Adidas claims that it has taken the lead in the European market for football shoes and that it should reach a new record turnover of €2.5 billion in the football category this year, up from €2.2 billion in 2015. This would be more than twice the sales that the company generated from this category ten years ago.
The prediction for 2016 is based on plans to sell 1.3 million replica shirts for the German football team and 7 million balls around the European football championships that are currently unfolding in France. Adidas' sales of team jerseys have also been bolstered by the Copa América and by its mega-deals with Manchester United and Juventus, both of which were previously outfitted by Nike.
Herbert Hainer, chief executive of the Adidas Group, told journalists in Paris that the Adidas brand reached a market share of 36 percent in football footwear for the first quarter of 2016 in the five largest European markets, according to the NPD consumer panel, putting it slightly ahead of Nike for the period. Their market share in the segment was more or less equal in the first quarter of last year.
Adidas is clearly ahead of Nike in football apparel. This segment is about as big as footwear combined with balls and other types of equipment for the Big a.
The predicted sales of German jerseys compare with 3 million units sold in connection with the World Cup held in Brazil two years ago and one million at the previous European championships, held in Poland and the Ukraine. The company sold 14 million balls of all sizes in connection with the World Cup in Brazil.
Markus Baumann, general manager of Adidas football, attributed the positive sales projections in the football category to far-reaching strategic changes undertaken last year. Adidas has ditched the Predator range to focus on the X, Ace and Messi ranges and is updating its products much more regularly. It has also been targeting a younger audience through online marketing. And its focus for the championships is on laceless boots with a distinctive visual and marketing appeal – as opposed to less marketable technical upgrades.
The group's market share in football boots was said to have developed positively in each of the five largest European markets compared with last year. The company added that its market share gains focused on the big cities that it has been targeting for its marketing efforts, in line with the “Creating the New” strategy outlined last year. The five key cities in this case are London, Paris, Barcelona, Milan and Berlin.
Meanwhile, there have been some concerns in the market about the pricing of the Adidas' football jerseys, with recommended retail prices set at €85 for standard replicas, and more than €120 for “authentic” jerseys.
Intersport executives have been linking the rising prices charged by Adidas for its jerseys to its costly sports marketing contracts. They warned that there wasn't much room for further price hikes. Another issue raised by Intersport Germany is that the jerseys have been offered to a wide range of retailers, which may have contributed to price reductions when demand appeared weak before the tournament. While purchasing prices are based on the recommended retail price, the average selling prices in the market were probably much lower. Intersport Germany is calling for a fair analysis of the way in which the distribution was handled.
Hainer admitted that he was unimpressed by the discounts offered by some retailers early in the season. SportScheck even offered to refund the price paid by its customers for some German team jerseys bought between May 27 and June 30 by giving them a voucher for other purchases if the German team wins the championships. Karstadt has reportedly been offering rebates to people who are able to display football juggling skills. Intersport also organized a marketing campaign in Austria whereby customers would get compensation for their purchase of Euro-related merchandise in case Austria wins the championships – a campaign that is covered by insurance.
However, Adidas and several retailers said that sales of replica jerseys have been picking up since the championships started. The German shirts are still available at substantial discounts online, but Intersport Germany pointed to some shortages and price rises in the last few days as enthusiasm increased markedly – it was particularly short of women's jerseys but will receive further deliveries.
Hainer added that the huge escalation in prices of football marketing deals was justified by the globalization of the image of certain major football teams and some leading players, which has led to more exposure and higher revenues from the related contracts. Social networks have greatly contributed to their higher visibility. Furthermore, he indicated that Adidas has not increased its spending on marketing as a percentage of football sales, which are probably comparable to those of Nike. The comments came just four days before Adidas confirmed that it has extended its partnership with the German football federation, as reported elsewhere in this issue.
Adidas is outfitting nine of the 24 teams playing at the Euro. They include Germany, the 2014 world champions, along with Spain, the 2012 European champions, and smaller teams such as Wales and Northern Ireland. Nike is outfitting six teams, including the French hosts and England.
However, Nike footwear is apparently worn by more players overall, and the U.S. brand's boots are particularly visible due to their vivid colors. Hainer countered that Adidas' deals with individual players were focusing on their quality rather than quantity, pointing to star footballers such as Paul Pogba.
The third-largest player in the football market, Puma, has five teams under contract: Italy, Austria, Slovakia, the Czech Republic and Switzerland. However, its Swiss sponsorship deal hit headlines for the wrong reasons after several Swiss players had their shirts ripped and torn in their game against France.
Puma immediately investigated and stated that the shirts, which were made in Turkey with the brand's ACTV Thermo-R Technology, were fragile because the yarn had been damaged in the production process. The company apologized to the Swiss team, adding that other teams had been fully satisfied with their jerseys and that the issue only related to a small batch of Swiss jerseys.
Incidentally, an Adidas ball was badly punctured during the same game. The company also had its little mishap online, as it was reported that customers of its online store were temporarily unable to order jerseys with the names of players featuring an umlaut, such as Mesut Özil, Mario Götze and André Schürrle – but the issue was quickly resolved.
Other sponsors for teams at the Euro championships are Joma with Romania, Errea with Iceland, Macron for Albania and Umbro for the Republic of Ireland.
