important in North America. Constantly new strategies and managers did not bring any significant success there; Adidas has barely had a foothold in this largest and most important sporting goods market for decades. In 2023, sales fell by 16 percent. Because excess stocks had to be sold off at discounts because Adidas is not significantly represented in classic US sports such as American football or baseball, especially not in the important high schools and colleges. Young Americans also resent the German brand for ending its collaboration with Kanye West. Since then, West has either posed friendly with Gulden in photos (like recently when they met by chance at the airport in Los Angeles), or he insulted him and Adidas and called for a boycott.
The collaboration with Kanye West brought Adidas a lot of sales and even more trouble. It ended long ago.
(Photo: Ashley Landis/AP)
West is an explanation as to why Adidas slipped into the crisis in the first place. The company generated up to 1.2 billion euros in sales with its Yeezy collection alone, which is now gradually disappearing. Then there was a corona and boycott-related drop in sales in China of two billion euros compared to 2019. Losses that could not be compensated for. The Yeezy collection, which had already been produced at the time of its release, is currently being sold off. Adidas earned 750 million euros in 2023, and it will be 250 million this year. Adidas said it donated more than 140 million euros to organizations that fight against racism and anti-Semitism. To process these and future donations, an Adidas Foundation is currently being set up.