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Sneakered: Adidas, Yeezy & Kanye

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Sneakered: Adidas, Yeezy & Kanye

Adidas experienced a temporary boost from selling off old Yeezy inventory, but this masks persistent structural issues following its disastrous partnership with Kanye West. The collaboration began in 2013 when Adidas, desperate to gain US market share and cultural relevance, offered Kanye unprecedented creative control and a 15% royalty. Yeezy sneakers became a cultural phenomenon, with limited drops creating immense hype and solving Adidas’ “coolness” problem. However, the brand grew dangerously dependent on Kanye, who was diagnosed with bipolar disorder and exhibited increasingly erratic behavior, including moving R&D to Wyoming and displaying inappropriate content to staff. His antisemitic comments in 2022 forced Adidas to sever ties, costing the company billions. The underlying issue remains: Adidas lacks a sustainable, iconic product line like Nike’s Air Jordan. The Yeezy inventory sell-off is a one-time fix, and without a new flagship, Adidas faces an uncertain future in a competitive market dominated by Nike. The partnership’s rise and fall illustrate the risks of tying a brand’s fortunes to a volatile superstar.

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[Music] Tortoise. [Music] Hello, it's Basha here and you're listening to the Sloan Newscast from Tortoise. After a rough couple of years, Adidas has a glimmer of hope. In their latest quarterly results, the numbers were better than expected. The company's forecast was no longer quite as grim. But Adidas still has one problem, a big one. That big boost behind their latest results comes from selling off all their old pairs of Yeezys, Kanye West's Sneakaline. Once those old pairs run out, Adidas's longer-term problems are going to continue. And so my colleague Stephen Armstrong and Amy Harper have been investigating what happened when the world's second biggest sportswear brand tied its fortunes to a volatile mega star. Known for his increasingly offensive views, putting its own staff and eventually its own fortune in peril. Over to Stephen and Amy. Everybody want to know what I would do if I didn't win. I guess we'll never know. [Applause] That's Kanye West in 2005, picking up a Grammy for late registration. It's his breakthrough second album, both the album and its first single Goldiga hit #1 worldwide. After years of producing other rappers' work, Kanye was a global star in his own right. By 2013, if pop culture was a storm, Kanye was the heart of it. He was the most famous rapper in the world. His album Yeezys debuted at #1. He proposed to Kim Kardashian and he picked up three more Grammys. And the Grammy goes to. in Paris. J.Z. in Kanye West. He also signed an unprecedented deal with Adidas, worth a rumored $10 million plus royalties. It's a deal that by 2020 had made him the second rapper in history to achieve billionaire status on the Forbes Rich List. So how did it go from this? I mean, they were just an extremely, extremely supportive company. And I'm happy this is just only the beginning of the possibilities of what we could do together. To this. The thing about Adidas is like, I could literally say, "Atisemitic shit and they can't drop me." I could say, "Atisemitic things and Adidas can't drop me." Now what? Now what? Well, Adidas dropped him. Now the clothing giant Adidas has ended its partnership with the musician Yee, formerly known as Kanye West. Adidas says it does not tolerate hate speech. Hey there, Adidas. How you feeling, brother? I feel good. You look great. Do you want to talk about anything Kanye? Do you think you're being unfairly part of this? I'm Stephen Armstrong. And I've been reporting on culture since Adidas and Adidas' predator precision was winning the European Championships for France. Back then, football writers used to talk about the curse of Nike. If a player featured in a Nike World Cup ad, it almost guaranteed a disastrous performance in the tournament. Today, it isn't Nike that seems cursed. With Adidas signed West, I said, "This is going to end badly." And it did. If you're working with someone that is highly creative, incredibly rich and really, really important, it's very hard for anyone to say, "You know what? I don't really like that." That's not cool. The hype around the world was like, "It was crazy, but there was still no hype around Adidas." It was purely, purely Yeezy's. It's September 2013, a New York Fashion Week is in full swing. Kanye West is busy launching his Yeezestur when a text pings through on his phone. "I just landed in New York. By chance, are you here?" The text is from John Wexler, or Wex. Sporting grey hair and horn-rimmed glasses, Wex is Adidas' vice president of global entertainment and influencer marketing. He works with Snoop Dogg and Ferell Williams, and he's heard that Kanye isn't happy with his night deal, which produced the coveted air Yeezy sneaker. After making small talk with