The worldwide corporation Adidas was formed in Germany in 1924. The sports company focuses on the development and design of athletic shoes, jerseys, apparel, and other accessories. Adidas is one of the major makers of athletic apparel in the world.
Aside from American rival Nike, no other firm has tentacles as deeply entrenched in the creation of sportswear as Adidas. Adidas, despite being widely acknowledged as Europe’s leading sportswear maker, also owns a football club and a tech-based fitness company.
The German corporation is the Parent Company of the Adidas Group, through which it executes its responsibilities as an 8.33% shareholder in Bundesliga powerhouse Bayern München and as the owner of Austrian fitness company Runtastic.
In light of the separation that resulted in the development of the Adidas and Puma brands, Adidas’s success over the past 96 years and 70 years as Adidas has been remarkable. The perseverance and tenacity of Adidas brands remind me of the adaptability of Europeans.
With an emphasis on Adidas’ brand value, we will examine the company’s founding, expansion, accomplishments, and earnings.
Quick Facts about Adidas
|Earnings:||$23.64 Billion (2020)|
|Founded:||August 18, 1949|
|CEO:||Kasper Rørsted (2016–present)|
Adidas Brand Establishment
Adolf “Adi” Dassler, a teenage German, began creating athletic shoes in his mother’s laundry room after World War I. Adidas was created in a laundry room in Herzogenaurach, the current location of the company’s headquarters. Rudolf, Adolf’s older brother, joined the firm, and the Dassler Brothers Shoe Factory was created.
The two brothers were so dedicated to the creation of sports shoes that they used the pedal power of a bicycle to generate electricity for shoe production. In addition to being resolved, they were also creative. Instead of the hefty metal spikes commonly utilized at the time, the brothers used canvas and rubber in their spiked footwear.
After the 1936 Summer Olympics, the Dassler Brothers Shoe Factory experienced substantial growth. At the 1936 Olympic Games, sprinter Jesse Owens won four gold medals after the brothers successfully persuaded him to wear their hand-made spike shoes. This had a huge impact on the Adi Dassler shoe brands, as word quickly spread, resulting in the company producing 200,000 pairs of shoes per year before World War II.
The onset of World War II had little impact on the economy. During the height of World War II, the last shoe manufacturing company in Germany was owned by Nazi Party members. They manufactured shoes for the Wehrmacht, the German united Armed forces. At one of the company’s plants, anti-tank weapons were created. This plant was nearly destroyed by American troops, but Adolf Dassler’s wife persuaded them that they were solely interested in the production of athletic shoes. The Americans not only spared the factory but also became regular Dassler shoe purchasers.
In 1947, the relationship between the brothers deteriorated, prompting Rudolf to form Ruda, today is known as Puma. Adolf subsequently renamed his company Adidas AG. The name was derived from his nickname, Adi, and the initial three letters of his surname, Dassler.
The dispute between the brothers damaged the community of Herzogenaurach. Due to the dispute, the town was dubbed “the town of bent necks,” as residents glanced down to see what brand of shoes others wore. 1 FC Herzogenaurach supported Ruda, but ASV Herzogenaurach supported Adidas AG.
Adidas AG began utilizing its 3-Stripe logo in 1952 after purchasing it from Finnish sports manufacturer Karhu Sports for €1600 and two whiskeys.
Adidas Net Worth
According to sportytell.com, Adidas’ net worth in 2020 is around $16.48 billion, an increase of $2 billion from 2018. In 2019, Adidas earned net sales of €23.64 billion, with footwear accounting for the majority of sales. Adidas has increased its marketing expenditures in recent years. In 2018, the corporation spent $3 billion on marketing.
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Adidas Brand Expansion
The feud between the brothers brought Adidas to widespread attention. Sales increased because of the Dasslers’ reputation as seasoned shoemakers and more publicity. The clever utilization of endorsement deals, from which the brothers had previously benefited greatly, contributed to the increase in sales.
In 1989, French industrialist Bernard Tapie purchased the Adidas company from the Dassler family for 1.6 billion (€243.9 million), which he borrowed.
Following the takeover, Adidas relocated production to Asia and launched a fresh public relations campaign, prompting the company to employ Madonna for good PR. As a result of Tapie’s failure to repay the loan, he directed Crédit Lyonnais to sell the business. The debt was then turned into business ownership. This extraordinary course of action was a personal favor to Tapie, who was Minister of Urban Affairs at the time.
Robert Louis-Dreyfus purchased Adidas for 4.485 billion (€683.514 million) and became the company’s chief executive officer. Between 1993 and 2000, Robert Louis Dreyfus helped increase the brand’s income to as much as $7.5 billion. During this time period, Adidas acquired various companies, including the Salomon Group and TaylorMade Golf. In 2005, Adidas paid $3.8 billion to acquire Reebok. These acquisitions created Adidas Nike’s most formidable competitor.
Adidas signed an 11-year agreement with the NBA in 2006, making them the official jersey supplier for the NBA, WNBA, and NBDL. In 2011, Adidas bought Five Ten. By 2012, Adidas has achieved its biggest revenue ever. 2015 witnessed Adidas’ acquisition of Runstatic. Adidas exited the golf market in 2017 when it sold TaylorMade for $420 million.
Particularly, endorsement arrangements have helped Adidas remain relevant. Deals with renowned athletes, including as Lionel Messi’s lifelong contract with the brand, have helped it maintain its prominence in the sports industry. The partnership and sponsorship of large-scale sporting events, such as the FIFA World Cup, have contributed significantly to Adidas’ marketability.