Topic: The Day Adidas Shot itself in the foot by losing Liverpool FC

[Mad Men]

It must be shocking news to football fans around the world, Liverpool supporters especially when it was announced Liverpool would be signing a 25 million pound a year contract with Warrior Sports of the USA. Paying double what Adidas had been paying the club since 2006, and with adidas opting NOT to match what Warrior Sports was offering, there are good and bad sides to this deal.

1) Adidas has a bigger network of retail stores and chain stores globally than Warrior Sports will ever have. Warrior Sports is only prominant in a half dozen countries and that is limited to a small select number of sports.

2) Adidas CAN/COULD have afforded to match Warrior Sports but chose not to because it didn't like being bullied into a massive kit deal which in reality, it could have met if only the negotiating team had better marketing and sales managers at regional and international levels who were not sitting on their arses and coming out with the same method of sales (i.e. home, away,3rd kits, training kits, polo's.) Its a fact Adidas has been losing its foothold in global footbal with Nike gaining massive ground on the German brand and with adidas set to lose its "number one" status by 2015 to Nike in Football and expected to be dwarfed by Nike who will hit USD$50 BILLION in sales per year globally, its no wonder adidas management and senior marketing officers are taking several steps backwards by cutting budgets.

One of the biggest blunders in sport history as far as kit negotiations are concerned. Adidas thought the club would back down on their demands and didn't.

[canadianscraggledog]

In today's online world, does a retail store presence matter so much though?

Think it will do us a world of good with the extra $$ to spend on players.

[bakstabba]

In today's online world, does a retail store presence matter so much though?

Think it will do us a world of good with the extra $$ to spend on players.

That's a good point. I guess for Warrior this kit deal for them is a stepping stone (and a big one at that) to gain entry into the football merchandise market. They'll naturally increase their market presence globally in their operations because this is obviously one part of their plans

[soberphobia]

I don't think they shot themselves in the foot they just opted out of meeting a price. I read somewhere we sell 700 -900000 shirts a year so call it a million. To fund 25 quid per shirt in sponsorship before you make ship and market the shirt without the retailer margin or sales tax in some countries being taken into account means that maybe it just wasn't a good deal for adidas commercially. Warrior are looking for the exposure and have probably budgeted to lose money on the deal to gain market exposure which is something adidas don't really need.

[Godmadebloodred]

Liverpool FC.... is not in!

[Mad Men]

is..out!

Liverpool are adidas' 4th largest kit seller (merchandise wise) for the brand.

But if you think Warrior will be able to reach the sort of levels of sales globally, I don't think it will happen. They have a big problem with supply chains globally. UNLESS, they hope their new balance offices globally will be able to market on their behalf.

[classycarra]

who cares? the club doesnt make that much from shirt sales outside of the uk anyway

[scoobs]

Liverpool are adidas' 4th largest kit seller (merchandise wise) for the brand.

Who are the other 3 who sell more than us?
I remember reading somewhere where Ian Ayre said we were the biggest seller for Adidas.

[Scud02]

Who are the other 3 who sell more than us?
I remember reading somewhere where Ian Ayre said we were the biggest seller for Adidas.

Real
AC Milan
Bayern?

[rednich85]

I'm seriously considering spewing LFC once adidas leaves.

[Zlen]

I'm seriously considering spewing LFC once adidas leaves.

Yeah, me too. It just won't be the same right?
I'll just become an Adidas nomad, following them through the merchandise wilderness, wherever they may roam.

[west_london_red]

Who are the other 3 who sell more than us?
I remember reading somewhere where Ian Ayre said we were the biggest seller for Adidas.

From what I have read, we are the forth most popular after Real Madrid, Barcelona and the Mancs, Real Madrid being the only ones who outsell us and are with Adidas.

[Garstonite]

People who want to buy a Liverpool Football Club shirt will invariably buy a Liverpool Football Club shirt. It barely matters who sponsors it or even the design.

[Alan B'Stard]

People who want to buy a Liverpool Football Club shirt will invariably buy a Liverpool Football Club shirt. It barely matters who sponsors it or even the design.

I agree.

