Adidas (company)
Adidas AG is a prominent international corporation specializing in athletic footwear, apparel, accessories, and equipment, founded by Adolf "Adi" Dassler in Herzogenaurach, Germany, in 1949. It has grown to become one of the world's leading sportswear manufacturers, ranking as the second-largest producer of sportswear globally as of 2018. Known for its distinctive three-stripe logo, Adidas has established a significant presence in various sports and urban fashion scenes. The company also owns Reebok and has a workforce exceeding 61,000 employees worldwide. Historically, Adidas gained fame after its shoes were worn by athletes in multiple Olympic Games and during the 1954 FIFA World Cup. Its cultural impact surged in the 1980s through a partnership with the hip-hop group Run-DMC, which helped merge sportswear with casual fashion. Although Adidas has faced challenges, including competition from Nike and controversies surrounding celebrity endorsements, it continues to adapt and seek growth in the athletic market.
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Adidas (company)
Company information
- Date Founded: 1949
- Industry: Athletic footwear; athletic apparel
- Corporate Headquarters: Herzogenaurach, Germany
- Type: Public
Adidas AG is an international corporation that manufactures athletic footwear, clothing, accessories, and equipment. Headquartered in the Bavarian town of Herzogenaurach, Germany, Adidas is one of the world’s leading shoe and sportswear manufacturers. In 2018, Adidas ranked as the second-largest producer of sportswear in the world (behind Nike). Adidas products are easily recognizable by their company’s logo, three diagonal bars arranged in a triangular shape over the brand name adidas, set in lowercase sans-serif type. In 1972, Adidas introduced a trefoil marked by three horizontal white stripes as its logo, which it continues to use for its Adidas Originals collection. As a result of its logos, Adidas is popularly known as "the brand with the three stripes."
As of 2021, Adidas employed more than 61,000 employees worldwide. Adidas’s North American headquarters is located in Portland, Oregon. The Adidas Group also owns Reebok, which moved its headquarters from Canton, Massachusetts, to Boston between 2017 and 2018. In 2016, Kasper Rorsted replaced Herbert Hainer as chief executive officer (CEO) of Adidas AG.
History
Adidas is named after its founder, Adolf "Adi" Dassler, the son of a shoe factory worker who began designing and creating his own athletic shoes and equipment in the 1920s. In 1924, Dassler established the Gebrüder Dassler Schuhfabrik (Dassler Brothers Sports Shoe Company) with his brother Rudolf "Rudi" Dassler. The company supplied athletic footwear to several athletes in the 1928, 1932, and 1936 Olympic Games. Such athletes included American track legend Jesse Owens, who captured four gold medals at the 1936 Games in Berlin. During the 1940s, disputes between the Dassler brothers resulted in a split. Rudi Dassler left to establish his own company, which eventually became Puma, while Adi Dassler officially established the Adi Dassler adidas Sportschuhfabrik (Adi Dassler adidas Sports Shoe Company) on August 18, 1949, in Herzogenaurach, Germany. At the time of its establishment, Adidas consisted of just forty-seven employees.
From the 1950s through the late 1980s, Adidas grew in popularity and established a truly global presence. West Germany’s upset victory over Hungary in the 1954 FIFA World Cup provided free marketing for Adidas athletic footwear, as the German players were wearing Adidas cleats, which gave them an advantage in the rainy weather. Adidas also emerged as a popular brand of footwear for tennis, gymnastics, and hiking, in addition to soccer and track-and-field. Following Adi Dassler’s death in September 1978, his son Horst Dassler became the new head of the company. However, Horst Dassler died in 1987, and subsequent Adidas leadership plunged the company into deep financial losses until the mid-1990s, when Robert Louis-Dreyfus became CEO in 1993 and Adidas became a public corporation in 1995 (allowing shareholders to invest in the company through purchasing Adidas stock). In 1997, Adidas acquired the Salomon Group and its brands Salomon, TaylorMade, Mavic, and Bonfire. Adidas sold Salomon, Mavic, and Bonfire to Amer Sports in 2005 but retained the brand TaylorMade. In 2006, Adidas was renamed Adidas AG after the company acquired Reebok.
Impact
Today Adidas footwear and apparel are equally known for athletic competition as they are symbols of urban fashion. During the mid-1980s, Adidas gained tremendous popularity in the United States as a result of the pioneering hip-hop trio Run-DMC, who wore Adidas brand athletic shoes and tracksuits as part of their distinctive style during concerts and television appearances, as well as on album covers and in music videos. Run-DMC wore their shoes without laces, and the media attention devoted to this unique style provided Adidas with free advertising in the US market. In 1986, Run-DMC released the song "My Adidas" as a track on their album Raising Hell, and the German company quickly took note. Angelo Anastasio, an Adidas executive, attended a Run-DMC concert in New York City and noticed that thousands of fans held up their own Adidas shoes as the legendary rappers performed. In July 1986, Adidas entered into a $1 million endorsement deal with Run-DMC, the first ever endorsement deal for a rap group. The cultural significance of this partnership was twofold: the crossover of sportswear as casual fashion and the birth of the hip-hop/sports "sneaker wars"—a phenomenon of celebrity endorsement deals that continues to this day. Other athletic footwear manufacturers also began to market their products as popular fashion apparel: Nike released its first pair of Air Jordans to the public in 1985, and Converse entered into endorsement deals with basketball stars Larry Bird and Magic Johnson in 1986.
