Adidas
Adidas AG is a German multinational athletic apparel and footwear corporation headquartered in Herzogenaurach, Germany. It is the largest sportswear manufacturer in Europe, and the second largest in the world, after Nike. It is the holding company for the Adidas Group, which also owns an 8.33% stake in the football club Bayern Munich, and Runtastictrian fitness technology company. Adidas's revenue for 2024 was listed at €23 billion. Adidas is best known for their iconic brand image, offering the Yeezy Boost sneakers, and is publicly recognized for their extensive long origin history for participating in sponsored athletes, and for providing gear in the FIFA World Cup series. The brand is also unique for performance innovation of their shoes with major deep ties with sports culture, and durability with their focus of sport shoes, clothing, backpacks, and other accessories. Its commitment to sustainability includes their digital technology and AI, including collaborating with cultural figures like Lionel Messi, Patrick Mahomes, Real Madrid, and Pharrell Williams.
The company was started by Adolf Dassler in his mother's house. He was joined by his elder brother Rudolf in 1924 under the name Gebrüder Dassler Schuhfabrik. Dassler assisted in the development of spiked running shoes for multiple athletic events. To enhance the quality of spiked athletic footwear, he transitioned from a previous model of heavy metal spikes to utilising canvas and rubber. Dassler persuaded U.S. sprinter Jesse Owens to use his handmade spikes at the 1936 Summer Olympics. In 1949, following a breakdown in the relationship between the brothers, Adolf created Adidas and Rudolf established Puma, which became Adidas's business rival.
The three stripes are Adidas's identity mark, having been used on the company's clothing and shoe designs as a marketing aid. The branding, which Adidas bought in 1952 from Finnish sports company Karhu Sports for the equivalent of €1,600 and two bottles of whiskey, became so successful that Dassler described Adidas as "The three stripes company".
The most successful shoe from Adidas is the "Samba", due to its retro design and its versatility.
History
Early years: the "Gebrüder Dassler Schuhfabrik"
The company was founded by Adolf "Adi" Dassler who made sports shoes in his mother's scullery or laundry room in Herzogenaurach, Germany after his return from World War I. In July 1924, his older brother Rudolf joined the business, which became "Dassler Brothers Shoe Factory". The electricity supply in Herzogenaurach was unreliable, so the brothers sometimes had to use pedal power from a stationary bicycle to run their equipment.Dassler assisted in the development of spiked running shoes for multiple athletic events. To enhance the quality of spiked athletic footwear, he transitioned from a previous model of heavy metal spikes to utilising canvas and rubber. In 1936, Dassler persuaded U.S. sprinter Jesse Owens to use his handmade spikes at the 1936 Summer Olympics. Following Owens' four gold medals, the name and reputation of Dassler shoes became known to the world's sportsmen and their trainers. Business was successful and the Dasslers were selling 200,000 pairs of shoes every year before World War II.
Both Dassler brothers joined the Nazi Party in May 1933 and became members of the National Socialist Motor Corps. Adolf took the rank of Sportwart in the Hitler Youth from 1935 until the end of the war. During the war, the company was running the last sport shoe factory in Germany and predominantly supplied the Wehrmacht with shoes. In 1943, their shoe production was forced to cease operations and the company's facilities and workforce were used to manufacture anti-tank weapons. From 1942 to 1945, at least nine forced labourers were working at both sites of the company.
The Dassler factory, used for the production of anti-tank weapons during World War II, was nearly destroyed in 1945 by US forces. It was spared when Adolf Dassler's wife convinced the American soldiers that the company and its employees were only interested in manufacturing sports shoes. American occupying forces subsequently became major buyers of the Dassler brothers' shoes.
Split and rivalry with Puma
The brothers split up in 1947 after relations between them had broken down, with Adolf forming a company registered as Adidas AG, from Adi Dassler, on 18 August 1949, and Rudolf forming a new firm that he called Ruda – from Rudolf Dassler, later rebranded Puma. Urban myths have popularised two false backronyms for the name "Adidas": All Day I Dream About Sports and All Day I Dream About Sex.Adidas and Puma SE entered into a fierce and bitter business rivalry after the split. The town of Herzogenaurach was divided on the issue, leading to the nickname "the town of bent necks"—people looked down to see which shoes strangers wore. Even the town's two football clubs were divided: ASV Herzogenaurach club was supported by Adidas, while 1 FC Herzogenaurach endorsed Rudolf's footwear. When handymen were called to Rudolf's home, they would deliberately wear Adidas shoes. Rudolf would tell them to go to the basement and pick out a pair of free Pumas. The two brothers never reconciled and although they are now buried in the same cemetery, they are spaced as far apart as possible.
In 1948, the first football match after World War II, several members of the West Germany national football team wore Puma boots, including the scorer of West Germany's first post-war goal, Herbert Burdenski. Four years later, at the 1952 Summer Olympics, 1500 metres runner Josy Barthel of Luxembourg won Puma's first Olympic gold in Helsinki, Finland.
At the 1960 Summer Olympics, Puma paid German sprinter Armin Hary to wear Pumas in the 100 meter sprint final. Hary had worn Adidas before and asked Adolf for payment, but Adidas rejected this request. The German won gold in Pumas, but then laced up Adidas for the medals ceremony, to the shock of the two Dassler brothers. Hary hoped to cash in from both, but Adi was so enraged he banned the Olympic champion.
