PR 508: Public Relations and Advertising fundamentals and strategy
Babatunde Afolabi
Company History
“All day I dream about sports.” This acronym is a great way to describe the essence of the company Adidas. The brand name for Adidas does not come from the acronym but, from the name of the creative founder Adolph “Adi” Dassler[1]. Although starting with humble beginnings Adidas has cemented itself as a juggernaut of sports fashion and is one of the biggest sports brands in Europe.
The company was started in a laundry room in the small town of Herzogenaurach. The founder Adolf Dassler, started his project after World War 1, recruiting his brother Rudolph for help in the “Dassler Brothers Shoe Factory.[2]”
The early focus for Dassler was to create a shoe that would be revolutionary for runners. Dassler was able to create one of the first spiked athletic shoes. What made Dassler’s shoe unique is that through using innovation he swapped metal spikes with canvas and rubber.
The Adidas brand came into the limelight after the shoes were used in the 1936 Olympics. Dassler convinced runner Jesse Owens to wear them. Owens won four gold medals as he donned the Adidas spikes, thus giving the shoes immense notoriety[3]. Before World War II the Adidas brand was selling nearly 200,000 pairs a year.
Adidas had difficulties after the war. The Dassler brothers had a quarrel and split up. Rudolf Dassler later created the shoe rival Puma. The Dassler factory was also nearly destroyed by American forces after the war.
A pivotal moment for the Adidas brand was during the 1954 World Cup. Dassler created lightweight football boots that were worn by the German national team. This boot was innovative as it was half the weight of normal English football boots. The studs could be removed and changed making them adaptable to the weather. Germany shocked the world by beating Hungary, putting the Adidas shoes on the map.
Currently, Adidas has transcended the sports world and offer a plethora of products and services. They are a big fashion brand collaborating with influential people like Kanye West to release the Yeezy shoe line. They also create football kits for some of the biggest teams in the planet making their logo the three white stripes almost impossible to overlook.
Mission Statement
Adidas has a clear mission. Adidas is trying to be the best sports brand in the world. It is additionally trying to do this in a sustainable manner. Its purpose is to change lives through sport, and the company wants to contribute to expanding the limits of human possibilities[4].
Brand Positioning
To: the 20 to 29-year-old athlete who is passionate about sport.
Adidas is the: premiere creative sport and fashion brand.
That: allows you to achieve and create the impossible in a sustainable manner.
That is because: Adidas constantly pushes the boundaries of innovation, as can be verified by our boost technology that created shoes that were comfortable, soft, and responsive, but also improved running performance allowing runners to take strides whilst using less kinetic energy[5]. In the future, Adidas is releasing the future-strung shoe which uses athlete data to create a shoe that is mapped to the natural wearer of the shoe[6].
Statement of Opportunity
The Covid-19 pandemic shocked the world and grounded most sporting events to a halt. During dark times it is often sports that can unify people together. The pandemic forced many to go without seeing friends and family. People could not be as active as they wanted to be and couldn’t band together to watch the sports they love.
Adidas also felt the ramifications of the pandemic. The brand had to shut nearly all its stores, shifting to digital sales instead of physical. The financial metrics for Adidas also verify the impact of the pandemic. Adidas profits fell by 78% in 2020; while sales dropped by 16%[7].
"Sports might not be the answer right now, but it teaches us that impossible challenges must be faced and overcome...now that sport is back, we can't waste this chance.[8]"Adidas took the opportunity to launch the Ready for Sport campaign. This campaign aimed to empathize with the feeling most athletes are having of getting back to the sport they love. The campaign acts as a beacon of light, with the message that although things are bleak right now, it will get better, and sports will open again. The campaign evolved into an 18-part unscripted docuseries that followed the challenges of athletes during the pandemic[9]. Adidas took an opportunity to communicate with its target audience, the athlete. They made it known that they were here and resonated with the pain of the athlete. The Ready for Sport campaign became the second most successful campaign in the company’s history.
Research
To achieve the desired results for their campaign Adidas needed to focus on athletes. Adidas most likely asked the following research questions to athletes.
What do sports mean to you?
