Adidas dated back to 1949 when the “Adi Dassler Adidas Sportschufabrik” was founded in Herzogenaurach, Germany: Strategy and Innovation Case Study, UOS, UK

Adidas dated back to 1949 when the “Adi Dassler Adidas Sportschufabrik” was founded in Herzogenaurach, Germany, with the desire to provide “only the best for the athlete.” Prior to that, Adolf Dassler had already been producing shoes with his brother, who had helped him to gain a good reputation among athletes and their fans.

During the 1950s the company’s internationalization process began: its shoes were first exported to Canada, Scandinavia, and Switzerland, and then successively to 40 different countries. A pivotal moment of Adida’s popularity was the FIFA World Cup in 1954, as it was the official shoe of the German winning team.

Throughout the 1970s, in response to the entrance of brands like Nike and Reebok, Adidas began to introduce apparel to its previously footwear-only line. These brands had changed the sports fashion industry with their products, increasing competition and taking market shares away from the German firm.° However, its attempt to increase popularity via its leisure apparel and to compete with rival brands resulted in a loss of focus away from Dassler’s initial philosophy.

Following years of financial losses and the deaths of both Adi Dassler and his son, in 1990 the founder’s daughters decided to sell their shares. Subsequent controversial strategic practices led the firm to near bankruptcy in 1992. It was then that the company made its first structural change in its approach to business. The newly appointed CEO, Robert Louis-Dreyfus, changed the direction of the company from sales-driven to marketing-driven and steered Adidas back on a path to growth. Louis-Dreyfus’s leadership was necessary to rediscover and strengthen Adida’s brand identity.

The same direction was followed by the succeeding CEO, Herbert Hainer, who sought to further broaden Adida’s worldwide platform by increasing the range of products, thus creating a stronger presence among athletes and sports events. Hainer held the leadership position from 2001 until September 2016.

During this time the Adidas Group achieved meaningful milestones: it became one of the most sustainable European corporations, its net income quadrupled and its value increased from €3 billion to €18 billion.8 Important steps in Hainer’s managerial years were to divest the weak-performing Salomon, acquired during his predecessor’s management, and to acquire Reebok International Ltd. in 2005.’

The company’s internationalization strategy allowed Adidas to develop a multi-brand approach that gave the Group the necessary breadth to serve both mass and niche markets around the world. By 2020, its footwear, apparel, and hardware products were sold in roughly 160 countries under the brand names Adidas and Reebok.

Its strongest presence was in Europe, where it retained its position as the leading sportswear manufacturer. It came second in the global market after US-based Nike, its biggest competitor. Indeed, it was one of the most valuable global sportswear brands, with the Adidas brand valued at $11.2 billion and the Reebok brand valued at $800 million in 2019 according to Forbes. The group closed the financial year with total revenues of €23 billion and a net income from continuing operations of €1 .9 billion.

With its headquarters firmly based in Herzogenaurach, the Adidas Group had reached a truly global status, employing approximately 60,000 people worldwide. It had regional headquarters based across six locations in Europe, Central and North America, and China.” As a result of the strategy launched in 2015 and labeled “Creating the New,” in the years preceding 2020, the Adidas Group also focused on increasing its business in six global cities — London, Los Angeles, New York, Paris, Shanghai, and Tokyo.

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