Adidas Divestiture And Development To Break Arm With Nike

Group president

"Our brand Adidas and Reebok continued to grow substantially in the past quarter," he said.

The Group recorded double-digit growth in Western Europe, Greater China, European emerging markets and South America.

Although the continued weakening of the currency in Russia and its neighbouring countries led to a depressed business environment, we achieved our goal in 2014.

In 2013,

Sales in Western Europe recorded a drop of 6%.

But in 2014 the growth rate was mainly due to the world cup effect.

However, it has not announced the performance of the US market for the time being. Its market share in the local market has recently been surpassed by Under Armour.

The group reported net profit of 650 million euros a year.

In 2013, its net profit after adjustment was 839 million euros.

The ruble depreciation in 2014 also caused it to lose 80 million euros.

The group also sold its leather shoes brand Rockport to the Berkshire Partners foundation and Drydock Foo group.

In the 2015 Asian Cup, the Chinese team unexpectedly won the three battle of the group match. Some people immediately laughed at it. Adidas should not give up sponsoring the Chinese team and let Nike pick up the cheap.

Whether or not to peel off the Rockport brand, Adidas actually took a lot of effort to weigh it.

As early as May 2014, there was news that Adidas would sell Lok step brand. A few days ago, this rumor came true. Analysts believe that this stripped move helps Adidas narrow its distance from Nike.

Adidas's latest announcement announced that it had reached an agreement with BerkshirePartners (Berkshire) and NewBalance (New berlon) to sell it to the two party joint operating entities at a price of 280 million euros.

The move is expected to bring tens of millions of euros to Adidas's net profit in the 2014 fiscal year.

Yue Bu is also known as "

Founded in 1971, it is committed to the concept of comfortable walking.

It was bought by American brand Reebok in 1986, and was acquired by Adidas in 2006 with Reebok, becoming the sub brand of Adidas group.

There are less than 10 stores in Shanghai, and after the divestiture, the business and personnel of these stores are going nowhere. Adidas has not responded to the Greater China region. The stakeholders confirmed to our reporter that the proportion of Yue Bu's business in Adidas Greater China is very small.

In the 2006 fiscal year, the annual sales volume of Yue Bu was 293 million euros before and after being bought by Adidas. In the 2013 fiscal year, the sales volume of joy step was 289 million euros, that is to say, in 8 years, the sales of Yue Bu did not go backward.

The performance of Yue Bu has not been satisfactory.

Sullivan, global partner and chief executive of Greater China, told reporters that Adidas's pformation to Rockport was unsuccessful, which made it impossible to integrate into the Adidas system and lost the original vitality of Rockport.

Yue Bu was founded in the United States, the main market in North America, and products are mainly men's shoes.

After the acquisition, Adidas hopes to expand its market to the world. The product line covers men and women, becoming the world's leading brand of leather shoes.

But it turned out to be the opposite.

The two businesses do not have strong complementarity.

Wang Xin said that the main position of Rockport is business and leisure, while Adidas is mainly about sports brand.

On the other hand, Adidas obviously focuses on equipment development rather than product marketing.

And Rockport's main technology factors can't enhance Adidas's strength in marketing.

Adidas's sale of Rockport was the result of the poor performance of the company in the first quarter of 2014.

In the first quarter of 2014, the net income of Adidas based on shareholders was 204 million euros, a 34% decline compared with the previous year's 308 million euros, while Rockport's sales fell 12.1% to 53 million euros.

The problem of Rockport in the Adidas system has long been predicted. After the financial crisis in 2009, Adidas decided to cut off the business which was not conducive to business success, and subsequently downsized employees of its brands such as Reebok and Rockport.

Wang Xin said, therefore, for Adidas, Rockport has become more and more a burden on the development of the company rather than the original growth momentum.

Adidas has announced a 2015 growth plan, which is expected to achieve sales of 17 billion euros in 2015. The actual performance is that sales in fiscal year 2014 are only 14 billion 800 million euros, which is only 300 million euros higher than the 2013 fiscal year.

To achieve the goal of 17 billion euros this year, Adidas will have to work hard.

In addition to the difficulties of achieving their own goals, rival Nike's momentum is also aggressive.

In the 2010 fiscal year, Nike's revenue was $18 billion 324 million. In the 2014 fiscal year (up to May), revenue grew by nearly 50% to $27 billion 799 million, while Adidas's sales in the 2010 fiscal year increased by only about 23% in the 2014 fiscal year.

Nike, who is running ahead, is still moving forward lightly and intends to further build its advantages in the core product area.

Nike sold its sub brand Umbro and ColeHaan.Nike in 2012, making it clear that the ion brand is aimed at concentrating on Nike, JordanBrand, Converse and Hurley brands.

Adidas's market share in its main markets, Europe and Germany, is facing a continuous erosion of Nike by its main rival.

In 2012, Adidas accounted for 13.2% of the Western European sporting goods market, while Nike accounted for 12.4% of the total market.

Wang Xin said that in terms of the Chinese market, Nike has been increasing investment in sports fields in recent years. Frequent sponsoring of sports stars and events, and the use of big data marketing have made Nike constantly open up the gap with Adidas.

Although Adidas has maintained growth through channel sinking and launching different positioning products after 2008, these methods still can not maintain the sustainable growth of Adidas in the long run.

Wang Xin said that Nike and Adidas had gone through a period of unsatisfactory operation before giving up their brand. Nike faced a slowdown in the growth rate of the Greater China region and the decline in the volume of the bookings. Adidas faced the main battleground and the European market was encroachment.

And from time to time, the trend of Nike centralization is prior to Adidas, which brings pressure to Adidas and makes it adopt similar strategy.

This seems to mean that in the environment of global economic slowdown, the practice of sports brand expansion in the past has lagged behind and can not bring satisfactory results. It is a viable way for giants to compete for market share by concentrating resources in the core area.