£25m per season will only help us become more competitive in the transfer market. If adidias dont want to pay what we think we're worth then we move on. No time for sentiment!

[ollick]

I don't think they shot themselves in the foot they just opted out of meeting a price. I read somewhere we sell 700 -900000 shirts a year so call it a million. To fund 25 quid per shirt in sponsorship before you make ship and market the shirt without the retailer margin or sales tax in some countries being taken into account means that maybe it just wasn't a good deal for adidas commercially. Warrior are looking for the exposure and have probably budgeted to lose money on the deal to gain market exposure which is something adidas don't really need.

What about the 100,000's of shorts, sock, tracksuits, boots, polo shirts it also sell with the LFC brand on?

What about people (like me, sad I know) that wear non-LFC branded Adidas gear solely because they sponsor my club?

To think that the calculation was made solely on football shirt sales and nothing else is naive.

[meff]

This is a great deal for us in terms of increased revenue especially with the financial fair-play rules coming into full effect in the near future. It's also a great deal for Warrior, rather: New Balance as this will inevitably increase their profile in the apparel market outside of the US.

With regards to the allegiance between match going fans (and those who would like to be match going fans) and Adidas: it's origins rooted deep in history going back to the late 70s and early 80s and had nothing to do with which manufacturers name was on our jersey at the time.

[royhendo]

It's not our problem really. Me personally? I'm gonna stock up on some of the good "Originals" clobber for my nippers when they grow up, but that's about it for me.

[sattapaartridge]

Automatically, the current crop of shirts gain in value? buy now, sell in 20 years time

[Mad Men]

New Balance do make awesome running shoes though. Better than adidas or Nike to be honest...

[Alonso]

What about the 100,000's of shorts, sock, tracksuits, boots, polo shirts it also sell with the LFC brand on?

What about people (like me, sad I know) that wear non-LFC branded Adidas gear solely because they sponsor my club?

To think that the calculation was made solely on football shirt sales and nothing else is naive.

They shouldn't be expected to consider that.

Just continue to wear your Adidas gear. It's not a big deal.

[nez808]

It also means that we will probably get a unique kit. For the past few years ours and Chelsea's, to name but one, kits have only really been distinguishable by the colour.

[Fiasco]

New Balance do make awesome running shoes though. Better than adidas or Nike to be honest...

People are starting to wear New Balance trainers in general now aswell mate, not just for running shoes. Can't see this deal being nothing but fruitful for us, the three stripes will go but we will be getting 25 million a year in place of it. Diddums.

[andspecks]

Warrior makes the hockey jerseys and jackets at my school. All of their stuff is quality.

[Mackeroo]

Warrior makes the hockey jerseys and jackets at my school. All of their stuff is quality.

Could you post some pics if it's not too much trouble mate? Just so we have an idea of what we're dealing with?

Adidas do make fantastic, classy stuff, but we're a business as well as a football club, and we need a deal that is beneficial to us. People may not like that but that's the way it is. £25 million a season is a fantastic deal for the club and can only be a good thing.

[royhendo]

Adidas might not have had much of a chance anyway. Improvements for the Boston Red Sox centenary at Fenway Park this year include a big illuminated New Balance sign. *rubs both sides of bridge of nose with index finger*

http://tinyurl.com/3j7rj6h

[Bob Loblaw]

I don't know why anyone is/was worrying about shirt sales to be honest. Surely that's purely Warrior's concern now?

[Mad Men]

I don't know why anyone is/was worrying about shirt sales to be honest. Surely that's purely Warrior's concern now?

How does the club market its merchandise globally if there are no downstreams to sell from (i.e. adidas concept stores/adidas retailers)? How many retail stores does Warrior have globally?

You're right, surely it's their problem but if we are earning cash on royalty as well and are looking to grow, surely this was in the long run not a good deal for the club. I still think adidas made a big mistake in letting the club go.

I don't see how they came away from this looking smart.

[jaygraham]

Surely Warrior would still distribute the shirt to general sports stores though?

[PhilV]

I don't really care about adidas being gone, we were the second best selling adidas branded footie club, obviously they didn't value us as such so screw them, no brand loyalty from me, my only loyalty is to Liverpool FC, I am sure Warrior will put in a good effort on the kit as we are their stepping stone into football kits.