The "Pelé Pact" was the most notable event in the Dassler brothers feud, when both owners of Adidas and Puma agreed not to sign a sponsorship deal with Pelé for the 1970 FIFA World Cup, feeling that a bidding war for the most famous athlete in the world would become too expensive, only for Puma to break the pact and sign him. Many business experts credit the brothers' rivalry and competition for transforming sports apparel into a multi-billion pound industry.
Corporate image
In 1952, following the 1952 Summer Olympics, Adidas acquired its signature 3-stripe logo from the Finnish athletic footwear brand Karhu Sports, for two bottles of whiskey and the equivalent of €1,600.
The Trefoil logo was designed in 1971 and launched in 1972, just in time for the 1972 Summer Olympics held in Munich. This logo lasted until 1997, when the company introduced the "three bars" logo, initially used on the Equipment range of products.
Tapie affair
After a period of trouble following the death of Adolf Dassler's son Horst Dassler in 1987, the company was bought in 1990 by French industrialist Bernard Tapie, for ₣1.6 billion, which Tapie borrowed. Tapie was at the time a famous specialist of rescuing bankrupt companies, an expertise on which he built his fortune.Tapie decided to move production offshore to Asia. He also hired Madonna for promotion. He sent, from Christchurch, New Zealand, a shoe sales representative to Germany and met Adolf Dassler's descendants, Amelia Randall Dassler and Bella Beck Dassler, and was sent back with a few items to promote the company there.
In 1992, unable to pay the loan interest, Tapie mandated the Crédit Lyonnais bank to sell Adidas. The bank converted the outstanding debt owed into equity in Adidas, which was unusual per the prevalent French banking practice. The state-owned bank had tried to get Tapie out of dire financial straits as a personal favour to Tapie, it is reported, because Tapie was Minister of Urban Affairs in the French government at the time.
Robert Louis-Dreyfus, a friend of Tapie, became the new CEO of the company in 1994. He was also the president of Olympique de Marseille, a team Tapie had owned until 1993. In 1994, Tapie filed for personal bankruptcy. He was the object of several lawsuits, notably related to match fixing at the football club. In 1997, he served 6 months of an 18-month prison sentence in La Santé prison in Paris. In February 2000, Crédit Lyonnais sold Adidas to Louis-Dreyfus for a much higher amount of money than Tapie owed, 4.485 billion francs rather than 2.85 billion.
Post-Tapie era
In 1994, combined with FIFA Youth Group, SOS Children's Villages became the main beneficiary.In 1997, Adidas AG acquired the Salomon Group who specialized in ski wear, and its official corporate name was changed to Adidas-Salomon AG. With this acquisition Adidas also acquired the TaylorMade golf company and Maxfli, which allowed them to compete with Nike Golf.
In 1998, Adidas sued the NCAA over their rules limiting the size and number of commercial logos on team uniforms and team clothing. Adidas withdrew the suit, and the two groups established guidelines as to what three-stripe designs would be considered uses of the Adidas trademark.
As CEO of Adidas, Louis-Dreyfus quadrupled revenue to €5.84 billion from 1993 through 2000. In 2000, he announced he would resign the following year, due to illness.
In 2003, Adidas filed a lawsuit in a British court challenging Fitness World Trading's use of a two-stripe motif similar to Adidas's three stripes. The court ruled that despite the simplicity of the mark, Fitness Worlds use was infringing because the public could establish a link between that use and Adidas's mark.
In September 2004, English fashion designer Stella McCartney launched a joint-venture line with Adidas, establishing a long-term partnership with the corporation. This line is a sports performance collection for women called "Adidas by Stella McCartney".
On 3 May 2005, Adidas informed the public that they had sold their partner company Salomon Group for €485 million to Amer Sports of Finland.
In August 2005, Adidas declared its intention to buy Reebok for $3.8 billion. This takeover was completed with a partnership in January 2006 and meant that the company had business sales closer to those of Nike in North America. The acquisition of Reebok also allowed Adidas to compete with Nike worldwide as the number two athletic shoemaker in the world.
In 2005, Adidas introduced the Adidas 1, the first ever production shoe to use a microprocessor. Dubbed by the company "The World's First Intelligent Shoe", it features a microprocessor capable of performing 5 million calculations per second that automatically adjusts the shoe's level of cushioning to suit its environment. The shoe requires a small, user-replaceable battery that lasts for approximately 100 hours of running. On 25 November 2005, Adidas released a new version of the Adidas 1 with an increased range of cushioning, allowing the shoe to become softer or firmer, and a new motor with 153 percent more torque.
In April 2006, Adidas announced an 11-year deal to become the official NBA clothing provider. The company has been making NBA, NBDL, and WNBA jerseys and products as well as team-coloured versions of the "Superstar" basketball shoe. This deal took over the previous Reebok deal that had been put in place in 2001 for 10 years.
In November 2011, Adidas announced that it would acquire outdoor action sport performance brand Five Ten through a share purchase agreement. The total purchase price was US$25 million in cash at closing.