Adidas to Sign Up to 500 Athletes for Endorsements
Sports-Clothes Maker Trying to Regain Market Share Lost to Under Armour, Nike
Adidas AG plans to sharply ramp up endorsement deals with U.S. pro football and baseball players in the next few years, as the German sportswear maker tries to gain traction in the American market.
The company’s U.S. arm has the go-ahead to sign as many as 250 National Football League players and 250 Major League Baseball players over the next three years, up from a total of fewer than 40 now, Adidas North American President Mark King said in an interview Tuesday.
Adidas said it also recently inked deals with both the NFL and MLB that will allow the players it endorses to sport the company’s three-stripe logos on the equipment they wear on the field.
Adidas has fallen into third place in the U.S. sportswear market behind Under Armour Inc. and has dropped even farther behind market leader Nike Inc.
In the 11 months ended Jan. 3 Adidas held a 4.6% share of the U.S. market in retail apparel and 7.1% in footwear, the latter including Reebok, which has its own sponsorships, according to data from Sterne Agee and SportScanInfo. The company posted declines in both categories from a year earlier period. Nike and Under Armour, which together control roughly 46% of the apparel and 62% of the U.S. retail footwear markets, each posted gains over the same period.
Adidas is a leader in soccer but hasn’t done a good job of associating itself with traditional American sports like football, basketball and baseball. The company’s executives have been slow to deviate from that soccer-first strategy until just recently.
“We can’t use the global strategy,” said Mr. King, who took the helm as the company’s North America president in June after running its TaylorMade golf division. “I know we’re a soccer brand globally, but in the U.S. we have to be about U.S. sport. We can still be No. 1 in soccer, but that can’t be what drives our business.”
Sports endorsements are a costly but arguably necessary step to cementing brands in the minds of American shoppers, and it’s an area where Adidas has lagged behind rivals. The market is hotly competitive. Under Armour recently scooped up British tennis champion Andy Murray , who previously wore Adidas as part of the Baltimore-based company’s push to gain influence abroad. Last summer, Nike won a tough bidding war with Under Armour over NBA MVP Kevin Durant.
It still isn’t clear how or when these endorsements directly translate into retail sales. “It’s not a visceral kind of thing where you run an ad and you get a response, it’s a long-term brand building idea. But in terms of impact, I think it’s meaningful,” said Matt Powell, a sports industry analyst for NPD Group.
Current Adidas-sponsored football players include Washington Redskins quarterback Robert Griffin III and Dallas Cowboys running back DeMarco Murray. Its present MLB baseball roster includes Philadelphia Phillies second baseman Chase Utley and brothers B.J. and Justin Upton, who play for the Atlanta Braves and San Diego Padres, respectively.