'Creating the new’ is adidas Group's new business plan until 2020
At its Investor Day in Herzogenaurach, Germany, adidas Group presented its new strategic business plan until the year 2020. By ‘creating the new’, the strategy aims at further accelerating growth by significantly increasing brand desirability. This is expected to spur top- and bottom-line growth, with revenues projected to increase at a high-single-digit rate on average per year on a currency-neutral basis until 2020 compared to the expected 2015 results. The Group’s net income is expected to grow at a considerably higher rate than the top line and is projected to expand by around 15 per cent on average in each of the next five years.
The new business plan is built around three major strategic choices: speed, cities and open source. The Group aims to expand its e-commerce business to above € 2 billion by 2020, by implementing a true omni-channel approach. Further, the company is going to evolve production capabilities to dramatically expand product customisation options for its consumers.
Herbert Hainer, CEO, adidas Group said: “We are living in a fast-changing world. Only what is new is relevant to the consumer. Therefore, we have to relentlessly focus on ‘creating the new’ for our consumers. And we have to constantly re-invent ourselves as an organisation to lead the change in our industry. Going forward, speed will be a key competitive advantage for us as we transform the adidas Group into the first true fast sports company.”
With 80 per cent of global GDP generated in cities and global trends being increasingly shaped in metropolitan areas, the adidas Group aims to continue its growth in all relevant geographic markets with a focus on six global key cities: Los Angeles, New York, London, Paris, Shanghai and Tokyo. Across these cities, the adidas Group will over-proportionally invest in talent, attention and marketing spend.
Roland Auschel, Executive Board Member, Global Sales said: “Global brands are created in global cities. If we win running in New York and Los Angeles, we will win running in the US. Therefore, we are committed to win market and mind share in key cities around the globe.”
In order to capture growth opportunities even more effectively than before, the adidas Group will focus investments across its core brand portfolio: adidas, Reebok and TaylorMade. Further, the Group unleashed open source, a strong commitment to further strengthen the company’s ties with its consumers. By increasing consumer desire in how the Group creates, designs and presents products, the adidas Group will engage with consumers, athletes, retailers and partners more than ever before, make them become part of its brands and, as a result, increasingly build brand advocacy.