Kanye, Wex pings over another text. "Hey, we're all here. Maybe we should connect." The pair have been in talks for a while. Kanye wanted a platform to create, and Wex wanted a mega star to promote the brand. New York Fashion Week was the perfect opportunity. Both Adidas Chief Marketing Officer and its creative director are also in town for the Y3 show. And so Wex and his colleagues meet Kanye as he rehearses for a performance on the television show Late Night with Jimmy Fallon. It kick-starts a conversation that ends on November 6, 2013, when Wex receives a text from Kanye. The reads, the world changes now. Moments later, Kanye signed contract, appears in Wexler's email inbox. My name is Brendan Dunn. I'm the head of sneaker content at Complex. I've been writing about sneakers for over a decade now. They really consume my life in a way that extends beyond my work. I'm speaking to you now from a room filled with several hundred pairs of shoes. The Nike deal went sour because Nike was not giving Kanye what he wanted. He wanted to have a meaningful role in this company and create something much bigger than him not being a full-blown athlete. Him and their view not being justified for a signature deal on the level of a LeBron or a Michael Jordan. Kanye's very public response to this was, "I am an athlete. I go to Madison Square Garden and I play one-on-one with myself." When celebrities sign a contract with a brand, there's always a risk, says PR Guru Mark Bukoski. Mark's worked with stars like Led Zeppelin, Eddie Isard and Briefly Michael Jackson, as well as brands like Vodafone, Amix and Sony. I can't say what was happening in the room with Adidas but it would surprise me if there wasn't some sort of eager Wrangler who was present, who felt that they could manage this on the basis of the commercial deal. For Adidas, that ego Wrangler was John Wexler. And Adidas was willing to bet on Kanye West in a way that Nike wasn't. John Wexler really brought Kanye West over to the brand and was a champion for him there and was a person who helped grow the business into a billion-dollar business, which again is unprecedented. And Kanye was a big fan. "I have to point out, I've John basically saved my life. John Wexler, this guy, I'm just a coach here from Chicago, I want to say that Jay Dilla heard all the albums. Like, "You guys want to go out and do, you know, get somebody to work with your best company. It's my knows about the person that you're talking to." November 2014, Adidas officially announces the deal. Kanye has full creative control and will eventually earn a 15% royalty on every shoe sold. Kanye is delighted. "I am going to be the two-pock of product and ain't no two-pock of rap except for two-pock. I'm going to be the first hip-hop designer and because of that, I'm going to be bigger than Walmart." In February 2015, the initial limited run of 9,000 pairs of the Adidas Yeezy Boost 750 sold out within minutes. "What Wexler helped Kanye West do at Adidas was on another level that contributed in a meaningful way to Adidas revenue, to Adidas profits, and at a time when Adidas really needed it." For young sneakerheads like 17-year-old Patty Smiley, the shoes were an instant hit. Yeezy's were like the singular coolest thing for people in my age. They were like, "You'd walk around, you'd see someone in a pair of Yeezy's and you'd go, 'Oh my God, it's Yeezy's.' Wow, lose your mind on it. If your mate had a pair of Yeezy's, they had to be locked away almost. They were that cool. They were far cooler than a pair of Jordans. They were far cooler than anything that we had. Like, it got to the point where even fake Yeezy's were ridiculously cool. If you wore a pair of fake Yeezy, that was still a flex." And now, Kanye isn't just winning Grammys. In 2015, the Yeezy Boost 350 wins Footwear News shoe of the Year. This time, Kanye had wax on stage with him. "So it's cool to be up here with the three people that scream at the molster in the past year." But less than a year later, in November 2016, Kanye was booed off stage after a 15-minute monologue. during the Sacramento Lake of his St. Pablo tour. (crowd cheering) - You ready to have a real day, Chris? Get ready, get ready to the shows over. (crowd cheering) - The following evening, his show in Inglewood was canceled at the last minute, foreshadowing the end of the tour. - We're gonna move on now to that health scare for Kanye West. He's been hospitalized after a serious bizarre rancid on stage, his tour has been canceled. His wife Kim Kardashian rushing over to be by his side and his hands. - Although the news wouldn't be public for some time, Kanye received a diagnosis that would significantly impact his marriage, his career, and his future. He discovered he was bipolar. - Bipolar is a lifelong severe mental health illness characterized by changes in mood and energy. Sarah Owen is the policy and communications manager at Bipolar UK. - So if someone experiences a low mood, they'll have the well-known symptoms of depression and at its very worst, someone can