How did you feel when the world went into lockdown?
How has the pandemic impacted you?
How has your sport adapted to Covid-19?
How does it feel playing your sport without an audience?
What does having live audiences mean to you?
How can Adidas help athletes?
To achieve the desired research questions Adidas will have to use the following primary and secondary research questions.
Primary
A qualitative approach could have the company having an in-depth interview with athletes about their experiences. The in-depth interview will have 6 prominent athletes from the leading sports. A focus group would also be useful to get emotional answers out of athletes. With a focus group, athletes can draw from each other’s experiences. You also would get a broad perspective and you can see where there are parallels between sports. The focus group will consist of ten people from different sports.
b. When doing Quantitative research, Adidas can do a mass survey and questionnaire to ordinary athletes. The survey should be filled out by 2000 random athletes, and the questionnaire should be filled out by 4000 college and professional athletes. For the Ready for Sport campaign to hit its mark, it must relate to ordinary athletes, not just professionals. The company must figure out the sentiments of everyday people to make sure their campaign speaks to them too.
Secondary Research
Adidas can use government-published research about how Covid-19 has affected athletics. This will save time and money. Additionally, scientific research about how lack of physical exercise can be detrimental to your health will be useful for building a campaign. The company can also use external articles from prominent athletes who have voiced their struggles in the pandemic.
Situational Analysis
In terms of strengths, Adidas has the third most powerful brand in the world, and the company can leverage this[10]. Adidas is renowned for having high-quality sports and fashion goods. Popular celebrities and athletes wear or are signed by Adidas improving the brand's credibility with consumers. Adidas has become a strong brand due to its history and being a sponsor of several sports events and teams. Its logo composed of three white stripes is iconic to Western culture[11].
Additionally, Adidas has a strong supply chain. They control most of their downstream supply chain and can achieve cheaper costs by manufacturing in China, thus, leading to economies of scale and lowering prices. Adidas can get its goods and products all over the globe within a short time frame. They are also improving their e-commerce presence, which is supplemented with several brick-and-mortar chains[12].
Another strength of Adidas is how diverse its portfolio is. When crises like Covid-19 occur brands like Adidas can rely on other products to keep them afloat. Adidas has a large range of products and owns strong brands like Reebok which operate in a similar market[13].
Weaknesses
60% of Adidas’ sales came from footwear. The issue is demand for footwear is going down[14].
Adidas also has a pricing issue. Due to spending so much money on innovation, several of their products are too expensive alienating middle-income customers[15].
Another weakness is that Adidas relies on far Eastern manufacturers to create its goods. If there is turmoil in the area or the price of labour increases in these regions, Adidas will have a price hike, thus leading to lower demand and lower profits[16].
Opportunities
Covid has identified that E-commerce is an essential part of Adidas’s business model. Focusing on E-commerce sales might mean that the company can cut expenses by having fewer stores. Adidas should be integrating digital marketing on social media sights to funnel customers to its stores[17].
Targeting new markets is another opportunity. The North American market is dominated by Nike. It is one of the biggest consumer markets. If Adidas can improve its market share in North America, its revenues will increase. Additionally, Adidas should increase its influence in emerging markets like China and Africa[18].
Adidas had success with its smart materials. Focusing on this aspect will diversify the company from Nike. New materials that give athletes an edge will be attractive to sports enthusiasts[19].
Threats
The sports industry has fierce competition. Nike is constantly innovating and taking market share of Adidas. There is also a plethora of competitors like Under Armor, Puma and New Balance. If one of the other competitors can create a cheaper product than Adidas with similar quality, the demand in this industry is elastic so consumers will easily pivot to a new brand.
Adidas also has a huge issue with counterfeit goods. Approximately 10% of all products in Asia are counterfeit. It is hard to find a viable way to stop the sale of fake goods. As counterfeit products get harder to detect, consumers would rather buy the cheaper option than the real version.
Strategic Insights
The Competitive Landscape is fierce.
