At the Adidas annual meeting here last week, Chairman-CEO Robert Louis-Dreyfus said the company's longtime agency, London-based Leagas Delaney, will open an office in Portland, Ore., to service the account in the U.S.
With this strategy to advance its worldwide relationship with Leagas-a shop primarily known for work in Europe-Adidas appears to be on a different track from Nike. The latter seems to be outgrowing its association with Portland-based Wieden & Kennedy (AA, Feb. 6).
Adidas, by contrast, is sticking with Leagas for all its markets, although Mr. Louis-Dreyfus did note there won't be a global campaign for the brand.
"Adidas is structured by geographic territories and sports-based business units," said Bruce Haines, Leagas chief executive. "We're anxious to make sure there's one hand writing one signature whatever the work, whatever the sport."
Adidas, known primarily for its sports shoes, reached $2.13 billion in sales last year, with about 61% from Europe, 19% from Asia, 18% from North America and 12% from South America. For the first half of 1995, total Adidas sales were 20% above sales for all of 1994, Mr. Louis-Dreyfus said.
The company will spend $210 million on marketing this year. There's a huge disparity between what Adidas and Nike spend in the U.S., however. Adidas laid out only $4 million in the U.S. on measured media for the first nine months of '94, according to Competitive Media Reporting, compared with Nike's $108 million.
Despite a small U.S. budget, Adidas' sales there jumped 62% to $430 million in '94, giving the company a 10% share of the sports shoe market vs. Nike's 33% and Reebok International's 27%.
The opening of Leagas' Portland office indicates Adidas' desire to regain its supremacy in the U.S. market, where it led the sports shoe category in the early '80s.
In giving its international vote of confidence to Leagas, Adidas is dropping Team One, the El Segundo, Calif., agency that had handled advertising in the U.S. only. But Adidas will keep its U.S. media buying with Team One, a unit of Saatchi & Saatchi Co., where Mr. Louis-Dreyfus was chief executive before joining Adidas in March 1993.
Leagas is owned by Abbott Mead Vickers/ BBDO, but the shop has no formal link with New York-based BBDO Worldwide or its parent, Omnicom Group. Leagas this month sent a team to Portland that could become the nucleus for future growth of the agency in the U.S.
Saatchi nearly had the worldwide Adidas account in its back pocket when Mr. Louis-Dreyfus joined the athletic shoe marketer. But the agency muffed the pitch, and the account stayed at Leagas.
The Saatchi brothers themselves were given a stake in Adidas by Mr. Louis-Dreyfus. But Mr. Louis-Dreyfus paid them $40 million to relinquish their claim to a greater share of Adidas when his investment group bought the remainder of the company last month.
Marketing has played a key role in the turnaround magic Mr. Louis-Dreyfus has conjured at Adidas. When he took over at the ailing marketer, the company was deep in debt. In 1993, Adidas earned a paltry $1 million; a year later, that had skyrocketed to $100 million before taxes. Still, there's much work to do at Adidas.
"It will take another two years until Adidas is as healthy as rivals Nike or Reebok," Mr. Louis-Dreyfus said.
The core of his strategy has been to update Adidas' image. A major feat was Adidas' creation of a new sport in Europe called Streetball, a form of basketball played in the street. The company's advertising shows the game being played and Streetball wear.
Adidas' current ad campaign, running outside the U.S. on networks such as MTV, features boxer Muhammad Ali and Czech-born Olympic runner Emil Zatopek. The spots explain the philosophy of founder Adi Dassler that shoes should help athletes perform better.
Laurel Wentz in London contributed to this story.