have an endless suicidal thoughts. If someone experiences a high mood, they can get symptoms of hypomania, such as not sleeping very much, or sometimes not at all, impulsive spending. Maybe they make risky decisions or go through periods of hypersexuality. And if left untreated, that high mood can escalate into full-blown mania, where someone can go into psychosis and become incredibly paranoid, usually at that point they require hospitalisation. - People with bipolar are more prone to stress than the average person, and they have a tougher time bouncing back from a stressful situation. And working for Adidas in the early 2010s was very stressful. Olaf Stolbeck covers Adidas for the financial times. - What Zebelb inside us told us, which initially was denied by Adidas, but later on other people kind of confirmed it in kind of informal conversation, was that Yeezy was basically used as a kind of stopgab if they were having a poor quarter and were at risk of missing some failed earnings guidelines. - Because Adidas had an America problem. - Outside of the US, Nike and Adidas are in relative parity. They have essentially about the same share. - This is Matt Powell. He's been researching the sports retail business for more than 20 years. - Nike typically has a slightly greater share than Adidas outside of the US, but they're very close together. Here in the US, the gap is huge. Nike is four times the size of Adidas. - When it comes to sneakers, the US market is not like other markets. In 2013, as Wix was courting Kanye, Forbes reported that night's US dominance gave it 54% of the global market for athletic apparel, compared with Adidas' 4.4%. - The US represents about a third to 40% of the world's sneaker market with 4% of the world's population. So it is incredibly important here. - And the fight back was not going well. In November 2013, Adidas sales in North America were down 1% for the year. Across the whole company, sales were flat. Adidas had two problems, geography and demographics. They weren't American and they weren't cool. - I'm Miranda Sawyer. I'm a journalist and broadcaster. I have lots of trainers. I like trainers. I'm in my 50s. And what I would younger, and from the North, Adidas was what we wore. That's what we were interested in. And I would kind of divide them in that era, let's say the 90s era, into the people who were into music, like Adidas, the people who went to fashion like Nike. They've also did something over the last few years where they worked to kind of middle class women really well. So the women who would wear a mid-dress, you know, like with spots on or brightly coloured, they would wear stanzas. - The burst of interest in Yeezy meant that for a while, Kanye was solving both of those problems. The first Yeezy's sold for around $350. New shoes were launched every few months. And in 2015, Kanye claimed he'd sold 280,000 pairs. Overall, Adidas' sales grow 10%. Clearly, Yeezy's sales weren't enough to account for all of those dollars. But one former Adidas consultant told us, - Adidas made an incredible amount of money on Yeezy. They didn't have Michael Jordan, but the Yeezy shoe was as important to them as the Air Jordan is for Nike. Gap did the same, but don't get the attention. They all wanted the Kanye magic. - It was at the point where you couldn't wear them in certain situations. Like, you couldn't wear Yeezy's just hanging about, because you would get mugged for them. There was no question about it. You would get mugged for Yeezy's. That was what people were looking for. The hype around them was like, "It was crazy, but there was still no hype around Adidas." - It was purely, purely Yeezy's. Nobody cared if you had a pair of Adidas. People like, "Oh my God, that was Yeezy's." For older consumers, not so much. - So they look a little bit like kind of gardening shoes. They're kind of plastic, and they look like an overshoot, right? - I'm a tall zin. - I'm a zin, I want to get rid of laces. We still have shoes, we sell with laces, because it's a popular shoe, and people love this shoe. And it hurts me. I feel like Steve Jobs trying to remove buttons off the side of the next apple. - But a lot of the Yeezy hype depended on these rapid fire-limited releases, which is part of the structure inherent in the sneaker business. - The celebrity endorsements typically do not generate tremendous volume. They tend to be relatively small, pairs made. And let's say there are somewhere between 5,000 and 50,000 pairs of a shoe made. That may sound like a lot. Nike sold 400 million pairs of shoes last year. So 50,000 is a drop in the ocean. - It begins in 1984, when Michael Jordan signed with Nike in a blaze of publicity. - In the beginning, it could have been Adidas, not Nike. - Tell me how that went down what was going on in your head. - You know what? The thing is, I never wore Nike shoes until I signed a Nike contract. Up to that point, my favorite shoe was a Deedit shoe. - Nike started releasing a new Air Jordan sneaker every season. Consumers started to collect, trade, and