Adidas must find a way to capture more market share in North America. Nike is miles ahead in North America. Adidas has a market share of 5.9% compared to 16.7 of Nike[20]. Under Armor, and New Balance are also landing exclusive celebrity endorsements. Adidas must set itself apart by highlighting its commitment to sustainability and constantly promoting the innovative nature of its product. Adidas also focuses on brand notoriety for marketing instead of celebrity endorsements which is not a good approach in America. To compete with Nike in the US, Adidas needs to get popular athletes and celebrities to promote its sporting goods.
E-commerce is the future
Due to the pandemic, Adidas has had to close several of its stores. This led to record e-commerce sales. As consumers are more engaged with digital devices, it only makes sense for Adidas to slowly shift most of its marketing to its e-commerce sales. If Adidas fails to move quickly into capitalizing on e-commerce, competitors will gain a competitive advantage. Adidas only launched its app in 2017, adding a reward feature and integrative methods for users will increase brand loyalty, and sales, and allow customers to feel appreciated.
Reliance on foreign manufacturers might leave Adidas exposed
The supply chain is an integral part of every business. Adidas has an immaculate downward stream integration. The company owns most of its stores and has rapid times for getting the goods to the customer. The issue is the brand’s backward vertical integration. Adidas relies on foreign countries to manufacture its goods. As these countries improve and have better labor laws, prices will surge lowering revenue for Adidas. Outsourced manufacturing gives too much power to the supplier. Adidas cannot do anything if quality shifts or if the manufacturer goes on strike and refuses to produce anything.
Communication Goals
To generate engagement on social media with a hopeful message
One key aspect of this campaign was to get the Ready For Sport movement trending. Adidas created stickers to use for social media websites like Instagram that encouraged people to show what sporting activity they’re looking forward to doing again. Through this campaign, Adidas wanted to get athletes fired up to play sports again.
To convey empathy with athletes
Adidas wanted to be the first sports brand to communicate directly to athletes after a lockdown that was devastating. The Ready For Sport Campaign is a rallying cry for athletes. It was made to have a positive message that let athletes know things will be back to normal and they will play their sport again. Adidas is showing that they understand what the athletes are going through. This creates brand apathy and athletes, and consumers will remember the message when purchasing products.
To create a viral advertising campaign
The pandemic meant Adidas could not rely on a huge budget to push its campaign. Adidas needed to make a campaign that is viral in nature that will get athletes to share and partake in the movement of their own accord.
Communication Objectives
To create a campaign that reached over 300 million people and generated increased engagement.
Adidas needed to get athletes’ attention after a poor 2020 for the brand. They needed a viral video that would show that they are the brand that is there for all athletes. When sports open again Adidas wants to be the company on athletes’ minds.
To Increase E-commerce sales and revenue by over 10%.
The pandemic was crippling for sales as Adidas was forced to close stores. Adidas had to pivot to online sales and the best way to get their consumers to buy from their online store was through a huge online media campaign.
To gather several athletes to share their lockdown stories
One of the big issues for Adidas is that they rely too much on the strength of their brand for marketing. In North American markets consumers are swayed by endorsements and big personalities. Through the Ready For Sport campaign, Adidas was able to elevate the allure of its brand. Initially, Adidas did not plan on having a lot of big athletes engaging with the campaign trend. However, when
athletes start getting involved with the campaign Adidas made sure to make it a key objective to have athletes sharing their narratives.
Target Audience
Women who are into athletics
Adidas has female athletes as a priority going into 2025. There is an untapped reservoir of customers to tap into with women’s apparel and sportswear. Adidas is executing a cross-category plan to achieve product excellence and improve women’s experience through their membership experience[21]. The Ready For Sport campaign made sure women’s stories were essential to the narrative.
Generation Z and Millennials
The bulk of Adidas’s audience is Millennials 20-29 who are athletes or are passionate about sports. In recent years Adidas has attempted to gain
reverence with Generation Z. Adidas believes that the 14–19-year-old age range is the most influential consumer group in the world[22].
Upper Middle-Class Clients
With sustainability now being at the forefront of Adidas’s branding. They can no longer mass produce cheap products, thus alienating middle and working-class clients. This can also be confirmed with their fashion endeavours as products like Yeezy’s sell for $300-$500. By targeting this audience Adidas is boosting its perceived prestige[23].
