Adidas to spend the bulk of increased marketing spend on digital

The sportswear giant is increasing its marketing outlay for the rest of the year by 13 per cent, up from previous guidance, which closer to 12.8 per cent. It will push investments past €2bn over the next 18 months.

Adidas said the bulk of upcoming spend would flow into digital, particularly its newsroom offering, after claiming the tactic made it the most talked about brand during the World Cup. It pulled marketers, agencies and media owners together into a central team, which then coordinated in-store, online and reactive posts with its teams all over the world.

Adidas said the structure would be adapted to its other marketing platforms moving forward, which could see future activations around Chelsea FC and the Champions League.

Herbert Hainer, chief executive of Adidas, told analysts on a conference call today (7 August) that the newsroom helped elevate its marketing to the “highest professional level”. “We want our guys to concentrate on executing marketing concepts at the highest level and make our marketing accountable in terms of margins and sales”, he added.

“[The increased marketing spend] will feature a mix of everything but we will definitely invest the biggest bulk of the money into the digital media. [The newsroom] allowed us to talk to customers minute-by-minute on what was happening around the World Cup with our teams and players.

“We know that consumers love our brands when they hear our stories. Therefore, we will be bringing even more of these to life on the streets, screens and stores in the future, to ensure customers constantly hear what we have to say.”

Adidas will also plough significant funds into visual merchandising in its own branded stores as well as third party outlets. The business wants to create tighter experiences between its online and physical channels as part of bigger bid to amplify its premium credentials.

The German business said the upcoming deal with Manchester United would lift retail demand. “Having [United] shirts in our own stores will help drive traffic [into our stores]”, said Hainer.

“With United we have three out of the four big symbols in football alongside Real Madrid and Bayern Munich. Studies show you can sell around 20 to 35 per cent more from our brand around these key symbols.”

Elsewhere, Adidas said 2015 would see the launch of its most ambitious campaign to date. The business admitted a lack of marketing support had left its brands exposed to attacks in some markets, such as its home region of Western Europe, where it has ceded grounded to Nike.

The decline is compounded by losses at its golf division and poor sales in Russia. It forced the business to slash forecasts for the year and abandon its 2015 €7bn (£5.5bn) sales target.

Hainer said: “In 2012 we had been heavily attacked by our main competitor in Western Europe in the football and running areas. We rebounded with Boost last year and are on the attack in football following a strong World Cup where launched the Battle Pack. We’re bringing momentum back into the brand’s speed.”