Today’s article is brought to you by audible go to audible slash company man or text company man to five hundred for a free audiobook and a 30-day free trial. It’s all in the description. There are some differences in pronunciation going on here that I’d better address right in the beginning.
The way I’ve been pronouncing the name of this company for my entire life is like this Adidas. A little emphasis on that second syllable. That’s how everyone in America says it. Now, all the Americans watching this might be shocked to learn that in Europe and almost everywhere else they pronounce it like this, Oddy does moving the emphasis to the first syllable.
And I have to say, I prefer the European pronunciation. It’s not only more fun to say it makes more sense. For one, it’s a German company and it would make sense to follow their lead and how to say it. And for two, the name comes from this guy, Adolf Dassler. Drop the last syllable from his name and you’re left with.
He does all that nonsense where people say it stands for all day. I dream about sports or soccer. It’s not true. It would be too big of a coincidence that it just happened to share the first six letters of his name. But even though the American pronunciation is less popular and makes less sense, that’s how I’ll be saying it for the rest of this article.
It’s the way I’ve always said it. And honestly, I wouldn’t be able to pull it off saying it any other way. It would sound too unnatural. So to all the Europeans, please excuse my pronunciation. As I talk about how Adidas got so big in the world of sneakers and sportswear today, Adidas is number two. Number one is, of course, Nike.
And those rankings are pretty solid. It’s been that way for some time. In just about every measure, Nike is ahead of Adidas. We can take a look at annual sales or market cap or whatever else to compare the two. And in the end, it’s no contest.
But the good news for Adidas is that they’re pretty safe in that number two position in being the second biggest company of its kind. It’s a huge success. Forbes says that they’re the 60 eighth most valuable brand in the world. They brought in over 21 billion dollars in sales last year. Just look at how their sales have been growing over the past five years.
And I just want to point out that those numbers are in millions and in euros. And how about this? They own Reebok bought them over a decade ago, which I’ll admit sounds more impressive than it actually is. Reebok tends to make up less than 10 percent of its total sales. There’s the visual. For over the past couple of years, I would have guessed more.
But in total, their value on the stock market is nearly 40 billion dollars. They actually hit their all-time high share price earlier this year, a little drop since, but nothing major. I think I can say that anyone who plays sports or watches sports in most of the world is very familiar with D.A.
Even if you know nothing about sports, there’s a good chance that you know the name. But how did they get there? How did they get this big? Like most companies, it didn’t start out big in the 1920s in a small town in Germany. Adi Dassler and his brother Rudy started the company when they began producing shoes in their mother’s laundry room.
At that time, it wasn’t even called Adidas yet. It was called the Dassler Brothers Shoe Factory. Now, obviously, there are numerous factors that are responsible for transforming that little business into the giant that we know today. But what I’d like to do here is highlight three things that seem to have made the greatest impact and are most responsible for their growth.
A first thing is a man named Jesse Owens. Jesse Owens is fast in his time, probably the fastest man on the planet in the 1936 Olympics held in Berlin, Germany. He won four gold medals in track events, breaking records along the way. A very impressive performance. Do you know-how in every Olympics there tends to be one or two people that become really famous and are just the start of the whole thing? Well, in 1936, it was Jesse Owens.
If you’re up on your world history, I’m sure you’ve already put together why this was so significant. These Olympics were in 1936 in Germany at the time the country was led by Adolf Hitler and the Nazis. He was planning for these Olympics to prove how the Aryan race was superior. And obviously, Jesse Owens ruined that plan. I’m oversimplifying all this, but you get the idea as to what happened. Here’s where Adidas comes in. As I said, these Olympics took place in Germany and the Dassler shoe company was from Germany.
It was on their home turf. Adi Dassler somehow convinced Jesse Owens to wear a pair of his shoes during the races. And it looks like he didn’t specifically target Owens. He was just kind of trying to convince. All the athletes, but the one that paid off was Jesse Owens. And let’s just take a second to point out how risky this was, possibly one of the riskiest marketing moves of all time.
This was a small business operating under the German Nazi government, providing Jesse Owens with a pair of shoes that were perceived to help him win and ruin Hitler’s plan. That’s a risky move. I can tell you this as a small business, you do not want the government mad at you. And more importantly, you don’t want Hitler mad at you.
