After experiencing a drop in U.S. sales in 2014, due to its lagging golf segment, the adidas Group made building upon its strong soccer roots a top priority. Through partnerships with teams (Real Madrid, Bayern Munich) and key players, as well as a FIFA World Cup sponsorship, the adidas logo became pervasive on the soccer field and beyond. It even managed to secure contacts with Juventus (EUR €139.5 million) and Manchester United (USD $1.3 billion) after each ended their kit deals with Nike. Despite slowed growth for the Group last year, adidas brand sales spiked a currency-neutral 11 percent year over year in Q3 2015.
The uptick in sales may be credited to recent collaborations and innovation efforts. The brand has partnered with top talent like Pharrell Williams, Kanye West, Rita Ora, and Selena Gomez, as well as designers like Yohji Yamamoto, Stella McCartney, Jeremy Scott, and Nigo. It’s all part of adidas’ Sport Style division, which is aimed at attracting “style-adopting youth”—and it’s working. By broadening and diversifying its portfolio, adidas has been able to reach different targets while responding quickly to market changes. Innovations like the Smart Run watch (developed with Spotify and RunKeeper), the superlight adizero 99g soccer cleat, and Primeknit 2.0 keep adidas at pace with—and ahead of—competitors. The new Futurecraft 3D, a customizable 3-D-printed running shoe midsole, breaks all new design ground while offering unique user personalization.
In fact, “creating the new” is what adidas aims to achieve with its new strategic business plan. Put in place to accelerate growth through 2020, the plan focuses on three main points: speed, cities, and open source, which means it will be working toward increasing in-season creation; implementing growth in key cities like Los Angeles, New York, London, Paris, and Tokyo; and strengthening engagement with customers, athletes, retailers, and partners.
The brand is quickly becoming a forerunner of sustainability in the sportswear sector—and beyond. It’s leading the cross-industry Sports Infinity project, aimed at developing new, recyclable materials for the production of easily customizable sporting goods. In a groundbreaking partnership with Parley for the Oceans, adidas introduced the world’s first shoe with an upper made entirely from recycled ocean plastics. Including plans to reduce the distribution of plastic bags, adidas’ initiatives have earned it third place in the Global 100 Most Sustainable Corporations in the World index.
By continuing to develop clout among sports fans as well as innovation-savvy and socially conscious customers, adidas is picking up speed as it pursues its new growth goals.