resell sneakers creating a hugely lucrative resell market. Such is the demand for collectibles that sneaker heads snap up limited editions when they drop and sell them for a healthy profit on eBay or on specialist sites like stock heads. - Other resell markets worked, so they have their own app where they will advertise like a drop, or sometimes it will be a surprise drop. And then you'll buy them there and then you won't wear them. So you'll keep them and then people resell them for a higher price because it was a limited drop, so the more people won them, then they'll actually use the price goes up. The big ones that everybody wanted for a while until they were re-released in 2022 were the Adidas Easy 350 V2 Zebras or Zebras. And they were going for in the thousands at one point. And they were sold originally for like 200, 220. So it was quite a big markup. High profile limited editions serve as so-called brand halos and also actors test runs for new product designs. - The purpose for these launches or these releases are to sell out quickly and create hype and buzz for the brand. But they really don't yield much commercial value. For Adidas Easy Introduced Adidas's new cushion sold and it's so-called Primed-Nit technology. This is basically synthetic yarns woven together with knitting machines and these later featured in more affordable shoes. For this strategy to work, Adidas had to stick to the rules. The cool, limited edition, cutting edge easies had to create hype for shoe technology the company would then feed through to the mass market. In 2018, something started to go wrong. Sneakerheads love limited editions. - In fact, if you think about it, the whole idea of scarcity really fights against the idea of growth. If your brand is scarce, your product is scarce, you can't make it big. Jordan again is the exception here. Jordan still is a brand that it does sell out and does still have scarcity. But it took 30 odd years for them to get to this point. - But Adidas suddenly flooded the market. - It's interesting. In the holiday of 2018, Adidas really turned up the amount of product that they were buying for the US market. And they released a million pairs of shoes in about six weeks. - I'm sneakerheads love to keep collecting new designs. Okay, so when people wore yellow, It was, I'd say, 2017 to 2019 was the biggest time really. And it was, there was nothing really like it the week seen. But Adidas suddenly stopped releasing them. I think it was around 2018, 2019, where they didn't update the 350V2 into a 350V3. They haven't done that. So they've had eight years of the Adidas Easy 350V2 being the flagship. And there's only so many college you can release before people go, okay, we want the new shoe now. And they just went, now we're gonna do a lot of dad shoes. It's at this moment, things start to slip. I think that when most people come into town, the scenery, the mountains, the surroundings is probably the most dramatic. The following year, Kanye buys a ranch near Cody, Wyoming. It's a wonderful place to visit. It's on the doorstep of Yellowstone Park. We've got animals and outdoor recreational activities and fishing and hiking and world class museums in our area. And then always a trip to the rodeo in the summertime if available. This is Matt Hall. He's been the mayor of Cody since 2016. - We're bordered on all sides of town by mountains that are anywhere between two to 3000 feet higher than town. And we have a lot of wildlife. We have Mildere in town. We have grizzly bears that try and go out to our landfill, which is south of town. And so it's a nice area. (upbeat music) And Cody is surrounded by what used to be known as the Wild West. It's even named after Buffalo Bill Cody. So it's about 500 miles from Denver, Colorado, about 800 miles from Las Vegas, and it's a thousand miles from Adidas' US HQ in Portland, Oregon. So it came as something of a surprise to the industry when Kanye decided Adidas would move his entire R&D operation to Cody. - It is totally unprecedented in anything I've ever seen that an endorser would ask that the brand make, let's call it supply chain accommodations to the product. - When Kanye arrived in town, Mayor Hall's office was one of his first stops. - When he came and visited me in my office and he just kind of popped around a corner and sat down and had a conversation with me about what the town was like, what the needs were, what maybe some of the issues were, what are some of the resources that Kanye could bring to town. - For Mayor Hall, this was a welcome investment. - There's definitely a couple sizeable warehouse where they had the R&D situation set up. We actually had a pharmaceutical company for a while. And they had built this really large facility. And so they came in and they rented out that entire space and then there was a couple other commercial properties that they bought in town. And then they were all the Adidas stuff who had to relocate. - A lot of them would stay there. We had, I think they rented, they rented several different places in