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Football Investment Paying Off For Adidas With Sales Expected To Rise To $2.8B

Adidas expects sales of football boots, shirts and balls to rise 14% to a new record of €2.5B ($2.8B) in '16, "showing a return for spending more on partnerships with top teams and players," according to Emma Thomasson of REUTERS. The German sportswear company has long been the world's top football brand, but "it was overtaken by U.S. rival Nike" in the market for boots in '14, prompting adidas to "lift its marketing spending." Adidas CEO Herbert Hainer said that his company has "edged back ahead of Nike" to take 36% of the market for football boots in the top five markets in Europe in the first quarter of '16. Hainer said, "Our complete restart of the football footwear business 12 months ago is paying off. We have gained market share in key markets and our footwear offering is resonating well among our young target audience." Adidas is "kitting out nine of the 24 teams playing at Euro 2016," including reigning champions Spain and Germany. Nike has six teams, including host France and England, and smaller German brand Puma has five, including Italy. Adidas' football shirt sales "have been boosted after it poached" both ManU and Italian champions Juventus from Nike, although Nike "recently hit back by taking Chelsea" from adidas from '17. Footwear and balls together "account for about half" of adidas' expected sales of football gear of €2.5B, "while replica team shirts make up the rest." Football accounted for 13% of its sales in '15. Adidas is "currently under pressure to pay more to renew its sponsorship deal with Germany." Hainer said that "the two sides are in constructive talks and said he was still hopeful for a deal before he steps down as chief executive" in October after 15 years as CEO (REUTERS, 6/16).

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