These "sneaker wars" resulted in an intense rivalry between Adidas and Nike. However, in the 1990s Nike entrenched its dominance over Adidas in athletic apparel in the United States, which it has not relinquished. Adidas remains the largest sports apparel manufacturer in Europe. Part of the geographic divide in market dominance between the two corporations stems from sport preferences in different regions; Nike primarily produces clothing and footwear for football, basketball, baseball, and running, while Adidas has long created products primarily for soccer and tennis.
Despite its continuing successes, Adidas has generated controversy. In the spring of 2015, numerous Adidas investors and stockholders expressed frustration that the corporation was allegedly not doing enough marketing and innovation to challenge Nike’s dominance. Adidas’s stock had declined 38 percent in 2014, although the company’s stock value did rise in 2015. However, in 2015, Under Armour surpassed Adidas in both apparel and footwear sales in the United States, bumping Adidas to the number-three position in the US sportswear market. Despite these setbacks, however, Adidas sought to reposition itself to compete with Nike and Under Armour in the United States in the coming years with multimillion dollar endorsement deals signed with basketball player James Harden and recording artists Kanye West and Pharrell Williams. In 2016, the company took back its second-place position from Under Armour in the United States.
In September 2017, Adidas executive James Gatto was one of ten people arrested by the Federal Bureau of Investigation (FBI) in connection with the National Collegiate Athletic Association (NCAA) Division I men's basketball corruption scandal, in which coaches at several top college basketball programs accepted bribes in order to help direct players toward certain managers and schools. Gatto was charged with paying families of top high school athletes to ensure that the athletes signed with one of two universities, the University of Louisville and the University of Miami, with which Adidas had sponsorship deals. The following year, some called for the company to end its relationship with West, who created the Yeezy line, after he made controversial statements regarding slavery; however, while Rorsted made it clear that the company did not share West's view, it did not sever ties at that time. However, in October 2022, West, who now used the name Ye, made more controversial remarks—a series of anti-Semitic and anti-Black statements—that led to a decision by Adidas to terminate its partnership with West. Though Adidas was one of the first of West's corporate partners to sever ties with the artist, company leaders encountered backlash for not denouncing his actions and ending the partnership sooner. The decision would have significant impacts on the company's finances. Adidas executives reported it would cost the company $246 million in 2022 alone.
In April 2019, Adidas made another significant announcement about a celebrity partnership when it was revealed that popular singer Beyoncé Knowles had signed with the company to expand her athleisure brand and work as a creative partner.
Bibliography
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Eddy, Melissa, et al. "Adidas Ends Partnership with Kanye West at a Considerable Cost." The New York Times, 25 Oct. 2022, www.nytimes.com/2022/10/25/business/adidas-kanye-west.html. Accessed 3 Nov. 2022.
"History." Adidas, www.adidas-group.com/en/group/history/. Accessed 5 Jan. 2018.
Mellery-Pratt, Robin. "Run-DMC’s ‘My Adidas’ and the Birth of Hip Hop Sneaker Culture." The Business of Fashion, 18 July 2014, www.businessoffashion.com/articles/video/run-d-m-c-s-adidas-birth-hip-hop-sneaker-culture. Accessed 1 Aug. 2016.
Shaer, Matthew. "Sneaker Wars: Inside the Battle between Nike and Adidas." GQ, 28 Sept. 2015, www.gq.com/story/nike-adidas-sneaker-wars. Accessed 1 Aug. 2016.
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Thomasson, Emma. "Adidas under Fire from Investors Despite Recovery Signs." Reuters, 7 May 2015, www.reuters.com/article/us-adidas-agm/adidas-under-fire-from-investors-despite-recovery-signs-idUSKBN0NS10P20150507. Accessed 1 Aug. 2016.
Warnett, Gary. "How Run-DMC Earned Their Adidas Stripes." The Daily, Mr Porter, May 2016, www.mrporter.com/daily/how-run-dmc-earned-their-adidas-stripes/939. Accessed 1 Aug. 2016.
Winter, Tom, and Tracy Connor. "4 NCAA Basketball Coaches, Adidas Executive Charged in Bribe Scheme." NBC News, NBC, www.nbcnews.com/news/us-news/college-basketball-coaches-allegedly-took-bribes-agents-deliver-athletes-n804781. Accessed 22 Jan. 2018.