Chances of dropping Adidas after our contract is up?

http://www.bizjournals.com/portland/blog/threads_and_laces/2016/07/as-ncaa-deals-heat-up-adidas-shifts-down.html

Adidas Group North America President Mark King said the company didn't want to lose any of the schools and wrote the biggest offer in its history to keep UCLA (Under Armour offered more, $280 million over 11 years).

King said those kind of terms makes it difficult to sign as many top schools.

...

"We don't want to lose any battles," he said. "But there's a cost."

King previously said Adidas wanted to double, to roughly 200, its number of collegiate partners, part of an effort to get the brand back in front of U.S. consumers. With the cost going up, Adidas will continue to bid on all deals, King said, but it'll also get more aggressive about signing smaller programs.

...

Unlike elite schools, which typically get millions of dollars annually in cash and product, smaller schools get a limited amount of merchandise and reduced prices on additional gear.

...

King said Adidas also wants to get more bang for the marketing buck out of existing deals.

"We're going to look at how do we leverage those in a meaningful way rather than just have numbers," he said.

...

"If all of the deals we had lost, (including) Wisconsin, and ... Michigan, if we negotiated those today I don't think we'd lose either one of them."
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So.... They want to shift strategy to smaller schools rather than elite schools in order to be more efficient with money and have more schools overall. I guess that makes a little sense. Doesn't bode well for NU's contract, though.

What I don't understand is the part where they say they shouldn't have lost the schools they did. It seems to run counter to the argument they make earlier in the article. Maybe I am missing something...

 
IA State Husker said:
http://www.bizjournals.com/portland/blog/threads_and_laces/2016/07/as-ncaa-deals-heat-up-adidas-shifts-down.html

Adidas Group North America President Mark King said the company didn't want to lose any of the schools and wrote the biggest offer in its history to keep UCLA (Under Armour offered more, $280 million over 11 years).

King said those kind of terms makes it difficult to sign as many top schools.

...

"We don't want to lose any battles," he said. "But there's a cost."

King previously said Adidas wanted to double, to roughly 200, its number of collegiate partners, part of an effort to get the brand back in front of U.S. consumers. With the cost going up, Adidas will continue to bid on all deals, King said, but it'll also get more aggressive about signing smaller programs.

...

Unlike elite schools, which typically get millions of dollars annually in cash and product, smaller schools get a limited amount of merchandise and reduced prices on additional gear.

...

King said Adidas also wants to get more bang for the marketing buck out of existing deals.

"We're going to look at how do we leverage those in a meaningful way rather than just have numbers," he said.

...

"If all of the deals we had lost, (including) Wisconsin, and ... Michigan, if we negotiated those today I don't think we'd lose either one of them."
Click to expand...
So.... They want to shift strategy to smaller schools rather than elite schools in order to be more efficient with money and have more schools overall. I guess that makes a little sense. Doesn't bode well for NU's contract, though.

What I don't understand is the part where they say they shouldn't have lost the schools they did. It seems to run counter to the argument they make earlier in the article. Maybe I am missing something...
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I agree that the statement is oddly worded. Maybe he is referring to Adidas' strong sales and financial results the past year would have enabled the company to make a more competitive offer to Wisconsin and Michigan. With the strong results, Adidas may be able to offer a school like Nebraska more money when the bidding comes up next year (NU's contract runs through 2018, but the negotiation usually is done a year prior), especially with the long relationship between Nebraska and Adidas.

 
So he's basically saying that they don't have the ability to keep up with Nike or UA, and are going to try a different strategy to make money instead of fighting and losing trying to get the top contenders.

Adidas will definitely offer Nebraska a ton, ton, ton of money to re-up our contract. I guarantee they'll offer more than Nike by a long shot, maybe more than Under Armour although UA has now proven itself to not care about the cost going after the premiere brands.

 
I like Adidas personally. I don't care for any of their alternate uniforms they did for the Huskers. And I don't have any faith that they will somehow come up with a great one in the near future. So if the ties are cut, I'm fine with that.

Aside from that, I love all my sneaks. Especially my Adidas Top-Ten BBall shoes (white and navy blue)
default_eek3dance.gif


 
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admo said:
I like Adidas personally. I don't care for any of their alternate uniforms they did for the Huskers. And I don't have any faith that they will somehow come up with a great one in the near future. So if the ties are cut, I'm fine with that.

Aside from that, I love all my sneaks. Especially my Adidas Top-Ten BBall shoes (white and navy blue)
default_eek3dance.gif
Click to expand...
Agree. And our recruits like them too.

#3stripelife

 
BigRedBuster said:
admo said:
I like Adidas personally. I don't care for any of their alternate uniforms they did for the Huskers. And I don't have any faith that they will somehow come up with a great one in the near future. So if the ties are cut, I'm fine with that.

Aside from that, I love all my sneaks. Especially my Adidas Top-Ten BBall shoes (white and navy blue)
default_eek3dance.gif
Click to expand...
Agree. And our recruits like them too.

#3stripelife
Click to expand...
Same. Adidas casual/canvas shoes (what I wear 90% of the time) are great.

 
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The Pioneer Institute recently got access to Adidas's recently-renegotiated contract with UMass. An interesting look at a smaller-school's contract that is pretty favorable to Adidas. I think this is what they were talking about when they mentioned renegotiating existing contracts. There are a lot of incentive-based perks in the contract:

UMass does receive a discount on apparel and footwear – 50% and 45%, respectively. But it’s also required to purchase at least $180,000 worth of Adidas product...

..Adidas has free license to use UMass’ name, trademark, image, and likeness ....

...UMass is also required to hang Adidas signs in various facilities, provide tickets for sporting events, and make two PA announcements during home games listing Adidas as its official supplier....

...if UMass purchases a total of $200,000 worth of Adidas apparel in the first year, it receives an extra $10,000 in retail.

...There have been a slew of retroactive amendments made to the UMass-Adidas contract, often to refine minimum purchase requirements and incentive levels. A 2013 amendment increased the football program’s performance incentives: $10,000 for winning its conference, $10,000 for making a bowl game, $5,000 for 7 or more wins in a single season....

...the individualized performance incentives for the teams mentioned above (lacrosse, softball, and hockey) were completely removed in a 2013 amendment for unknown reasons...

... If UMass does start to win more, Adidas could be paying the school to wear its product, not the other way around.
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To me, this also answers the question of how Adidas is going to start winning on the elite schools - by making its (more numerous) smaller-school contracts more profitable. This might bode well for Nebraska.

$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$

 
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