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The Three Stripes Saga

A comprehensive exploration of Adidas's journey, from its foundational innovations to its enduring global influence in sports and culture.

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Foundational Origins

The Dassler Brothers' Vision

The genesis of Adidas traces back to Adolf "Adi" Dassler, who began crafting sports shoes in his mother's scullery in Herzogenaurach, Germany, following his return from World War I. In July 1924, his elder brother Rudolf joined the venture, establishing the "Dassler Brothers Shoe Factory" (Gebrüder Dassler Schuhfabrik). Their early operations were marked by resourcefulness, sometimes relying on pedal power from a stationary bicycle to run their equipment due to unreliable electricity supply.

Innovation in Athletic Footwear

Adolf Dassler was instrumental in advancing spiked running shoes. He innovated by transitioning from cumbersome heavy metal spikes to lighter, more flexible designs utilizing canvas and rubber. This commitment to performance led to a pivotal moment in 1936 when Dassler convinced American sprinter Jesse Owens to wear his handmade spikes at the Berlin Summer Olympics. Owens' remarkable achievement of four gold medals propelled the Dassler brand onto the global stage, making their reputation known among athletes and trainers worldwide. By the onset of World War II, the Dasslers were successfully selling 200,000 pairs of shoes annually.

Wartime Operations & Survival

During World War II, both Dassler brothers became members of the Nazi Party in May 1933, with Adolf holding the rank of Sportwart in the Hitler Youth from 1935 until the war's end. The factory, operating as Germany's last sports shoe manufacturer, primarily supplied the Wehrmacht. By 1943, shoe production ceased, and the facilities were repurposed for manufacturing anti-tank weapons. Between 1942 and 1945, at least nine forced laborers were employed at the company's sites. The factory narrowly escaped destruction by US forces in 1945, saved when Adolf Dassler's wife persuaded American soldiers that their sole interest was sports shoe manufacturing, leading the occupying forces to become significant buyers of their footwear.

Corporate Evolution

The Sibling Schism

A profound breakdown in the relationship between Adolf and Rudolf Dassler led to their separation in 1947. This familial rift resulted in the formation of two distinct companies: Adolf established Adidas AG on August 18, 1949, deriving the name from "Adi Dassler," while Rudolf founded Ruda, later rebranded as Puma. This split ignited a fierce and enduring business rivalry that deeply divided their hometown of Herzogenaurach, earning it the moniker "the town of bent necks" as residents would subtly check which brand of shoes strangers wore. The brothers never reconciled, and even in death, their graves in the same cemetery are spaced as far apart as possible.

The rivalry extended beyond family to local institutions. The town's football clubs were divided, with ASV Herzogenaurach supported by Adidas and 1 FC Herzogenaurach endorsing Puma. Anecdotes abound, such as Rudolf instructing handymen wearing Adidas to exchange their footwear for free Pumas from his basement. This intense competition is widely credited by business experts for transforming the sports apparel industry into a multi-billion-pound enterprise.

Key moments in their rivalry include:

  • 1948: Several West Germany national football team members wore Puma boots in the first post-WWII match.
  • 1952 Summer Olympics: Josy Barthel of Luxembourg secured Puma's first Olympic gold.
  • 1960 Summer Olympics: German sprinter Armin Hary, sponsored by Puma for the 100-meter final, controversially wore Adidas for the medal ceremony, leading to his ban by Adi Dassler.
  • "Pelé Pact": For the 1970 FIFA World Cup, both companies agreed not to sponsor Pelé to avoid a bidding war, but Puma famously broke the pact and signed him.

Iconic Branding & Logos

Adidas's distinctive "three stripes" became its identity mark, a branding element so successful that Adolf Dassler referred to Adidas as "The three stripes company." This iconic motif was acquired in 1952 from the Finnish sports company Karhu Sports for the equivalent of €1,600 and two bottles of whiskey. The Trefoil logo, designed in 1971 and launched for the 1972 Munich Summer Olympics, served as the primary corporate emblem until 1997. That year, the company introduced the "three bars" logo, initially for its Equipment product range, which subsequently became the corporate emblem and is now prominently featured on the Adidas Originals heritage line.

