Battle of the brands

Puma slinking into soccer stadiums

main 41754302 AP – Puma sponsor Arsenal soccer football branding Nike Adidas competition
A very happy Puma. Source: AP

Puma has made a sprint to narrow the lead of Adidas and Nike by signing up three top-flight soccer clubs — AC Milan, Olympique Marseille und Borussia Mönchengladbach — for the new season, meaning Puma pays them for the privilege of wearing and hence advertising its kit.

“Our clear goal is to gain market share,” Puma’s head of sports marketing, Johan Adamsson, told Handelsblatt. “Our plan is to make sure that there’s no part of the world where there’s football without Puma.”

Puma CEO Bjørn Gulden, a former professional footballer, wants to crack the duopoly at the top of soccer. But it won’t be easy. Go into most sports stores and you will see the soccer section dominated by Nike and Adidas shoes and shirts.

In the World Cup in Russia, Puma was far less visible than the big two. Only four teams wore Puma, and the most successful of them, Uruguay, didn’t get past the quarter-finals. Adidas sponsored 12 teams and Nike 10 including the winner, France. Nevertheless, Puma outpaced its rivals in the second quarter with double-digit growth in all global regions.

Spending millions

Adidas and Puma, both based in the Bavarian town of Herzogenaurach, were set up by the two brothers Adolf and Rudolf Dassler respectively. They began making sports shoes together in 1920 but went their separate ways after World War Two. Adolf, known as Adi, founded Adidas.

The three new football clubs are attractive fits for Puma. AC Milan has global appeal and ranks fifth among the most popular soccer brands in China. “That among other things makes the cooperation interesting for us,” said Mr. Adamsson.

Marseille helps Puma in France where the club is extremely well known. And Puma has history with Mönchengladbach because it kitted the Bundesliga club out in the 1970s.

Puma returned to soccer six years ago after a long spell focusing on sports lifestyle clothing which came to an end when it started falling out of fashion with young buyers. It won over Borussia Dortmund and four years ago clinched Premier League club Arsenal London.

09 p23 Graph of the day – The big sports rivals-01 Nike Adidas Puma Under Armour

For the big sports firms soccer equipment tends to rank well behind jogging shoes and sports fashion in terms of sales. But their marketing investment in soccer is crucial for promoting the brand. That’s why Nike and Adidas invest millions every year in clubs like Real Madrid and Bayern Munich (Adidas) or FC Barcelona and Chelsea (Nike), and in stars like Lionel Messi (Adidas) or Cristiano Ronaldo (Nike).

Nike and Adidas each claim to be the world’s biggest soccer brand and there’s no way of knowing for sure because there are no reliable statistics to back up their claims. Adidas doesn’t release results on its individual sports segments. Nike recently said its annual revenue from soccer equipment rose 8 percent to just under $2.2 billion (€1.9 billion).

Retailers say Puma is the number three in soccer and is catching up. But it often only manages to get deals with football clubs that Adidas or Nike have dropped. Adidas didn’t renew its contract with AC Milan because it’s focusing on the more successful Juventus Turin. With Olympique Marseille too, Adidas withdrew, allowing Puma to pounce.

Meanwhile British media are speculating that Adidas will snatch Arsenal from Puma next year because it’s willing to pay an annual 60 million pounds (€66 million), around twice as much as Puma has been paying. There’s no confirmation yet but there’s no doubt that Adidas could easily afford it. It’s five times bigger in sales and more profitable.

Joachim Hofer covers the sports, leisure and IT sectors for Handelsblatt. To contact the author: hofer@handelsblatt.com

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