The exterior of Adidas's NYC Flagship.

ADIDAS REALIGNS: Adidas has discontinued its Digital Sports business unit, calling into question 74 staff jobs.

The business unit was the driving force behind the development of wearable technology, consisting of technology experts in the fields of data science, experience design, algorithm development and software and hardware engineering. Adidas first ventured into the wearable area in 2001 with the launch of sensor-enabled footwear.

Asked about the layoffs, an Adidas spokeswoman said, “I don’t know that ‘layoff’ is the right word.” The 74 staffers worked out of a few Adidas offices including Portland, Ore.; Germany; China, and other parts of the U.S. Conversations will be held with each of them about “hopefully finding them other places in the organization,” an Adidas spokeswoman said.

The redefined strategy is in line with Adidas chief executive officer Kasper Rorsted’s plans for more digital experiences. The realignment will entail the company consolidating some of its apps to focus on its two most powerful platforms Runtastic and its relaunched Adidas app. The latter is an AI-enabled shopping app that is meant to offer a more personalized consumer experience that was introduced last month at Dreamforce.

Adidas acquired the Austrian app maker Runtastic for a reported $240 million n August 2015. The European company also developed wearables and other hardware fitness monitors.

It has not been determined whether software and hardware will continue to be made. “We’re not ruling it out but we haven’t made a clear commitment,” the spokeswoman said.

Referring to the company’s 2020 global business plan, “Creating the New,” she pointed to three pillars: Speed, Open Source and Key Cities. “When we think about digital that goes across everything, it’s just the way of the world today. In terms of if we are going to be making other changes across different departments, of course we’re always looking to strategically get better and get closer to our consumer. I am not personally aware of any other plans but we are a company that is constantly evolving to connect with our consumer. It’s just how it is, I’m sure, across the industry.”

Despite the disbanding of the DSB unit, Adidas is “growing like crazy and bursting at the seams in Portland” where the employee base has increased to 1,700 from 800 in three years. “We’re having to make these strategic decisions but that’s certainly not a reflection of our growth in North America,” she said.

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