In the world of sportswear, the Adidas Samba has emerged as a surprising frontrunner, captivating a diverse clientele that includes celebrities and political figures alike. Since its resurgence over the past year, the Samba has taken the fashion sneaker market by storm. However, this surge in popularity was not part of the original plan laid out by Adidas until its new CEO, Bjørn Gulden, took the reins in January 2023.
Gulden, who previously helmed Puma, recognized the untapped potential of the Samba shortly after assuming leadership. Rather than waiting for production increases planned for 2024, he immediately pushed for an expansion in manufacturing. “For whatever reason, no one wanted to scale it,” Gulden remarked, but within five days of starting his position, he initiated a change. This shift not only boosted production but subsequently led to the Samba’s high sales figures, placing it front and center as Adidas addressed ongoing financial challenges.
The backdrop of this recovery is crucial to understand. Adidas faced a significant crisis after cutting ties with its Yeezy line, which once contributed to nearly 8% of its annual revenue. The decision to sever ties with Ye (formerly Kanye West) resulted in a financial downturn marked by a sharp decline in stock prices and a swift succession of profit warnings. Compounding this, the company’s withdrawal from the Russian market post-Ukraine invasion and slowed growth in China only added to its tribulations. Yet, in a strategic pivot, Gulden reignited interest in Adidas’ core products like the Samba and other terrace styles, leading to unexpected and powerful recuperation in sales.
Post-resurgence, Adidas’ financial outlook changed markedly. By July, the company raised its revenue growth projections from mid-single to high-single digits, suggesting a more robust trajectory. The forecast for operating profit climbed from €700 million to €1 billion, signaling that the corporate revitalization was underway. The company’s stock, up 20% this year, is 130% higher than the value from October 2022, illustrating a remarkable turnaround.
Gulden’s hands-on approach and deep understanding of the sportswear landscape are pivotal in this turnaround narrative. Analysts credit his commitment to empowering Adidas’ creative teams. His methodology encompasses a more streamlined decision-making process, shifting away from risk-averse strategies that had characterized the brand prior to his arrival. “The key with Bjørn is his understanding around product,” noted Erwan Rambourg from HSBC, emphasizing Gulden’s long-standing passion for footwear.
One factor contributing to the Samba’s success is that it offers a contrast to the bulky retro basketball sneaker trend. As fashion preferences shift, the low-profile soccer sneaker provides a more versatile and stylish option. Successful collaborations with designers such as Grace Wales Bonner and Gucci have enhanced the Samba’s cultural cachet, allowing Adidas to experiment with new designs and colors that attract today’s conscious consumers. The swift adjustment toward producing high-margin lifestyle products like the Samba offsets the financial shortfall left in the wake of Yeezy’s departure.
Adidas is now targeting the North American market more aggressively. With Nike currently experiencing difficulties, this presents an opportunity for Adidas to increase its market share. The company’s new office and creation center in Los Angeles underline a strategic move to engage more directly with the American consumer, particularly in basketball. The challenge ahead is significant; Nike, long a dominant force in this region, is poised for a potential revitalization, urging Adidas to strike while the iron is hot.
In a series of interviews, Gulden discussed the company’s strategy for success. “Turning around a company has three components: It’s luck, it’s timing, and it’s effort,” he stated, offering insight into the mindset behind Adidas’ recovery. This realignment has included rekindling relationships with retail partners, recognizing that collaboration is crucial when revitalizing brand presence in challenging markets.
As Adidas seeks to enhance its standing in basketball—one of the key pillars of the North American sportswear market—it is fortified by its roster of global sports stars. Recent campaigns featuring high-profile athletes like Jude Bellingham and Zinedine Zidane highlight the brand’s renewed focus on partnerships that go beyond mere transactions.
Gulden’s leadership has not been without challenges, evidenced by missteps such as the controversial advertising for the SL72 sneaker featuring Bella Hadid. Despite these hurdles, his overall emphasis on product innovation and responsive market strategies continues to resonate.
As Adidas progresses, it finds itself at an exciting crossroads. The expansion into North America coincides with plans for future sporting events, including the 2026 World Cup and the 2028 LA Olympics. A focus on local engagement and culture is central to ensuring the brand’s unique identity remains intact while also appealing to the evolving tastes of a diverse consumer base.
In summary, Adidas’ swift transformation under Bjørn Gulden illustrates the power of strategic decision-making rooted in consumer insights and market trends. With new product launches on the horizon—like the fully 3D-printed “Climamog” sneaker—Adidas seems poised to maintain momentum. The lessons learned from the Samba’s success will likely serve as a blueprint for further endeavors as the company reclaims its standing in a competitive industry.