town for the entire time they were here. And one of a couple of them were like Airbnb, is like they were renting an Airbnb continuously for a year and a half just to make that available to bring those folks in. - But Kanye's erratic behavior was manifesting in more than just moving his company to a small Midwestern city. - You know, when he was being in creative meetings with young people from Adidas, he would do things like show a porn video, which is obviously completely, completely inappropriate and unfair on these young people. If you're working with someone that is highly creative, incredibly rich and really, really important, it's very hard to say, for anyone to say, even if somebody's older than them, to say, "You know what, I don't really like that." That's not cool. But if you're younger, 15, 20 years younger, and you're not that important within the setup of Adidas, you know, you know that you're dispensable in the way that Kanye is not dispensable, he's really, really important. You can't say anything, you just have to sit there. In 2018, Adidas employees allegedly showed a presentation to the executive board, outlining the risks that they faced by interacting with Kanye West. - Somebody relatively recently told me that apparently there were instances like, he kind of coming into the office, telling people, "Oh, I don't like what you wear, I change it." - Kanye even released a 30 minute documentary on YouTube, including a scene where he shows a pornographic video to two Adidas executives on his phone. And just after the Kanye Adidas deal collapsed, a number of easy employees spoke to Rolling Stone about his erratic behavior and porn addiction. Staff recalled being in meetings where West showed them pornography, saying, "This is what I want people to feel when they put on our shoes." At the end of October this year, the New York Times published similar allegations, including Kanye's troubling obsession with Hitler. And the fact that employees had a code red signal to warn each other when staff felt exhausted and unsupported. - The allegation by easy staff was that Adidas management was aware of this inappropriate behavior and basically tolerated it didn't intervene because it was such an important partner to the relationship and they basically turned a blind eye to this. - They also managed to turn a blind eye to Kanye's erratic public behavior. In May 2018, he suggested 400 years of slavery was a choice. - You hear about slavery for 400 years, for 400 years? That sound like a choice. Like, you was there for 400 years and it's all the y'all. In August, he appeared on the Jimmy Kimmel show and discussed his bipolar disorder. - I think it's important for us to have conversations about mental health, especially with me being black because we never had therapists in the black community. We never approach like taking medication. And I think it's good that when I had my first complete blackout at age five, my mom didn't fully medicate me because I might have never been yay. And this time's where, at least September. He served as creative director for the Paul Hub Awards. In October, he called for the abolition of the 13th Amendment, the clause in the US Constitution that outlawed slavery. In the same month, he said he'd planned to name his 2018 album after Adolf Hitler and he also met Trump in the Oval Office to talk once again about being bipolar. - What do you do when someone is massively influential, multi-high-finated and won't take his medication? He has a disease that tells you you do not have a disease. He was absolutely crazy. - At the time, however, Adidas had its own problems. Other celebrity fashion lines with Beyonce and Ferelle Williams, which executives had hoped would generate hundreds of millions of dollars had failed to take off. Yeezy, on the other hand, was generating close to $1 billion a year for the company. So, Adidas doubled down. Creating Yeezy Day to celebrate the sneakers every year on the 2nd of August. And Wix moved all in at Yeezy to become the brand's general manager. But by the following year, anyone working at Yeezy must have felt they were stepping through the looking glass. Kanye announced he would be running for president. And then, Adidas employees received a stunning email. - We regret to inform you that John Wixler, VP, GM of Yeezy, has decided to leave Adidas to pursue interest outside the company, effective August 31st. - On Instagram, Kanye paid tribute, saying, "God speed to my brother, John Wixler. This man changed the game without Adidas deal and helped bring Adidas to a $62 billion market cap and made me a multi-billionaire. Thank you, John. You changed my life." I believe that once Wixler left, Kanye West did not have a real facilitator to help manage his relationship with Adidas. I guess I wondered at the time when Wixler left Adidas, whether that was the first sign that there was some meltdown coming. And did he perceive that the situation was going to get worse and wanted to get out before it all blew up? Yeezy's final act began when