Warc Blog

Adidas increases marketing spend

5 August 2014
FRANKFURT: Adidas is overhauling its global brand structure and plans to spend more than €2bn on marketing, especially in developed markets such as North America and Europe, the German sports accessories firm has announced.

It said the new brand structure, which came into effect on Friday, will involve having one brand marketing team in each category to drive faster decision-making and more effective consumer-focused strategies, Marketing Week reported.

Meanwhile, a vertical team led by executive board member Eric Liedtke will continue to look after long-term strategy for each category while developing the corporate brand.

The recently announced sponsorship deals with two football clubs, Manchester United and Juventus, were the first stages of its plan to increase marketing spend, the company indicated.

And it also represents its first significant increase in marketing spend since its sponsorship of the 2010 FIFA World Cup in South Africa.

The announcement came as Adidas reported that it has lowered its full-year net profit target to about €650m ($870m) from between €830m and €930m.

By way of explanation, it cited declining sales for its TaylorMade-adidas Golf brand combined with lower consumer spending in Russia and the worsening political situation in the country.

Adidas operates 1,000 stores in Russia, but now plans to close some of them and to scale back its plans for new outlets.

"Everything we announced [today] has one objective: to strengthen our brands, to drive consumer desire, and to set our group up for long-term success," chief executive Herbert Hainer said in a statement.

Data sourced from Adidas, Marketing Week; additional content by Warc

 
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