Adidas awards $55 mil acc't to Carat

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Adidas America handed its $55 million U.S. media buying and planning account to Aegis Group's Carat USA without a review, according to people familiar with the switch.

The account, which covers athletic footwear and apparel, had been housed at Leagas Delaney, San Francisco. The move is the latest blow to the agency, which continues as the lead strategic shop for Adidas. Adidas has tapped urban marketing agency Burrell Communications, Chicago, to handle TV efforts featuring NBA star Tracy McGrady, while Red Button, Portland, Ore., has devised ads using lead global pitchman Kobe Bryant.

For Carat, the account is the latest victory in a winning streak that calls to mind Mr. Bryant's Los Angeles Lakers. Carat initially struggled to develop a U.S. presence and lost several high-profile pitches. But this year, the media agency doubled its billings on the Pfizer account after the client merged with Warner-Lambert. Then it won AOL Time Warner`s New Line Cinema, followed by planning and buying for Royal Philips Electronics in the U.S. when parent Carat International captured that $600 million global account. In the U.S., Carat now has estimated billings approaching $3 billion.

Adidas did not provide comment at deadline; Carat declined to comment.

Carat already handles Adidas outside the U.S., so the shift from Leagas Delaney completes a global consolidation. Adidas is under new management and appears to have sought the leverage of a media specialist rather than retaining media at a full-service agency.

Adidas underwent a remarkable turnaround under previous Chairman Robert Louis-Dreyfus but has struggled to find its footing lately. Competition in the athletic-footwear category is heating up, thanks largely to the re-emergence of Reebok, which recently signed a deal to become the official outfitter of the National Basketball Association and saw its endorser Allen Iverson shine in the NBA playoffs. And the battle may take on a new dynamic if Michael Jordan comes out of retirement again, which might mark the best news for Nike since Air Jordans hit the market in the 1980s.

Adidas has pledged to increase its share of the U.S. market to 20%, an ambitious goal considering it currently stands at 10.8%. That's far below Nike's 42.6%, but close behind Reebok's 11.9%, according to market researcher Sporting Goods Intelligence.

Adidas saw its U.S. sales fall from $845 million in 1999 to $811 last year. Each of the Big Three athletic- footwear players has been impacted by the resurgence of New Balance, where stylish running shoes propelled the company from a 7.4% share in 1999 to 9.6% in 2000.

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