Ownership Transitions

Following the passing of Adolf Dassler's son, Horst Dassler, in 1987, Adidas faced a period of corporate instability. In 1990, French industrialist Bernard Tapie acquired the company for ₣1.6 billion, a sum he largely borrowed. Tapie initiated significant changes, including relocating production offshore to Asia and engaging Madonna for promotional activities. However, by 1992, Tapie's inability to service his loan interest led Crèdit Lyonnais bank to sell Adidas. Robert Louis-Dreyfus, a friend of Tapie, assumed the role of CEO in 1994. Under Louis-Dreyfus's leadership, Adidas's revenue quadrupled from 1993 to 2000, reaching €5.84 billion ($7.5 billion).

Product Portfolio

Apparel & Sportswear

Adidas offers an extensive range of clothing, including t-shirts, jackets, hoodies, pants, and leggings for both men and women. The company's first apparel item, the Franz Beckenbauer tracksuit, was introduced in 1967. Adidas is recognized as the largest manufacturer of sports bras in Europe and the second largest globally. Beyond general apparel, Adidas maintains a significant presence in specialized sportswear across numerous disciplines.

  • Association Football: A core focus, providing kits and equipment globally. Notable innovations include the 1979 Copa Mundial boot, the best-selling boot of all time, and its soft-ground counterpart, the World Cup. Since 1970, FIFA has commissioned Adidas to design official World Cup match balls, including the Telstar, Teamgeist, Jabulani, Brazuca, and Al Rihla. Adidas is also an official sponsor of the UEFA Champions League, with the Adidas Finale as its official match ball.
  • Basketball: Iconic shoes like the Superstar and Pro Model ("shelltoes") gained popularity, particularly in 1980s hip hop streetwear. Adidas served as the official uniform supplier for all 30 NBA teams from 2006 to 2017.
  • Cricket: Began manufacturing cricket footwear in the mid-1970s, later expanding into bat production in 2008. Adidas has sponsored prominent cricketers like Sachin Tendulkar and the Indian national cricket team.
  • Running: Manufactures popular running and lifestyle shoes such as the Energy-boost and Spring-blade trainers. The brand has also explored sustainable innovations, teasing a 100% biodegradable sneaker made from ocean plastic and Biosteel in 2016, though it was never released.
  • Tennis: Involved with tennis equipment since the mid-1960s, sponsoring legendary players like Stan Smith, Ilie Nastase, Ivan Lendl, Stefan Edberg, and Steffi Graf.
  • Other Sports: Adidas also provides equipment and sponsors athletes in Baseball, Formula One, Golf, Gymnastics, Ice Hockey, Lacrosse, and Kabaddi.

Accessories & Lifestyle

The Adidas product range extends to various accessories, including slide-style sandals, mobile accessories, watches, eyewear, bags, baseball caps, and socks. The brand also offers a line of male and female deodorants, perfumes, aftershaves, and lotions. In 2014, Adidas introduced the Fit Smart wristband, a fitness tracker designed to pair with its miCoach app, functioning as a personal trainer.

Iconic Footwear: Sandals

Adidas has a strong legacy in casual footwear, particularly with its slide sandals:

  • Adilette: Developed in 1963 at the request of athletes for a locker room shoe, the Adilette was the first Adidas sandal and remains a best-seller. It features a contoured orthopedic rubber sole and a synthetic upper, available in various colors, often with the signature three stripes in a contrasting hue.
  • Adissage: This slide sandal incorporates tiny black massage nubs throughout the footbed, designed to alleviate foot aches after sports. It features the three stripes on a Velcro strap and is popular both among athletes and as a casual sandal.
  • Santiossage: Similar to the Adissage, the Santiossage also includes massage nubs, but these are clear, allowing Adidas's three stripes to be visible underneath. It is available in black, navy, or red and is worn for both post-sport recovery and casual comfort.