Kanye wore a white lives matter t-shirt during the Yeezy Season 9 fashion show at Paris Fashion Week in October 2022. Adidas issued this statement three days later. After repeated efforts to privately resolve the situation, we have taken the decision to place the partnership under review. What had changed? They weathered abortion, race, slavery, sexism, violence, but they couldn't weather anti-semitism because that's sacrosanct grounds for German companies. Adidas was founded in 1948 by Adolf Dessler, nickname Adi. Adidasler Adidas Did it? Eddie was born in Bavaria in 1900. He was a keen athlete. And in his 20s began designing spiked running shoes. He pioneered the relationship between athlete and shoe at the 1928 Olympics, where the German distance runner Lena Radke broke the world 800 meters record wearing a pair of daclers. Eddie was soon supplying athletes all over the world, including at the 1936 Berlin Olympics the black American runner Jesse Owen, who won four gold medals. But by then, Eddie was a member of the Nazi party. His company was making its money supply and sports equipment to the Hitler youth and shoes for the German army. It's something the company tries to forget. You won't find any mention of this on his website, for instance. And it's sensitive to anything that reminds the world of Eddie's party membership. As a company, Adidas have to react. They have to react for two reasons. One because he was blatantly being anti-Semitic and racist. That's very, very difficult for a company to associate themselves with. But also because he was treating their employees very badly. Since the 1920s, contracts between brands and celebrities have what's technically called the morality clause. But it's really a bad behaviour clause. My name is Gonzalo Mann. I'm a partner at the law firm of Kelly Drymoren. One of the things I spend a fair bit of time doing is working on celebrity and influencer agreements. So the clause generally gives a brand the right to terminate if a celebrity does something outside of the contract that could harm a brand's reputation. So for example, if they've been arrested, if they've been accused of a crime, or if they make offensive statements. And brands can generally terminate under a morals clause without giving the celebrity an opportunity to fix things because it's likely at that point those things can't be fixed. Oakley and other brands terminated agreements with Lance Armstrong after he was accused of taking performance in handsome drugs. H&M terminated an agreement with Kate Moss after she admitted to using recreational drugs. Reebok terminate an agreement with Michael Vic after he was arrested for illegal dogfighting. And I'll say most of these sort of breakups happen as quietly as possible because it's in the interest of both the brand and the celebrity to make it go away. The easy breakup was not quiet. Adidas was clear when it announced the end of its relationship with Kenya. Adidas does not tolerate antisemitism and any other sort of hate speech. Yeh's recent comments and actions have been unacceptable, hateful and dangerous and they violate the company's values of diversity and inclusion, mutual respect and fairness. The statement had two other interesting points. Adidas expected to lose 250 million euros as a result of the decision and insisted it was the sole owner of all Yees' design rights. For Adidas it was one collaboration that was driving the business. That's all Adidas had in terms of big names compared to Nike. Adidas breaking up with Kanye is the business equivalent of Nike breaking up with Michael Jordan. And there were some internal warnings we were told about internal managers saying, look, we shouldn't kind of make us overly dependent on this brand which is kind of linked to a really wayward celebrity who could go wrong at any given point. And those warnings were ignored. No one had added as a peer to take responsibility for ignoring these warnings. And in September it briefly looked like the new added as CEO, Bjorn Gulden, was reaching out an olive branch to Kanye in an interview. I think Kanye West is one of the most creative people in the world. And then as creative people, he did some statements which wasn't that good and that course started to break the contract and we draw the product very unfortunate because I don't think he meant what he said and I don't think he's a bad person. It just came across that way. Adidas took its hit from the Yees' deal. Sales fell by almost twice what the company predicted. In early 2023 it decided to cut its losses. By shifting its remaining Yees' stock. Adidas's most recent results showed a big boost from selling off Kanye's work. And Adidas has told investors it's turning a corner. Some aren't so sure. They think the fundamental problems remain. Oh I think Adidas is a dead brand because what I think in the world of sports is a big factor in that. So they Adidas obviously have Messi, Nike had Cristiano Ronaldo and Adidas failed to replace Messi essentially. So then the two people headlining this new