Cool Currency

Sportswear to the Stars

  • Why it matters

    Why it matters

    The sportswear market is notoriously competitive, as brands vie for attention on and off the field of play. To help stand out from the crowd, companies are increasingly using non-sporting celebrities to help shift their products.

  • Facts

    Facts

    • Puma and Adidas have taken their rivalry to the celebrity arena, signing up stars like singer Rihanna and rapper Kanye West.
    • Puma’s sales of €3.63 billion in 2016 were dwarfed by those of Adidas, which reached €19.29 billion.
    • Companies use social media to create hype for their products, relying on celebrities to promote the brand on their own channels.
  • Audio

    Audio

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Pariser Modewoche – Rihanna für Fenty / Puma
Singer and actress Rihanna show off her Puma Fenty fashion line during Paris Fashion Week. Source: dpa

They were equipped with sleeping bags, deck chairs and sandwiches. Six friends spent four cold days and nights at the beginning of February camped out in front of a fashion store in Nottingham, central England. And all because they were desperate to get their hands on American rap star Kanye West’s new signature Adidas sneakers. Despite their hardship, they ended up paying a hefty £150 ($187.68) for a pair of Adidas Yeezy Boost 350 V2 shoes.

The story made headlines across England. Once again, Adidas had managed to create a stir without much effort, using the same old trick. The German sportswear company designs a pair of flashy, eye-catching sneakers that they sell in a few select stores for a pile of money. In this case, the fashion store in Nottingham was the only place you could buy the sneakers before their general release.

To build hype among the young target market, the stars, dealers and brands mount a huge social media campaign on Facebook, Instagram and Twitter. The whole brouhaha is in sharp contrast to the number of shoes for sale. Supply is deliberately limited to add an exclusive touch.

“You don’t become cool just by buying coolness.”

Hartmut Heinrich, consultant at Fjord

Though companies have been using this strategy for years, it still works. What’s more, it appears these limited edition sneakers are an increasingly coveted commodity. “Our legendary shoe, Creeper, from Rihanna’s Puma Fenty collection, sold out worldwide within hours,” Puma boss Björn Gulden said recently.

Of course, the company from Herzogenaurach in Bavaria cannot survive on selling a few thousand Rihanna shoes alone. But that’s not what it’s all about. “By using our brand ambassadors and the hype surrounding them on social media, we have been able to further boost our brand desirability,” Mr. Gulden stressed.

It seems sportswear companies are recruiting enough celebrities to form their own teams. As well as Rihanna, Puma has model and reality TV star Kylie Jenner and Canadian singer, songwriter and producer The Weeknd on its roster. Among those lending their name to Adidas are rapper Kanye West, singer Pharrell Williams and British singer and actress Rita Ora. Meanwhile, Gisele Bündchen lines up for Under Armour, the ambitious young pretender from the United States. Other than the fact that they regularly tone up in fitness centers, most of these celebrities have nothing to do with sport, which is, of course, the brands’ core business.

A former professional soccer player, Mr. Gulden set out four years ago to take Puma away from the catwalk and back onto the soccer field. Sweat instead of glitter is his motto. Nevertheless, he cannot do without Rihanna. Despite an intensive search, Puma hasn’t managed to find a female athlete with anywhere near the same level of pulling power as the singer, Mr. Gulden said. No athlete has been able to fill Steffi Graf’s shoes. And the ones who came after Graf, the Williams sisters, Venus and Serena, are under contract with Puma’s competitor Nike. Mr. Gulden is certain: “Rihanna is an ambassador for the brand.”

However, Hartmut Heinrich from the consultancy firm Fjord doesn’t believe it pays to sign up such big names. “With megastars you buy increased sales, prominence and coolness for a short time,” he said. “But you don’t become cool just by buying coolness.” What’s more, Mr. Heinrich is convinced the time is past for wheeling out celebrities to sell sneakers – as likeable and as athletic as they might be. He says the brands need to become livelier and give people the chance to tell their own sporting stories.

29 p23 Manufacturer of Sporting Goods-01

Adidas CEO Kasper Rorsted disagrees. The 55-year-old sees celebrity endorsements as having a very considerable impact on business. Many customers look up to the stars, treating them as role models. “For that reason they are a genuine help for the brand,” he said.

But this is a recent development at Adidas HQ. At the start of the millennium, then-CEO Herbert Hainer wanted nothing to do with show business. “Robbie Williams’ target audience notices when, all of a sudden, he artificially pulls the Adidas cap into camera,” said Mr. Hainer, adding: “That’s why we don’t sign contracts with show business stars.”

The three stripes brand now earns every third euro from lifestyle products, such as fashionable sneakers, hoodies or T-shirts. “The lifestyle market is much larger than the purely sports business,” explained Robin Stalker, Adidas’ chief financial officer. “That’s where we have to be.”

Of course, only the big brands can afford the really big stars. “We limit ourselves to celebrities who are tangible for the customers,” says Daniel Stadtmann, Garmin’s head of marketing for Germany. So while Puma sponsors Rihanna, the American producer of running watches and fitness trackers advertises in this country with the long distance runner Florian Neuschwander. Never heard of him? The athlete lives in Frankfurt and has a total of 40,000 followers on Facebook. But Mr. Stadtmann believes the Saarland native can help tell a good story, too. And Garmin’s target group, the ambitious jogger, probably identifies more with Mr. Neuschwander than with Rihanna.

The boys in Nottingham, by the way, didn’t buy the sneakers to show them off in a nightclub. In fact, they will never wear the shoes. Instead they are banking on auctioning off the valuable merchandise for lots of money on Ebay in a few months’ time. As they say, there’s no business like show business.

Joachim Hofer covers the high-tech industry and the IT sector as well as the outdoor- and recreational-industry for Handelsblatt. To contact the author: hofer@handelsblatt.com

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