Corporate Business

Financial Performance

Adidas AG is a publicly traded company, listed on the Frankfurt Stock Exchange (FWB: ADS) and a component of the DAX index. The company consistently reports significant revenues, with 2024 figures reaching €23.683 billion. Its global operations are supported by a substantial workforce, numbering 62,035 employees in 2024. Adidas also holds an 8.33% stake in the football club Bayern Munich and owns Runtastic, an Austrian fitness technology company.

Global Presence & Structure

Headquartered in Herzogenaurach, Germany, Adidas maintains a worldwide operational footprint with key business locations in major cities such as London, Portland, Toronto, Tokyo, and offices across Australia, Taiwan, and Spain. The company's strategic acquisitions and divestitures have shaped its market position. Notable moves include the acquisition of the Salomon Group in 1997 (later sold in 2005) and the significant purchase of Reebok for $3.8 billion in 2005, which aimed to bolster its competitive standing against Nike, particularly in North America. Reebok was subsequently sold to Authentic Brands Group in 2022 for approximately $2.5 billion.

Leadership & Governance

The executive leadership of Adidas plays a crucial role in steering its global strategy. The current CEO is Bjørn Gulden, supported by a board including Harm Ohlmeyer as Chief Financial Officer, Eric Liedtke overseeing Global Brands, Gil Steyaert managing Global Operations, and Roland Auschel leading Global Sales. Past leadership includes Robert Louis-Dreyfus (CEO 1993–2002) and Herbert Hainer (CEO 2002–2016), who both contributed significantly to the company's growth and market expansion.

Adidas Key Business Trends (2006-2024)

Year Revenue (€b) Net Income (€m) Effective Tax Rate (%) Number of Employees Number of Stores
200610.048331.426,376
200710.255131.831,344
200810.764228.838,9821,884
200910.324531.539,5962,212
201011.956729.542,5412,270
201113.361330.046,8242,384
201214.879129.346,3062,446
201314.478729.249,8082,740
201415.549029.753,7312,913
201516.963432.955,5552,722
201619.21,01729.560,6172,811
201721.21,09729.356,8882,588
201821.91,70228.157,0162,395
201923.61,97625.065,1942,533
202019.843225.462,2852,456
202121.22,11619.459,2582,184
202222.561234.561,4011,990
202321.4(119) 59,0301,863
202423.7 756 62,035

Note: Revenue figures are "Net sales" and Net income figures are "Net income/(loss) attributable to shareholders".

Global Marketing

Strategic Brand Segmentation

In the mid to late 1990s, Adidas strategically segmented its brand into three distinct groups to cater to diverse consumer interests:

  • Adidas Performance: Dedicated to maintaining the brand's commitment to athletes and high-performance sportswear.
  • Adidas Originals: Focused on leveraging the brand's rich heritage and earlier designs, which had evolved into popular lifestyle icons.
  • Style Essentials: Targeted the fashion market, notably including the Y-3 collaboration with renowned Japanese fashion designer Yohji Yamamoto, where 'Y' represents Yamamoto and '3' signifies Adidas's iconic three stripes.

These divisions allowed Adidas to address different market segments while maintaining a cohesive brand identity.

Memorable Campaigns & Slogans

Adidas has launched several impactful marketing campaigns throughout its history:

  • "Impossible is Nothing" (2004): One of the company's most memorable global campaigns, developed by 180/TBWA and TBWA\Chiat\Day, emphasizing aspiration and overcoming challenges.
  • "Believe in 5ive" (2006-2007): A basketball-specific campaign for the NBA season.
  • "Adidas is all in" (2011): This became the global marketing strategy slogan, aiming to unify all Adidas brands and labels under a single image, appealing to consumers across sports, fashion, street culture, music, and pop culture.
  • "Creating the New" (2015): Introduced as the strategic business plan until 2020, focusing on innovation and future growth.

