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Adidas exec Mark King Looks Towards 20% | The Oregonian

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Source: Adidas exec Mark King discusses major expansion, brand growth, scandal (photo Jeff Manning | The Oregonian/OregonLive)

The Oregonian has an abbreviated transcript of their discussion with Mark King. At this moment adidas has 9% of the market. King states that the brand should have 15%. He makes the statement that BOOST has propelled much of the growth and that the Superstar remains the number one selling shoe from the brand. The transcript isn’t very long, so you should definitely click through and read it. For those interested on the sneaker head there isn’t a question raised about the influence of entertainment endorsements. There is a question about sports endorsements and a short section on the recent adidas scandal in college basketball, but nothing was really detailed.

Points I took from the discussion:

  1. The brand feels they should be at 15%. (I think this is an acknowledgement that adidas needs to figure out this market.)
  2. adidas would love to have Nike’s problems. (In other words the talk of Nike being on the downside is way overrated.)
  3. BOOST is a BASF product and there isn’t enough of it. (A technology not owned by a brand can not be the driver of growth. There wasn’t a mention of BOUNCE, but I expect more BOUNCE driven models to appear and models that look similar to BOOST based products.)
  4. 1700 employees from 800. (If I’m an analyst I’m worried about this number. The fast growth and turn around of adidas is predicated on fashion and fashion is fickle. King acknowledges that BOOST was performance based but it was the casual athletic application which pushed the growth of the brand. The moment adidas NMD and UltraBOOST becomes Roshe and Flyknit Racer, without an additional anchor for the brand the growth in employment could lead to layoffs.)
  5. Club Sport is important. (adidas will not stop looking to endorse youth sports. The brand has a firm grasp on the development and investment into young talent. This is evidenced by their work in the global arena. Grassroots North American is a difficult place to navigate and they will have to figure it out to reach that 15% growth in the US.)

The transcript doesn’t go into great detail, but it’s a good read. Use the source link to check it out.