Adidas hopes fashion styles will help it win on pitch too

Thu Jan 21, 2016 4:30am EST
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By Emma Thomasson

BERLIN (Reuters) - A combination of new and retro sneaker styles will keep driving growth at Adidas's fashion business and help attract more sports fans too, the head of the German firm's Originals unit said in an interview.

Adidas, which on Monday announced that Henkel's (HNKG_p.DE: Quote) Kasper Rorsted will take over as new chief executive in October, has lost market share to Nike as its U.S. rival has concentrated more squarely on performance-enhancing sportswear.

Adidas has started to muscle back into the U.S. market, but growth has come largely from retro fashion styles like its Stan Smith tennis sneakers, while sales of core sports products like running and soccer shoes has been more muted.

Arthur Hoeld, head of Adidas Originals, told Reuters that the fashion business made popular by collaborations with celebrities like Kanye West, Pharrell Williams and Rita Ora helps the brand win fans on the field too.

"We will capture more of the growth of the sneaker industry with our performance products, but Originals will help us to grow a more significant share," he said. "We're not concerned here internally about the balance."

Nike has done better than Adidas at launching products with new features to help athletes, and has concentrated more on deals with sports figures than celebrities.

But products like its minimalist "Free" running shoes have also become style hits and the company has been doing more collaborations with fashion designers and models - Kanye West actually switched to Adidas from Nike.

Adidas fashion brands - which include Originals and teen label NEO - accounted for 30 percent of sales in 2014 to 70 percent for sports performance products. As Nike does not run a separate lifestyle unit, it does not give comparable figures.   Continued...

The Adidas logo on a 3D city map is pictured at the flagship store in Berlin, Germany, January 20, 2016.  REUTERS/Hannibal Hanschke