Adidas says speed is key to its strategy
09/03/2017
The company’s sales for the year were €19.3 billion ($20.4 billion), an 18% increase on 2015 on a currency-neutral basis. This growth was driven by a 22% increase in sales for the Adidas Brand. Within this segment, lifestyle products, led by Adidas Originals and Adidas Neo, performed especially strongly, banking a 45% sales growth. There was also a 6% increase in revenue from the Reebok brand.
Upon announcing the results, the company said it now expects currency-neutral sales to increase at a rate of between 10% and 12% on average each year between 2015 and 2020. This compares to previous forecasts of high single-digit growth.
This target forms part of Adidas’s long-term strategic business plan, which it calls ‘Creating the New’. It was launched in March 2015 and includes a series of steps designed to boost the company’s sales and profitability.
“Our 2016 results and our positive outlook for 2017 are proof that our strategy is paying off. After the first full year of ‘Creating the New’, we have exceeded our original plan,” said Kasper Rorsted, CEO of Adidas. “Now we have developed additional initiatives which will accelerate the execution of ‘Creating the New’ and enable us to significantly increase our targets for 2020.”
As part of this plan, Adidas has set itself the goal of becoming the “first true fast sports company”. It has already made progress, with the launch of its pilot ‘Speedfactory’ in Ansbach, Germany, where mass production is slated to begin this year. It is also opening a second Speedfactory in Atlanta, US.
Adidas revealed that in 2016, approximately 15% of its sales were generated by products manufactured on ‘Speed’ programmes. It aims to increase the share of ‘speed-enabled’ products to at least 50% by 2020.
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