Luckily, they avoided any negative effects and came out of it better than ever. After that, their shoes were known to be the ones that Jesse Owens used during his historic races. You can imagine the demand that it created for them. And it really helped bring the small shoe company to the next level.
A few years later, unrelated, the company was forced to transform into a Nazi weapons manufacturer. I’ve already spoken about Nazis more than I would like. So I’ll just leave it at that and skip to. After the war, the two brothers that were running the company found it impossible to work together and they split apart. Rudy left so that he can form his own shoe company.
That company he started is now known as Puma. You probably know them. And Artie stayed put and redesigned the existing company. That’s where the name was changed to Adidas. And he came up with the three stripes signature look. And it really just started taking shape into the company that we’re familiar with today. That brings me to the second event. I’d like to highlight the 1954 World Cup final.
It’s been called The Miracle in Bern. It took place in Bern, Switzerland, and showcased a very strong Hungarian team against the underdog team from West Germany. The games started with two early goals from Hungary, which solidified their victory in the minds of many people. But Hungary didn’t score for the rest of the game, while Germany scored three times, making them the winner three to two.
And there was a lot of politics tied to this game as well. It was the Second World Cup following the war, the first one held in Europe since the war. It was held in Switzerland because they were neutral during the war and mostly unaffected. It involved a newly formed and weak German team. A lot going on with this World Cup. But the reason I mentioned it here is that that winning German team was famously wearing Adidas shoes. The Dassler boot, as they call them, with all its features that make it superior to the traditional boot.
As they say. Again, you can imagine how being attached to such a big event like this could help the brand. Remember, the success with Jesse Owens was linked to the old brand before all the changes. So this helped bring the new brand into the mind of the public. It’s where many people first saw their signature stripes and learned the name I.D. does. See, I told you I couldn’t pull it off. They learned the name Adidas.
The third thing that I’d like to highlight may not be as significant as the first two, but it’s worth mentioning. Run DMC. It’s a really popular rap group from the 1980s. They’re pioneers in the genre. They had a song called My Adidas. It was one of their more popular songs.
They sang about how they wore Adidas. And they were known for wearing Adidas. I would liken it to the NWA and their Raiders gear. And unlike the first two contributors to their success, this one started independently from Adidas, meaning Run DMC wasn’t approached by them to create the song or anything like that. They made it on their own.
The story goes that they invited an Adidas executive to one of their concerts. And before they sang their song, they asked the crowd to raise their Adidas sneakers in the air. And thousands of people did it, showing the executive how influential they were. It motivated them to sign Run DMC to an endorsement deal, which is said to be the first-ever endorsement deal in rap.
Here we have a popular rap group singing about them and wearing them. Not just shoes. Head to toe, Adidas. And they were obviously influencing their fans to buy them, or at very least familiarizing them with the brand. All three of these contributors have something in common. It was someone famous and influential wearing their shoes, which is a very common practice for companies like this. We’ve all seen Nike do it.
Adidas continues to be reliant on their marketing and continues to be aggressive with this type of marketing. A few years ago, they had a big campaign labeled Impossible is Nothing involving David Beckham and Muhammad Ali. Today, they have some of the top athletes in each sport signed to endorsement deals for soccer.
They have Lionel Massie for basketball. They have James Harden for football. They have Aaron Rodgers for baseball. They have Chris Bryant. Almost half of their marketing budget every year goes to paying all these players from different sports to wear and endorse their shoes. So to summarize the answer to the question, how did Adidas get. So big. Well, a bunch of influential people wore their stuff and it made other people want their stuff. It’s the same thing that they’re doing today. Let me know in the comments. Do you agree with the three reasons that I highlighted?
Maybe there’s an even bigger contributor to their success that I’m overlooking. As I said and say every time, it’s impossible to accurately explain the success of a company like this in a short article. But I did my best by focusing on some of the highlights. I only touched on how Eddie’s brother Rudy split apart to form his own company. I think that following his story and the success of Puma might make for a great spin-off to this article.
So be sure to let me know if that’s something you’d be interested in seeing and any other thoughts you have regarding the wide variety of topics touched on in this article? Leave them in the comments as well. I’d like to hear what you have to say today.
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