Influencers and Athletes
To compete in North America, having the biggest athletes and celebrities endorsing your brand is essential. Influencers have a lot of sway, especially to Millennials and Generation Z. Adidas must continue to innovate so they can attract the best athletes to adopt its products. Adidas’s collaboration with Kanye West became one of the fastest-growing footwear collaborations in history. The shoe line is now worth 1 billion dollars. Adidas want to become a platform for influencers to collaborate with[24].
Current Brand Perceptions
Consumers primarily view Adidas as a sports brand. Adidas has infiltrated almost every sports market and its logo can be seen in apparel, sports gear, and around stadiums. Adidas is known for having high-quality goods at a reasonable price. When it comes to fashion a study shows that Adidas is deemed the most
fashionable sports brand[25]. In recent years Adidas has positioned its brand to emphasize style and Athleisure[26].
Desired Audience Brand Perceptions
“The Adidas Group strives to be the global leader in the sporting goods industry with brands built on a passion for sports and a sporting lifestyle[27]”. Adidas want to become the key sports brand in the market. However, competition is fierce with Nike. Their pivot into fashion and style is working wonders for the Adidas brand. With more high-end celebrity endorsements, Adidas will become more popular than Nike with younger generations.
Key Message Mapping
We will ___ again”
One of the main messages of The Ready For Sport campaign is things will open up again. Covid-19 robbed everyone from the glue that brings several people together, sport. The campaign was the first sports brand to communicate this yearning to play sports again after the pandemic. The campaign was a rallying cry to get people excited to get back to playing sports [28].
Hope and optimism
Creative director Gabi Mostert stated: “in a world of “stay strong” ads, we wanted to create something fresh and positive”[29]. The pandemic caused fear and uncertainty. Sports can fuel joy and optimism and that is what Adidas was trying to convey. Adidas want athletes to look forward and be excited for what is to come[30].
We are for the athlete
Adidas engaged with 3000 athletes for the campaign, following them through their journey of training during the pandemic. Adidas was trying to reiterate we are there for the athletes and we are there for them throughout the pandemic.
Strategies
To create a viral advertising campaign using social media
Adidas’s strategic approach was to generate buzz for the Ready For Sport campaign. They wanted to get athletes to hear its rallying message and partake in the trend and join the conversations.
To have a campaign that features some of the biggest cast of athletes
To make the message work, Adidas needed credibility. To fulfill this they gathered 3000 elite athletes to show how they trained through the pandemic. They also used stock footage of some of the best sporting moments in recent memory and used this to get audiences hyped.
Using Positive tonality to get athletes inspired to get back into sports.
Advertising messaging during the pandemic was one of sadness and sorrow. The communications director at Adidas wanted to flip the script and be the first sports brand to create a campaign that is getting people excited to get back into sports. The message was clear. We will partake in sports again.
Tactics
The goal of the Ready For Sport campaign was to create a global viral campaign. The Vice President of Communication conveyed a key messaging tactic used for the campaign. He stated “We want to inspire our community to get back in the game, master their craft and play like never before. We chose Siya to narrate the film because his story serves as a reminder that sport has the power to bring hope.”
The tactics of Adidas can be analyzed using the Peso model.
Paid
Adidas did not use a lot of paid media for its campaign. It used stock footage of key sporting moments over the years and utilized a voice-over. After the campaign started generating momentum Adidas used YouTube, Instagram, and Facebook ads to help boost the virality of the campaign. Adidas bought billboard spaces to support the campaign. After the success of the social media campaign, Adidas ran a successful television advert.
Earned Media
Several publications created a blog post or wrote an article about the campaign. Sites like The Drum, Marcommnews, and AdForum discussed the latest campaign and went into detail about the passionate message it attempted to invoke.
Shared Media
Adidas succeeded in creating a campaign that was viral in nature. Because the campaign was initially a project started by employees, they used their social media platform to advertise it. Eventually, athletes started using the #readyforsport hashtag to show how they are training during the pandemic. Athletes were sharing and engaging with the YouTube film on their social media accounts.
