Adidas to grow soccer sales by getting back to roots

Wed Jun 24, 2015 11:46am EDT
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By Emma Thomasson

BERLIN (Reuters) - German sportswear firm Adidas presented plans on Wednesday to defend its position as the world's top soccer brand against fierce competition from Nike by launching a new range of footwear and setting up more grassroots programs.

Adidas said it aims to increase sales from soccer gear at a mid-single-digit rate annually on average from 2015 to 2020 on a currency-neutral basis. That is lower than the "high-single-digit" growth rate it set for group sales in March and reflects the challenges it faces from U.S. rival Nike.

The two companies dominate a soccer kit industry worth more than $5 billion a year, sharing more than 80 percent of the market for many products. But Nike has been threatening Adidas' leadership, including in its home territory of western Europe.

Adidas, which saw the 2014 World Cup help boost its soccer sales by more than 20 percent to 2.1 billion euros ($2.35 billion), said it would do more to connect with a broader range of players with permanent or temporary grassroots programs.

"Soccer still starts on the street. This is where the kids get in touch with the sport," Adidas soccer head Markus Baumann told analysts, noting that 226 million unregistered soccer players worldwide dwarfed the 30 million registered.

Adidas is setting up soccer centers in key cities around the world with a focus on street players, including different kinds of pitches, shoot-out areas, lounges and bars.

In the professional game, Baumann said Adidas would focus on the top three soccer leagues in the world - in England, Germany and Spain - as well as the top 25 clubs.

Adidas last year struck a record shirt deal with former British champions Manchester United, ousting Nike. It will also replace Nike at Italian champions Juventus this summer and has extended an outfitting deal with Bundesliga champions Bayern Munich. The U.S. company, however, has struck deals with many other top clubs and players.   Continued...

Jun 12, 2015; Winnipeg, Manitoba, CAN; Adidas Conext15 soccer balls on the field before the game between Australia and Nigeria in a Group D soccer match in the 2015 FIFA women's World Cup at Winnipeg Stadium. Michael Chow-USA TODAY Sports