Adidas to accelerate Product Innovation
German sportswear company Adidas has decided to speed up product innovation. According to the sportswear major, which designs and manufactures sports shoes, clothing and accessories, it has planned to prioritize some of globe's biggest cities to accelerate profit growth.
On Thursday, Herbert Hainer, Chief Executive Officer of the company based in Herzogenaurach, said that speed will be one of three key strategies for the company to drive future growth. According to Hainer, speed will help the company to get the latest products to customers more quickly. According to reports, the world's second-biggest sporting-goods maker will also make investment to do good business in cities like New York, London, Los Angeles, Tokyo, Paris and Shanghai.
The reports stated that Hainer planned to deal with a slide in profit and market share that has taken the company slid further behind Nike Inc., which is currently the biggest sporting-goods maker. Last summer, Adidas had discarded its initial plan that had called for 17 billion euros in sales. On Thursday, the company released its new aims, which included a forecast for about 15% growth in net income on average every year through 2020.
Cedric Rossi, an analyst at Bryan Garnier & Co., said that the Herzogenaurach based company has to improve its execution to deliver its goals. The new forecast announced by the company's CEO will be positive for the Adidas, Rossi added. In Frankfurt, shares of Adidas fell 0.5% to about 70.09 euros. In 2015, the stock has gained more than 20%.
In a statement, Hainer said, "We need to put our money where we can make a real difference in consumer experience. We don't need to win everywhere, but we need to win where the halo effects are created".
Hainer further said that as part of its new focus on speed, the company will seek to quadruple e-commerce sales to over 2 billion euros in next five years.