generation of football are Harland and Ape. They're both Nike athletes. And to make way for these Nike athletes, Nike got rid of some of their existing ones like Neymar and Raheem Sterling and they didn't go to Adidas. Neymar went to Puma. They completely skipped Adidas. So what are the issues this story throws up? Of course it's clear that Kanye's behaviour with Adidas employees was entirely inappropriate and utterly un-pardonable. And yet, with Kanye making billions for Adidas, the rapper was fully aware of being in a position that thousands of black sport stars and artists have faced for decades. Kanye had been talking about systemic stuff. There is a tension that the fate of black creativity is not in the hands of black people. As powerful as LeBron is in sport, he hands the trophy to a white woman. The intersection between money and a global business and bipolar becomes a really loaded topic when there's a black man at the heart of it. Or why don't you empower yourself and don't need them and do it yourself? Hats way. Take a few steps back to go forward. You ain't got the answers man. You ain't got the answers. And a lot of his more outlandish behaviour. But it sounds very much like the symptoms of bipolar. What we've heard many people living with bipolar tell us that when they are on well, they can say things in behaviour ways which they later deeply regret. And we've heard countless stories during periods of hypermania, and mania of impulsive overspending, risk taking, hypersexual behaviour and a rational decision making. And many of these actions can have far-reaching, sometimes life changing consequences. As Olaf says, Adidas was using Yeezy's sales to hit quarterly targets. Was this fair on an artist with a lifelong mental health condition? I mean, I think you possibly do have a duty of care because it's not unstressful being cany-e, and it's not unstressful trying to design things and get them out and get them to work. So you are definitely, you know, okay, you're paying him for it, but you're adding to his general stress. We contacted Adidas with the points raised in his podcast, but they haven't come back to us. I'm not aware of anyone who, because of kind of Yeezy repercussions, lost their job. I mean, I think it was in late 2022, just after the Yeezy partnership was ditched by Adidas. Adidas launched an internal investigation commissioning an independent law firm with, well, getting to the bottom of these allegations. They said they were looking in ways to how to prevent this and kind of how to have a better system that these kind of behavioural were reflected and not tolerated anymore. I think the branding highway is littered with bleached bones of many celebrity deals that have fallen foul and died. It would seem that there are no real lessons of history because it all boils down to a brand needs the power of a celebrity in the now to associate themselves with commercially and all the sort of associated branding joy that comes with that. There's a very dark background to any marketing strategy that places one individual, creative sporting or otherwise, at the heart of a company's business. Sports shoe brands depend on us believing in the elite, an individual who is so much better than the rest. Sports or music, they're so good they can do anything and they usually get away with it. This strategy started in 1930s Berlin. Adidas le Pia miaid the athlete is the champion of the sports shoe, the 1936 Olympics which is breakthrough moment. But the 1936 Olympics changed sportswear marketing in another way. But as a favourite filmmaker, then I rife and the star released Olympia, a documentary at the event. The film fetishises physical perfection, featuring artfully lit muscular sport stars gazing into tomorrow. It looks like every heroic athlete advert you've ever seen. Unbumench with powers you'll never have. But hey, at least you can buy their shoes. Of course, Addy and Lenny were selling myths. Every England fan knows that putting 11 brilliant individuals on the pitch doesn't win tournaments. Sport is about teamwork, coaches, families, money. Just as music is about background producers, labels and money. It's never just one athlete. It's never just one genius. It's the team that gives them the power and the fans that make them the money. Now, I'm not suggesting that anyone in modern sportswear companies has any fascist sympathies. But the stunned, traumatized, added-as staff and Kanye's collapsing mental health should at least be a wake-up call to these companies. If you're going to make billions out of the myth of superhumans, you need to make sure you're treating real humans with care. Thanks for listening to this episode of the Sloan Newscast. It was written and reported by me, Stephen Armstrong. The producer was Imi Harper, a sound design by Hannah Varrell. The executive editors were Chloe Hedgian-Mathaeo and Kerry Thomas. And if you, or someone you know, is affected by bipolar, help and information is available on the bipolar-UK website, www.bipolaruk.org. www.bipolaruk.org

