NEW YORK — Adidas plans to name an executive to work with North America president and chief executive officer Erich Stamminger in a top management position in the U.S., global ceo Herbert Hainer told analysts at an investor meeting in Germany last week.
Adding a key executive in the U.S. is another signal that the company is concentrated on aggressively building its American business. As part of that strategy, Adidas bought Reebok in August in a $3.8 billion cash deal that dramatically expands the German giant's American presence.
"In the North American market, you can see that it is not a turnaround [of the brand] that has taken place, but a full-scale repositioning," Hainer told analysts at the meeting at company headquarters in Herzogenaurach, Germany. "We have changed the pace, changed the spirit, and retailers sense they want to be a part of it."
The U.S. last year accounted for about 23 percent of sales and is critical to the company's long-term success. Adidas earlier this year opened its largest flagship in New York's SoHo neighborhood. Stamminger told analysts the firm is gaining market share in the region because of technology innovation, customer service and improved relationships with retailer partners.
Stamminger has been operating since 2003 as Adidas' global marketing head and president and ceo of Adidas America, and the company is searching for someone to take over some of his responsibilities here, Hainer said in a question-and-answer period at the annual investor event. Stamminger will remain Adidas America's ceo, but he will be traveling more in Europe because of the World Cup soccer tournament, set this year in Germany, and Adidas needs an executive to oversee some of his day-to-day responsibilities, according to a company spokesman.
"It was never the intent for Erich to run both marketing and U.S. permanently," Merrill Lynch analyst Virginia Genereux wrote in a report after the conference.
Stamminger, a 22-year veteran of Adidas, took over the role of Adidas America president about two years ago following the departure of Ross McMullin, who was battling cancer and died in 2004.
Goldman Sachs analyst Margaret Mager said in a report, "Adidas' results are improving across regions as the turnaround in North America continues to take hold."The company reiterated that it expects to reach 20 percent earnings growth this year, with sales gains in the midsingle digits. Last year, Adidas had sales of $8.3 billion.
Adidas said it has a number of marketing and product events planned around the World Cup 2006. Adidas is an official sponsor of the event. Adidas also has aggressive sales goals for the Asia Pacific region, and said it has ramped up its offerings in golf and is planning a golf marketing campaign for 2006. New performance technologies such as Climacool and the Adidas 1 smart sneaker are driving footwear and apparel sales, Hainer noted.
Adidas gave little new information about its acquisition of Reebok, but Hainer said the deal has continued to move through regulatory purchases, and the company has put together an integration team headed by one Adidas executive and one Reebok executive.
The company has identified about 125 million euros, or about $150 million at current exchange, in annual cost savings and operating improvements related to the merger.
"Through this combination, we will benefit from a more competitive platform worldwide, well-defined and complementary brand identities, a wider range of products and a stronger presence across teams, athletes, events and leagues," Hainer said.
In August, Adidas purchased 24 acres of land adjacent to Reebok's headquarters in Canton, Mass., according to local Boston-area newspapers. There have been rumors swirling in the industry that Adidas is moving its North American headquarters to Reebok's headquarters in Canton, but a company insider told WWD that Adidas management recently sent out a company-wide note that said headquarters would remain in Portland, Ore.
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