Comparative Analysis Of Adidas And New Balance

Imagine turning on the television to see two rivals play against each other on the pitch. Liverpool faces off against Manchester United in a premier league game to determine their spots on the table. Liverpool in their red, New Balance, home kit, while Manchester are in their white, Adidas, away jersey. This match is being broadcasted worldwide and the jerseys are iconic. Just like the two brands sponsoring them. Adidas is a company that is based out of Germany, while New Balance is based here in the United States. This paper is going to go in depth and compare these two multinational companies and dig deeper to see what each company has to go through. Comparing these two companies will help one better understand the concepts of international trade and the similarities and differences of two similar multinational companies.

History

Adidas and New Balance have both made a name for themselves in today’s society. Both are making waves in the athletic department. To understand how they got where they are today one must look at their history and watch the path they took to get there. Adidas’s journey started in 1924 under a different name, “Gebrüder Dassler Schuhfabrik”, which was founded by Adi Dassler. Dassler was trying to provide athletes with equipment that was the “best possible”. He later restarted his business under the registered name “Adi Dassler Adidas Sportschuhfabrik” in 1949. It was started in Germany, in the town of Herzogenaurach. Dassler worked hard in his new company for a few years before he finally got his jump in business. German soccer players in the 1954 World Cup were wearing his cleats when they won in the final against Hungary. It launched his business and helped make his brand common place on a soccer pitch. In 1967, Adidas released its first set of apparel and set in motion a whole new path for a company known for its shoes. Dassler and his company were known for listening to the athletes throughout the years to improving each product as he went.

He gained the trust of athletes and customers alike. In 1972 Adidas rebranded it’s logo to the classic Trefoil we know today. When it was first changed to this logo, it stood for performance, something that Dassler has stood by since the beginning. In 1978, Adi Dassler had passed away, and his wife and son took over the Adidas company. 1986 rolled around and this is when the company finally had a reason to promote their products to non-athletic customers all due to Run-DMC and their song “my adidas”. The song helped create an unlikely partnership which allowed for the street style of Adidas to flourish in the United States. After the deaths of the son (Horst Dassler) and the wife (Kathe Dassler) and after the Dassler daughters (of Adi and Kathe) sold their shares. Adidas began to crumble and neared close to bankruptcy until Robert Louis-Dreyfus took over in 1993. Once it was changed to a public corporation Adidas was a “marketing-driven” powerhouse and was back on its previous path to growth. Ever since then Adidas has been an innovative force worldwide and has continuously improved and grown. It is a powerhouse in the athletic world and will be for a while to come. New Balance was founded in 1906 under the name of “New Balance Arch Support Company” by William J. Riley. Riley created the company in Boston, Massachusetts, wanting to create a product with “three support points”. Riley hires a salesman and later partner Arthur Hall. They worked on selling arch supports for around thirty years, specifically to workers that had jobs that had them standing for long periods of time. In 1938, the company produces their first running shoe. Riley created them for a local running group. They later expanded into sportswear, tapping into the shoe market for tennis, baseball, and boxing. This was a great mover for them to continue growth; however, the company was still making its products in low-volume by a small group of people. Hall’s daughter (Eleanor) and her husband (Paul Kidd) buy New Balance and continue the legacy of footwear specifically for orthopedic reasons. They soon found a new interest in athletic wear that they saw as a way to tap more into the athletic market. They release a track shoe in 1960, with a wider range of width fittings. This shoe was the first of its kind and it took the athletic community by storm. In 1972 the company was purchased by Jim Davis. He pushed to go back to the basics.

Davis wanted to strive for quality products and customer service. In order to stick out in the athletic and shoe departments, New Balance names their products as numbers in order to show that they are all equal in quality and just made for different purposes and specialties. In 1976, the famous “N” was shown for the first time on a shoe. The shoe in particular was named “320”. New Balance, soon after releasing 320, release their first clothing products. New Balance prides themselves in their innovation and growth. They push shoes that are comfortable to wear, exercise, or play athletics in. They started growing after Davis took over and they have not stopped since. These two companies have very similar time lines, going from a specialized company, expanding, then bringing back the basics along the way. Adidas started out specifically for athletes and grew into a company for anyone. New Balance started out for comfort, for the everyday worker, and grew into a company that does both athletics and shoes.

Present Day

Adidas is currently headquartered in Herzogenaurach, Germany. The mission of the company is “to be the best sports company in the world”, and they plan to use innovation in all aspects of the market to put them ahead of the rest. They have invested millions into research and development, and the company has produced over 900 million units of product worldwide. Adidas is working on being sustainable while they create products with great quality. They have cotton that has been 100% sustainable, pushes all of their facilities to get not use single-use plastics, to lower their waste footprint. The company has taken steps to use produce goods that do not have perfluorinated compounds (PFCs). PFCs are chemicals that when released into the environment it does not break down. Many products that use these compounds are products that help you stay dry when outdoors. Adidas has dropped the number of products that use PFCs to 1%. The company also uses plastic from the ocean in about five million pairs of shoes, helping show that they are here to make the earth a better place to live while also making a profit. The company prides itself by the strategies employed and shown throughout the company. The main strategy is what they call “The 3CS” (which stands for confidence, collaboration, and creativity).

Confidence allows the company to take risks and try new things, in order to learn and make the best products. Collaboration allows the employees to understand that they are a team and in order to win you need to be a team. Finally, creativity allows for the company to be original and explore new ideas. The company is still today still has the consumer (and the athlete), at heart when making decisions for what they create. They want to give athletes the most optimal opportunity, with the best equipment, to make a difference. The company has key locations all over the world, whether it is the headquarters in Germany, Adidas North America, located in Portland, or Adidas Asia-Pacific located in Shanghai. The company employs over 57,000 people worldwide. New Balance is headquartered in Boston, Massachusetts. The company’s goal is to “help you achieve yours”. They push athletes (both professional and every day athletes) to push for greatness. They base the company around movement, because of the idea that people and athletes were “born to move”. The company specifies three types of movement they focus on, moving the environment forward, moving forward together, and moving forward, giving back. The company pushes the idea of sustainable practices, while also priding itself on “Responsible Leadership”. They make sure that whoever works for them, in any position, from anywhere, gets the proper respect, opportunity and dignity that they deserve. New Balance also works hard to make sure that with every product, they are looking for ways to have a minimal effect on the environment, if not any, throughout their whole supply chain.