The Berlin Marathon on Sunday was not just a competition between athletes. It was also the duel between the two largest sporting goods manufacturers for a global market worth billions. Nike and Adidas are fiercely vying for dominance in the billion-dollar running business, and the winners of major road competitions are drawing global attention to their suppliers’ running shoes. In Berlin, the Kenyan top favorite Eliud Kipchoge won for the fifth time – and in Nike shoes. However, the Ethiopian Tigist Assefa stole the show by smashing the women’s world record – in new Adidas shoes. They are the lightest running shoes ever, each weighing just 138 grams. The German runner Amanal Petros also wore the model and set a new national record with it in Berlin.
Adidas immediately invited the two of them to the company headquarters in Herzogenaurach on Tuesday; as recognition, but also to motivate the 6,000 employees there. An appointment that was perfect for CEO Björn Gulden. In office since the beginning of the year, the Norwegian has made one appearance after another with top athletes from the realm of the three-stripe brand. There is a method behind it. Look, we are a large, successful sports brand, is the message. A matter of course, one would think, that doesn’t need to be emphasized at Adidas. But under the return- and margin-driven reign of Gulden’s predecessor Kasper Rorsted, who was chased away from the court at the end of 2022 with a severance payment of 16 million euros, the Adidas identity had been somewhat forgotten and therefore a good dose of self-assurance is needed for the new start.
The miracle shoe is balm for the Adidas soul
After nine months under Björn Gulden, 58, Adidas looks like a runner who is taking a breather to get going again. “You can clearly feel the changes and they are consistently positive,” says Margit Gosau, head of the international specialist retailer organization Sport 2000, taking stock. “Since Gulden has been there, the Adidas employees seem liberated and much more relaxed and calm than before. They also have the courage to make more decisions again.” Under Rorsted, a “strategic hydrophile was built up with people who thought and acted like management consultants. The Adidas brand was neglected and it appeared correspondingly starved. Gulden’s approach is completely different: his basis is the brand and product, but also retail. “
However, Gulden, who was brought to Adidas from Herzogenaurach’s local rival Puma, is struggling with a legacy that caused him a shitstorm on social networks last week. It’s about the inheritance of Kanye West, the at least eccentric US rapper and designer, whose Yeezy Adidas shoe collection generated sales of up to 1.2 billion euros annually. Until West, who now calls himself Ye, made it impossible as a business partner due to misogynistic, racist and, above all, anti-Semitic attacks. Adidas cut ties a few months before Gulden took office. However, that doesn’t stop him from expressing sympathy for the controversial US rapper. West was “perhaps the most creative person” to have ever worked in the sporting goods world, Gulden said in May. A few days ago he followed up in a podcast: “I don’t think he meant what he said seriously and I don’t think he’s a bad person,” said Gulden, “he just came out like that over”. The Adidas boss as a defender of a racist and anti-Semite? Large parts of the online community were outraged, especially Jewish organizations and the International Auschwitz Committee.
The quote, however, was shortened and given out of context. And Gulden responded to the outrage by clarifying that the “decision to end the partnership with Ye because of his comments was absolutely right.” “Our stance has not changed: hate of any kind has no place in sport or society, and we remain committed to the fight against it.” He said so in two phone calls with leaders of the American Jewish Committee and the Anti-Defamation League.
A fired rapper significantly improves Adidas sales
The flame of indignation left Gulden relatively quickly, but dealing with the legacy of Kanye West, who was currently wandering around Europe in a bizarre way, continues to be a problem for Adidas. One that is fraught with contradictions. It’s about how to deal with the last Yeezy collection at Adidas, sneakers worth hundreds of millions of euros. They had already been produced when Adidas, still under Kasper Rorsted, ended its collaboration with West. In one of his first decisions, successor Gulden decided to sell the shoes in several waves. The first brought Adidas 400 million euros in sales in the second quarter. Of this, 110 million went as donations to organizations that fight racism and anti-Semitism. But what about the remaining 290 million euros? How much of this covers production and delivery costs, how much is left to Adidas, but above all: How much does Kanye West get? Adidas does not provide any information when asked, citing contractual confidentiality. One can assume that West, who was fired from Adidas as an anti-Semite and racist, continues to earn millions of euros with Adidas. The second wave of sales started on August 2nd via various online shops and “if this second sale is successful, it would further improve the company’s results,” Adidas already admitted.
According to Adidas headquarters, destroying the shoes would have been more ecologically irresponsible. Otherwise the issue is over within the group. The longing for a new start is too great, too overwhelming for everything else. With the European Football Championship and the Olympic Games in Paris, 2024 will be a sports year with two world stages on which the big sports brands can show off. Until then, Gulden has to get the economically ailing, three-striped giant fit again. The Norwegian cures the patient with the same formula that he once used to get Puma going. In order to grow sales and minimal profits, which have recently been almost stagnant, Gulden is relying on a strong, sports-rooted brand, innovative products, trendy sports fashion and the specialist retail trade, which was neglected under Rorsted, as a partner.
Her impression and that of managers of other large sports chain stores and purchasing groups is that Gulden is again “increasingly focusing on partnership with retailers,” says Sport 2000 boss Gosau. “Adidas is once again taking retail seriously and appreciating it. This is what Gulden personally stands for. He can be reached quickly if necessary and responds to inquiries immediately.” And it is again possible to “strategically plan longer-term product campaigns together with the Adidas people and not just in the short term for a year.”
This is important because from the development of a running shoe, for example, to its delivery to the retailer, it can take a year or a year and a half. As a result, the collections for the European Championships and the 2024 Olympics will be the first to be attributed to guilders. The record shoes from the Berlin Marathon date back to Kasper Rorsted’s time. However, it is unclear who set their price. A pair costs 500 euros.