Owned Media
Adidas used its robust social media platforms to generate initial buzz. The first video was launched on their YouTube and content was made for their Instagram page. Adidas used its own stock footage to create the initial footage. Eventually, the campaign evolved into a long YouTube series with several athletes involved.
KPIs - Measurement and Evaluation
Quantitative Measure of engagement with the brand
To measure engagement Adidas must document how much traffic has increased on their social media platforms and their website. They must also evaluate how many times the hashtag was used in the campaign period. While the campaign was running Adidas was able to generate a 300% increase in social conversation. Numerous athletes were engaging with the campaign, posting free content for Adidas.
Qualitative Measures, to create a viral campaign
To confirm the virality of the campaign, Adidas must compare the Ready For Sport performance with its previous ones. The campaign ended up being Adidas’s second most successful campaign.
Qualitative Measures, to gather a large number of athletes to promote the campaign
Adidas were able to get 3000 athletes to document their journey through the pandemic. When competing with Nike, Adidas is at a disadvantage because Nike has more access to elite athletes, especially in North America. The pandemic meant Adidas was not able to put too much money into its advertising campaigns. Having a campaign backed by that many athletes was amazing for Adidas’s competitive advantage.
Quantitative measures, increased revenue by 10% and sales by 50%
Adidas needed to generate revenue after a poor 2020. Adidas can verify how well the campaign did by measuring the per cent increase in quarter 4 revenue and the increase in E-commerce sales. The company was successful at both metrics as both increased at the end of quarter 4 of 2020.
Timeline
June 2020: start research for the campaign
July 2020: create a storyboard for YouTube Advert
Roll out YouTube advert on social media channels
Post YouTube advert on Instagram, Facebook, and Tik Tok
Create brand engagement by promoting the ReadyForSport Hashtag
August 2020: Start filming a TV advert called the anthem
Rollout the TV advert
Share TV advert on all channels
Start filming YouTube series documenting athletes during the pandemic
Budget
Due to the pandemic, Adidas must spend a reduced amount on the campaign. Adidas cut media spending by 25% during the pandemic. Adidas often spends 3 billion euros on Marketing and Advertising. The Ready for Sport campaign revolves around virality. Athletes were partaking in the campaign on their own accord making the campaign cheap in nature. When analyzing the process it took to fulfil the campaign, I would estimate Adidas only needed to invest 50 million on social media adverts and a television advert for the entire campaign.
[1] https://www.thoughtco.com/quick-history-of-adidas-1444319
[2] https://en.wikipedia.org/wiki/Adidas
[3] https://www.freelapusa.com/the-history-of-track-spikes/
[4] https://www.adidas-group.com/media/filer_public/2013/07/31/adidas_gb_2012_en_booklet_en.pdf
[5] https://www.adidas.com/us/blog/373504-what-is-boost
[6] https://www.designboom.com/design/adidas-futurecraft-strung-shoe-athlete-data-10-21-2020/
[7] https://www.bangkokpost.com/business/2081427/adidas-profit-plummets-78-in-pandemic-hit-2020
[8] https://www.mediaupdate.co.za/marketing/149252/adidas-and-siya-kolisi-launch-ready-for-sport-the-anthem-campaign-film
[9] https://www.thedrum.com/news/2020/10/21/joy-optimism-and-resilience-how-adidas-unified-its-message-sports-darkest-hour
[10] https://bstrategyhub.com/adidas-swot-analysis/
[11] https://bstrategyhub.com/adidas-swot-analysis/
[12]https://pestleanalysis.com/swot-analysis-of-adidas/
[13] https://www.mbaskool.com/brandguide/lifestyle-and-retail/2460-adidas.html
[14] https://www.swotanalysistemplate.com/swot-analysis-of-adidas/
[15] https://bstrategyhub.com/adidas-swot-analysis/
[16] https://pestleanalysis.com/swot-analysis-of-adidas/
[17] https://bstrategyhub.com/adidas-swot-analysis/
[19] https://bstrategyhub.com/adidas-swot-analysis/