[Ambrosia]

This is a great deal for us in the short term.

The extra £100m we get from the Warriors can be used to improve the team, which will hopefully lead to success for us. Once we've got a few trophies under the belt, by the time we come to the end of the contract, the likes of Adidas can come back to the table with a deal which will worthy of our stature.

[redbyrdz]

Adidas might go for the German option, pushing their sales in the bundesliga, which is on the way up. Doubt they'll lose out in the end. They'll probably come back in 3-4 years time if we get back into the top CL teams.

Don't really think it'll work out for warrior, their gear looks shite. Not really talking about the shirts, but general clothing items and trainers (which come from new balance it think).

Anyone know how much money is made from shirt/kit/training gear sales compared to club-branded clothing (like adidas hoodies with a Liverbird on them)?

[fjelloter]

Just going to leave this one right here: http://imgur.com/1yldQ

[Mackeroo]

Just going to leave this one right here: http://imgur.com/1yldQ

That's fake. Hideous alright, but fake.

[rednich85]

That's fake. Hideous alright, but fake.

Seriously?

Looks real and class.

[Mackeroo]

Seriously?

Looks real and class.

[Acaustiq]

FWIW this hasn't been confirmed by the club and may well be a negotiating tactic from the owners.

Who are the other 3 who sell more than us?
I remember reading somewhere where Ian Ayre said we were the biggest seller for Adidas.

In terms of replica shirts we're second behind Madrid.

In terms of overall merchandise - training tops, hats, balls, shoes, etc. We're apparently the biggest seller, full stop.

Contrary to a belief in some quarters that leading football clubs sell many millions of shirts around the world each year, Dr Rohlmann studied sales in the period 2005 to 2009 to get an accurate long-term picture, and found that the leading two clubs sold, on average, 1.2m to 1.5m shirts per year each. These clubs were Manchester United (Nike’s best seller) and Real Madrid (Adidas’s best seller).

But even that does not tell the full merchandise story, because although Liverpool were found to Adidas’s No2 shirt seller behind Real (with 700,000 to 900,000 shirts sold per year), Liverpool are understood to be ahead of Real in overall merchandise sales for Adidas, according to industry sources. In this instance “overall merchandise” means not just the sale of shirts (which is what Dr Rohlmann measured), but other kit, boots, tracksuits and other clothing, bags and even club-branded balls.

And Liverpool’s commercial director, Ian Ayre, has told this website that Liverpool are Adidas’s top-selling team in overall merchandise terms. “It is clear that we are Adidas’s highest selling football club – Adidas advised us we were their highest selling club,” Ayre says.

http://www.sportingintelligence.com/2010/08/31/exclusive-manchester-united-lead-global-shirt-sales-list-liverpool-chase-as-england%E2%80%99s-second-best-310805/

[Mad Men]

Good article.

[MrGrumpy]

New Balance do make awesome running shoes though. Better than adidas or Nike to be honest...

This is true, I am on my second pair of 767's and will probably purchase another pair of New Balance when those are worn out.

http://size.co.uk/footwear?departmentPage=N#back

[Grobbelrevell]

Surely Warrior would still distribute the shirt to general sports stores though?

Exactly. Whenever I've bought a Liverpool shirt in the past I've either picked it up in the club shop (which will still stock them), ordered on line from one of the club or the likes of JJB/Sports Direct (which will still stock them) or gone into one of the previously mentioned chain sports shops directly (which will still stock them).

I don't think I have ever been in a specific Adidas store to purchase a shirt, or anything else for that matter. In fact, I don't even know where my nearest one is.

I just don't see this as being as big a problem as is being made out.

[Alf]

I think there are factors to take into consideration here:

People who always buy our shirt will still buy the Warrior one.
People that buy other Adidas LFC branded merchandise in addition to the shirt will be less inclined to with the Warrior alternative.
Our performance on the pitch impacts how many shirts we sell so the more money we get up front the better.
How much many do the club actually make on each shirt sold?
Will we have the same distribution issues with a lesser brand as we did with Reebok prior to Adidas again?