Nike’s Germany kit deal ‘inexplicable’, says Adidas CEO

Paris – The sum reportedly paid by Nike to lure the German football team away from its historic partner Adidas was “inexplicable”, the CEO of the German sportswear giant Bjorn Gulden told AFP in an interview.

Defending the company’s decision not to enter into a bidding war with its fierce US rivals, Gulden said the German sport outfitter would continue to go after major kit deals, including the franchise for France, but only if the price is right.

News of the breakup with the German football team came at a bad time for Adidas, which had slumped to its first annual loss in over three decades in 2023.

The German Football Association (DFB) said last month it would end its partnership of over 70 years with Adidas, selecting Nike as its kit provider from 2027.

The DFB said the decision was made in the interests of the domestic game and grassroots football.

But the shock announcement, just a few weeks before Germany is set to host the 2024 European football championships, prompted an outcry from politicians who accused the DFB of a lack of patriotism.

“Nike won with, by all accounts, a huge offer,” said Gulden, referring to reports that the US giant will pay around 100 million euros ($106.5 million) a year in the deal that runs from 2027 through 2034.

“If the numbers are right for what Nike paid the DFB, they are inexplicable for us” on the back of Adidas’s own calculations, the Norwegian CEO said.

International football was not everything, Gulden said, lauding the “advertising impact” made by Adidas’s partnerships with clubs like Real Madrid and Bayern Munich.

Demand for national kit or federation merchandising is “much lower than it is for clubs”, he added.

“We try always to invest where one gets the best advertising impact and can make the highest sales, and we’ll continue to do that.” 

– Olympic hopefuls –

In seeking other big kit deals therefore, Adidas will only pay what it deems reasonable, including for France potentially.

“We make offers where we are interested at a price that we believe is the right one,” he said, underlining that “over that we won’t go there.”

Gulden, who took over the reins of Adidas in 2023, also sketched out a plan to shift Adidas’ focus from major disciplines like football to a more comprehensive scope.

“As a sports romantic, I want to go back into breadth, into a wider range of sports,” said Gulden, a former footballer.

Athletics would be an area, he said, where Adidas would like to gain more visibility.

“For me, it’s always about athletics — the core of every type of sport — no matter what one does, be it breakdancing or BMX or football or basketball, one must be able to run or jump high,” he said.

Already, Adidas was making footwear that would be worn in 41 different events at the Paris Olympics which will start in July, he said.

“I am certain, that in four years’ time, besides very few exceptions, we’ll have products for every type of sport,” added Gulden.

Usain Bolt lit up the track wearing Puma kit, while Gulden was at the helm of Adidas’s local rival.

Lightning could strike twice for Gulden, he said, if hotly tipped Adidas athlete Noah Lyles takes the gold in the 100 metres for the US in Paris this summer. 

– Changing fortunes –

Yet Olympic success was not likely to translate directly into sales. 

“You don’t walk around wearing a weightlifting jersey or a track-and-field jersey,” Gulden said. 

“What often happens is that interest in sports goes up in a given country and the world as a whole.”

For Adidas, 2024 has already witnessed the start of a turnaround after a period marred by struggles.

The group raised its revenue and profit outlook for 2024 this week on the back of a better-than-expected first quarter.

The brand was still “alive” Gulden said, but needed “a bit of time” to recover fully after reporting an annual loss in 2023.

The slump was linked to poor sales in the United States and the end of a partnership with the rapper Kanye West.

Adidas distanced itself from the artist in late 2022 over allegations of anti-Semitism.

Since then it has been slowly selling off its remaining stock of Yeezy products from its highly lucrative collaboration with West. 

Creative partnerships remained an area of interest for Adidas, Gulden said.

The outfitter worked with “many designers”, Gulden said and would “100 percent in future work with people from the music, fashion and entertainment businesses”.