Collaborations & Regional Focus

Adidas has engaged in numerous high-profile collaborations with designers such as Alexander Wang, Jeremy Scott, Raf Simons, and Stella McCartney. The brand has also partnered with celebrities like Beyoncé, Jonah Hill, Karlie Kloss, Ninja, Bad Bunny, and Pharrell Williams to create highly sought-after collections. A 2025 collaboration with the Britpop band Oasis, "Original Forever," commemorated the band's long-standing association with the brand.

Regionally, Adidas has tailored its marketing efforts. In India, despite a speculative market, the company aimed to double its revenue by 2020, signing Bollywood actor Ranveer Singh as a brand ambassador and launching cricket campaigns with figures like Virat Kohli. In Russia, Adidas provided outfits for the Soviet Union's team at the 1980 Summer Olympics, becoming one of the first global brands to enter the territory. The brand's three stripes, initially modified by the Communist Party, later became a staple of the Gopnik subculture.

Ethical Considerations

Labor Standards & Sweatshops

Adidas has faced significant scrutiny and criticism regarding its business practices and commitment to worker welfare, particularly concerning allegations of operating sweatshops in countries like Indonesia. Between 2006 and 2007, Adidas reportedly shifted away from suppliers that supported unions, favoring subcontractors with less favorable labor rights records. This subcontracting model has made it more challenging for Adidas to ensure its stated labor standards, which include freedom for workers to engage in collective bargaining and a non-retaliation policy, are consistently upheld in practice.

  • Panarub Factory, Java (2005): 33 workers were reportedly fired after striking for better pay.
  • PT Kizone Factory, Indonesia (2011): After its closure, 2,686 laid-off workers were owed $3 million in severance pay and benefits. While Nike contributed $1.5 million, Adidas did not, leading to a campaign by United Students Against Sweatshops urging universities to cut contracts with Adidas.
  • War on Want Protest (2012): Activists in London replaced Adidas price tags with 34p tags, highlighting the low hourly wage paid to Indonesian workers. Adidas responded by claiming total wages, including bonuses and overtime, were often double the hourly wage, and emphasized purchasing power parity.
  • Yue Yuen Industrial Holdings Strike, China (2014): One of mainland China's largest strikes occurred at this factory, which produced for Adidas, among other brands.
  • Xinjiang Cotton (2022): Researchers from Nordhausen University of Applied Sciences identified cotton from Xinjiang in Adidas shirts, raising concerns given reports of forced labor in the region.

Marketing & Social Controversies

Adidas has also encountered public backlash over certain marketing campaigns and product designs:

  • 2012 "Shackle" Sneakers: A Jeremy Scott-designed shoe featuring shackles, intended for release in July, sparked widespread controversy. Civil rights leader Jesse Jackson condemned it as "offensive, appalling and insensitive," leading Adidas to cancel the product.
  • 2018 Soviet-Themed Items: A line of Soviet-themed products promoted by Adidas was withdrawn from the market following a social media outcry.
  • 2024 SL 72 Sneaker Campaign: An advertising campaign starring Bella Hadid for the SL 72 sneaker, originally created for the 1972 Munich Olympics, was withdrawn and apologized for due to its association with the Munich massacre of 11 Israeli athletes.

Corporate Governance & Diversity

Beyond product and labor, Adidas has faced challenges related to corporate conduct and internal diversity:

  • NCAA Corruption Scandal (2017): Adidas executive James Gatto was indicted in the 2017 NCAA Division I men's basketball corruption scandal, highlighting issues of integrity in collegiate sports recruitment.
  • Racial Diversity Controversy (2020): Karen Parkin, the head of global human resources, voluntarily stepped down after black employees raised concerns about her failure to address racism and discrimination within the workplace. Parkin had previously referred to racism as "noise" and was criticized for not adequately addressing workforce diversity. She issued an apology upon her resignation, supporting the company's progress towards racial justice.

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References

References

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