Podcast Summary

Key Points:

  1. Adidas’ recent better-than-expected quarterly results were largely driven by selling off old Yeezy inventory, masking deeper long-term problems.
  2. The partnership with Kanye West began in 2013, giving him full creative control and a 15% royalty, which turned Yeezy into a billion-dollar brand.
  3. Yeezy’s limited-edition drops created massive hype and solved Adidas’ US market share and coolness problems, but the brand became overly dependent on Kanye.
  4. Kanye’s bipolar diagnosis, erratic behavior (e.g., moving R&D to Wyoming, showing porn in meetings), and antisemitic comments led Adidas to end the partnership in 202
  5. Without Yeezy, Adidas faces ongoing challenges, including a lack of a signature product to compete with Nike’s Air Jordan.

Summary:

Adidas experienced a temporary boost from selling off old Yeezy inventory, but this masks persistent structural issues following its disastrous partnership with Kanye West. The collaboration began in 2013 when Adidas, desperate to gain US market share and cultural relevance, offered Kanye unprecedented creative control and a 15% royalty. Yeezy sneakers became a cultural phenomenon, with limited drops creating immense hype and solving Adidas’ “coolness” problem.

However, the brand grew dangerously dependent on Kanye, who was diagnosed with bipolar disorder and exhibited increasingly erratic behavior, including moving R&D to Wyoming and displaying inappropriate content to staff. His antisemitic comments in 2022 forced Adidas to sever ties, costing the company billions. The underlying issue remains: Adidas lacks a sustainable, iconic product line like Nike’s Air Jordan.

The Yeezy inventory sell-off is a one-time fix, and without a new flagship, Adidas faces an uncertain future in a competitive market dominated by Nike. The partnership’s rise and fall illustrate the risks of tying a brand’s fortunes to a volatile superstar.

FAQs

The boost came from selling off old pairs of Yeezys, Kanye West's sneaker line. Once those are gone, Adidas will still face longer-term problems.

The deal was officially announced in November 2014, but negotiations started in 2013. It was worth a rumored $10 million plus royalties.

Kanye felt Nike wasn't giving him a meaningful role or a signature deal on the level of LeBron or Michael Jordan. Adidas offered full creative control and a 15% royalty on each shoe sold.

Yeezy was used as a stopgap to boost poor quarters, and it helped Adidas overcome its lack of coolness and small US market share by creating huge hype.

He was diagnosed with bipolar disorder, a mental health condition characterized by mood swings from depression to mania, which can include psychosis if untreated.

Adidas released a million pairs in about six weeks during the 2018 holiday season, which hurt the scarcity that sneakerheads valued and reduced the shoes' exclusivity.

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